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ALARMING DEVICES, INC.

(A Development Stage Enterprise)

NOTES TO THE UNAUDITED FINANCIAL STATEMENTS

May 31, 2011

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Alarming Devices, Inc. (“Company”) is in the initial development stage and has incurred losses since inception totaling $59,367.  The Company was incorporated on July 22, 2008 in the State of Nevada and established a fiscal year end of August.  The Company is a development stage company and intends to import from China and supply a reliable and affordable home and commercial wireless alarm system.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Statements

The accompanying interim unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months period ended May 31, 2011 and 2010 are not necessarily indicative of the results that may be expected for the year ending August 31, 2011. For further information, refer to the financial statements and footnotes thereto included in our Form 10-K Report for the fiscal year ended August 31, 2010.

Basis of Presentation

The financial statements present the balance sheet, statements of operations, stockholders' equity (deficit) and cash flows of the Company. These financial statements are presented in United States dollars and have been prepared in accordance with accounting principles generally accepted in the United States.

Advertising

Advertising costs are expensed as incurred.  As of May 31, 2011, no advertising costs have been incurred.

Property

The Company does not own or rent any property.  The office space is provided by the president (or a director or whoever) at no charge.

Use of Estimates and Assumptions

Preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.

Income Taxes

The Company follows the liability method of accounting for income taxes in accordance with Statements of Financial Accounting Standards FASB ASC 740, "Accounting for Income Taxes." Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those 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 income in the period that includes the date of enactment or substantive enactment.

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ALARMING DEVICES, INC.

(A Development Stage Enterprise)

NOTES TO THE UNAUDITED FINANCIAL STATEMENTS

May 31, 2011

Net Loss per Share

Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of May 31, 2011.

Recent Accounting Pronouncements

In June 2009, the FASB issued guidance now codified as ASC 105, Generally Accepted Accounting Principles as the single source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with U.S. GAAP, aside from those issued by the SEC. ASC 105 does not change current U.S. GAAP, but is intended to simplify user access to all authoritative U.S. GAAP by providing all authoritative literature related to a particular topic in one place.  The adoption of ASC 105 did not have a material impact on the Company’s financial statements, but did eliminate all references to pre-codification standards.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

In June 2009, the FASB issued guidance now codified as ASC 105, Generally Accepted Accounting Principles as the single source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with U.S. GAAP, aside from those issued by the SEC. ASC 105 does not change current U.S. GAAP, but is intended to simplify user access to all authoritative U.S. GAAP by providing all authoritative literature related to a particular topic in one place.

The adoption of ASC 105 did not have a material impact on the Company’s financial statements, but did eliminate all references to pre-codification standards.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

NOTE 3 – GOING CONCERN

The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern.  This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has a working capital deficit of $44,167, an accumulated deficit of $59,367 and net loss from operations since inception of $59,367. The Company does not have a source of revenue sufficient to cover its operation costs giving substantial doubt for it to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company.  There can be no assurance that the Company will be successful in either situation in order to continue as a going concern.  

The Company is funding its initial operations by way of issuing Founder’s shares.

As of May 31, 2011, the Company had issued 5,000,000 Founder’s shares at $0.001 per share for net funds to the Company of $5,000 and 340,000 common shares at$0.03 per share for net funds received of $10,200.

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ALARMING DEVICES, INC.

(A Development Stage Enterprise)

NOTES TO THE UNAUDITED FINANCIAL STATEMENTS

May 31, 2011

NOTE 3 – GOING CONCERN (continued)

The officers and directors have committed to advancing certain operating costs of the Company, including Legal, Audit, Transfer Agency and Edgarizing costs

NOTE 4 - FAIR VALUE OF FINANCIAL INSTRUMENTS

In accordance with the requirements of ASC 825 and ASC 820, the Company has determined the estimated fair value of financial instruments using available market information and appropriate valuation methodologies.  The fair value of financial instruments classified as current assets or liabilities approximate their carrying value due to the short-term maturity of the instruments.

NOTE 5 – CAPITAL STOCK

The Company’s capitalization is 75,000,000 common shares with a par value of $0.001 per share.  No preferred shares have been authorized or issued.

As of May 31, 2011, the Company has not granted any stock options and has not recorded any stock-based compensation.

On August 11, 2008, the Company issued 5,000,000 shares of the common stock in the Company at $0.001 per share for $5,000 to the director of the Company.

During December 2009, the Company issued 340,000 shares of Common stock in the Company at $0.03 per shares for $10,200.

As of May 31, 2011 the Company had 5,340,000 shares of common stock issued and outstanding.

NOTE 6 – LOAN PAYABLE – RELATED PARTY LOANS

The Company has received $24,868 as a loan from a Director. The loan is payable on demand and without interest.

NOTE 7 – INCOME TAXES

We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. Accounting for Uncertainty in Income Taxes when it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit.  We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry forwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry forward period.

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ALARMING DEVICES, INC.

(A Development Stage Enterprise)

NOTES TO THE UNAUDITED FINANCIAL STATEMENTS

May 31, 2011

NOTE 7 – INCOME TAXES

The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of May 31, 2011 are as follows:

The net federal operating loss carry forward will expire between 2027 and 2028.  This carry forward may be limited upon the consummation of a business combination under IRC Section 381.

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Item 2. Management`s Discussion and Analysis of Financial Condition and Results of Operations

This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance.  Forward looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions or words which, by their nature, refer to future events.  You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report.  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.

Overview

Alarming Devices, Inc. ("Alarming Devices", "the Company", “our” or "we") was incorporated in the State of Nevada as a for-profit company on July 22, 2008. We are a development stage company that intends to import from China and supply a reliable and affordable home and commercial wireless alarm system to resellers and distributors in North America. The company will import and distribute through certified resellers that will install and provide end user support. The company will also allow resellers to customer label the products so they could have the opportunity to create their own “house” brand. The Company would import and hold products with a shipping agent that would pick and ship for the company contractually to help control fixed costs.

The Company intends to seek a master distributor in North America who already supplies the alarm industry. The Master Distributor will have exclusive reseller rights throughout the territory; product manufactured specifically for Alarming Devices will be shipped directly from the manufacturer to the master distributor.

Plan of Operation

The Company has not yet generated any revenue from its operations.  As of May 31, 2011 we had $188 of cash on hand. We incurred operating expenses in the amount of $59,367 since July 22, 2008 to May 31, 2011. These operating expenses were comprised of professional fees and office and general expenses.

Our current cash holdings will not satisfy our liquidity requirements and we will require additional financing to pursue our planned business activities.  We have registered 2,000,000 of or our common stock for sale to the public.  Our registration statement became effective on November 30, 2009 and we are in the process of seeking equity financing to fund our operations over the next 12 months.  

Management believes that if subsequent private placements are successful, we will generate sales revenue within the following twelve months thereof. However, additional equity financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements.

If Alarming Devices is unsuccessful in raising the additional proceeds through a private placement offering it will then have to seek additional funds through debt financing, which would be very difficult for a new development stage company to secure. Therefore, the company is highly dependent upon the success of the anticipated private placement offering described herein and failure thereof would result in Alarming Devices having to seek capital from other resources such as debt financing, which may not even be available to the company. However, if such financing were available,

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because Alarming Devices is a development stage company with no operations to date, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing and determine whether the business could sustain operations and growth and manage the debt load. If Alarming Devices cannot raise additional proceeds via a private placement of its common stock or secure debt financing it would be required to cease business operations. As a result, investors in Alarming Devices common stock would lose all of their investment.

Our specific goal is to import and supply an affordable wireless alarm system.  We intend to accomplish the foregoing through the following milestones:

1.

Our president plans to begin secure a licensing/purchase agreement with a company that owns some proprietary radio technology that would become the backbone of the Company’s product line. Then the President would contact factories in China and then travel to negotiate prices, approve prototypes and do all the necessary arrangements. We expect to complete this step within 120 days after we have raised enough funds.

2.

We intend to search for a suitable location for storage, to order some of alarms and have them shipped from China and stored for future sales. Even though the Company would prefer to drop ship from our manufacturer in directly to our distributors the Company will have to store some inventory back up in case of manufacturing delays in China. We also intend to hire an outside web designer to develop our website. We expect to have our products in stock and our website ready within 300 days after we have raised enough funds.

3.

As soon as our website is operational, we will begin to market our product on TV commercials. Marketing is an ongoing matter that will continue during the life of our operations

In summary, we anticipate that we will be fully operational within 360 days after we have raised enough funds.

As of the date of this filing, Alarming Devices has not yet generated enough funds in order to start its plan of operations. We have not yet secured any private placement offering or debt financing.

The Company incurred a net loss of $4,838 for the three-month period ended May 31, 2011, compared with a net loss of $4,473 for the three month period ended May 31, 2010.

31.1

Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer

31.2

Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer *

32.1

Section 1350 Certification of Chief Executive Officer

32.2

Section 1350 Certification of Chief Financial Officer **

[1]     Incorporated by reference from the Company’s filing with the Commission on January 29, 2009.

*     Included in Exhibit 31.1

**    Included in Exhibit 32.1

SIGNATURES

Pursuant to the requirements of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ALARMING DEVICES, INC.

BY:       /s/ Andre Luiz Nascimento Moreira

 ----------------------

Andre Luiz Nascimento Moreira

President, Secretary Treasurer, Principal Executive Officer,

Principal Financial Officer

Dated:  July 15, 2011.

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