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U.S. 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, 2011


[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Commission File No.333-153182


Great Wall Builders Ltd.,

(Exact name of registrant as specified in its charter)


Texas

71-1051037

(State or other jurisdiction

(I.R.S. Employer Identification No.)

of incorporation or organization)

 


1177 South US Highway

Vero Beach, FL 32962

(Address of principal executive offices)

 

(206) 337-8045

(Issuer's telephone number)

 

Indicate by checkmark whether the issuer: (1) has 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 past 90 days. Yes [X ] No[  ]

 

Indicate by check mark whether the registrant is a large accelerated filed, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

 

Large accelerated file

[  ]    

Accelerated filer

[  ]

Non-accelerated filer

[  ]

Small Reporting company

[X]


Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [x] No [  ]

 

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the most practicable date: 4,800,000 as of November 18, 2011.

 










GREAT WALL BUILDERS Ltd.


Form 10-Q Report Index



 

Page No.

PART 1. FINANCIAL INFORMATION

 

 

 

Item 1. Financial Statements

 

 

 

Condensed Balance Sheets

2

 

 

Condensed Statements of Operations

3

 

 

Condensed Statements of Cash Flows

4

 

 

Notes to Condensed Financial Statements

5-8

 

 

Item 2. Management Discussion and Analysis of Financial Condition

9

 

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk

11

 

 

Item 4. Control and Procedures

11

 

 

PART 11. OTHER INFORMATION

 

 

 

Item 1. Legal Proceedings

12

 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

12

 

 

Item 3. Defaults Upon Senior Securities

12

 

 

Item 4. Submission of Matters to a Vote of Securities Holders

12

 

 

Item 5. Other Information

12

 

 

Item 6. Exhibit

12

 

 

Item 7. Signature

13










PART 1: FINANCIAL STATEMENTS


Great Wall Builders Ltd.

(A Development Stage Company)

September 30, 2011

(unaudited)

Index



Condensed Balance Sheets

2


Condensed Statements of Operations

3


Condensed Statements of Cash Flows

4


Notes to the Financial Statements

6










GREAT WALL BUILDERS LTD.

(A Development Stage Company)

Balance Sheets

(Expressed in U.S. dollars)


 

 September 30,

 2011

(unaudited)

 $

 June 30,

 2011

 

 $

 

 

 

ASSETS

 

 

 

 

 

Cash

271

 

 

 

Total current assets

271

 

 

 

Property

37,500

 

 

 

Total Assets

37,771

 

 

 

LIABILITIES

 

 

 

 

 

Current Liabilities

 

 

 

 

 

Accounts payable and accrued liabilities

8,617

Loan from shareholder (Note 5)

39,550

Due to related parties (Note 4)

248,057

 

 

 

Total Liabilities

48,167

248,057

 

 

 

STOCKHOLDERS’ DEFICIT

 

 

 

 

 

Preferred Stock

 

 

Authorized: 98,989,886 preferred shares with a par value of $0.0001 per share

 

 

None issued and outstanding

 –

 –

 

 

 

Common Stock

 

 

Authorized: 918,816,988 common shares with a par value of $0.0001 per share

 

 

Issued and outstanding: 4,800,000 common shares

 480

 480

 

 

 

Additional Paid-In Capital

 63,020

 63,020

 

 

 

Accumulated Deficit during the Development Stage

(111,667)

(273,786)

 

 

 

Total Stockholders’ Deficit

(48,167)

(210,286)

 

 

 

Total Liabilities and Stockholders’ Deficit

37,771

 

 

 





(The accompanying notes are an integral part of these financial statements)


2



GREAT WALL BUILDERS LTD.

(A Development Stage Company)

Statements of Operations

(Expressed in U.S. dollars)

(unaudited)


 

For the Three Months Ended

September 30,

2011

$

For the Three Months Ended

September 30,

2010

$

Accumulated from the Period from November 3, 2007 (Date of Inception) to September 30,

2011

$

 




Revenues

61,860

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

General and administrative

11,438

2,950

55,986

Management fees

19,545

291,098

 

 

 

 

Total Operating Expenses

11,438

22,495

347,084

 

 

 

 

Net Loss before Other Income (Expense)

(11,438)

(22,495)

(285,224)

 

 

 

 

Other Income (Expense)

 

 

 

 

 

 

 

Gain on settlement of debt (Note 4)

173,557

173,557

 

 

 

 

Net Income (Loss)

162,119

(22,495)

(111,667)


Net Earnings (Loss) per Share – Basic and Diluted        


0.03


(0.01)

 


Weighted Average Shares Outstanding – Basic and Diluted             


4,800,000


4,800,000

 

 

 

 

 












(The accompanying notes are an integral part of these financial statements)


3



GREAT WALL BUILDERS LTD.

(A Development Stage Company)

Statements of Cash Flows

(Expressed in U.S. dollars)

(unaudited)


 

For the Three Months Ended

September 30,

2011

$

For the Three Months Ended

September 30,

2010

$

Accumulated from the Period from November 3, 2007 (Date of Inception) to June 30,

2011

$

 

 

 

 

 

Operating Activities

 

 

 

 

 

 

 

Net income (loss) for the year

162,119

(22,495)

(111,667)

 

 

 

 

Adjustments to net income (loss) relating to non-cash operating items:

 

 

 

Gain on settlement of debt

(173,557)

(173,557)

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

8,617

8,617

 

 

 

 

Net Cash Used In Operating Activities

(2,821)

(284)

(276,607)

 

 

 

 

Financing Activities:

 

 

 

 

 

 

 

Proceeds from issuance of common stock

26,000

Proceeds from loans from shareholders

39,550

 

39,550

  Due to related parties

(37,000)

22,221

211,057

 

 

 

 

Net Cash Provided By Financing Activities

2,550

276,607

 

 

 

 

Decrease in Cash

(271)

(284)

 

 

 

 

Cash – Beginning of Year

271

580

 

 

 

 

Cash – End of Year

296

 

 

 

 

 

 

 

 

Supplemental Disclosures

 

 

 

 

 

 

Interest paid

Income tax paid

 –

 

 

 

 

Supplemental Schedule of Noncash Investing Activities:

 

   Settlement of debt in transfer of properties

37,500

 

 


 


(The accompanying notes are an integral part of these financial statements)


4



GREAT WALL BUILDERS LTD.

(A Development Stage Company)

Notes to the Financial Statements

September 30, 2011



1.

Nature of Operations and Continuance of Business

Great Wall Builders Ltd. (the “Company”) was incorporated in the State of Texas on November 3, 2007.  The Company formerly provided homes with a solar integrated system in Texas, with the plans to expand to other parts of the United States and China. The Company has ceased those operations  and is now a development stage company, as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915, Development Stage Entities. The Company’s focus is towards identifying and pursuing the development of a new business plan and direction. No assurances can be given that the Company will be successful in identifying and developing a successful business plan.

Going Concern

These financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at September 30, 2011, the Company has a working capital deficit of $48,167 and an accumulated deficit of $111,667. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.  These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.  


2.

Summary of Significant Accounting Policies

a)

Basis of Presentation

The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is June 30.

b)   Use of Estimates

The preparation of financial statements in conformity with US GAAP 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. The Company regularly evaluates estimates and assumptions related to the deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

c)

Interim Financial Statements

These interim financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.

d)

Cash and cash equivalents

The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.  As at September 30 and June 30, 2011, the Company had no cash equivalents.



5



GREAT WALL BUILDERS LTD.

(A Development Stage Company)

Notes to the Financial Statements

September 30, 2011



2.

Summary of Significant Accounting Policies (continued)

e)

Revenue recognition

The Company is in the development stage and has yet to realize revenues from operations. The Company will recognize revenue from the sales of its homes in accordance ASC 605, Revenue Recognition. Revenue will be recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service has been provided, and collectability is assured.

f)

Basic and Diluted Net Loss per Share

The Company computes net loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.  As at September 30 and June 30, 2011, there were no potentially dilutive securities.  

g)   Financial Instruments

Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of cash, accounts payable and accrued liabilities, and loan from shareholder. Pursuant to ASC 820, the fair value of our cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.





6



GREAT WALL BUILDERS LTD.

(A Development Stage Company)

Notes to the Financial Statements

September 30, 2011



2.

Summary of Significant Accounting Policies (continued)

i)

Recent Accounting Pronouncements

In January 2010, the FASB issued an amendment to ASC 820, Fair Value Measurements and Disclosure, to require reporting entities to separately disclose the amounts and business rationale for significant transfers in and out of Level 1 and Level 2 fair value measurements and separately present information regarding purchase, sale, issuance, and settlement of Level 3 fair value measures on a gross basis.  This standard, for which the Company is currently assessing the impact, is effective for interim and annual reporting periods beginning after December 15, 2009 with the exception of disclosures regarding the purchase, sale, issuance, and settlement of Level 3 fair value measures which are effective for fiscal years beginning after December 15, 2010.  The adoption of this standard did not have a significant impact on the Company’s financial statements.  


In May 2011, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2011-04, “Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS” (“ASU 2011-04”). ASU 2011-04 redefines many of the requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements to ensure consistency between U.S. GAAP and IFRS. ASU 2011-04 also expands the disclosures for fair value measurements that are estimated using significant unobservable (Level 3) inputs. The Company determines that the adoption of this standard will not materially expand its consolidated financial statement footnote disclosures.


The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company 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.


3.

Property

 

 

Cost

$

 

Accumulated Amortization

$

 

Disposal

$

 

September 30, 2011

Net Carrying Value

$

 

June 30,

2011

Net Carrying Value

$

 

 

 

 

 

 

 

 

 

 

 

Residential property lots

 

37,500

 

 

(37,500)

 

 

37,500


4.

Related Party Transactions

a)

As at September 30, 2011, the Company owes $nil (June 30, 2011 - $248,057) to the former President and CEO of the Company. On August 2, 2011, the President and CEO of the Company and a director of the Company resigned.  As part of the release and settlement agreement, the Company settled amounts owing of $248,057, with a final cash payment of $37,000, a transfer of title to three residential lots with a value of $37,500, resulting in a gain on settlement of debt of $173,557.  

b)

During the three months ended September 30, 2011, the Company incurred $nil (2010 - $19,545) in management fees to the President and CEO of the Company.


5.

Loan from Shareholder

On August 3, 2011, the Company borrowed $39,550 from a shareholder. The Company used $37,000 from this financing to settle debt (Note 4). Under the terms of the loan, the amount owing is unsecured, non-interest bearing, and due on demand. As at September 30, 2011, the Company still owes $39,550.




7



GREAT WALL BUILDERS LTD.

(A Development Stage Company)

Notes to the Financial Statements

September 30, 2011



6.

Subsequent Events

In preparing these condensed financial statements, the Company has evaluated events and transactions for potential recognition or disclose through November 18, 2011, the date the condensed financial statements were available to be issued.






8





Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

COMPANY OVERVIEW AND BUSINESS OPERATIONS OVERVIEW

 

Great Wall Builders Ltd. (the “Company”) was incorporated in Texas on November 3, 2007, under the laws of the State of Texas to engage in any lawful corporate undertaking.  The Company was previously engaged in developing a business plan to build affordable homes in the USA.


The Company decided prior to its fiscal year ended June 30, 2011, to redirect its business focus towards identifying and pursuing options regarding the development of a new business plan and direction.  The Company is currently looking for ventures of merit for corporate participation as a means of enhancing stockholder value.  This may involve sales of our equity or debt securities in merger or acquisition transactions.  No such ventures have been identified as of the date of this quarterly report.


As of September 30, 2011, we had not generated any revenues.  We have been issued an opinion by our auditor that raises substantial doubt about our ability to continue as a going concern based on our current financial position.  Please refer to Note 1 of our financial statements.


RESULTS OF OPERATIONS


Working Capital


 

M

 

  

September 30,

June 30,

  

2011

$

2011

$

Current Assets

-

271

Current Liabilities

48,167

248,057

Working Capital (Deficit)

(48,167)

(247,786)



Cash Flows


 

 

 

  

Three months ended September 30,

2011

$

Three months ended September 30,

2010

$

 

 

 

 

 

 

 

 

 

Cash Flows from (used in) Operating Activities

(2,821)

(284)

Cash Flows from (used in) Financing Activities

2,550

-

Net Increase (decrease) in Cash During Period

(271)

(284)


Operating Revenues


We have not generated any revenues since inception.





9





Operating Expenses and Net Loss


Operating expenses for the three months ended September 30, 2011 were $11,438 compared with $22,495 for the three months ended September 30, 2010. The decrease is due to the fact that the Company did not have any management fees for the current year.


During the three months ended September 30, 2011, the Company recorded a net income of $162,119 compared with a net loss of $22,495 for the three months ended September 30, 2010.   During the three month period ended September 30, 2011, the Company settled $248,057 of amounts owing to the former management of the Company in exchange for cash payment of $37,000 and three residential property lots in the value of $37,500, which resulted in a gain on settlement of debt of $173,557.


Liquidity and Capital Resources


As at September 30, 2011, the Company’s cash and total assets was $nil compared to cash and total assets of $271 as at June 30, 2011. The decrease in cash and total assets was due to the fact that the Company incurred operating expenditures during the year and repaid/settled related party debts with payment of cash.  


As at September 30, 2011, the Company had total liabilities of $48,167 compared with total liabilities of $248,057 as at June 30, 2011. The decrease in total liabilities is attributed to the settlement of $248,057 of outstanding related party debt from former management with the payment and borrowing of $39,550 from a shareholder.  


Cashflow from Operating Activities


During the three months ended September 30, 2011, the Company incurred $2,821 of cash flows for operating activities compared with $284 of cash flows for operating activities during the three months ended September 30, 2010. Overall use of cash for operating activities was consistent as the Company had limited operating activities in both periods.    

 

Cashflow from Financing Activities


During the three months ended September 30, 2011, the Company received $2,550 from financing activities comprised of $39,550 from a shareholder loan offset by the payment of $37,000 to related parties.    


 

PLAN OF OPERATION AND FUNDING

 

We expect that working capital requirements will continue to be funded through a combination of our existing funds, advance from our officer and director, and further issuances of securities or debt. Our working capital requirements are expected to increase in line with the growth of our business.


Existing working capital, further advances from our officer and director, and anticipated cash flow are expected to be adequate to fund our operations over the next 12 months. We have no lines of credit or other bank financing arrangements.  Generally, we have financed operations to date through the proceeds of the private placement of equity and advance from officer and director.  In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to:


(i) acquisition of businesses or assets; (ii) professional fees relating to such acquisitions; (iii) international and domestic travel expenses (iv) other expenses related to being a public company.  




10





We intend to finance these expenses with further issuances of securities, advance from our officer and director and debt.  Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements.

 

OFF-BALANCE SHEET ARRANGEMENTS

 

As of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.


Item 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

We are a small reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information.

 

Item 4: CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

 

In connection with the preparation of this quarterly report, an evaluation was carried out by the Company management, with the participation of the chief executive officer and the chief financial officer, of the effectiveness of the Company disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act") as of March 31, 2011. Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission rules and forms, and that such information is accumulated and communicated to management, including the chief executive officer and the chief financial officer, to allow timely decisions regarding required disclosures.

 

Based on that evaluation, the Company management concluded, as of the end of the period covered by this report, that the Company disclosure controls and procedures were effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Commission rules and forms, and such information was accumulated and communicated to management, including the chief executive officer and the chief financial officer, to allow timely decisions regarding required disclosures.

 

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

 

Our management has evaluated whether any change in our internal control over financial reporting occurred during the last fiscal quarter. Based on that evaluation, management concluded that there has been no change in our internal control over financial reporting during the relevant period that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.






11





PART II. OTHER INFORMATION


Item 1: LEGAL PROCEEDINGS

 

We are not a party to any pending legal proceeding.  We are not aware of any pending legal proceeding to which any of our officers, directors of our voting securities are adverse to us or have a material interest adverse to us.


Item 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.


There were no unregistered sales of equity securities during the quarterly period ended September 30, 2011.


Item 3: DEFAULTS UPON SENIOR SECURITIES


None


Item 5: OTHER INFORMATION


None.

 

Item 6: EXHIBITS


Exhibit 31.

 Certification of Peter Evan Bell pursuant to rule 13a-14a.

 

Exhibit 32

Certification of Peter Evan bell pursuant to U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*

XBRL Instance Document


101.SCH*

XBRL Taxonomy Extension Schema Document


101.CAL*

XBRL Taxonomy Extension Calculation Linkbase Document


101.DEF*

XBRL Taxonomy Extension Definition Linkbase Document


101.LAB*

XBRL Taxonomy Extension Definition Linkbase Document


101.PRE*

XBRL Taxonomy Extension Defition Linkbase Document


*  XBRL Information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended and otherwise is not subject to liability under these sections.






12





SIGNATURES


In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.




Great Wall Builders Ltd.


/s/ Peter Evan Bell

By: Peter Evan Bell

Chief Executive Officer/Chief Financial Officer


November 18, 2011



Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated.




/s/ Peter Evan Bell

By Peter Evan Bell

Chief Executive Officer & Chief Financial Officer.


Date: November 18, 2011





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