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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For Quarter Ended September 30, 2002
[_] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE EXHANGE ACT
Commission File No. 0-24262
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ADVEN, INC.
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(Exact name of registrant as specified in its charter)
Washington 91-1363905
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
3653 Hemlock Court
Reno, Nevada 89509
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(Address of principal (Zip Code)
executive offices)
(775)378-2636
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(Registrants telephone number
including area code)
Indicate by a check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding twelve months (or for such shorter period that
the Registrant was required to file such reports), and (2) has been subject
to such filing requirement for the past ninety days.
Yes [X] No [_]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date:
The number of shares of Registrant's Common Stock, $.0001 par, outstanding
on September 30, 2002 was 11,572,667.
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ADVEN, INC.
FINANCIAL STATEMENTS
SEPTEMBER 30, 2002
TABLE OF CONTENTS
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Balance Sheets...............................................................2
Statements of Operations and Other Comprehensive Loss........................3
Statements of Cash Flows.....................................................4
Notes to Financial Statements................................................5
1
ADVEN, INC.
BALANCE SHEETS
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September 30, 2002 (unaudited), and December 31, 2001
SEPTEMBER 30, DECEMBER 31,
2002 2001
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ASSETS
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CURRENT ASSETS
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Cash $ 718 $ 67
Prepaid legal fees 211 211
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Total current assets 929 278
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OTHER ASSETS
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Investment 52 103
Deferred tax asset (net) -- --
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Total other assets 52 103
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FIXED ASSETS
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Computer equipment 2,390 2,390
Accumulated depreciation (1,587) (1,243)
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Total fixed assets 803 1,147
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Total assets $ 1,784 $ 1,528
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LIABILITIES AND STOCKHOLDERS' DEFICIT
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CURRENT LIABILITIES
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Accounts payable $ 885 $ 759
Accrued interest 172 3,794
Shareholder advances 7,250 28,819
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Total current liabilities 8,307 33,372
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COMMITMENTS AND CONTINGENCIES
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STOCKHOLDERS' DEFICIT
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Common stock, $.0001 par value, 20,000,000 shares
authorized, 11,572,667 and 4,919,667 shares issued
and outstanding 1,157 492
Additional paid-in-capital 1,204,120 1,171,520
Unrealized loss on securities available for sale (397,471) (397,420)
Accumulated deficit (814,329) (806,436)
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Total stockholders' deficit (6,523) (31,844)
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Total liabilities and stockholders' deficit $ 1,784 $ 1,528
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See Notes to the Interim Financial Statements
2
ADVEN, INC.
STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS
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For the Nine Months and the Three Months
Ended September 30, 2002, and 2001 (unaudited)
FOR THE NINE MONTHS ENDED FOR THE THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
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2002 2001 2002 2001
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REVENUE $ -- $ -- $ -- $ --
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EXPENSES
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General and administrative expenses (3,175) (3,475) (987) (1,174)
Accounting fees (3,550) (3,850) (800) (1,500)
Depreciation expense (344) (574) (115) (192)
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Net loss before interest expense
and income taxes (7,069) (7,899) (1,902) (2,866)
Interest expense (824) (1,617) (121) (540)
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Net loss before income taxes (7,893) (9,516) (2,023) (3,406)
Provision for income taxes -- -- -- --
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Net loss (7,893) (9,516) (2,023) (3,406)
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OTHER COMPREHENSIVE LOSS
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Unrealized gain (loss) on securities (net) (51) (13,172) 9 (290)
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Comprehensive loss $ (7,944) $ (22,688) $ (2,014) $ (3,696)
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Loss per share
- basic and diluted $ (0.00) $ (0.00) $ (0.00) $ (0.00)
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Weighted average shares outstanding
- basic and diluted 9,355,000 5,469,667 11,572,667 5,469,667
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See Notes to the Interim Financial Statements
3
ADVEN, INC.
STATEMENTS OF CASH FLOWS
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For the Nine Months Ended September 30, 2002, and 2001 (unaudited)
SEPTEMBER 30,
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2002 2001
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CASH FLOWS FROM OPERATING ACTIVITIES
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Net loss $ (7,893) $ (9,516)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation expense 344 574
Increase in prepaid legal fees -- (358)
Increase (decrease) in accounts payable 126 (3,064)
Increase in deferred tax asset (2,701) (7,714)
Increase in deferred tax valuation allowance 2,701 7,714
Increase in accrued interest 824 1,540
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Net cash used in operating activities (6,599) (10,824)
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CASH FLOWS FROM FINANCING ACTIVITIES
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Proceeds from shareholder advances 7,250 2,000
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Net cash provided by financing activities 7,250 2,000
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Net increase (decrease) in cash and cash equivalents 651 (8,824)
Cash and cash equivalents at December 31, 2001, and 2000 67 9,254
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Cash and cash equivalents at September 30, 2002, and 2001 $ 718 $ 430
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SUPPLEMENTARY INFORMATION AND NON CASH TRANSACTIONS
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During the nine months ended September 30, 2002, and 2001, no amounts were paid
for income taxes.
In April 2002 the Company issued 6,653,000 of its common stock to retire $28,819
of the shareholder advances, and $4,446 of related interest.
During the nine months ended September 30, 2001, $101 was paid for interest.
See Notes to the Interim Financial Statements
4
ADVEN, INC.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
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September 30, 2002
1. BASIS OF PRESENTATION
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The accompanying unaudited interim financial statements of Adven, Inc. (the
"Company") have been prepared by the Company in accordance with generally
accepted accounting principles in the United States of America, pursuant to
the Securities and Exchange Commission rules and regulations. In
management's opinion all adjustments necessary for a fair presentation of
the results for the interim periods have been reflected in the interim
financial statements. The results of operations for any interim period are
not necessarily indicative of the results for a full year. All adjustments
to the financial statements are of a normal recurring nature.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. Such disclosures are those that
would substantially duplicate information contained in the most recent
audited financial statements of the Company, such as significant accounting
policies and stock options. Management presumes that users of the interim
statements have read or have access to the audited financial statements and
notes thereto included in the Company's most recent annual report on Form
10-KSB.
NEW PRONOUNCEMENTS
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In May 2002 the Financial Accounting Standards Board ('FASB') issued
Statement of Financial Accounting Standards ('SFAS') 145 "Rescission of
FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and
Technical Corrections". This pronouncement requires that gains or losses
arising from early extinguishments of debt that are part of a company's
recurring operations (i.e., a risk management strategy) would not be
reported as extraordinary items. The statement also provides that
modifications to a capital lease that make it an operating lease be
accounted for as a sale-leaseback. Management feels that the early adoption
of SFAS No. 145 will not affect the financial results as the Company has no
long term debt or capital leases.
In August 2002 the FASB issued SFAS 146 "Accounting for Costs Associated
With Exit or Disposal Activities". This statement nullifies Emerging Issues
Task Force ('EITF') issue 94-3
5
ADVEN, INC.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
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September 30, 2002
and establishes new standards of accounting and reporting for exit
activities (including a restructuring). Under EITF 94-3, a liability was
recognized as of the date of an entity's commitment to an exit plan.
According to SFAS 146, a liability for exit or disposal costs is recorded
as of the date that the obligation is incurred. This standard also requires
that the liability be initially measured at fair value. The Company will
account for exit or disposal activities in accordance with the guidance in
SFAS 146. Management does not feel that this standard will affect the
Company as they currently have no operations.
2. GOING CONCERN
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These financial statements have been prepared assuming that the Company
will continue as a going concern. The Company has sustained recurring
losses over the past years and currently has no source of operating income.
The Company's cash flow and existing credit are insufficient to fund the
Company's cash flow needs based on the expenses expected to be incurred
during the next year. The President of the Company intends to advance funds
as necessary to fund the cash flow needs of the Company.
3. CAPITAL STOCK
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In April 2002 the Company issued 6,653,000 restricted common shares to the
President. These shares provided for payment in full of the $28,819
advanced by the President to the Company as of December 31, 2001, and the
related interest of $4,446 accrued through the payment date.
4. RELATED PARTY TRANSACTIONS
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The President of Adven, Inc. has advanced the Company funds to pay
expenses. The advance is due upon demand and carries an interest rate of
8.0% per annum. As of September 30, 2002, the outstanding advance balance
was $7,250, and related accrued interest was $172.
6
SIGNATURES
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In accordance with requirements of the Securities Exchange Act of 1934, the
Registrant caused this Report to be signed on its behalf by the Undersigned,
thereunto duly authorized.
ADVEN, INC.
Registrant
/s/ Henri Hornby
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Henri Hornby
November 8, 2002 President / Director
/s/ Sheila Ledrew
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Sheila Ledrew
November 8, 2002 Director
7