Item
1. Financial
Statements
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GOLDEN
VALLEY DEVELOPMENT, INC
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BALANCE
SHEETS
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(unaudited)
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June
30,
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December
31,
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2007
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2006
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ASSETS
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Cash
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$
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198,085
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$
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89,381
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Accounts
Receivable
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Prepaid
Income Taxes
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400
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1,180
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Total
Assets
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$
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198,485
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$
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90,561
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LIABILITIES
AND STOCKHOLDERS'
EQUITY
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Liabilities
- Related Party
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$
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216,800
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$
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110,000
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Stockholder's
Deficit
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Common
Stock; $.001 par value;75,000,000
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shares
authorized 40,000,000 issued
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and
outstanding at December 31, 2006
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40,000
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40,000
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Additional
paid-in-capital
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(17,498
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)
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(22,109
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)
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Accumulated
deficit
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(40,817
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)
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(37,330
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)
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Total
Stockholders' Deficit
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(18,315
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)
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(19,439
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)
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Total
Liabilities and Stockholders' Deficit
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$
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198,485
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$
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90,561
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GOLDEN
VALLEY DEVELOPMENT, INC
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STATEMENTS
OF OPERATIONS
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Three
and Six Months Ended June 30, 2007 and 2006
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(unaudited)
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Three
Months
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Six
Months
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2007
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2006
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2007
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2006
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Revenue
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$
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5,099
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$
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926
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$
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11,720
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3,381
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Operating
Expenses
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General
& Administrative
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4,922
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8,208
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12,925
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19,420
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Interest
Expense
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1,057
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1,152
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2,283
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2,034
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Net
Loss
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$
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(880
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)
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$
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(8,434
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)
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$
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(3,488
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)
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$
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(18,073
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)
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Basic
and diluted income (loss) per common share
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$
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(0.00
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$
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(0.00
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)
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$
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(0.00
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)
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$
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(0.00
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)
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Basic
weighted average common
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shares
outstanding
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40,000,000
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40,000,000
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40,000,000
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40,000,000
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GOLDEN
VALLEY DEVELOPMENT, INC
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STATEMENTS
OF CASH FLOWS
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Six
Months Ended June 30, 2007 and 2006
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(unaudited)
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2007
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2006
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CASH
FLOWS FROM OPERATING ACTIVITIES
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Net
Loss
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$
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(3,488
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)
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$
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(18,073
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Adjustments
to reconcile net loss
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to
cash used in operating activities:
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Imputed
rent expense
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2,328
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2,328
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Imputed
interest expense
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2,283
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-
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Changes
in:
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Accounts
Receivable
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2,380
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Prepaid
Taxes
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781
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(400
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Accrued
Expenses
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2,034
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NET
CASH USED IN OPERATING ACTIVITIES
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1,904
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(11,731
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CASH
FLOWS FROM FINANCING ACTIVITIES
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Proceeds
from note payable to related party
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604,650
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253,000
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Payments
on note payable to related party
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(497,850
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(253,000
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NET
CASH PROVIDED BY FINANCING ACTIVITIES
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106,800
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-
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NET
CHANGE IN CASH
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108,704
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(11,731
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Cash
balance, beginning of the period
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89,381
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45,626
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Cash
balance, end of the period
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$
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198,085
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$
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33,895
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Supplemental
Disclosures:
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Taxes
paid
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$
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-
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$
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-
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Interest
paid
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-
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-
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Notes
to Financial
Statements
NOTE
1 -
BASIS OF PRESENTATION
The
accompanying unaudited interim financial statements of Golden Valley
Development, Inc. (“GVD”), have been prepared in accordance with accounting
principles generally accepted in the United States of America and the rules
of
the Securities and Exchange Commission, and should be read in conjunction with
the audited financial statements and notes thereto contained in GVD's 2006
annual report on Form 10-KSB. In the opinion of management, all adjustments,
consisting of normal recurring adjustments, necessary for a fair presentation
of
financial
position
and the results of operations for the interim periods
presented
have been reflected herein. The results of operations
for
interim periods are not necessarily indicative of the results
to
be
expected for the full year. Notes to the financial statements that would
substantially duplicate the disclosure contained in the audited financial
statements for fiscal year 2006, as reported in the Form 10-KSB, have been
omitted.
NOTE
2 –
RELATED PARTY TRANSACTIONS
During
the six months ended June 30, 2007, GVD borrowed $604,650 from a related
party. The notes carried interest at 5% per annum and are due two
years from the date of issuance. During the six months ended June 30,
2007, GVD made note payments of $497,850 to reduce this balance.
During
the six months ended June 30, 2007, GVD imputed interest of $2,283 on its
related party notes as a contribution to capital due to Adavco, Inc. agreeing
to
waive interest on the notes payable.
Item
2. Managements Discussion and
Analysis
Liquidity
and Cash
Requirements
Adavco
Inc., a related party, loaned us $50,000 in October of 2004 to satisfy cash
requirements, including accounting and auditing costs, for our first 36 months
–
through October of 2007. In addition, Adavco has provided temporary funding
to
support certain broker transactions. During the second quarter, Golden Valley
Development borrowed $166,800 from Adavco. Additional funding may be available
to us from Adavco; however, based on our current cash forecasts, we do not
expect to borrow additional funds, except as may be needed on a short-term
basis
to support a broker transaction. Our projected cash requirements over the next
twelve months should not exceed $15,000. However, our cash requirements will
increase significantly if we begin any advertising campaigns, as discussed
below
in our Marketing subsection. As of June 30, 2007, our cash on hand was
$198,085.
Results
of
Operations
In
June
of 2007, Adavco, Inc. loaned us $166,800 to complete one transaction. This
loan
was due on June 11, 2009, and was repaid in full in July 2007.
On
June
13th we completed a transaction where we brokered the purchase and sale of
heifers and bulls for an aggregate sales price of $171,804 and we recognized
a
net broker fee of $5,004.
Industry
Trends.
As
we discussed above, there is a growing trend in our industry which is of concern
to us. As farms grow and consolidate, they become better able to negotiate
sales
directly with the buyers, since the farms now have the sufficient quantity
to
satisfy most buyers.
Our
business model only works when there are still sufficient small, niche farmers
with which to work, and by “niche” farmers we mean those that produce a niche
crop such as alfalfa hay or grass hay, organic produce, and unusual or specialty
commodities. However, we are able to work with larger farms and larger buyers
on
occasion, because we still retain the advantage of quality control. We send
out
a field inspector to make sure all the produce loaded onto the trucks is high
quality, which is something the buyers do not do themselves, nor do the farmers,
nor do our competitors. In this way, we still are able to generate enough
business to continue as a going concern.
Description
of
Property
.
Our
principal office is in a dedicated office building at 1200 Truxton Ave., Suite
130 in Bakersfield, California.
We
own no
real estate nor other property, nor do we invest in real estate.
Plant
and Significant
Equipment
We do not expect any purchase of any plant or significant
equipment assets in the next 12 months.
Number
of Employees.
Our current number of employees is zero. We do not expect a
significant number in the change of employees in the next 12
months.
Security
Ownership of
Certain Beneficial Owners and Management
.
We
have
only one class of securities – our Common Stock.
The
following represents the security ownership of the only person who owns more
than five percent of our outstanding Common Stock:
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Annette
Davis
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38,054,331
shares
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95.1%
of class
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Financing
Plans
We
will continue to rely on loans from Adavco Inc. to complete brokerage
transactions. At this time there has been nothing signed by Adavco Inc.
guaranteeing that such funds will be made available.
OFF
BALANCE SHEET ARRANGEMENTS
We
have
no off balance sheet arrangements.
Item
3.
Controls and
Procedures.
It
is
management’s responsibility for establishing and maintaining adequate internal
control over financial reporting for Golden Valley Development. It is the
President’s ultimate responsibility to ensure the Company maintains disclosure
controls and procedures designed to provide reasonable assurance that material
information, both financial and non-financial, and other information required
under the securities laws to be disclosed is identified and communicated to
senior management on a timely basis. The Company’s disclosure controls and
procedures include mandatory communication of material events, management review
of monthly, quarterly and annual results and an established system of internal
controls.
As
of
June 30 2007, management of the Company, including the President, conducted
an
evaluation of the effectiveness of the design and operation of the Company’s
disclosure controls and procedures with respect to the information generated
for
use in this Quarterly Report. Based upon and as of the date of that evaluation,
the President and Treasurer have concluded the Company’s disclosure controls
were effective to provide reasonable assurance that information required to
be
disclosed in the reports that the Company files or submits under the relevant
securities laws is recorded, processed, summarized and reported within the
time
periods specified in the Commission’s rules and forms. There have been no
changes in the Company’s internal control over financial reporting during the
period ended June 30, 2007, that have materially affected, or are reasonably
likely to materially affect, the Company’s internal control over financial
reporting.
It
should
be noted that while the Company’s management, including the President, believes
the Company’s disclosure controls and procedures provide a reasonable level of
assurance, they do not expect that the Company’s disclosure controls and
procedures or internal control over financial reporting will prevent all errors
and all fraud. A control system, no matter how well conceived or operated,
can
provide only reasonable, not absolute, assurance the objectives of the control
system are met. Further, the design of a control system must reflect the fact
there are resource constraints, and the benefits of controls must be considered
relative to their costs. Because of the inherent limitations in all control
systems, no evaluation of controls can provide absolute assurance all control
issues and instances of fraud, if any, have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty, and breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
controls. The design of any system of controls is based in part upon certain
assumptions about the likelihood of future events, and there can be no assurance
any design will succeed in achieving its stated goals under all potential future
conditions; over time, controls may become inadequate because of changes in
conditions, or the degree of compliance with the policies or procedures may
deteriorate. Because of the inherent limitations in a cost-effective control
system, misstatements due to errors or fraud may occur and not be
detected.
Other
Information
Item
4. Exhibits