Attached files
UNITED STATES
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 THE QUARTERLY PERIOD ENDED JULY 31, 2010
Commission file number 333-165365
IMPACT EXPLORATIONS INC.
(Exact name of registrant as specified in its charter)
NEVADA
(State or other jurisdiction of incorporation or organization)
78 York Street
London W1H 1DP England
(Address of principal executive offices, including zip code)
Telephone +44 207 681 1620 Facsimile +44 207 681 1620
(Telephone number, including area code)
Resident Agents of Nevada
711 S. Carson Street #4
Carson City, NV 89701
Telephone (775)882-4641 Facsimile (775)882-6818
(Name, address and telephone number of agent for service)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the last 90 days. YES [X] NO [ ]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). YES [ ] NO [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer, "accelerated filer,"
"non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the
Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). YES [X] NO [ ]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 3,000,000 shares as of September 14,
2010
ITEM 1. FINANCIAL STATEMENTS
The un-audited quarterly financial statements for the period ended July 31,
2010, prepared by the company, immediately follow.
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GEORGE STEWART, CPA
316 17TH AVENUE SOUTH
SEATTLE, WASHINGTON 98144
(206) 328-8554 FAX (206) 328-0383
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Stockholders of Impact Explorations Inc.
I have reviewed the condensed balance sheet of Impact Explorations Inc. (An
Exploration Stage Company) as of July 31, 2010, and the related condensed
statements of operations for the three and six months ended July 31, 2010 and
for the period from January 6, 2010 (inception) to July 31, 2010, and condensed
statements of cash flows for the six months ended July 31, 2010 and for the
period from January 6, 2010 (inception) to July 31, 2010. These financial
statements are the responsibility of the company's management.
I conducted my review in accordance with the standards of the Public Company
Accounting Oversight Board (United States). A review of interim financial
information consists principally of applying analytical procedures and making
inquiries of persons responsible for financial and accounting matters. It is
substantially less in scope than an audit conducted in accordance with standards
of the Public Company Accounting Oversight Board (United States), the objective
of which is the expression of an opinion regarding the financial statements
taken as a whole. Accordingly, I do not express such an opinion.
Based on my review, I am not aware of any material modifications that should be
made to the accompanying interim financial statements for them to be in
conformity with generally accepted accounting principles in the United States of
America.
I have previously audited, in accordance with auditing standards of the Public
Company Accounting Oversight Board (United States), the balance sheet of Impact
Explorations Inc. (An Exploration Stage Company) as of January 31, 2010, and the
related statements of operations, retained earnings and cash flows for the year
then ended (not presented herein); and in my report dated February 21, 2010, I
expressed a going concern opinion on those financial statements. In my opinion,
the information set forth in the accompanying condensed balance sheet as of
January 31, 2010, is fairly stated, in all material respects, in relation to the
balance sheet from which it has been derived.
/s/ George Stewart, CPA
-------------------------------
Seattle, Washington
September 1, 2010
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IMPACT EXPLORATIONS INC.
(An Exploration Stage Company)
Balance Sheet
--------------------------------------------------------------------------------
As of As of
July 31, January 31,
2010 2010
-------- --------
ASSETS
CURRENT ASSETS
Cash $ 342 $ 14,980
-------- --------
TOTAL CURRENT ASSETS 342 14,980
-------- --------
TOTAL ASSETS $ 342 $ 14,980
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable $ -- $ 790
-------- --------
TOTAL CURRENT LIABILITIES -- 790
-------- --------
TOTAL LIABILITIES -- 790
-------- --------
STOCKHOLDERS' EQUITY
Common stock, ($0.001 par value, 75,000,000 shares
authorized; 3,000,000 shares issued and outstanding
as of July 31, 2010 and January 31, 2010 3,000 3,000
Additional paid-in capital 12,000 12,000
Deficit accumulated during exploration stage (14,658) (810)
-------- --------
TOTAL STOCKHOLDERS' EQUITY 342 14,190
-------- --------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 342 $ 14,980
======== ========
See Notes to Financial Statements
4
IMPACT EXPLORATIONS INC.
(An Exploration Stage Company)
Statement of Operations
--------------------------------------------------------------------------------
January 6, 2010
Three Months Six Months (inception)
ended ended through
July 31, July 31, July 31,
2010 2010 2010
---------- ---------- ----------
REVENUES
Revenues $ -- $ -- $ --
---------- ---------- ----------
TOTAL REVENUES -- -- --
EXPENSES
General and Administrative 360 3,648 4,458
Mineral Exploration Expense -- 4,000 4,000
Professional Fees 1,600 6,200 6,200
---------- ---------- ----------
TOTAL EXPENSES 1,960 13,848 14,658
---------- ---------- ----------
NET INCOME (LOSS) $ (1,960) $ (13,848) $ (14,658)
========== ========== ==========
BASIC EARNING (LOSS) PER SHARE $ 0.00 $ 0.00 $ 0.00
========== ========== ==========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 3,000,000 3,000,000 3,000,000
========== ========== ==========
See Notes to Financial Statements
5
IMPACT EXPLORATIONS INC.
(An Exploration Stage Company)
Statement of Cash Flows
--------------------------------------------------------------------------------
January 6, 2010
Six Months (inception)
ended through
July 31, July 31,
2010 2010
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(13,848) $(14,658)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Changes in operating assets and liabilities:
Accounts Payable (790) --
-------- --------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (14,638) (14,658)
CASH FLOWS FROM INVESTING ACTIVITIES
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- --
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of common stock -- 15,000
-------- --------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES -- 15,000
-------- --------
NET INCREASE (DECREASE) IN CASH (14,638) 342
CASH AT BEGINNING OF PERIOD 14,980 --
-------- --------
CASH AT END OF YEAR $ 342 $ 342
======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ -- $ --
======== ========
Income Taxes $ -- $ --
======== ========
See Notes to Financial Statements
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IMPACT EXPLORATIONS INC.
(An Exploration Stage Company)
Notes to Financial Statements
July 31, 2010
--------------------------------------------------------------------------------
NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS
Impact Explorations Inc. (the Company) was incorporated under the laws of the
State of Nevada on January 6, 2010. The Company was formed to engage in the
acquisition, exploration and development of natural resource properties.
The Company is in the exploration stage. Its activities to date have been
limited to capital formation, organization and development of its business plan.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. BASIS OF ACCOUNTING
The Company's financial statements are prepared using the accrual method of
accounting. The Company has elected a January 31, year-end.
B. BASIC EARNINGS PER SHARE
ASC No. 260, "Earnings Per Share", specifies the computation, presentation and
disclosure requirements for earnings (loss) per share for entities with publicly
held common stock. The Company has adopted the provisions of ASC No. 260.
Basic net loss per share amounts is computed by dividing the net loss by the
weighted average number of common shares outstanding. Diluted earnings per share
are the same as basic earnings per share due to the lack of dilutive items in
the Company.
C. CASH EQUIVALENTS
The Company considers all highly liquid investments purchased with an original
maturity of three months or less to be cash equivalents.
D. USE OF ESTIMATES AND ASSUMPTIONS
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 of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. In accordance with ASC No. 250
all adjustments are normal and recurring.
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IMPACT EXPLORATIONS INC.
(An Exploration Stage Company)
Notes to Financial Statements
July 31, 2010
--------------------------------------------------------------------------------
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
E. INCOME TAXES
Income taxes are provided in accordance with ASC No. 740, Accounting for Income
Taxes. A deferred tax asset or liability is recorded for all temporary
differences between financial and tax reporting and net operating loss
carryforwards. Deferred tax expense (benefit) results from the net change during
the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion of all of the deferred
tax assets will be realized. Deferred tax assets and liabilities are adjusted
for the effects of changes in tax laws and rates on the date of enactment.
F. REVENUE
The Company records revenue on the accrual basis when all goods and services
have been performed and delivered, the amounts are readily determinable, and
collection is reasonably assured. The Company has not generated any revenue
since its inception.
G. ADVERTISING
The Company will expense its advertising when incurred. There has been no
advertising since inception.
H. RECENT ACCOUNTING PRONOUNCEMENTS
The Company has evaluated all the recent accounting pronouncements through the
date the financial statements were issued and filed with the Securities and
Exchange Commission and believe that none of them will have a material effect on
the company's financial statements.
NOTE 3. GOING CONCERN
The accompanying financial statements are presented on a going concern basis.
The Company had limited operations during the period from January 6, 2010
(inception) to July 31, 2010 and generated a net loss of $14,658. This condition
raises substantial doubt about the Company's ability to continue as a going
concern. Even though the Company is currently in the exploration stage and has
minimal expenses, management does not believe that the company's current cash of
$342 is sufficient to cover the expenses they will incur during the next twelve
months.
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IMPACT EXPLORATIONS INC.
(An Exploration Stage Company)
Notes to Financial Statements
July 31, 2010
--------------------------------------------------------------------------------
NOTE 4. WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional shares of
common.
NOTE 5. RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or personal property. The sole
officer and director of the Company is involved in other business activities and
may, in the future, become involved in other business opportunities as they
become available.
Thus she may face a conflict in selecting between the Company and her other
business interests. The Company has not formulated a policy for the resolution
of such conflicts.
NOTE 6. INCOME TAXES
As of July 31, 2010
-------------------
Deferred tax assets:
Net operating tax carryforwards $ 14,658
Other 0
--------
Gross deferred tax assets 4,984
Valuation allowance (4,984)
--------
Net deferred tax assets $ 0
========
Realization of deferred tax assets is dependent upon sufficient future taxable
income during the period that deductible temporary differences and carryforwards
are expected to be available to reduce taxable income. As the achievement of
required future taxable income is uncertain, the Company recorded a valuation
allowance.
NOTE 7. NET OPERATING LOSSES
As of July 31, 2010, the Company has a net operating loss carryforward of
approximately $14,658. Net operating loss carryforward expires twenty years from
the date the loss was incurred.
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IMPACT EXPLORATIONS INC.
(An Exploration Stage Company)
Notes to Financial Statements
July 31, 2010
--------------------------------------------------------------------------------
NOTE 8. STOCK TRANSACTIONS
Transactions, other than employees' stock issuance, are in accordance with ASC
No. 505. Thus issuances shall be accounted for based on the fair value of the
consideration received. Transactions with employees' stock issuance are in
accordance with ASC No. 718. These issuances shall be accounted for based on the
fair value of the consideration received or the fair value of the equity
instruments issued, or whichever is more readily determinable.
On January 6, 2010 the Company issued a total of 3,000,000 shares of common
stock to one director for cash at $0.005 per share for a total of $15,000.
As of July 31, 2010 the Company had 3,000,000 shares of common stock issued and
outstanding.
NOTE 9. STOCKHOLDERS' EQUITY
The stockholders' equity section of the Company contains the following classes
of capital stock as of July 31, 2010:
* Common stock, $ 0.001 par value: 75,000,000 shares authorized;
3,000,000 shares issued and outstanding.
NOTE 10. SUBSEQUENT EVENTS
The Company evaluated all events or transactions that occurred after July 31,
2010 up through the date the Company issued these financial statements. During
this period, the Company did not have any material recognizable subsequent
events.
10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
FORWARD LOOKING STATEMENTS
This report contains forward-looking statements that involve risk and
uncertainties. We use words such as "anticipate", "believe", "plan", "expect",
"future", "intend", and similar expressions to identify such forward-looking
statements. Investors should be aware that all forward-looking statements
contained within this filing are good faith estimates of management as of the
date of this filing. These forward-looking statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from historical results or our predictions.
RESULTS OF OPERATIONS
We are an exploration stage company and have generated no revenues since
inception (January 6, 2010) and have incurred $14,658 in expenses through July
31, 2010. For the three months ended July 31, 2010 we incurred $1,960 in
expenses. These expenses consisted of $1,600 in professional fees and $360 in
general and administrative expenses. For the six months ended July 31, 2010 we
incurred $13,848 in expenses. These expenses consisted of $16,200 in
professional fees, $3,648 in general and administrative expenses and $4,000 in
mineral exploration expenses.
The following table provides selected financial data about our company for the
period ended July 31, 2010.
Balance Sheet Data: 7/30/10
------------------- -------
Cash $ 342
Total assets $ 342
Total liabilities $ 0
Shareholders' equity $ 342
Cash provided by financing activities since inception through July 31, 2010 was
$15,000 from the sale of 3,000,000 shares of common stock to our officer and
director in January 2010. In order to proceed with our business plans we will
need to complete an offering of 3,000,000 shares of common stock pursuant to the
S-1 Registration Statement we filed with the US Securities and Exchange
Commission. Total proceeds from the offering will be $45,000.
LIQUIDITY AND CAPITAL RESOURCES
Our cash balance at July 31, 2010 was $342, with no outstanding liabilities. If
we experience a shortfall of cash our director has agreed to loan us additional
funds for operating expenses, however she has no legal obligation to do so. Our
plan of operation for the next twelve months after receiving funding is to
complete the exploration program. In addition to the $24,000 we anticipate
spending for the exploration program as outlined below, we anticipate spending
11
an additional $20,000 on professional fees, including fees payable in connection
with complying with reporting obligations, and general administrative costs.
Total expenditures over the next 12 months are therefore expected to be
approximately $44,000. We will require the funds from our offering to proceed.
We are an exploration stage company and have generated no revenue to date.
PLAN OF OPERATION
Our exploration target is to find exploitable minerals on our property. Our
success depends on achieving that target. There is the likelihood of our mineral
claim containing little or no economic mineralization or reserves of silver and
other minerals. There is the possibility that our claim does not contain any
reserves and funds that we spend on exploration will be lost. Even if we
complete our current exploration program and are successful in identifying a
mineral deposit we will be required to expend substantial funds to bring our
claim to production. We are unable to assure you we will be able to raise the
additional funds necessary to implement any future exploration or extraction
program even if mineralization is found.
Our plan of operation for the twelve months after receiving funding from our
offering is to complete the exploration program. In addition to the $24,000 we
anticipate spending for the exploration program as outlined below, we anticipate
spending an additional $20,000 on professional fees, including fees payable in
connection with complying with reporting obligations, and general administrative
costs. Total expenditures over the next 12 months are therefore expected to be
approximately $44,000. We will require the funds from our offering to proceed.
The following work program has been recommended by the consulting geologist who
prepared the geology report.
PHASE 1
Prospecting, mapping and grid controlled soil geochemistry $10,000
PHASE 2
A program of grid controlled ground magnetometer and very
low frequency electro magnetometer (VLF-EM) surveys should
be undertaken over the areas of interest as determined by
the Phase 1 program $14,000
-------
Total $24,000
=======
Phase 2 is contingent upon favorable results from Phase 1.
If we are successful in raising the funds from our offering we plan to commence
Phase 1 of the exploration program on the claim in late summer 2010. We expect
this phase to take 15 days to complete and an additional two to three months for
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the consulting geologist to receive the results from the assay lab and prepare
his report.
The above program costs are management's estimates based upon the
recommendations of the professional consulting geologist's report and the actual
project costs may exceed our estimates. To date, we have not commenced
exploration.
Following phase one of the exploration program, if it proves successful in
identifying mineral deposits, we intend to proceed with phase two of our
exploration program. The estimated cost of this program is $14,000 and will take
approximately 3 weeks to complete and an additional two to three months for the
consulting geologist to receive the results from the assay lab and prepare his
report.
We anticipate commencing the second phase of our exploration program in fall
2010. We have a verbal agreement with James McLeod, the consulting geologist who
prepared the geology report on our claim, to retain his services for our planned
exploration program. We cannot provide investors with any assurance that we will
be able to raise sufficient funds to proceed with any work after the exploration
program if we find mineralization.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements.
ITEM 4. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Under the supervision and with the participation of our management, including
our principal executive officer and the principal financial officer, we have
conducted an evaluation of the effectiveness of the design and operation of our
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities and Exchange Act of 1934, as of the end of the period
covered by this report. Based on this evaluation, our principal executive
officer and principal financial officer concluded as of the evaluation date that
our disclosure controls and procedures were effective such that the material
information required to be included in our Securities and Exchange Commission
reports is accumulated and communicated to our management, including our
principal executive and financial officer so that it may be recorded, processed,
summarized and reported within the time periods specified in SEC rules and forms
relating to our company, particularly during the period when this report was
being prepared.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
There have been no changes in our internal control over financial reporting that
occurred during the last fiscal quarter ended July 31, 2010 that have materially
affected, or are reasonably likely to materially affect, our internal control
over financial reporting.
13
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS
The following exhibits are included with this quarterly filing. Those marked
with an asterisk and required to be filed hereunder, are incorporated by
reference and can be found in their entirety in our original Registration
Statement on Form S-1, filed under SEC File Number 333-165365, at the SEC
website at www.sec.gov:
Exhibit No. Description
----------- -----------
3.1 Articles of Incorporation*
3.2 Bylaws*
31.1 Sec. 302 Certification of Principal Executive Officer
31.2 Sec. 302 Certification of Principal Financial Officer
32.1 Sec. 906 Certification of Principal Executive Officer
32.2 Sec. 906 Certification of Principal Financial Officer
SIGNATURES
Pursuant to the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
September 14, 2010 Impact Explorations Inc., Registrant
By: /s/ Jenny Brown
------------------------------------------------
Jenny Brown, President, Chief Executive Officer,
Principal Accounting Officer, and
Chief Financial Officer
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
September 14, 2010 Impact Explorations Inc., Registrant
By: /s/ Jenny Brown
------------------------------------------------
Jenny Brown, President, Chief Executive Officer,
Principal Accounting Officer, and
Chief Financial Officer
1
