EMLL El Maniel International Inc (CE)

5-4, 4th Floor, Jalan 1 1/48A,

Sentul Raya Boulevard,

Off Jalan Sentul,

51000 Kuala Lumpur

Malaysia

+60 3 4043 7881

 

EXPLANATORY NOTE

 

The purpose of this Amendment to the 10-Q is to correct the shell status of the Company. The Company is not a shell company as defined in Rule 12b-2 of the Exchange Act.

 

EL MANIEL INTERNATIONAL, INC. AND SUBSIDIARY

(A DEVELOPMENT STAGE COMPANY)

 

CONTENTS

PAGE			1		CONDENSED CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2009 (UNAUDITED) AND SEPTEMBER 30, 2009
PAGE			2		CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 2009 AND 2008, AND FOR THE PERIOD FROM JULY 24, 2007 (INCEPTION) TO DECEMBER 31, 2009 (UNAUDITED).
PAGE			3		CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’DEFICIENCY FOR THE PERIOD FROM JULY 24, 2007 (INCEPTION) TO DECEMBER 31, 2009 (UNAUDITED).
PAGE			4		CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED DECEMBER 31, 2009 AND 2008, AND FOR THE PERIOD FROM JULY 24, 2007 (INCEPTION) TO DECEMBER 31, 2009 (UNAUDITED).
PAGES			5 - 12		NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).

 

El Maniel International, Inc. and Subsidiary
(A Development Stage Company)
Condensed Consolidated Balance Sheets
			December 31				September 30,
ASSETS			2009				2009
			(Unaudited)
Current Assets
	Cash		$	91			$	919
Total Current Assets				91				919
	Property  and Equipment, net			-				2,460
Total  Assets			$	91			$	3,379
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current Liabilities
Accounts payable			$	8,693			$	1,419
	Sales tax payable			-				540
	Note payable			49,509				49,349
	Loan payable - related party			1,081				1,081
Total  Liabilities				59,283				52,389
Commitments and Contingencies
Stockholders' Deficiency
Common stock, $0.001 par value; 110,000,000 shares authorized,
96,110,000 and 96,110,000 issued and outstanding, respectively				96,110				96,110
Additional paid-in capital				109,307				106,861
Deficit accumulated during the development stage				(264,609	)			(251,981	)
Total Stockholders' Deficiency				(59,192	)			(49,010	)
Total Liabilities and Stockholders' Deficiency			$	91			$	3,379

 

See accompanying notes to condensed consolidated unaudited financial statements.

El Maniel International, Inc. and Subsidiary
(A Development Stage Company)
Condensed Consolidated Statements of Cash Flows
(Unaudited)
		For the Three Months Ended December 31, 2009				For the Three Months Ended December 31, 2008				For the Period From July 24, 2007 (Inception) to December 31, 2009
Cash Flows Used In Operating Activities:
Net Loss		$	(12,628	)		$	(22,820	)		$	(264,609	)
Adjustments to reconcile net loss to net cash used in operations
Amortization			328				284				1,776
Loss on impairment of inventory			-				-				30,252
Loss on impairment of website			2,132				-				2,132
Common stock issued for services			-				-				5,000
In-kind contribution of services			1,300				1,300				12,671
In-kind contribution of interest			1,146				-				1,146
Changes in operating assets and liabilities:
(Increase)/Decrease in prepaid expense			-				250				-
(Increase)/Decrease in inventory			-				(19,352	)			(30,252	)
(Increase)/Decrease in deposit			-				10,650				-
Increase/(Decrease) in accounts payable and accrued expenses			6,734				8,419				8,693
Net Cash Used In Operating Activities			(988	)			(21,269	)			(233,191	)
Cash Flows From Investing Activities:
Payment for intangible asset			-				(1,408	)			(3,908	)
Net Cash Used In Investing Activities			-				(1,408	)			(3,908	)
Cash Flows From Financing Activities:
Proceeds from note payable			-				-				-
Proceeds from loan payable- related party			448				(5	)			3,052
Repayment of loan payable - related party			(288	)			-				(1,811	)
In-kind contribution of cash			-				-				100
Proceeds from loans payable			-				1,000				50,349
Repayment of loan payable			-				-				(1,000	)
Proceeds from issuance of common stock			-				-				186,500
Net Cash Provided by Financing Activities			160				995				237,190
Net Decrease/(Decrease) in Cash			(828	)			(21,682	)			91
Cash at Beginning of Year/Period			919				22,546				-
Cash at End of Year/Period		$	91			$	864			$	91
Supplemental disclosure of cash flow information:
Cash paid for interest		$	-			$	-			$	-
Cash paid for taxes		$	-			$	-			$	-

See accompanying notes to condensed consolidated unaudited financial statements.

 

 

NOTE 1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A) Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America and the rules and regulations of the Securities and Exchange Commission for interim financial information.  Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations.

 

It is management's opinion, however that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statements presentation.  The results for the interim period are not necessarily indicative of the results to be expected for the year.

 

Activities during the development stage include developing the business plan and raising capital .

(B) Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of El Maniel International, Inc. from July 24, 2007 (inception) and its 100% owned subsidiary El Maniel Cigar Company.  All inter-company accounts have been eliminated in the consolidation (See Note 4(E)).

(C) Use of Estimates

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period.  Actual results could differ from those estimates.

(D) Cash and Cash Equivalents

The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At December 31, 2009 and 2008, respectively, the Company had no cash equivalents.

 

(E) Website Development Costs

Costs incurred in the planning stage of a website are expensed while costs incurred in the development stage are capitalized and amortized over the estimated three-year life of the asset. For the period ended December 31, 2009 and for the year ended September 30, 2009 the Company paid $0 and $3,908, respectively, to develop its website.

 

(F) Loss Per Share

Basic and diluted net loss per common share is computed based upon the weighted average common shares outstanding as defined by FASB Accounting Standards Codification Topic 260, “Earnings Per Share.” As of December 31, 2009 and 2008, respectively, there were no common share equivalents outstanding.

(G) Income Taxes

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”).  Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  Under ASC 740-10-25, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

(H) Business Segments

The Company operates in one segment and therefore segment information is not presented.

(I)  Concentrations

For the three months ended December 31, 2008 the Company purchased 100% of its cigars from one vendor.

For the three months ended December 31, 2008, one customer accounted for 100% of the Company’s sales .

(J) Revenue Recognition

The Company recognized revenue on arrangements in accordance with FASB Codification Topic 605, “Revenue Recognition” (“ASC Topic 605”).  Under ASC Topic 605, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.  Revenue is recognized when products are received and accepted by the customer.  Risk of loss transfers from the manufacturer to the Company upon shipment of product from the warehouse.

 

(K) Inventories

Inventories are valued at the lower of cost or market.  Cost is determined using the first-in, first-out (FIFO) method. Provision for potentially obsolete or slow moving inventory is made based on management's analysis of inventory levels and future sales forecasts. At September 30, 2009, the Company determined that inventory on hand was slow moving and recognized an impairment loss of $30,252.  Inventory consisted of the following at December 31, 2009 and September 30, 2009:

 

		December 31, 2009				September 30, 2009
Raw Materials		$	-			$	23,550
Work in Process			-				-
Finished			-				6,702
Provision for impairment			-				(30,252	)
Net Inventory		$	-			$	-

 

(L) Advertising and Promotional Expense

Advertising and other product-related costs are charged to expense as incurred. For the thre three months  ended December 31, 2009 and 2008 and for the period from July 24, 2007(inception) to December 31, 2009, advertising expense was $0, $2,145, and $11,627 respectively.

( M) Reclassification

Certain amounts from prior period have been reclassified to conform to the current period presentation.

(N) Recent Accounting Pronouncements

In June 2009, the FASB issued ASC 105 Accounting Standards Codification TM and the Hierarchy of Generally Accepted Accounting Principles . The FASB Accounting Standards Codification TM (the “Codification”) has become the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in accordance with Generally Accepted Accounting Principles (“GAAP”). All existing accounting standard documents are superseded by the Codification and any accounting literature not included in the Codification will not be authoritative. Rules and interpretive releases of the SEC issued under the authority of federal securities laws, however, will continue to be the source of authoritative generally accepted accounting principles for SEC registrants. Effective September 30, 2009, all references made to GAAP in our consolidated financial statements will include references to the new Codification. The Codification does not change or alter existing GAAP and, therefore, will not have an impact on our financial position, results of operations or cash flows.

In June 2009, the FASB issued changes to the consolidation guidance applicable to a variable interest entity (VIE). FASB ASC Topic 810, "Consolidation," amends the guidance governing the determination of whether an enterprise is the primary beneficiary of a VIE, and is, therefore, required to consolidate an entity, by requiring a qualitative analysis rather than a quantitative analysis. The qualitative analysis will include, among other things, consideration of who has the power to direct the activities of the entity that most significantly impact the entity's economic performance and who has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. This standard also requires continuous reassessments of whether an enterprise is the primary beneficiary of a VIE. FASB ASC 810 also requires enhanced disclosures about an enterprise's involvement with a VIE. Topic 810 is effective as of the beginning of interim and annual reporting periods that begin after November 15, 2009. This will not have an impact on the Company’s financial position, results of operations or cash flows.

 

In June 2009, the FASB issued Financial Accounting Standards Codification No. 860 - Transfers and Servicing. FASB ASC No. 860 improves the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor's continuing involvement, if any, in transferred financial assets. FASB ASC No. 860 is effective as of the beginning of each reporting entity's first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. The Company is evaluating the impact the adoption of FASB ASC No. 860 will have on its financial statements.

NOTE 2

PROPERTY AND EQUIPMENT

At December 31, 2009 and September 30, 2009 property and equipment is as follows:

		December 31, 2009				September 30, 2009
Website costs		$	3,908			$	3,908
Less accumulated amortization			(1,776	)			(1,448)
Provision for impairment			(2,132)			_
		$	-			$	2,460

Amortization expense for the three months ended December 31, 2009 and 2008 and the period from July 24, 2007 (inception) to December 31, 2009 was $328, $284 and $1,776, respectively.  At December 31, 2009, the Company recognized an impairment loss of $2,132.

NOTE 3

LOANS PAYABLE

On December 12, 2009, a non related party loaned the Company $448.  The loan is noninterest bearing and payable on demand. A loan payment of $11 has been made and as of December 31, 2009, the loan balance is $436 and is not in default.   For the period ended December 31, 2009, the Company recorded contributed interest expense having a fair value of $1.

For the year ended September 30, 2009, a related party loaned the Company $483.  The Company entered into a written promissory note concerning this obligation.  The loan is noninterest bearing and payable on demand.  As of September 30, 2009, the loan balance has been repaid and the loan payable is $0 (See Note 6).

For the year ended September 30, 2009, a non related party loaned the Company $276.  The loan is noninterest bearing and payable on demand.  The loan was repaid on October 12, 2009. As of December 31, 2009, the loan balance is $0.

On August 11, 2009, a non related party loaned the Company $48,000. The Company entered into a written promissory note concerning this obligation. The loan is noninterest bearing and payable on demand.  As of December 31, 2009, the loan balance is $48,000 and is not in default.  For the period ended December 31, 2009, the Company recorded contributed interest expense having a fair value of $934.

During February 2009, a non related party loaned the Company $1,073. The Company entered into a written promissory note concerning this obligation. The loan is noninterest bearing and payable on demand. As of December 31, 2009, the loan balance is $1,073 and is not in default. For the period ended December 31, 2009, the Company recorded contributed interest expense having a fair value of $47 .

 

During December 2008, the Company received $518 from a relative of the principal stockholder. Pursuant to the terms of the loan, the loan is noninterest bearing and due on demand. As of September 30, 2009, the loan balance has been repaid and the loan payable is $0.  For the period ended December 31, 2009, the Company recorded contributed interest expense having a fair value of $34 (See Note 6).

 

For the year ended September 30, 2007, the Company received $1,603 from a principal stockholder. Pursuant to the terms of the loan, the loan is non interest bearing and due on demand. As of December 31, 2009, the Company still owes $1,081 to the principal shareholder.  For the period ended December 31, 2009, the Company recorded contributed interest expense having a fair value of $129 (See Note 6).

 

NOTE 4

STOCKHOLDERS’ EQUITY

(A) Common Stock Issued for Cash

As of December 31, 2007, the Company issued 1,765,000 shares of common stock for $176,500 ($0.10/share).  As a result of the forward split, the 1,765,000 were increased to 24,710,000 shares ($0.007/share).

 

For the period from July 24, 2007 (inception) through September 30, 2007, the Company issued 100,000 shares of common stock for a subscription receivable of $10,000 ($0.10/share).  The subscription receivable was collected during the period ending December 31, 2007.  As a result of the forward split the 100,000 were increased to 1,400,000 shares ($0.007/share).

(B) In-Kind Contribution of Services

For the period ended December 31, 2009, the Company recorded contributed interest expense having a fair value of $1,146 (See Note 3).

 

For the period ended December 31, 2009, a shareholder of the Company contributed services having a fair value of $1,300 (See Note 6).

 

For the year ended September 30, 2009, a shareholder of the Company contributed services having a fair value of $5,200 (See Note 6).

 

As of September 30, 2008, a shareholder of the Company contributed services having a fair value of $5,200 (See Note 6).

 

For the period from July 24, 2007 (inception) through September 30, 2007, the shareholder of the Company contributed services having a fair value of $971 (See Note 6 ).

(C) In-Kind Contribution of Cash

As of September 30, 2007, the shareholder of the Company contributed cash of $100 to cover the costs of setting up the subsidiary (See Note 6).

(D) Stock Issued for Services

On July 24, 2007, the Company issued 5,000,000 shares of common stock to its founders having a fair value of $5,000 ($0.001/share) in exchange for services provided (See Note 6).  As a result of the forward split 5,000,000 shares were increased to 70,000,000 shares ($0.00007/share).

(E) Acquisition Agreement

On September 28, 2007, El Maniel International, Inc. consummated an agreement with El Maniel Cigar Company, pursuant to which El Maniel Cigar Company exchanged all of its members’ interest for 5,000,000 shares or approximately 100% of the common stock of El Maniel International, Inc.  The Company has accounted for the transaction as a combination of entities under common control and accordingly, recorded the merger at historical cost.

(F) Stock Split

On August 5, 2009, the Company's Board of Directors declared a fourteen-for-one stock split which was distributed on August 5, 2009 to shareholders of record.  A total of 89,245,000 shares of common stock were issued.  All basic and diluted loss per share and average shares outstanding information has been adjusted to reflect the aforementioned stock split.

 

               

On October 15, 2007, the Company entered into a consulting agreement to receive administrative and other miscellaneous services.  The Company is required to pay $5,000 a month.  This agreement was terminated effective November 1, 2008.

 

For the period ended December 31, 2009, the Company recorded related party contributed interest expense having a fair value of $1,146 (See Note 3).

 

For the period ended December 31, 2009, a shareholder of the Company contributed services having a fair value of $1,300 (See Note 4(B)).

 

For the year ended September 30, 2009, a shareholder of the Company contributed services having a fair value of $5,200 (See Note 4(B)).

 

As of September 30, 2008, a shareholder of the Company contributed services having a fair value of $5,200 (See Note 4(B)).

 

For the year ended September 30, 2009, a related party loaned the Company $483.  The Company entered into a written promissory note concerning this obligation.  The loan is noninterest bearing and payable on demand.  As of September 30, 2009, the loan balance has been repaid and the loan payable is $0 (See Note 3).

For the year ended September 30, 2007, the Company received $1,603 from a principal stockholder. Pursuant to the terms of the loan, the loan is non interest bearing and due on demand. As of December 31, 2009, the Company still owes $1,081 to the principal shareholder (See Note 3).

 

During December 2008, the Company received $518 from a relative of the principal stockholder. Pursuant to the terms of the loan, the loan is noninterest bearing and due on demand. As of September 30, 2009, the loan balance has been repaid and the loan payable is $0 (See Note 3).

 

For the period from July 24, 2007 (inception) through September 30, 2007 the shareholder of the Company contributed services having a fair value of $971 (See Note 4(B)).

 

As of September 30, 2007, the shareholder of the Company contributed cash of $100 to cover the costs of setting up the subsidiary (See Note 4(C)).

 

On July 24, 2007, the Company issued 5,000,000 shares of common stock to its founders having a fair value of $5,000 ($0.001/share) in exchange for services provided (See Note 4 (D)). As a result of the forward split 5,000,000 shares were increased to 70,000,000 shares ($0.0007/share).

 

NOTE 7

GOING CONCERN

 

As reflected in the accompanying financial statements, the Company is in the development stage with minimal operations, used cash in operations of $233,191 from inception and has a net loss since inception of $264,609 for the period from July 24, 2007 (inception) to December 31, 2009.  In addition, there is a working capital deficiency of $59,192 and stockholders’ deficiency of $57,060 as of December 31, 2009.  This raises substantial doubt about its ability to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

NOTE 8

SUBSEQUENT EVENTS

 

In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through February 10, 2010, the date the financial statements were issued.

 

 

We have completed the cigar box and ordered 1,000 boxes for inventory. Additionally we have ordered and paid for cigars that are being held in inventory by the manufacturer for delivery as we are able to make sales. We have also finished the web site which we continue to try to use as a tool for the sale of the product. We have already begun to introduce the cigars to different consumer groups seeking to get some interest in the cigars. With the cigar box completed and the web site  operational we will continue to selectively introduce the product to various consumer groups. Our initial efforts were to firms in the financial services industry but that has only resulted in limited sales. We will begin work on wedding planners which we see a possible source of early introduction. We have hired a marketing consultant who is helping to roll out the product now that we have inventory and an  operational web site.

 

We continue to look for a third-party order and fulfillment partner with all the necessary licenses to sell and deliver cigar products in the U.S. and Canada. This would allow us the fastest access to the markets through a well-established and experienced fulfillment organization.

 

Over the next 12 months our target is to place approximately 100-200 units with opinion leaders, media professionals and prospective customers to start to generate awareness of the PLC Cigars product line and initiate the sales effort; conduct at least three direct email blasts to targeted contacts from cigar industry media subscriber lists; sponsor at least two small events in conjunction with cigar industry events and local festivals such as the Durham Beer Festival.

 

We have run through our initial marketing budget primarily through the purchase of inventory and initial marketing expenses.  This essentially covered the cost of inventory to fulfill orders that may come from the marketing efforts. We have a cost for each box of $21.50 and a replaceable placard for personalizing the boxes at $2.80 per box. We initially ordered 1,000 units for inventory at a cost of approximately $24,300 without the cost of shipping and handling. There will be an additional cost to fulfill the orders. We do not expect to have to carry a heavy inventory of the cigars since the company making them will also be fulfilling orders.

 

We are in the process of assessing our marketing and sales efforts and possible results in light of the company’s dire financial status. News announcements, email blasts, seeding efforts and event sponsorship are expected to continue as the primary marketing and promotion efforts to drive sales and revenue growth.

 

If we are unable to gain any market share for our premium cigars, we may have to suspend or cease our efforts.  If we cease our previously stated efforts, we do not have plans to pursue other business opportunities.  If we cease operations, investors will not receive any return on their investments.   We are still pursuing this plan but to date we have not been able to raise additional funds through either debt or equity offerings. Without this additional cash we have been unable to gain a market share for our product. As a result of the foregoing, we may begin to explore our options regarding the development of a new business plan and direction.

 

The initial efforts of our founders to establish a cigar company began in early 2007.  We were formed in July 2007 and we have limited operations upon which an evaluation of our company and our prospects can be based.  There can be no assurance that our management will be successful in concluding a successful sales and marketing plan to attain significant penetration of the premium cigar market segment or that we will generate sufficient revenues to meet its expenses or to achieve or maintain profitability.

 

We anticipate that our operational, and general and administrative expenses for the next 12 months will total approximately $20,000. We do not anticipate the purchase or sale of any significant equipment. We also do not expect any significant additions to the number of employees. The foregoing represents our best estimate of our cash needs based on current planning and business conditions. The exact allocation, purposes and timing of any monies raised in subsequent private financings may vary significantly depending upon the exact amount of funds raised and our progress with the execution of our business plan. We anticipate that depending on market conditions and our plan of operations, we may incur operating losses in the foreseeable future. Therefore, our auditors have raised substantial doubt about our ability to continue as a going concern.

 

We have no off-balance sheet arrangements.