Notes to the Financial Statements
Years Ended June 30, 2018 and 2017
NOTE 1 – BUSINESS AND CONTINUED OPERATIONS
ORGANIZATION
Global Seed Corporation was incorporated
on July 13, 2010 in the State of Texas. The initial operations have included organization and incorporation, target
market identification, new business development, marketing plans, fund raising, and capital formation. A substantial
portion of the Company’s activities had involved developing a business plan and establishing contacts and visibility in
the Asian communities in Houston, Texas. Prior to the change in control on June 2, 2018, the Company was a publishing company
that publishes a monthly journal called the
Global Seed Journal.
The fiscal year end of the Company is
June 30.
NOTE 2 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying financial statements
for Global Seed Corporation have been prepared in accordance with accounting principles generally accepted in the United States
of America and in accordance with Regulation S-X promulgated by the Securities and Exchange Commission
.
USE OF ESTIMATES
The preparation of the Company’s
financial statements in conformity with accounting principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
CASH AND CASH EQUIVALENTS
The company considers all highly liquid
investments purchased with an original maturity of three months or less to be cash equivalents.
REVENUE RECOGNITION
The Company recognizes revenue from the
sale of advertising services in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 104 (“SAB
104”), “
Revenue Recognition in Financial Statements
.” Revenue will consist of selling of adverting services
and will be recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service
is performed, and collectivity is reasonably assured. Payments received before all of the relevant criteria for revenue recognition
are satisfied will be recorded as unearned revenue. The Company’s financial statements are prepared under the accrual method
of accounting. Revenues will be recognized in the period the publication is provided and costs are recorded in the period incurred
rather than paid.
FAIR VALUE MEASUREMENTS
The Company adopted the provisions of
ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting
pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.
The estimated fair value of certain financial
instruments, including cash and cash equivalents, deposits, prepaid expenses, notes payable, and accrued expenses are carried
at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. The Company
has no other financial instruments.
ASC 820 defines fair value as the exchange
price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous
market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also
establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of
unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:
* level l - quoted prices in active markets
for Identical assets or liabilities
* level 2 - quoted prices for similar
assets and liabilities in active markets or inputs that are observable
* level 3 - inputs that are unobservable
(for example cash flow modeling inputs based on assumptions)
INCOME TAXES
The Company
utilizes FASB ASC 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method,
deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and
their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences
are expected to affect taxable income. A valuation allowance is recorded when in the opinion of management, it is “more
likely-than-not” that a deferred tax asset will not be realized.
BASIC AND DILUTED NET LOSS PER SHARE
Net loss per share is calculated in accordance
with ASC 260, Earnings Per Share, for the period presented. Basic net loss per share is based upon the weighted average number
of common shares outstanding. Diluted net loss per share is based on the assumption that all dilative convertible shares and stock
options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and
warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained
thereby were used to purchase common stock at the average market price during the period.
As of June 30, 2018 and 2017, the Company had no potentially
dilutive securities.
NOTE 3 – GOING CONCERN
The Company’s financial
statements are prepared using accounting principles generally accepted in the United States of America applicable to a going
concern, which contemplates the realization of assets and liquidation as of liabilities in the normal course of business. The
Company has accumulated losses of $80,369 as of June 30, 2018. The Company had cash of $132 at June 30, 2018.
Management’s plans to continue as a going concern include raising additional capital through sales of common stock.
However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The
ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans
described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The
accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue
as a going concern.
NOTE 4 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
In May, 2016, the FASB issued ASU No.2016-12, Revenue from
Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. The amendments in this Update affect
the guidance in Accounting Standards Update 2014-09, Revenue from Contracts with Customers (Topic 606), which is not yet effective.
The effective date and transition requirements for the amendments in this Update are the same s the effective date and transition
requirements for Topic 606 (and any other Topic amended by Update 2014-09). Accounting Standards Update 2015-14, Revenue from
Contracts with Customers (Topic 606): Deferral of the Effective Date, defers the effective date of Update 2014-09 by one year.
In March, 2016, the FASB issued ASU No.2016-09,
Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. For public business entities,
the amendments are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods.
For all other entities, the amendments re effective for annual periods beginning after December 15, 2017, and interim periods
within annual periods beginning after December 15, 2018. Early adoption is permitted for any entity in any interim or annual periods.
If an entity early adopts the amendments in an interim period, any adjustment should be reflected as of the beginning of the fiscal
year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period.
In June 2014, the FASB
issued ASU 2014-12, “Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of
an Award Provide That a Performance Target Could be Achieved after the Requisite Service Period.” This ASU provides more
explicit guidance for treating share-based payment awards that require a specific performance target that affects vesting and
that could be achieved after the requisite service period as a performance condition. The new guidance is effective for annual
and interim reporting periods beginning after December 15, 2015. The Company does not expect the adoption of this guidance to
have a material impact on the financial statements.
August 2014, the FASB
issued ASU 2014-15, “Presentation of Financial Statements – Going Concern (Topic 205-40)”, which requires management
to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern for each annual
and interim reporting period. If substantial doubt exists, additional disclosure is required. This new standard will be effective
for the Company for annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The Company will
continue to assess the impact on its financial statements.
NOTE 5 – DEFERED INCOME TAX
The Company maintains deferred tax assets
and liabilities that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for income tax purposes. The deferred tax assets at June 30, 2018 and 2017
consist of net operating loss carryforwards. The net deferred tax asset has been fully offset by a valuation allowance because
of the uncertainty of the attainment of future taxable income. The items accounting for the difference between income taxes at
the effective statutory rate and the provision for income taxes for the year ended June 30, 2018 and 2017 were as follows:
|
|
Year
Ended June 30,
2018
|
|
|
Year
Ended June 30
2017
|
|
Income tax benefit at statutory
rate
|
|
$
|
16,390
|
|
|
$
|
23,602
|
|
Total Provision for income
tax
|
|
$
|
16,390
|
|
|
$
|
23,602
|
|
The Company’s approximate net deferred
tax asset as of June 30, 2018 and 2017 was as follows:
|
|
June
30,
2018
|
|
|
June
30,
2017
|
|
Deferred Tax Asset:
|
|
|
|
|
|
|
Net Operating Loss Carryforward
|
|
$
|
78,048
|
|
|
$
|
67,437
|
|
Valuation Allowance
|
|
|
(78,048
|
)
|
|
|
(67,437
|
)
|
Net deferred tax asset
|
|
$
|
-
|
|
|
$
|
-
|
|
The net operating loss carryforward was
$78,048 at June 30, 2018. The Company provided a valuation allowance equal to the deferred income tax asset for the years ended
June 30, 2018 and 2017 because it was not known whether future taxable income will be sufficient to utilize the loss carryforward.
The allowance was $78,048 at June 30, 2018. The potential tax benefit arising from the loss carryforward will expire in 2037.
Additionally, the future utilization of
the net operating loss carryforward to offset future taxable income may be subject to an annual limitation as a result of ownership
changes that could occur in the future. If necessary, the deferred tax assets will be reduced by any carryforward that expires
prior to utilization as a result of such limitations, with a corresponding reduction of the valuation allowance.
The Company does not have any uncertain
tax positions or events leading to uncertainty in a tax position.
The Company’s income tax
rate computed at the statutory federal rate of 21%, applied to our net operating loss carryforward of $78,048 provided a
deferred tax asset of $16,390 which will begin to expire in 2037 unless utilized first. An allowance of $16,390 has been
established, since it is more likely than not that some or all of the deferred tax credit will not be realized.
NOTE 6 – COMMITMENTS AND CONTINGENCIES
The Company does not have any commitments nor contingencies.
NOTE 7 – RELATED PARTY TRANSACTIONS
There was $0 balance in due to related party liability
at June 30, 2018. The Company imputed interest of $2,321 and $1,480 respectfully for the years ended June 30, 2018 and 2017. During
the year ended June 2018, $26,700 was forgiven resulting in an increase in additional paid in capital and decrease due to related
parties of $26,700.
NOTE 8 – LITIGATION
There were no legal proceedings against
the Company with respect to matters arising in the ordinary course of business. Neither the Company nor any of its officers or
directors is involved in any other litigation either as plaintiffs or defendants, and have no knowledge of any threatened or pending
litigation against them or any of the officers or directors.
NOTE 9 – SUBSEQUENT EVENTS
None.
NOTE 10 – CHANGES IN AND DISAGREEMENTS
WITH ACCOUNTANTS AND ACCOUNTING AND ON FINANCIAL DISCLOSURE
None