Report of Independent Registered Public Accounting Firm
To the shareholders and the board of directors of MS Young Adventure Enterprise, Inc.
Opinion on the Financial Statements
We have audited the accompanying balance sheets of MS Young Adventure Enterprise, Inc. (the "Company") as of December 31, 2022 and 2021, the related statements of operations, stockholders' equity (deficit), and cash flows for the years then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States.
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company’s minimal activities raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ BF Borgers CPA PC
BF Borgers CPA PC (PCAOB ID 5041)
We have served as the Company's auditor since 2021
Lakewood, CO
March 24, 2023
Notes to the Audited Financial Statements
December 31, 2022 and 2021
NOTE 1 - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS
MS Young Adventure Enterprise, Inc. (formerly “AllyMe Holding Inc,” and formerly “Rain Sound Acquisition Corporation”) (the “Company” or “MS Young”) was incorporated on December 7, 2016 under the laws of the state of Delaware. The Company engages in consulting services.
On November 13, 2017, the Company changed the Company’s name to AllyMe Holding Inc.
On August 6, 2019, the Company changed the Company’s name to MS Young Adventure Enterprise, Inc.
The Company was a marketing and management consulting company that provides advisory services to companies located in Asia for the purpose of facilitating the competitiveness of those companies in the international market. The Company offers a wide assortment of advisory services, ranging from business planning consulting services, mergers and acquisitions advising, and marketing services. As of the date of this report, the Company has signed few clients.
The outbreak of COVID19 coronavirus in China and Asia starting from the beginning of 2020 has resulted delay for our business. The Company followed the restrictive measures implemented in China, by suspending contacting clients or contacting clients remotely during February and March 2020. The Company gradually resumed contacting clients in person starting in April 2020. The recent developments of COVID 19 has resulted in the Company’s lower revenue and net income. Other financial impact could occur though such potential impact is unknown at this time.
On March 10, 2021, new management acquired control and has begun to implement a new business model.
On November 2, 2021, MS Young reported that it has entered the encryption industry with the beta launch of Forceshield Mail, a fully-featured secure e-mail service. ForceShield Mail (www.forceshieldmail.com) employs modern end-to-end encryption methods to ensure the privacy of users’ electronic communications, with an emphasis on accessibility and ease of use. The Company hopes to fill the growing demand for services that address the increasing need for Digital Privacy by developing and providing a suite of robust, easy-to-use solutions that will safeguard consumers’ private information.
On November 22, 2021, MS Young also announced the beta launch of ForceShield VPN, a state-of-the-art encrypted VPN service that seeks to achieve synergy with the Company’s prior product, ForceShield Mail, to provide users with robust protection against privacy intrusions and other cyber-related crimes.
BASIS OF PRESENTATION
The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America. The Company’s year end is December 31.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted accounting principles 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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
RECLASSIFICATIONS
Certain prior period amounts have been reclassified to conform with the current period presentation. The reclassification had no impact on net loss and financial position.
FAIR VALUE OF FINANCIAL INSTRUMENTS
ASC 820, “Fair Value Measurements and Disclosures”, defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:
Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.
Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value.
The carrying amounts of financial instruments such as accounts payable and promissory note payable approximate their fair values because of the short maturity of these instruments.
SOFTWARE DEVELOPMENT
The Company accounts for all software and development costs in accordance with ASC 985-20 – Software. Accordingly, all costs incurred prior to establishing technological feasibility have been expensed. As of December 31, 2022, none of the costs associated with software and development met the criteria for capitalization.
NET INCOME (LOSS) PER SHARE
Basic net income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted net income per share is computed similar to basic net income (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. If applicable, diluted net income per share assumes the conversion, exercise or issuance of all common stock instruments, such as convertible notes, unless the effect is to reduce a loss or increase earnings per share. As of December 31, 2022 and 2021, there were no dilutive potential common shares.
INCOME TAXES
The Company accounts for income taxes pursuant to FASB ASC 740 “Income Taxes.” Pursuant to ASC 740, deferred income taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences, and operating loss carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The provision for income taxes represents the tax expense for the period, if any, and the change during the period in deferred tax assets and liabilities. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
ASC 740 also provides criteria for the recognition, measurement, presentation and disclosure of uncertain tax positions. Under ASC 740, the impact of an uncertain tax position on the income tax return may only be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. At December 31, 2022 and 2021, there were no unrecognized tax benefits (see Note 5).
RECENT ACCOUNTING PRONOUNCEMENTS
Management has considered all recent accounting pronouncements issued. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.
NOTE 2 - GOING CONCERN
The Company has generated minimal revenue since inception to date and accumulated deficit of $432,084 through the year ended December 31, 2022. These factors among others raise substantial doubt about our ability to continue as a going concern. The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations and/or obtaining additional financing from its members or other sources, as may be required. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Management believes that the current actions to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern. There are no assurances that additional funds will be available when needed from any source or, if available, will be available on terms that are acceptable to us.
NOTE 3 – PROMISSORY NOTE PAYABLE
| | | | December 31, | | | December 31, | |
| | Expiry Date | | 2022 | | | 2021 | |
Promissory Note - October 2021 | | 12/31/2023 | | $ | 8,085 | | | $ | 8,085 | |
Promissory Notes - December 2021 | | 12/31/2023 | | | 21,321 | | | | 21,321 | |
Promissory Note - March 2022 | | 12/31/2023 | | | 14,344 | | | | - | |
Promissory Note - June 2022 | | 12/31/2023 | | | 8,645 | | | | - | |
Promissory Note - September 2022 | | 12/31/2023 | | | 9,755 | | | | - | |
Promissory Note - December 2022 | | 12/31/2023 | | | 20,935 | | | | - | |
| | | | | 83,085 | | | | 29,406 | |
Less: non-current portion | | | | | - | | | | - | |
Current portion | | | | $ | 83,085 | | | $ | 29,406 | |
During the year ended December 31, 2022 and 2021, the Company issued promissory notes of $53,679 and $29,406 to an unaffiliated party for payment for operation expenses on behalf of the Company, respectively. The notes bear an interest of 3% per annum and mature on December 31, 2023.
During the year ended December 31, 2022 and 2021, the interest expense of $1,409 and $61 was incurred, respectively. As of December 31, 2022 and 2021, accrued interest of $1,470 and $61, respectively.
NOTE 4 - EQUITY
The Company is authorized to issue 100,000,000 shares of common stock with par value of $0.0001 and 20,000,000 shares of preferred stock with par value of $0.0001.
As of December 31, 2022 and 2021, there were no preferred stock issued and outstanding.
As of December 31, 2022 and 2021, there were 6,731,667 shares of common stock issued and outstanding.
NOTE 5 – INCOME TAX
The Company provides for income taxes under ASC 740, “Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.
The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of December 31, 2022 and 2021, are as follows:
| | December 31, | | | December 31, | |
| | 2022 | | | 2021 | |
Net operating loss carryforward | | $ | (432,084 | ) | | $ | (376,632 | ) |
Statutory tax rate | | | 21 | % | | | 21 | % |
Deferred tax asset | | | (90,738 | ) | | | (79,093 | ) |
Less: Valuation allowance | | | 90,738 | | | | 79,093 | |
Net deferred asset | | $ | - | | | $ | - | |
As of December 31, 2022 the Company had approximately $432,000 in net operating losses (“NOLs”) that may be available to offset future taxable income. NOLs generated in tax years prior to December 31, 2017 can be carryforward for twenty years, whereas NOLs generated after December 31, 2017 can be carryforward indefinitely. In accordance with Section 382 of the U.S. Internal Revenue Code, the usage of the Company’s net operating loss carry forwards is subject to annual limitations following greater than 50% ownership changes. Tax returns for the years ended 2016 through 2022 are subject to review by the tax authorities.
NOTE 6 - RISKS AND UNCERTAINTIES
In early 2020, the World Health Organization declared the rapidly spreading coronavirus disease (COVID-19) outbreak a pandemic. This pandemic has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. The Company considered the impact of COVID-19 on the assumptions and estimates used and determined that there were no material adverse impacts on the Company’s results of operations and financial position at December 31, 2022. The full extent of the future impacts of COVID-19 on the Company’s operations is uncertain. A prolonged outbreak could have a material adverse impact on financial results and business operations of the Company in the future. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of the date of issuance of these financial statements. These estimates may change, as new events occur and additional information is obtained.
NOTE 7 - SUBSEQUENT EVENTS
In accordance with ASC 855-10, the Company has analyzed its operations subsequent to the December 31, 2022 to the date these financial statements were issued and has determined that it does not have any material subsequent events to disclose in these financial statements.