Quarterly Report (10-q)
December 13 2016 - 2:05PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended October 31, 2016
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from __________ to __________
Commission file number 000-53048
Concrete Leveling Systems, Inc.
(Exact name of small business issuer as specified in its charter)
Nevada 26-0851977
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
5046 E. Boulevard, NW, Canton, OH 44718
(Address of principal executive offices)
(330) 966-8120
(Issuer's telephone number)
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. YES [X]
NO [ ]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss. 232.405
of this chapter) during the preceding 12 month (or for such shorter period that
the registrant was required to submit and post such files). YES [X] NO [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer (as defined in Rule 12b-2 of the
Exchange Act).
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). YES [ ] NO [X]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 6,395,418
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
Concrete Leveling Systems, Inc.
Balance Sheets
October 31, 2016 and July 31, 2016
October 31 July 31
---------- ----------
(Unaudited) (Audited)
ASSETS
CURRENT ASSETS
Cash in bank $ 821 $ 104
Accounts receivable, net of allowance for doubtful accounts
of $0 at October 31, 2016 and July 31, 2016 -- 217
Current portion of notes receivable, net of allowance for
loan losses of and $2,391 at October 31, 2016 and July 31, 2016 203 --
Interest receivable, net of collectability allowance of
and $242 at October 31, 2016 and July 31, 2016 155 26
Inventory 23,607 23,607
Prepaid expenses and other current assets 3,014 485
---------- ----------
Total Current Assets 27,800 24,439
---------- ----------
PROPERTY, PLANT AND EQUIPMENT
Equipment 700 700
Less: Accumulated depreciation (700) (700)
---------- ----------
Total Property, Plant and Equipment -- --
---------- ----------
OTHER ASSETS
Notes receivable, net of current portion and allowance for
loan losses of $21,860 at October 31, 2016 and July 31, 2016 2,160 2,695
---------- ----------
TOTAL ASSETS $ 29,960 $ 27,134
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 40,468 $ 33,559
Accounts payable - stockholders 35,486 35,486
Advances - stockholders 104,150 89,400
Notes payable - stockholders 62,750 62,750
Accrued interest - stockholders 15,139 15,139
Other accrued expenses 17,090 15,828
---------- ----------
Total Current Liabilities 275,083 252,162
---------- ----------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock (par value $0.001)
100,000,000 shares authorized:
6,395,418 shares issued and outstanding at
October 31, 2016 and July 31, 2016 6,395 6,395
Additional paid-in capital 405,355 405,355
Retained (deficit) (656,873) (636,778)
---------- ----------
Total Stockholders' Equity (Deficit) (245,123) (225,028)
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 29,960 $ 27,134
========== ==========
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See notes to financial statements.
2
Concrete Leveling Systems, Inc.
Statements of Income
For the Three Months Ended October 31, 2016 and 2015
3 Months Ended 3 Months Ended
October 31, 2016 October 31, 2015
---------------- ----------------
(Unaudited) (Unaudited)
Expenses
Selling, general and administration $ 20,250 $ 17,780
---------- ----------
(Loss) from Operations (20,250) (17,780)
---------- ----------
Other Income (Expense)
Interest income 397 297
Interest expense (242) (252)
---------- ----------
Total Other Income (Expense) 155 45
---------- ----------
Net (Loss) Before Income Taxes (20,095) (17,735)
Provision for Income Taxes -- --
---------- ----------
Net (Loss) $ (20,095) $ (17,735)
========== ==========
Net (Loss) per Share - Basic and Fully Diluted $ (0.00) $ (0.00)
========== ==========
Weighted average number of common shares
outstanding - basic and fully diluted 6,395,418 6,395,418
========== ==========
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See notes to financial statements.
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Concrete Leveling Systems, Inc.
Statements of Cash Flows
For the Three Months Ended October 31, 2016 and 2015
October 31, 2016 October 31, 2015
---------------- ----------------
(Unaudited) (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) $(20,095) $(17,735)
Adjustments to reconcile net (loss) to net
cash used in operating activities:
Decrease in accounts receivable 217 --
(Increase) in interest receivable (129) (237)
Decrease in prepaid expenses and other current assets (2,529) (1,032)
Increase in accounts payable 6,909 421
Increase in other accrued expenses 1,262 1,161
-------- --------
Net cash from (used by) operating activities (14,365) (17,422)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Payments on notes receivable 332 172
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Loans from stockholders 14,750 17,200
-------- --------
Net increase (decrease) in cash 717 (50)
Cash and equivalents - beginning 104 116
-------- --------
Cash and equivalents - ending $ 821 $ 66
======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION
Interest $ 242 $ 252
======== ========
Income Taxes $ -- $ --
======== ========
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See notes to financial statements.
4
Concrete Leveling Systems, Inc.
Notes to Financial Statements
October 31, 2016
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and with the instructions to Form 10-Q and
Article 8 of Regulation S-X. Accordingly, they do not include all the
information and footnotes required by accounting principles generally accepted
in the United States of America for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. For further
information, refer to the financial statements and footnotes thereto included in
the Concrete Leveling Systems, Inc. Form 10-K filing for the period ended July
31, 2016.
NOTE B - GOING CONCERN
As shown in the financial statements, the Company incurred a net loss of $20,095
for the three months ended October 31, 2016, and has incurred substantial net
losses since its inception. At October 31, 2016, current liabilities exceed
current assets by $247,283. These factors raise substantial doubt about the
Company's ability to continue as a going concern. The financial statements do
not include any adjustments relating to the recoverability and classification of
recorded assets, or the amounts and classification of liabilities that might be
necessary in the event the Company cannot continue existence.
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ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Concrete Leveling Systems, Inc. ("CLS" or "The Company") became an
operating company in 2009. As of October 31, 2016, CLS has cash assets of $821,
no accounts receivable and net notes receivable in the amount of $2,363. As of
October 31, 2016, the Company was carrying inventory valued at $23,607.
The Company's cash flow is currently not sufficient to maintain operations.
However, the Company is receiving periodic payments from the self financed sale
of its concrete leveling service units, which creates some cash flow for the
Company. Mr. Edward A. Barth has continued to contact companies regarding the
service units and has listed the service units held in inventory on Ebay. To
date, the Company has been contacted with inquiries regarding the purchase of a
unit, but no acceptable offers have been made.
CLS continues to have cash flow issues. As of October 31, 2016, it had
total current liabilities of $275,083, which includes advances from stockholders
and notes and accounts payable to stockholders in the amount of $217,525,
including accrued interest on those obligations. The Company had a net loss of
$20,095 during the quarter. Mr. Barth continues to remain in contact with
potential purchasers, who have expressed an interest in purchasing a service
unit. The purchase of the Company's product is seasonal in nature. Interest in
purchasing the concrete leveling service units increases in late winter and
early spring, since the use of the product is restricted by cold temperature.
There are no off balance sheet arrangements involving CLS at this time.
Liquidity Issues. Since its inception, the Company has experienced
continued need for additional liquidity in order to provide for operating
expenses and to purchase components for the assembly of its product. The company
maintains an inventory of two substantially completed service units. In the
event the Company receives an order for a concrete leveling service unit, it
will seek a down payment in an amount sufficient to complete the unit, in order
not to have to borrow additional funds. The Company is currently relying upon
loans from stockholders to meet operating expenses.
Capital Resources. CLS has made no material commitments for capital
expenditures as of the end of its fiscal quarter ending October 31, 2016 and
does not anticipate any immediate need for material capital expenditures over
the next quarter.
Result of Operations. During the quarter ended October 31, 2016, the
Company has experienced little activity. The Company has devoted a limited
amount of its resources to marketing its product during the last quarter. At
present, it is not in discussions with any potential buyers of its concrete
leveling service units.
ITEM 4 - CONTROLS AND PROCEDURES
Disclosure Controls and Procedures. Pursuant to Rule 13a-15(b) of the
Securities Exchange Act of 1934 ("Exchange Act"), the Company carried out an
evaluation, with the participation of the Company's management, which consists
of the Company's Chief Executive Officer (CEO) and Chief Financial Officer
(CFO), of the effectiveness of the Company's disclosure controls and procedures
(as defined under Rule 13a-15(e) of the Exchange Act) as of the end of the
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period covered by this report. Based upon that evaluation, the Company concluded
that the Company's disclosure controls and procedures are effective to ensure
that information required to be disclosed by the Company in the reports that the
Company files or submits under the Exchange Act, is recorded, processed,
summarized and reported, within the time period specified by the United States
Securities and Exchange Commission rules and forms, and that such information is
accumulated and communicated to the Company's management, including the
Company's CEO and CFO, as appropriate, to allow timely decisions regarding
required disclosure.
Changes in Internal Control Over Financial Reporting. There are no
changes in the Company's internal controls over financial reporting that
occurred during the three months ended October 31, 2016 that have materially
affected, or are reasonably likely to materially affect, the internal controls
over financial reporting.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
To the best of its knowledge, management of CLS is not aware of any legal
proceedings in which CLS is currently involved.
ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
There were no unregistered sales of equity securities during this quarter.
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
There are no defaults upon any senior securities.
ITEM 4 - MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5 - OTHER INFORMATION
None
ITEM 6 - EXHIBITS
A. The following are filed as Exhibits to this report. The numbers refer to the
exhibit table of Item 601 of regulation S-K: Reference is hereby made to the
exhibits contained in the registration statement (Form SB-2) filed by Concrete
Leveling Systems, Inc.
Exhibit 31.1 - Rule 13a-14(a)/15d-14(a) - Certification
Exhibit 31.2 - Rule 13a-14(a)/15d-14(a) - Certification
Exhibit 32 - Section 1350 - Certification
Exhibit 101 - Interactive Data Files Pursuant to Rule 405 of Regulation S-T
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
CONCRETE LEVELING SYSTEMS, INC.
Date: December 13, 2016 By: /s/ Edward A. Barth
---------------------------------------------
Edward A. Barth, Principal Executive Officer
Date: December 13, 2016 By: /s/ Suzanne I. Barth
---------------------------------------------
Suzanne I. Barth, Principal Financial Officer
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