NOTES
TO FINANCIAL STATEMENTS
AS
OF JULY 31, 2019 AND 2018 (Consolidated)
NOTE
1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION
(A)
Organization
Nuts
and Bolts International, Inc. (the “Company”) was incorporated under the laws of the State of Nevada on August 21,
2013 to create and publish electronic non-fiction books (“eBooks”) through the internet. The Company was formed to
create and distribute high quality, multimedia eBooks for the hobby and do-it-yourself consumer markets. These operations were
carried on through the Company’s wholly-owned subsidiary Nuts & Bolts Publishing, LLC. These operations have been discontinued
and the Company’s subsidiary has been dissolved.
In
connection with the Change of Control, on February 29, 2016, effective April 14, 2016, the Company filed with the State of Nevada
a Certificate of Amendment to the Articles of Incorporation changing the Company’s name from Nuts and Bolts International,
Inc. to Trendmaker Inc. Limited.
On
February 29, 2016, the Company entered into a Stock Purchase Agreement (the “SPA”) with the former director and officer
of the Company (the “Seller”), and the current director and officer (the “Purchaser”), under which the
Purchaser purchased 5,000,000 shares of common stock, par value $0.0001 per share, of the Company (the “Shares”),
for an aggregate purchase price of $155,000, payable in full to the Seller (a “Change of Control”). The Shares represent
all of the Seller’s interest in and to any securities of the Company, and make up 77.67% of the issued and outstanding shares
of common stock of the Company. The SPA closed and the Change of Control occurred on February 29, 2016. Following the change of
control, the Company elected to terminate its previous business plan to engage in eBook publishing, and adopt a new business plan
related to acting as an investment holding company and providing management and consulting services.
The
Company is now acting as an investment holding company and providing management and consulting services to Trendmaker Pte, Ltd.,
a Singapore entity.
(B)
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. Significant estimates include valuation
of in kind contribution of services, valuation of deferred tax assets. Actual results could differ from those estimates.
(C)
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 July 31, 2019 and July 31, 2018, the Company had no cash and cash equivalents.
(D)
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
ASC No. 260, “Earnings Per Share.” As of July 31, 2019, and July 31, 2018, there were no common share equivalents
outstanding.
TRENDMAKER
INC. LIMITED
NOTES
TO FINANCIAL STATEMENTS
AS
OF JULY 31, 2019 AND 2018 (Consolidated)
(E)
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.
(F)
Fair Value of Financial Instruments
The
Company measures its financial assets and liabilities in accordance with GAAP. For certain of our financial instruments, including
cash, accounts payable, and the short-term portion of long-term debt, the carrying amounts approximate fair value due to their
short maturities.
We
adopted accounting guidance for financial and non-financial assets and liabilities (ASC 820). The adoption did not have a material
impact on our results of operations, financial position or liquidity. This standard defines fair value, provides guidance for
measuring fair value and requires certain disclosures. This standard does not require any new fair value measurements, but rather
applies to all other accounting pronouncements that require or permit fair value measurements. This guidance does not apply to
measurements related to share-based payments. This guidance discusses valuation techniques, such as the market approach (comparable
market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the
service capacity of an asset or replacement cost). The guidance utilizes a fair value hierarchy that prioritizes the inputs to
valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:
Level
1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level
2: Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar
assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not
active.
Level
3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed
by us, which reflect those that a market participant would use.
(G)
Recent Accounting Pronouncements
In
August 2014, the FASB issued Accounting Standards Update “ASU” 2014-15 on “Presentation of Financial Statements
Going Concern (Subtopic 205-40) - Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”.
Currently, there is no guidance in U.S. GAAP about management’s responsibility to evaluate whether there is substantial
doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments
in this Update provide that guidance. In doing so, the amendments are intended to reduce diversity in the timing and content of
footnote disclosures. The amendments require management to assess an entity’s ability to continue as a going concern by
incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments
(1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods,
(3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when
substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and
other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date
that the financial statements are issued (or available to be issued). The amendments in this Update are effective for public and
nonpublic entities for annual periods ending after December 15, 2016. Early adoption is permitted. We are currently reviewing
the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.
In
August 2015, FASB issued Accounting Standards Update (“ASU”) No.2015-14, “Revenue from Contracts with Customers
(Topic 606): Deferral of the Effective Date” defers the effective date ASU No. 2014-09 for all entities by one year. Public
business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in Update 2014-09
to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period.
Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting
periods within that reporting period. All other entities should apply the guidance in Update 2014-09 to annual reporting periods
beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15,
2019. All other entities may apply the guidance in ASU No. 2014-09 earlier as of an annual reporting period beginning after December
15, 2016, including interim reporting periods within that reporting period. All other entities also may apply the guidance in
Update 2014-09 earlier as of an annual reporting period beginning after December 15, 2016, and interim reporting periods within
annual reporting periods beginning one year after the annual reporting period in which the entity first applies the guidance in
ASU No. 2014-09. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results
of operations, cash flows or financial condition.
TRENDMAKER
INC. LIMITED
NOTES
TO FINANCIAL STATEMENTS
AS
OF JULY 31, 2019 AND 2018 (Consolidated)
In
March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations
(Reporting Revenue Gross versus Net) that clarifies how to apply revenue recognition guidance related to whether an entity is
a principal or an agent. ASU 2016-08 clarifies that the analysis must focus on whether the entity has control of the goods or
services before they are transferred to the customer and provides additional guidance about how to apply the control principle
when services are provided and when goods or services are combined with other goods or services. The effective date for ASU 2016-08
is the same as the effective date of ASU 2014-09 as amended by ASU 2015-14, for annual reporting periods beginning after December
15, 2017, including interim periods within those years. The Company has not yet determined the impact of ASU 2016-08 on its financial
statements.
All
other newly issued accounting pronouncements but not yet effective have been deemed either immaterial or not applicable.
NOTE
2 INCOME TAXES
For
the year ended July 31, 2019 and year ended July 31, 2018, the local (United States) loss before income taxes were comprised of
the following:
|
|
For
the year ended
July 31, 2019
|
|
|
For
the year ended
July 31, 2018
|
|
|
|
|
|
|
|
|
Tax
jurisdictions from:
|
|
|
|
|
|
|
|
|
-
Local
|
|
$
|
(64,281
|
)
|
|
$
|
(56,461
|
)
|
Loss
before income tax
|
|
$
|
(64,281
|
)
|
|
$
|
(56,461
|
)
|
The
provision for income taxes consisted of the following:
|
|
For
the year ended
July 31, 2019
|
|
|
For
the year ended
July 31, 2018
|
|
|
|
|
|
|
|
|
Current:
|
|
|
|
|
|
|
|
|
-
Local
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
Deferred:
|
|
|
|
|
|
|
|
|
-
Local
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Income
tax expense
|
|
$
|
-
|
|
|
$
|
-
|
|
United
States of America
The
Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. As of July 31, 2019,
the operations in the United States of America incurred $728,974 of cumulative net operating losses which can be carried forward
to offset future taxable income. The net operating loss carry forwards begin to expire in 2037, if unutilized. The tax valuation
allowance for July 31, 2019 and July 31, 2018 are $153,085 and $139,586 respectively.
TRENDMAKER
INC. LIMITED
NOTES
TO FINANCIAL STATEMENTS
AS
OF JULY 31, 2019 AND 2018 (Consolidated)
NOTE
3 STOCKHOLDERS’ EQUITY
(A)
Preferred Stock
The
Company was incorporated on August 21, 2013. The Company is authorized to issue 10,000,000 shares of preferred stock with a par
value of $0.0001 per share. Preferred stock may be issued in one or more series with rights and preferences are to be determined
by the board of directors. As of July 31, 2019, and 2018, no shares of preferred stock have been issued.
(B)
Common Stock
The
Company is authorized to issue 100,000,000 shares of common stock with a par value of $0.0001 per share.
Between
August 1, 2016 and April 30, 2017, the Company issued 662,000 additional shares of common stock to 143 shareholders at $0.84 per
share for total proceeds of $556,080.
As
at July 31, 2019, the Company has 13,537,000 shares of common stock outstanding.
NOTE
4 COMMITMENTS AND CONTINGENCIES
(A)
Consulting Agreements
On
April 1, 2016 the Company entered into a consulting agreement to receive administrative and other miscellaneous services. The
Company is required to pay $2,500 a month. The agreement is to remain in effect unless either party desires to cancel the agreement.
(B)
Consulting Revenue
On
April 15, 2016, the Company entered into a consulting agreement to provide consulting services to Trendmaker Pte, Ltd.
TRENDMAKER
INC. LIMITED
NOTES
TO FINANCIAL STATEMENTS
AS
OF JULY 31, 2019 AND 2018 (Consolidated)
NOTE
5 ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts
payable and accrued expenses consisted of the followings at July 31, 2019 and July 31, 2018.
|
|
As
of July 31, 2019
|
|
|
As
of July 31, 2018
|
|
Accounts
payable
|
|
$
|
214,842
|
|
|
$
|
214,842
|
|
Accrued
expenses
|
|
|
25,300
|
|
|
|
1,000
|
|
Total
accounts payable and accrued expenses
|
|
$
|
240,142
|
|
|
$
|
224,842
|
|
NOTE
6 RELATED PARTY TRANSACTIONS
|
|
July
31, 2019
|
|
|
July
31, 2018
|
|
|
|
(Unaudited)
|
|
|
(Audited)
|
|
|
|
$
|
|
|
$
|
|
Due
from related party:
|
|
|
|
|
|
|
|
|
Related
Party A
|
|
|
337,688
|
|
|
|
386,669
|
|
As
of July 31, 2019, the balance US$337,688 represented an outstanding amount due from
Related Party A. Related Party A is having common director with the Company. The amount
due is unsecured, interest-free with no fixed repayment term.
NOTE
7 GOING CONCERN
As
reflected in the accompanying financial statements, the Company has working capital of $97,546 and stockholders’ equity
of $97,546, used cash in operations of $0 and has a net loss of $64,281 for the year ended July 31, 2019. 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 EVENT
On
October 2, 2019, the Company announced that Tan Sri Dato’ Sri Lai Teck Peng, the Chief Executive Officer and sole director
of the Company, passed away on 27 August, 2019 in Malaysia.
On
the same day, the late Tan Sri Dato’ Sri Lai Teck Peng was being removed from the position of Chief Executive Officer and
sole director of the Company due to his sudden demise whereby Puan Sri Datin Sri Tan Chin Yee, spouse of the late Tan Sri Dato’
Sri Lai Teck Peng, was being appointed as the Chief Executive Officer and director of Trendmaker, Inc. Limited, effective immediately.