ETERNITY HEALTHCARE INC. - FORM 10-Q

Attached files

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EXCEL - IDEA: XBRL DOCUMENT - ETERNITY HEALTHCARE INC.	Financial_Report.xls
EX-32.1 - CERTIFICATION - ETERNITY HEALTHCARE INC.	f10q1011ex32i_eternity.htm
EX-31.1 - CERTIFICATION - ETERNITY HEALTHCARE INC.	f10q1011ex31i_eternity.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

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

For the quarterly period ended

October 31, 2011

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission File Number

333-172061

ETERNITY HEALTHCARE INC.

(Exact name of registrant as specified in its charter)

Nevada

75-3268426

(State or other jurisdiction of incorporation or organization)

(IRS Employer Identification No.)

409 Granville Street, Suite 1023, Vancouver, BC, Canada

V6C 1T2

(Address of principal executive offices)

(Zip Code)

(604) 324-4844

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, 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 Securities Exchange Act of 1934 during the preceding 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

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o

Accelerated filer o

Non-accelerated filer o

(Do not check if a smaller reporting company)

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.

YES

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

63,575,000 common shares issued and outstanding as of December 8, 2011.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION	3
Item 1. Financial Statements	3
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Forward-Looking Statements	11
Item 3. Quantitative and Qualitative Disclosures About Market Risk	16
Item 4. Controls and Procedures	16
PART II – OTHER INFORMATION	17
Item 1. Legal Proceedings	17
Item 1A. Risk Factors	17
Item 2. Unregistered Sales of Equity Securities	17
Item 3. Defaults Upon Senior Securities	17
Item 4. [Removed and Reserved]	17
Item 5. Other Information	17
Item 6. Exhibits	18
SIGNATURES	19

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

The following unaudited interim consolidated financial statements of Eternity Healthcare Inc. for the three and six month and periods ended October 31, 2011 are included with this Quarterly Report on Form 10-Q:

(a)	Interim Consolidated Balance Sheets as of October 31, 2011 and April 30, 2011;
(b)	Interim Consolidated Statements of Loss and Comprehensive Loss for the three and six months ended October 31, 2011 and October 31, 2010 and for the period from December 10, 2009 (Inception) through October 31, 2011.
(c)	Interim Consolidated Statements of Cash Flows for the six months ended October 31, 2011 and October 31, 2010 and for the period from December 10, 2009 (Inception) through October 31, 2011.
(d)	Interim Consolidated Statements of Changes in Stockholders’ Equity (Deficiency) since inception through October 31, 2011.
(e)	Notes to Interim Consolidated Financial Statements.

Eternity Healthcare Inc.

(formerly Kid’s Book Writer Inc.)

(A Development Stage Company)

CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

For the six months ended October 31, 2011

(Expressed in U.S. Dollars)

Eternity Healthcare Inc.

(formerly Kid’s Book Writer Inc.)

(A Development Stage Company)

CONSOLIDATED BALANCE SHEETS

(Expressed in U.S. Dollars)

	October 31, 2011			April 30, 2011
	(Unaudited)
ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	83,976		$	58,600
GST/HST receivable		2,297			-
Total Current Assets		86,273			58,600

PROPERTY AND EQUIPMENT		525			647

TOTAL ASSETS	$	86,798		$	59,247

LIABILITIES

CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	12,799		$	12,686
Due to related parties		275,898			197,416

Total Liabilities		288,697			210,102

STOCKHOLDERS’ DEFICIT

CAPITAL STOCK (Note 6)

Authorized
300,000,000 common shares, par value $0.001
Issued and outstanding
October 31, 2011 – 63,575,000 common shares
April 30, 2011 – 63,575,000 common shares		63,575			63,575
Additional paid-in capital		(86,073	)		(86,073	)
Accumulated other comprehensive gain		616			2,629
Deficit, accumulated during the development stage		(180,017	)		(130,986	)

Total Stockholders’ Deficit		(201,899	)		(150,855	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	86,798		$	59,247

The accompanying notes are an integral part of these consolidated financial statements.

Eternity Healthcare Inc.

(formerly Kid’s Book Writer Inc.)

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS

(Expressed in U.S. Dollars)

(Unaudited)

	For the three month period ended October 31, 2011			For the three month period ended October 31, 2010			For the six month period ended October 31, 2011			For the six month period ended October 31, 2010			From inception on December 10, 2009 through October 31, 2011

EXPENSES
Depreciation	$	61		$	-		$	126		$	-		$	206
General and administrative		5,855			-			10,472			209			30,776
Management fee		-			-			-			30,000			-
Professional fees		28,132			788			38,433			5,123			120,035
Research and development		-			-			-			-			29,000

NET LOSS FOR THE PERIOD	$	(34,048	)	$	(788	)	$	(49,031	)	$	(35,332	)	$	(180,017	)

COMPREHENSIVE LOSS
Net loss for the period		(34,048	)		(788	)		(49,031	)	$	(35,332	)	$	(180,017	)
Foreign currency translation adjustments		10,974			-			(2,013	)		-			616

COMPREHENSIVE LOSS FOR THE PERIOD	$	(23,074	)	$	(788	)	$	(51,044	)		(35,332	)		(179,401	)

NET LOSS PER SHARE – BASIC AND DILUTED	$	(0.00	)	$	(0.00	)	$	(0.00	)		(0.00	)

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING		63,575,000			60,000,000			63,575,000			60,000,000

The accompanying notes are an integral part of these consolidated financial statements.

Eternity Healthcare Inc.

(formerly Kid’s Book Writer Inc.)

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in U.S. Dollars)

(Unaudited)

	For the six month period ended October 31, 2011			For the six month period ended October 31, 2010			From inception on December 10, 2009 through October 31, 2011

OPERATING ACTIVITIES
Net (loss) income for the period	$	(49,031	)	$	(35,332	)	$	(180,017	)
Adjustments to reconcile net cash provided by operating activities:
Depreciation		126			-			206
Expenses paid on behalf of the Company by related parties		-			-			7,308
Changes in operating assets and liabilities:
Increase (decrease) in accounts payable and accrued liabilities		-			(2,200	)		11,758
Shares issued for services		-			30,000			-
Increase (decrease) in HST/GST receivable		(2,297	)		-			(2,297	)
Increase in due to related parties		-			7,533			-

Net cash used in operating activities		(51,202	)		1			(163,042	)

INVESTING ACTIVITIES Purchase of equipment		-			-			(727	)
Net cash used in investing activities		-			-			(727	)

FINANCING ACTIVITIES
Common shares issued for cash		-			-			380
Proceeds from related party payables		73,884			-			289,601
Repayments on related party payables		-			-			(31,673	)

Net cash provided by financing activities		73,884			-			258,308

EFFECT OF EXCHANGE RATE CHANGES ON CASH		2,694			-			(10,563	)

INCREASE IN CASH		25,376			1			83,976

CASH, beginning of period		58,600			-			-

CASH, end of period	$	83,976		$	1		$	83,976

The accompanying notes are an integral part of these consolidated financial statements.

Eternity Healthcare Inc.

(formerly Kid’s Book Writer Inc.)

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

(Expressed in U.S. Dollars)

	Shares		Amount ($0.001 par)		Additional paid-in capital			Accumulated OCI			Accumulated deficit			Total

Balance as at December 10, 2009 (inception)		-	$	-	$	-		$	-		$	-		$	-

Common shares issued for cash on December 10, 2009 (Notes 1 and 6)		60,000,000		60,000		(59,620	)		-			-			380

Currency translation adjustment		-		-		-			(914	)		-			(914	)

Net loss for the period ended April 30, 2010		-		-		-			-			(29,765	)		(29,765	)

Balance as at April 30, 2010		60,000,000		60,000		(59,620	)		(914	)		(29,765	)		(30,299	)

Recapitalization (Notes 1 and 6)		3,575,000		3,575		(26,453	)		-			-			(22,878	)

Currency translation adjustment		-		-		-			3,543			-			3,543

Net loss for the year ended April 30, 2011		-		-		-			-			(101,221	)		(101,221	)

Balance as at April 30, 2011		63,575,000		63,575		(86,073	)		2,629			(130,986	)		(150,855	)

Currency translation adjustment (Unaudited)		-		-		-			(2,013	)		-			(2,013	)

Net loss for the period (Unaudited)		-		-		-			-			(49,031	)		(49,031	)

Balance as at October 31, 2011 (Unaudited)		63,575,000	$	63,575	$	(86,073	)	$	616		$	(180,017	)	$	(201,899	)

The accompanying notes are an integral part of these consolidated financial statements.

Eternity Healthcare Inc.

(formerly Kid’s Book Writer Inc.)

(A Development Stage Company)

CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2011 and April 30, 2011

(Expressed in U.S. Dollars)

(Unaudited)

1.	CONDENSED FINANCIAL STATEMENTS

The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at October 31, 2011, and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's April 30, 2011 audited financial statements. The results of operations for the period ended October 31, 2011 and 2011 are not necessarily indicative of the operating results for the full year.

2.	GOING CONCERN

The Company's financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

3.	SIGNIFICANT ACCOUNTING POLICIES

Reclassification

Certain balances in previously issued financial statements have been reclassified to be consistent with the current period presentation.

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 disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Recent Accounting Pronouncements

The Company has evaluated recent accounting pronouncements and their adoption has not had or is not expected to have a material impact on the Company’s financial position or statements.

Basis of presentation

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and are expressed in U.S. dollars.

Eternity Healthcare Inc.

(formerly Kid’s Book Writer Inc.)

(A Development Stage Company)

CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2011 and April 30, 2011

(Expressed in U.S. Dollars)

(Unaudited)

3.	SIGNIFICANT ACCOUNTING POLICIES (Continued)

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Eternity BC. All significant intercompany balances and transactions have been eliminated in consolidation.

Cash and cash equivalents

Cash and cash equivalents include highly liquid investments with original maturities of three months or less.

Foreign currency translation

The Company’s functional currency is the Canadian dollar and reporting currency is the U.S. dollar. All transactions initiated in other currencies are translated into the reporting currency in accordance with ASC 830, “Foreign Currency Matters” as follows:

i)	Assets and liabilities at the rate of exchange in effect at the balance sheet date, and

ii)	Revenue and expense items at rate of exchange at the dates on which those elements are recognized.

Gains and losses on translation are included in other comprehensive income (loss) in stockholders’ deficiency for the period.

4.	DUE TO RELATED PARTIES AND RELATED PARTY TRANSACTIONS

As at October 31, 2011, $ 275,898 is payable to a related party of the Company related to operating expenses paid on behalf of the Company and cash advances provided to the Company (April 30, 2011 - $ 197,416). This balance is non-interest bearing, unsecured and has no fixed terms of repayment.

5.	SUBSEQUENT EVENTS

There are no subsequent events to be reported that occurred during the period from the period ended October 31, 2011 to the date the financial statements were available.

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

Forward-Looking Statements

This quarterly report on Form 10-Q and other reports filed by our company from time to time with the United States Securities and Exchange Commission (the “SEC”) contain or may contain forward-looking statements (collectively the “Filings”) and information that are based upon beliefs of, and information currently available to, our company’s management as well as estimates and assumptions made our company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the filings, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or the negative of these terms and similar expressions as they relate to our company or our company’s management identify forward-looking statements. Such statements reflect the current view of our company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors, including the risks contained in the “Risk Factors” section of our company’s Annual Report on Form 10-K for the fiscal year ended April 30, 2011, filed with the SEC, relating to our company’s industry, our company’s operations and plan of operations, and any businesses that our company may acquire. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, our company cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, our company does not intend to update any of the forward-looking statements to conform these statements to actual results.

Our interim consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the interim consolidated financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our interim consolidated financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result. The following discussion should be read in conjunction with our financial statements and notes thereto appearing elsewhere in this report.

In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars unless otherwise state. All references to “common stock” refer to the common shares in our capital stock.

As used in this quarterly report, the terms, “we”, “us”, “our” and “our company” refer to Eternity Healthcare Inc. and our wholly owned subsidiary Eternity Healthcare Inc., a British Columbia corporation, unless the context clearly requires or states otherwise.

General Overview

We were incorporated in the State of Nevada on October 24, 2007 as an online services company under the name Kid’s Book Writer, Inc. On September 23, 2010, we changed our name to Eternity Healthcare Inc., and we effected a reverse split of our issued and outstanding common stock on a 10 old shares for 1 new share basis. Our business offices are located at 409 Granville Street, Suite 1023, Vancouver, BC, V6C 1T2 and our telephone number is 604-324-4844.

From inception to December 13, 2010, we planned to develop a website for children to create their own books. We intended to offer a pure online service designed to offer children and parents an ability to create their own book. Customers were to be able to log on to the service, pick a theme (i.e. birthday, family outing, vacation, special occasion such as Christmas / Easter, sporting event, summer camp, etc.), and the software would offer several options, including various book templates, backgrounds, page sizes, the ability to write your own story or have some guidance, etc. We were unable to find sufficient financing for this business model.

On December 10, 2010 we entered into and completed a share exchange agreement with Eternity Healthcare Inc., a British Columbia corporation, wherein we acquired Eternity BC as our wholly owned subsidiary and abandoned our former business to focus on the operations of Eternity BC.

Our Current Business

We are a medical device company that, subject to government approval, plans to distribute in-home medical diagnostic kits throughout Canada. Since we have not yet been granted such approvals, we cannot currently offer any products. The products which we hope to distribute differ from other current offerings by allowing ordinary people to perform diagnostic testing on themselves with a high degree of accuracy and without the need for the use of professionals such as nurses and technicians.

On March 11, 2010, we entered into a license agreement with Valimedix Limited, a United Kingdom corporation, pursuant to which we were granted the right to market and distribute 15 unique self diagnostic products developed by Valimedix on an exclusive basis in Canada, and a on a non-exclusive basis in the United States. We also have the right to market the products with Valimedix SELFCheck trademark. As consideration, we paid Valimedix a one-time fee of $10,000 and agreed to a three percent royalty on net revenues from the sales of Valimedix products. The term of the agreement is for 20 years and may be renewed for an additional 10 years if we meet specified sales targets. During the 20 year term of this agreement we are required to purchase a minimum of $1,000,000 worth of products from Valimedix.

Over the next 12 months, we plan to obtain regulatory approvals for the products and enter into distribution agreements with various retailers. We plan to expand our website to include the option to purchase our products online. We anticipate producing promotional materials and advertising in medical journals as well as consumer magazines. In order to carry out these plans, we anticipate hiring a marketing manager, a quality control manager and 3 people for packaging and shipping. We will require approximately $500,000 in order to achieve these objectives and there can be no assurance that we will be able to raise the required funds.

Results of Operations for the Three and Six Months Ended October 31, 2011 and 2010

The following summary of our results of operations should be read in conjunction with our unaudited interim consolidated financial statements for the quarter ended October 31, 2011 which are included herein.

We have not generated any revenue since inception and are dependent upon obtaining financing to pursue our business activities. For these reasons, our auditors believe that there is substantial doubt that we will be able to continue as a going concern.

Our operating results for the three and six month periods ended October 31, 2011 and 2010 and the changes between those periods for the respective items are summarized as follows:

	Three Month Period Ended October 31, 2011			Three Month Period Ended October 31, 2010			Change Between Three Month Periods Ended October 31, 2011 and October 31, 2010
Revenue	$	Nil		$	Nil		$	Nil
Operating expenses	$	34,048		$	788		$	33,260
Net loss	$	(34,048	)	$	(788	)	$	(33,260	)

Our expenses increased during the three month period ended October 31, 2011 compared to the same period in 2010 primarily as a result of increased depreciation, general and administrative expenses and professional fees.

	Six Month Period Ended October 31, 2011			Six Month Period Ended October 31, 2010			Change Between Six Month Periods Ended October 31, 2011 and October 31, 2010
Revenue	$	Nil		$	Nil		$	Nil
Operating expenses	$	49,031		$	35,332		$	13,669
Net loss	$	(49,031	)	$	(35,332	)	$	(13,669	)

Our expenses increased during the six month period ended October 31, 2011 compared to the same period in 2010 primarily as a result of increased depreciation, general and administrative expenses and professional fees.

Revenues

We have not earned any revenues to date, and have incurred $180,017 in expenses from December 10, 2009 (date of inception) through October 31, 2011.

Expenses

Our expenses for the three months ended October 31, 2011 and 2010 and for the period from December 10, 2009 (inception) through October 31, 2011 are outlined in the table below:

	Three Month Period Ended October 31, 2011 ($)		Three Month Period Ended October 31, 2010 ($)		Six Month Period Ended October 31, 2011 ($)		Six Month Period Ended October 31, 2010 ($)		For the Period from December 10, 2009 (Inception) through October 31, 2011 ($)
Depreciation		61	Nil			126	Nil			206
General and administrative		5,855	Nil			10,472		209		30,776
Management fees	Nil		Nil		Nil			30,000	Nil
Professional fees		28,132		788		38,433		5,123		120,035
Research and development	Nil		Nil		Nil		Nil			29,000

Professional Fees

Professional fees include our accounting and auditing expenses incurred in connection with the preparation and audit of our financial statements and professional fees that we pay to our legal counsel. Our accounting and auditing expenses were incurred in connection with the preparation of our audited financial statements and unaudited interim consolidated financial statements and our preparation and filing of a registration statement with the SEC. Our legal expenses represent amounts paid to legal counsel in connection with our corporate organization.

Liquidity and Financial Condition

Working Capital

	At October 31, 2011 ($)			At April 31, 2011 ($)
Current Assets		86,273			58,600
Current Liabilities		288,697			210,102
Working Capital/(Deficit)		(202,424	)		(151,502	)

Cash Flows

	Six Months Ended October 31, 2011 ($)			Six Months Ended October 31, 2010 ($)		For the Period from December 10, 2009(Inception) through October 31, 2011 ($)
Cash Flows provided by/(used in) Operating Activities		(51,202	)		1		(163,042	)
Cash Flows provided by/(used in) Investing Activities	Nil			Nil		(727		)
Cash Flows provided by/(used in) Financing Activities		73,884			Nil		258,308
Net Increase (Decrease) in Cash During Period		25,376			1		83,976

As of October 31, 2011, our total assets were $86,798 and our total liabilities were $288,697 and we had a working capital deficit of $202,424. Our unaudited financial statements report a net loss of $34,048 for the three months ended October 31, 2011 compared to a net loss of $788 for the same period in 2010, a net loss of $49,031 for the six months ended October 31, 2011 compared to a net loss of $35,332 for the same period in 2010 and a net loss of $180,017 for the period from December 10, 2009 (inception) to October 31, 2011.

Plan of Operation

You should read the following discussion of our financial condition and results of operations together with our unaudited financial statements and the notes thereto included elsewhere in this filing. Our unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States. This discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those anticipated in these forward-looking statements.

Anticipated Cash Requirements

We estimate that our expenses over the next 12 months will be approximately $500,000 as described in the table below. These estimates may change significantly depending on the nature of our future business activities and our ability to raise capital from shareholders or other sources.

Description	Estimated Completion Date	Estimated Expenses ($)
Legal and accounting fees	12 months		100,000
Marketing and advertising	12 months		50,000
Management and operating costs	12 months		100,000
Salaries and consulting fees	12 months		200,000
Fixed asset purchases	12 months		30,000
General and administrative expenses	12 months		20,000
Total			500,000

We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financing by way of private placements. We currently do not have any arrangements in place to complete any private placement financings and there is no assurance that we will be successful in completing any such financings on terms that will be acceptable to us.

Going Concern

The interim consolidated financial statements accompanying this report have been prepared on a going concern basis, which implies that our company will continue to realize its assets and discharge its liabilities and commitments in the normal course of business. Our company has not generated revenues since inception and has never paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or foreseeable future. The continuation of our company as a going concern is dependent upon the continued financial support from our shareholders, the ability of our company to obtain necessary equity financing to achieve our operating objectives, and the attainment of profitable operations. As of October 31, 2011, our company has accumulated losses of $180,017 since inception. We do not have sufficient working capital to enable us to carry out our stated plan of operation for the next twelve months. These interim consolidated 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 our company be unable to continue as a going concern.

Our interim consolidated financial statements contain additional note disclosures describing the circumstances related to the uncertainty of our ability to continue as a going concern.

The continuation of our business is dependent upon us raising additional financial support. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

Future Financings

We anticipate continuing to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to our existing stockholders. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our planned activities.

Off-Balance Sheet Arrangements

We have no significant 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 stockholders.

Critical Accounting Policies

The interim consolidated financial statements of our company have been prepared in accordance with generally accepted accounting principles in the United States. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment.

Reclassification

Certain balances in previously issued financial statements have been reclassified to be consistent with the current period presentation.

Use of Estimates

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As a “small reporting company”, we are not required to provide the information required by this Item.

Item 4. Controls and Procedures

Management’s Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer (our principal executive officer and our principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.

As of the end of our quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer (our principal executive officer and our principal financial officer and principle accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our chief executive officer and chief financial officer (our principal executive officer and our principal financial officer and principle accounting officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report due to the material weaknesses in our internal controls over financial reporting identified in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on August 5, 2011.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended October 31, 2011 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 1A. Risk Factors

As a “small reporting company”, we are not required to provide the information required by this Item.

Item 2. Unregistered Sales of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. [Removed and Reserved]

Item 5. Other Information

None.

Item 6. Exhibits

Exhibit No.	Description
(2)	Plan of Acquisition, Reorganization, Arrangement, Liquidation or Succession

2.1	Share Exchange Agreement with Eternity Healthcare Inc. dated December 13, 2010 (Incorporated by reference to our Current Report on Form 8-K filed on December 17, 2010)

(3)	(i) Articles of Incorporation (ii) Bylaws

3.01	Articles of Incorporation of Eternity Healthcare Inc. (formerly Kid’s Book Writer Inc.) (Incorporated by reference to our Registration Statement on Form S-1 filed on June 25, 2008)

3.02	Bylaws of Eternity Healthcare Inc. (formerly Kid’s Book Writer Inc.) (Incorporated by reference to our Registration Statement on Form S-1 filed on June 25, 2008)

3.03	Certificate of Amendment (Incorporated by reference to our Current Report on Form 8-K filed on November 16, 2010)

10	Material Contracts

10.1	Licensing Agreement with ValiMedix Limited, dated March 11, 2010 (Incorporated by reference to our Current Report on Form 8-K filed on December 17, 2010)

21	Subsidiaries

21.1	Eternity Healthcare Inc., a British Columbia corporation

(31)	Rule 13a-14(a)/15d-14(a) Certification

31.1*	Section 302 Certification under Sarbanes-Oxley Act of 2002

(32)	Section 1350 Certification

32.1*	Section 906 Certification under Sarbanes Oxley Act of 2002

101**	Interactive Data File

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 Label Linkbase Document

101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

* Filed herewith

Furnished herewith. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of any registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise are not subject to liability under those sections.

SIGNATURES

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

	ETERNITY HEALTHCARE INC.


Date: December 12, 2011	/s/ Francine Salari
	Francine Salari
	President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer and Director
	(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

ETERNITY HEALTHCARE INC. - FORM 10-Q - December 12, 2011

Attached files

ETERNITY HEALTHCARE INC. Reports