Attached files
| file | filename |
|---|---|
| EX-32.1 - CERTIFICATION - US VR Global.com Inc. | f10q0910ex32i_ace.htm |
| EX-31.1 - CERTIFICATION - US VR Global.com Inc. | f10q0910ex31i_ace.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM 10-Q
_______________
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2010
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______to______.
ACE Consulting Management, Inc.
(Exact name of registrant as specified in Charter)
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DELAWARE
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000-50413
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98-0407797
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||
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(State or other jurisdiction of
incorporation or organization)
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(Commission File No.)
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(IRS Employee Identification No.)
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923 E. Valley Blvd, Suite 103B, San Gabriel, CA
(Address of Principal Executive Offices)
_______________
(626) 307-2273
(Issuer Telephone number)
_______________
(Former Name or Former Address if Changed Since Last Report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the issuer was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days.
Yes x No o
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 (§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 o No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company filer. See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one):
Large Accelerated Filer o Accelerated Filer o Non-Accelerated Filer o 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 o
State the number of shares outstanding of each of the issuer’s classes of common equity, as of November __, 2010: 29,640,000 shares of Common Stock.
ACE CONSULTING MANAGEMENT, INC.
FORM 10-Q
September 30, 2010
INDEX
PART I-- FINANCIAL INFORMATION
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Item 1.
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Financial Statements
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F-1 - F-12
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Item 2.
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Management’s Discussion and Analysis of Financial Condition
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1
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Item 3.
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Quantitative and Qualitative Disclosures About Market Risk
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1
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Item 4T.
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Control and Procedures
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2
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PART II-- OTHER INFORMATION
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Item 1
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Legal Proceedings
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3
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Item 1A
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Risk Factors
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3
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Item 2.
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Unregistered Sales of Equity Securities and Use of Proceeds
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3
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Item 3.
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Defaults Upon Senior Securities
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3
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Item 4.
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Removed and Reserved
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3
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Item 5.
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Other Information
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3
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Item 6.
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Exhibits
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3
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SIGNATURE
Item 1. Financial Information
ACE CONSULTING MANAGEMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
September 30, 2010 and 2009
Index to Financial Statements
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FINANCIAL STATEMENTS
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Page #
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Balance Sheets as of September 30, 2010 (Unaudited) and December 31, 2009
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F-2
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Statements of Operations for the Nine and Three Months Ended September 30, 2010 and 2009 and for the Period from September 19, 2003 (Inception) through September 30, 2010 (Unaudited)
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F-3/F-4
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Statement of Stockholders’ Equity (Deficit) for the Period from September 19, 2003 (Inception) through September 30, 2010 (Unaudited)
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F-5
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Statements of Cash flows for the Nine Months Ended September 30, 2010 and 2009 and for the Period from September 19, 2003 (Inception) through September 30, 2010 (Unaudited)
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F-6
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Notes to the Financial Statements (Unaudited)
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F-7
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F-1
ACE CONSULTING MANAGEMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Balance Sheets
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September 30,
2010
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December 31,
2009
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|||||||
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(Unaudited)
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||||||||
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Current Assets:
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||||||||
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Cash
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$ | 33,052 | $ | - | ||||
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Total current assets
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33,052 | - | ||||||
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TOTAL ASSETS
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$ | 33,052 | $ | - | ||||
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
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||||||||
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Current Liabilities:
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||||||||
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Accrued expenses
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$ | 1,025 | $ | 14,400 | ||||
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Total Current Liabilities
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1,025 | 14,400 | ||||||
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Stockholders' Equity (Deficit):
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||||||||
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Common stock: $0.001 par value; 50,000,000 shares authorized; 29,640,000 and 100,000 shares issued and outstanding, respectively
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29,640 | 100 | ||||||
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Additional paid-in capital
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1,460,110 | - | ||||||
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Deficit accumulated during the development stage
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(1,457,723 | ) | (14,500 | ) | ||||
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Total Stockholders’ Equity (Deficit)
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32,027 | (14,400 | ) | |||||
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
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$ | 33,052 | $ | - | ||||
See accompanying notes to the financial statements.
F-2
ACE CONSULTING MANAGEMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Operations
(Unaudited)
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For the
Nine Months Ended
September 30, 2010
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For the
Nine Months Ended
September 30, 2009
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For the
Period From September 19, 2003
(Inception)
through
September 30, 2010
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||||||||||
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Revenues
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$ | 8,000 | $ | - | $ | 8,000 | ||||||
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Operating expenses:
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||||||||||||
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Professional fees
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33,283 | 1,500 | 47,683 | |||||||||
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Stock compensation
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1,415,500 | - | 1,415,600 | |||||||||
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General and administrative
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2,440 | - | 2,440 | |||||||||
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Total operating expenses
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1,451,223 | 1,500 | 1,465,723 | |||||||||
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Loss before income taxes
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(1,443,223 | ) | (1,500 | ) | (1,457,723 | ) | ||||||
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Income tax provision
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- | - | - | |||||||||
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Net loss
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$ | (1,443,223 | ) | $ | (1,500 | ) | $ | (1,457,723 | ) | |||
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Net loss per common share –
basic and diluted
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$ | (0.10 | ) | $ | (0.02 | ) | $ | (0.88 | ) | |||
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Weighted average number of common shares outstanding – basic and diluted
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14,262,234 | 100,000 | 1,661,506 | |||||||||
See accompanying notes to the financial statements.
F-3
ACE CONSULTING MANAGEMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Operations
(Unaudited)
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For the
Three Months Ended
September 30, 2010
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For the
Three
Months Ended
September 30, 2009
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|||||||
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Revenues
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$ | 2,000 | $ | - | ||||
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Operating expenses:
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||||||||
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Professional fees
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16,722 | 500 | ||||||
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General and administrative
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1,266 | - | ||||||
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Total operating expenses
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17,988 | 500 | ||||||
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Loss before income taxes
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(15,988 | ) | (500 | ) | ||||
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Income tax provision
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- | - | ||||||
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Net Loss
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$ | (15,988 | ) | $ | (500 | ) | ||
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Net loss per common share –
basic and diluted
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$ | (0.00 | ) | $ | (0.01 | ) | ||
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Weighted average number of common shares outstanding – basic and diluted
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29,640,000 | 100,000 | ||||||
See accompanying notes to the financial statements.
F-4
ACE CONSULTING MANAGEMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Statement of Stockholders’ Equity (Deficit)
For the Period from September 19, 2003 (Inception) through September 30, 2010
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Common Shares
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Amount
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Additional Paid-in Capital
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Deficit
Accumulated
During the
Development
Stage
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Total Stockholders’ Equity
(Deficit)
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||||||||||||||||
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September 23, 2009 (Inception)
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100,000 | $ | 100 | $ | - | $ | - | $ | 100 | |||||||||||
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Net loss
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(1,050 | ) | (1,050 | ) | ||||||||||||||||
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Balance, December 31, 2003
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100,000 | 100 | - | (1,050 | ) | (950 | ) | |||||||||||||
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Net loss
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(1,250 | ) | (1,250 | ) | ||||||||||||||||
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Balance, December 31, 2004
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100,000 | 100 | - | (2,300 | ) | (2,200 | ) | |||||||||||||
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Net loss
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(1,650 | ) | (1,650 | ) | ||||||||||||||||
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Balance, December 31, 2005
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100,000 | 100 | - | (3,950 | ) | (3,850 | ) | |||||||||||||
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Net loss
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(1,800 | ) | (1,800 | ) | ||||||||||||||||
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Balance, December 31, 2006
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100,000 | 100 | - | (5,750 | ) | (5,650 | ) | |||||||||||||
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Net loss
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(2,250 | ) | (2,250 | ) | ||||||||||||||||
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Balance, December 31, 2007
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100,000 | 100 | - | (8,000 | ) | (7,900 | ) | |||||||||||||
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Net loss
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(3,250 | ) | (3,250 | ) | ||||||||||||||||
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Balance, December 31, 2008
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100,000 | 100 | - | (11,250 | ) | (11,150 | ) | |||||||||||||
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Net loss
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(3,250 | ) | (3,250 | ) | ||||||||||||||||
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Balance, December 31, 2009
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100,000 | 100 | - | (14,500 | ) | (14,400 | ) | |||||||||||||
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Accrued expenses paid by
Stockholder
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12,650 | - | 12,650 | |||||||||||||||||
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Stock issued for compensation
at $0.05 per share on
January 5, 2010
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3,310,000 | 3,310 | 162,190 | - | 165,500 | |||||||||||||||
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Sale of common stock at $0.05
per share on February 16, 2010
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1,230,000 | 1,230 | 60,270 | - | 61,500 | |||||||||||||||
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Sale of common stock at $0.05
per share on June 14, 2010
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25,000,000 | 25,000 | 1,225,000 | - | 1,250,000 | |||||||||||||||
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Net loss
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(1,443,223 | ) | (1,443,223 | ) | ||||||||||||||||
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Balance, September 30, 2010
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29,640,000 | $ | 29,640 | $ | 1,460,110 | $ | (1,457,723 | ) | $ | 32,027 | ||||||||||
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See accompanying notes to the financial statements.
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||||||||||||||||||||
F-5
ACE CONSULTING MANAGEMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Cash Flows
(Unaudited)
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Nine
Months
ended
September 30, 2010
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Nine
Months
ended
September 30, 2009
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Period from
September 19,
2003 (Inception)
through
September 30,
2010
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||||||||||
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Cash Flows From Operating Activities:
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||||||||||||
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Net loss
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$ | (1,443,223 | ) | $ | (1,500 | ) | $ | (1,457,723 | ) | |||
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Adjustments to reconcile net loss to net cash used in operating activities:
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||||||||||||
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Stock based compensation
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1,415,500 | - | 1,415,600 | |||||||||
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Changes in operating assets and liabilities:
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||||||||||||
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Accrued expenses
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(13,375 | ) | 1,500 | 1,025 | ||||||||
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Net cash used in operating activities
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(41,098 | ) | - | (41,098 | ) | |||||||
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Cash Flows From Financing Activities:
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||||||||||||
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Payment of accrued expenses by
stockholder
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12,650 | - | 12,650 | |||||||||
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Proceeds from sale of common stock
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61,500 | - | 61,500 | |||||||||
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Net cash provided by financing activities
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74,150 | - | 74,150 | |||||||||
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Net increase in cash
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33,052 | - | 33,052 | |||||||||
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Cash at beginning of period
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- | - | - | |||||||||
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Cash at end of period
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$ | 33,052 | $ | - | $ | 33,052 | ||||||
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Supplemental disclosures of cash flow
information
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||||||||||||
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Interest paid
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$ | - | $ | - | $ | - | ||||||
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Income tax paid
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$ | - | $ | - | $ | - | ||||||
See accompanying notes to financial statements.
F-6
ACE CONSULTING MANAGEMENT, INC.
(A DEVELOPMENT STAGE COMPANY)
September 30, 2010 and 2009
NOTES TO THE FINANCIAL STATEMENTS
(UNAUDITED)
1. Organization and Operations
ACE Consulting Management, Inc. (“the Company”), a development stage company, was incorporated on September 19, 2003 under the laws of the State of Delaware. Initial operations have included organization and incorporation, target market identification, new product development, marketing plans, and capital formation. A substantial portion of the Company’s activities has involved developing a business plan and establishing contacts and visibility in the marketplace. The Company has generated minimal revenues since inception. The Company plans to engage in consulting to corporations to improve growth strategies, performance enhancement and maximization of shareholder value.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited interim financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These financial statements should be read in conjunction with the financial statements of the Company for the year ended December 31, 2009 and notes thereto contained in the Company’s Annual Report on Form 10-K as filed with the SEC on February 11, 2010.
Development Stage Company
The Company is a development stage company as defined by section 810-10-20 of the FASB Accounting Standards Codification. The Company is still devoting substantially all of its efforts on establishing the business and its planned principal operations have not commenced. All losses accumulated since inception have been considered as part of the Company’s exploration stage activities.
Reclassification
Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported losses.
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 disclosures of contingent assets and liabilities as of the date of the financial statements and reporting period. Accordingly, actual results could differ from those estimates.
Cash and Cash Equivalents
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The company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.
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F-7
Fair Value of Financial Instruments
U.S. GAAP for fair value measurements establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three levels. The fair value hierarchy gives the highest priority to quoted market prices (unadjusted) in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 inputs are inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.
The carrying amounts of the Company’s financial assets and liabilities, such as cash and accrued expenses approximate their fair values because of the short maturity of these instruments.
The Company does not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis, consequently, the Company did not have any fair value adjustments for assets and liabilities measured at fair value at September 30, 2010 and December 31, 2009, nor gains or losses are reported in the statement of operations that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date for the interim periods ended September 30, 2010, 2009 or for the period from September 19, 2003 (inception) through September 30, 2010.
Revenue Recognition
The Company applies paragraph 605-10-S99-1 of the FASB Accounting Standards Codification for revenue recognition. The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.
Income Taxes
The Company follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Operations in the period that includes the enactment date.
The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (“Section 740-10-25”). Section 740-10-25.addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25.
Net Loss Per Common Share
Net loss per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. There were no potentially dilutive shares outstanding as of September 30, 2010 and 2009 or for the period from September 19, 2003 (inception) through September 30, 2010.
F-8
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Commitments and contingencies
|
|
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The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.
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Cash flows reporting
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The Company adopted paragraph 230-10-45-24 of the FASB Accounting Standards Codification for cash flows reporting, classifies cash receipts and payments according to whether they stem from operating, investing, or financing activities and provides definitions of each category, and uses the indirect or reconciliation method (“Indirect method”) as defined by paragraph 230-10-45-25 of the FASB Accounting Standards Codification to report net cash flow from operating activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects of (a) all deferrals of past operating cash receipts and payments and all accruals of expected future operating cash receipts and payments and (b) all items that are included in net income that do not affect operating cash receipts and payments. The Company reports the reporting currency equivalent of foreign currency cash flows, using the current exchange rate at the time of the cash flows and the effect of exchange rate changes on cash held in foreign currencies is reported as a separate item in the reconciliation of beginning and ending balances of cash and cash equivalents and separately provides information about investing and financing activities not resulting in cash receipts or payments in the period pursuant to paragraph 830-230-45-1 of the FASB Accounting Standards Codification.
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Subsequent events
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The Company follows the guidance in Section 855-10-50 of the FASB Accounting Standards Codification for the disclosure of subsequent events. The Company will evaluate subsequent events through the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company as an SEC filer considers its financial statements issued when they are widely distributed to users, such as through filing them on EDGAR.
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Recently issued accounting pronouncements
In January 2010, the FASB issued the FASB Accounting Standards Update No. 2010-01 “Equity Topic 505 – Accounting for Distributions to Shareholders with Components of Stock and Cash”, which clarify that the stock portion of a distribution to shareholders that allows them to elect to receive cash or stock with a potential limitation on the total amount of cash that all shareholders can elect to receive in the aggregate is considered a share issuance that is reflected in EPS prospectively and is not a stock dividend for purposes of applying Topics 505 and 260 (Equity and Earnings Per Share (“EPS”)). Those distributions should be accounted for and included in EPS calculations in accordance with paragraphs 480-10-25- 14 and 260-10-45-45 through 45-47 of the FASB Accounting Standards codification. The amendments in this Update also provide a technical correction to the Accounting Standards Codification. The correction moves guidance that was previously included in the Overview and Background Section to the definition of a stock dividend in the Master Glossary. That guidance indicates that a stock dividend takes nothing from the property of the corporation and adds nothing to the interests of the stockholders. It also indicates that the proportional interest of each shareholder remains the same, and is a key factor to consider in determining whether a distribution is a stock dividend.
In January 2010, the FASB issued the FASB Accounting Standards Update No. 2010-02 “Consolidation Topic 810 – Accounting and Reporting for Decreases in Ownership of a Subsidiary – a Scope Clarification”, which provides amendments to Subtopic 810-10 and related guidance within U.S. GAAP to clarify that the scope of the decrease in ownership provisions of the Subtopic and related guidance applies to the following:
1. A subsidiary or group of assets that is a business or nonprofit activity
2. A subsidiary that is a business or nonprofit activity that is transferred to an equity method investee or joint venture
3. An exchange of a group of assets that constitutes a business or nonprofit activity for a non-controlling interest in an entity (including an equity method investee or joint venture).
F-9
The amendments in this Update also clarify that the decrease in ownership guidance in Subtopic 810-10 does not apply to the following transactions even if they involve businesses:
1. Sales of in substance real estate. Entities should apply the sale of real estate guidance in Subtopics 360-20 (Property, Plant, and Equipment) and 976-605 (Retail/Land) to such transactions.
2. Conveyances of oil and gas mineral rights. Entities should apply the mineral property conveyance and related transactions guidance in Subtopic 932-360 (Oil and Gas-Property, Plant, and Equipment) to such transactions.
If a decrease in ownership occurs in a subsidiary that is not a business or nonprofit activity, an entity first needs to consider whether the substance of the transaction causing the decrease in ownership is addressed in other U.S. GAAP, such as transfers of financial assets, revenue recognition, exchanges of nonmonetary assets, sales of in substance real estate, or conveyances of oil and gas mineral rights, and apply that guidance as applicable. If no other guidance exists, an entity should apply the guidance in Subtopic 810-10.
In January 2010, the FASB issued the FASB Accounting Standards Update No. 2010-06 “Fair Value Measurements and Disclosures (Topic 820) Improving Disclosures about Fair Value Measurements”, which provides amendments to Subtopic 820-10 that require new disclosures as follows:
1. Transfers in and out of Levels 1 and 2. A reporting entity should disclose separately the amounts of significant transfers in and out of Level 1 and Level 2 fair value measurements and describe the reasons for the transfers.
2. Activity in Level 3 fair value measurements. In the reconciliation for fair value measurements using significant unobservable inputs (Level 3), a reporting entity should present separately information about purchases, sales, issuances, and settlements (that is, on a gross basis rather than as one net number).
This Update provides amendments to Subtopic 820-10 that clarify existing disclosures as follows:
1. Level of disaggregation. A reporting entity should provide fair value measurement disclosures for each class of assets and liabilities. A class is often a subset of assets or liabilities within a line item in the statement of financial position. A reporting entity needs to use judgment in determining the appropriate classes of assets and liabilities.
2. Disclosures about inputs and valuation techniques. A reporting entity should provide disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements. Those disclosures are required for fair value measurements that fall in either Level 2 or Level 3.
This Update also includes conforming amendments to the guidance on employers' disclosures about postretirement benefit plan assets (Subtopic 715-20). The conforming amendments to Subtopic 715-20 change the terminology from major categories of assets to classes of assets and provide a cross reference to the guidance in Subtopic 820-10 on how to determine appropriate classes to present fair value disclosures. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years.
In February 2010, the FASB issued the FASB Accounting Standards Update No. 2010-09 “Subsequent Events (Topic 855) Amendments to Certain Recognition and Disclosure Requirements”, which provides amendments to Subtopic 855-10 as follows:
1. An entity that either (a) is an SEC filer or(b) is a conduit bond obligor for conduit debt securities that are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local or regional markets) is required to evaluate subsequent events through the date that the financial statements are issued. If an entity meets neither of those criteria, then it should evaluate subsequent events through the date the financial statements are available to be issued.
2. An entity that is an SEC filer is not required to disclose the date through which subsequent events have been evaluated. This change alleviates potential conflicts between Subtopic 855-10 and the SEC's requirements.
3. The scope of the reissuance disclosure requirements is refined to include revised financial statements only. The term revised financial statements is added to the glossary of Topic 855. Revised financial statements include financial statements revised either as a result of correction of an error or retrospective application of U.S. generally accepted accounting principles.
F-10
All of the amendments in this Update are effective upon issuance of the final Update, except for the use of the issued date for conduit debt obligors. That amendment is effective for interim or annual periods ending after June 15, 2010.
In April 2010, the FASB issued the FASB Accounting Standards Update No. 2010-17 “Revenue Recognition — Milestone Method (Topic 605) Milestone Method of Revenue Recognition”, which provides guidance on the criteria that should be met for determining whether the milestone method of revenue recognition is appropriate. A vendor can recognize consideration that is contingent upon achievement of a milestone in its entirety as revenue in the period in which the milestone is achieved only if the milestone meets all criteria to be considered substantive.
Determining whether a milestone is substantive is a matter of judgment made at the inception of the arrangement. The following criteria must be met for a milestone to be considered substantive. The consideration earned by achieving the milestone should:
1. Be commensurate with either of the following:
a. The vendor's performance to achieve the milestone
b. The enhancement of the value of the item delivered as a result of a specific outcome resulting from the vendor's performance to achieve the milestone
2. Relate solely to past performance
3. Be reasonable relative to all deliverables and payment terms in the arrangement.
A milestone should be considered substantive in its entirety. An individual milestone may not be bifurcated. An arrangement may include more than one milestone, and each milestone should be evaluated separately to determine whether the milestone is substantive. Accordingly, an arrangement may contain both substantive and nonsubstantive milestones.
A vendor's decision to use the milestone method of revenue recognition for transactions within the scope of the amendments in this Update is a policy election. Other proportional revenue recognition methods also may be applied as long as the application of those other methods does not result in the recognition of consideration in its entirety in the period the milestone is achieved.
A vendor that is affected by the amendments in this Update is required to provide all of the following disclosures:
1. A description of the overall arrangement
2. A description of each milestone and related contingent consideration
3. A determination of whether each milestone is considered substantive
4. The factors that the entity considered in determining whether the milestone or milestones are substantive
5. The amount of consideration recognized during the period for the milestone or milestones.
The amendments in this Update are effective on a prospective basis for milestones achieved in fiscal years, and interim periods within those years, beginning on or after June 15, 2010. Early adoption is permitted. If a vendor elects early adoption and the period of adoption is not the beginning of the entity's fiscal year, the entity should apply the amendments retrospectively from the beginning of the year of adoption. Additionally, a vendor electing early adoption should disclose the following information at a minimum for all previously reported interim periods in the fiscal year of adoption:
1. Revenue
2. Income before income taxes
3. Net income
4. Earnings per share
5. The effect of the change for the captions presented.
A vendor may elect, but is not required, to adopt the amendments in this Update retrospectively for all prior periods.
Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements.
F-11
3. GOING CONCERN
The accompanying financial statements have been prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. At September 30, 2010, the Company has a deficit accumulated during the development stage of $1,457,723 and had a net loss of $1,443,223 and net cash used in operating activities of $41,098 for the interim period then ended, respectively.
While the Company is attempting to generate sufficient revenues, the Company’s cash position may not be enough to support the Company’s daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate sufficient revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to increase revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate sufficient revenues.
The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
4. STOCKHOLDERS’ EQUITY
Common stock includes 50,000,000 shares authorized at a par value of $0.001, of which 100,000 have been issued to its Chief Executive Officer at their par value of $0.001 per share or $100 for compensation at inception on September 19, 2003.
On January 5, 2010, the Company authorized the issuance of 3,310,000 shares of its common stock for compensation at $0.05 per share for a total of $165,500.
On February 16, 2010, the Company sold 1,230,000 shares of its common stock at $0.05 per share to 69 individuals for a total of $61,500.
On June 14, 2010, the Company authorized the issuance of 25,000,000 shares of its common stock for compensation at $0.05 per share for a total of $1,250,000.
5. RELATED PARTY TRANSACTIONS
During the six months ended June 30, 2010, a stockholder of the Company paid professional fees on behalf of the Company aggregating $12,650. Such payment has been shown as a contribution to capital and included in additional paid-in capital.
The Company is provided the office space by an officer of the Company without cost. The management determined that such cost is nominal and did not recognize rent expense in its financial statements.
6. SUBSEQUENT EVENTS
Management has evaluated all events that occurred after the balance sheet date through the date when these financial statements were issued to determine if they must be reported. The Management of the Company has determined that there were no reportable subsequent events to be disclosed.
F-12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information contained in Item 2 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.
Plan of Operation
We have commenced limited operations and will require additional capital to recruit personnel to operate business and to implement our business plan.
We seek to become a bridge between China and US, with our business back ground and extensive knowledge we can assist China company to acquire U.S. technology in equipments to facilitate and implement their existing business in China. Currently we have consulting revenues from Hero International USA Holding Corp and Vivid Spa Corp. Hero International USA Corp is in the dietary food business, they have plan to import raw materials from China to produce quality products in in U.S. based factory and marketing its products in the US. Vivid Spa Corp is a company specializing in health care specifically skin care and massage therapy. We are assisting them to open a Spa in Shanghai & Beijing to introduce U.S. made products including essential oils and aroma formula therapy in China. Our current business is generated through referrals. We plan to have initiate marketing efforts through a variety of venues for our future business including trade association, chamber of commerce and alumni associations.
Results of Operation
For the nine months ended September 30, 2010, we had $8,000 in consulting revenue. Expenses for the period ended September 30, 2010 totaled $1,451,223 resulting in a net loss of $1,443,223. Expenses for the period ended September 30, 2009 totaled $1,500. Expenses for the period ended September 30, 2010 consisted of $33,283 in professional fees, $1,415,500 for stock compensation to individuals who assisted us during the nine months ended September 30, 2010 and $2,440 for general and administrative expenses.
Liquidity and Capital Resources
At September 30, 2010 the Company had $33,052 in cash and will rely upon the issuance of common stock and additional capital contributions from shareholders to fund administrative expenses planned business strategy
As reflected in the accompanying condensed financial statements, the Company is in the development stage with minimal operations, has net cash used in operations from inception of $41,098 and has a net loss since inception of $1,457,723. 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.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not required for Smaller Reporting Companies.
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Item 4T. Controls and Procedures
a) Evaluation of Disclosure Controls. Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) (the Company’s principal financial and accounting officer), of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures are not effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.
The company has limited resources and as a result, a material weakness in financial reporting currently exists. Those weaknesses include: Lack of Effective Corporate Governance Policies and Procedures. We do not have effective policies regarding the independence of or directors and do not have independent directors. The lack of independent directors means that there is no effective review, authorization, or oversight of management or management’s actions by persons that were not involved in approving or executing those actions. We have no conflicts of interest policies and there is no provision for the review and approval of transactions between the Company and interested members of management.
Lack of Effective Policies Regarding the General Accounting System. We do not have any documented processes for the input, accumulation, or testing of financial data that would provide assurance that all transactions are accurately and timely recorded or that the financial reports will be prepared on a periodic basis.
Management has determined that the Company does not have the financial resources or personnel to address any of the material weaknesses identified or to conduct a more robust evaluation of its controls. As resources become available, management will develop and implement remedial actions to address the material weaknesses it has identified.
A material weakness is a deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB Auditing Standard 5) or combination of deficiencies in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis. Management has determined that a material weakness exists due to a lack of segregation of duties, resulting from the Company's limited resources.
(b) Changes in internal control over financial reporting. There have been no changes in our internal control over financial reporting that occurred during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
Item 1A. Risk Factors
None
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None
Item 3. Defaults Upon Senior Securities
None
Item 4. (Removed and Reserved)
None
Item 5. Other Information
None
Item 6. Exhibits
(a) Exhibits
31.1 Certifications pursuant to Section 302 of Sarbanes Oxley Act of 2002
32.1 Certifications pursuant to Section 906 of Sarbanes Oxley Act of 2002
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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ACE CONSULTING MANAGEMENT, INC.
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Date: November 8, 2010
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By:
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/s/ Alex Jen
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Chief Executive Officer
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Chief Financial Officer
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