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EX-32.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER, PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 - Sur Ventures, Inc.surventuersex321.htm
EX-31.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER, PURSUANT TO RULE 13A-14 AND 15D-14 OF THE SECURITIES EXCHANGE ACT OF 1934 - Sur Ventures, Inc.surventuresex311.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
 
x
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934:
For the quarterly period ended March 31, 2012
 
o
 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934:
For the transition period from ____to____
 
Commission File Number: 333-171141
 
  Sur Ventures, Inc.
(Exact name of registrant as specified in its charter)
 
Nevada
26-2292370
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
 
500 Newport Center Drive, Suite 800, Newport Beach, CA 92660
(Address of principal executive offices) (Zip Code)
 
(888) 532-5522
(Registrant’s telephone number, including area code)
   
 
Indicate by check mark 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. x Yes o No
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§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). x Yes  o No
 
Indicate by check mark whether the registrant is a large accelerated file, an accelerated filer, a non-accelerated filer, or a smaller 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).  o Yes x No
 
As of May 14, 2012, there were 3,894,833 shares of the issuer's $.001 par value common stock issued and outstanding.
   
 

 
1

 
 


 

 
2

 
 
PART I - FINANCIAL INFORMATION
 
 
SUR VENTURES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
             
   
March 31,
   
September 30,
 
   
2012
   
2011
 
    (Unaudited)        
ASSETS
             
CURRENT ASSETS
           
    Cash
  $ 53,179     $ 17,998  
    Accounts receivable
    89,416       6,328  
    Total current assets     142,595       24,326  
                 
Property and equipment, net of $2,094 and $1,724
    accumulated depreciation, respectively
     1,600       1,970  
TOTAL ASSETS
  $ 144,195     $ 26,296  
                 
LIABILITIES AND STOCKHOLDERS'  EQUITY (DEFICIT)
 
                 
CURRENT LIABILITIES
               
    Accounts payable and accrued liabilities
  $ 195,275     $ 132,946  
    Loans from stockholder
    107,685       27,780  
    Total current liabilities
    302,960       160,726  
                 
                 
STOCKHOLDERS' EQUITY (DEFICIT)
               
                 
    Common stock; $.001 par value; 50,000,000 shares authorized;
        3,894,833 shares issued and outstanding, respectively
    3,895       3,895  
    Additional paid-in capital
    68,080       65,080  
    Deficit accumulated during the development stage
    (230,740 )     (203,405 )
                 
    Total stockholders' equity (deficit)     (158,765 )     (134,430 )
                 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
  $ 144,195     $ 26,296  
 
   
 
The accompanying notes are an integral part of these condensed financial statements.

 
3

 
 
SUR VENTURES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(UNAUDITED)

       
FOR THE THREE MONTHS
ENDED
MARCH 31, 2012
   
FOR THE THREE MONTHS
ENDED
MARCH 31, 2011
 
FOR THE SIX MONTHS
ENDED
MARCH 31, 2012
   
FOR THE SIX MONTHS
ENDED
MARCH 31, 2011
   
FOR THE PERIOD FROM
INCEPTION
(DECEMBER 4, 2007
THROUGH
MARCH 31, 2012)
 
                               
                               
REVENUES
  $ 175,616     $ 38,538     $ 192,265     $ 52,477     $ 369,157  
                                         
COST OF REVENUES
    99,768       28,109       102,876       28,109       219,750  
                                         
GROSS PROFIT
    75,848       10,429       89,389       24,368       149,407  
                                         
OPERATING EXPENSES
                                       
    Officer compensation
    6,000       6,000       12,500       12,000       42,500  
    General and Administrative
    45,413       31,515       102,172       39,454       240,870  
TOTAL OPERATING EXPENSES
    51,413       37,515       114,672       51,454       283,370  
                                         
NET INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS
   AND INCOME TAX EXPENSE
    24,435       (27,086 )     (25,283     (27,086 )     (133,963 )
                                         
LOSS FROM DISCONTINUED OPERATIONS
    -       (4,625 )     -       (44,527 )     (85,812 )
                                         
LOSS BEFORE INCOME TAXES
    24,435       (31,711 )     (25,283     (71,613 )     (219,775 )
                                         
OTHER INCOME (EXPENSE)
                                       
    Interest expense
    (1,408 )     (819 )     (2,052 )     (1,571 )     (10,965 )
TOTAL OTHER INCOME (EXPENSE)
    (1,408 )     (819 )     (2,052 )     (1,571 )     (10,965 )
                                         
NET INCOME (LOSS) BEFORE INCOME TAXES
    23,027       (32,530 )     (27,335     (73,184 )     (230,740 )
                                         
INCOME TAX (BENEFIT) EXPENSE
    -       -       -       -       -  
                                         
NET INCOME (LOSS)
  $ 23,027     $ (32,530 )   $ (27,335   $ (73,184 )   $ (230,740 )
                                         
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING
    3,894,833       3,766,500       3,894,833       3,766,500          
                                         
NET INCOME (LOSS) PER COMMON SHARE:
  $ 0.01     $ (0.01 )   $ (0.01   $ (0.02 )        
                                         
 
         
The accompanying notes are an integral part of these condensed financial statements.
 

 
4

 
 
SUR VENTURES, INC.
(A DEVELOPMENT STAGE COMPANY)
  STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
FOR THE PERIOD FROM INCEPTION (DECEMBER 4, 2007) THROUGH MARCH 31, 2012

               
Additional
         
Total
 
   
Common Stock
   
Paid-in
   
Accumulated
   
Stockholders’
 
   
Shares
   
Par Value
   
Capital
   
Deficit
   
Equity/(Deficit)
 
                               
Balance - December 4, 2007
    -     $ -     $ -     $ -     $ -  
                                         
Issuance of common stock for services,
December 5, 2007
    1,000,000       1,000       -       -       1,000  
                                         
Issuance of common stock for cash,
January 15, 2008
    2,500,000       2,500       2,500       -       5,000  
                                         
Additional paid-in capital in exchange
for facilities provided by related party
    -       -       4,500       -       4,500  
                                         
Net loss
    -       -       -       (28,553 )     (28,553 )
                                         
Balance - September 30, 2008
    3,500,000       3,500       7,000       (28,553 )     (18,053 )
                                         
Issuance of common stock for cash,
June 5, 2009
    31,500       32       1,543       -       1,575  
                                         
Additional paid-in capital in exchange
for facilities provided by related party
    -       -       6,000       -       6,000  
                                         
Net loss
    -       -       -       (50,847 )     (50,847 )
                                         
Balance - September 30, 2009
    3,531,500       3,532       14,543       (79,400 )     (61,325 )
                                         
Issuance of common stock for cash,
April 1, 2010
    235,000       235       23,265       -       23,500  
                                         
Additional paid-in capital in exchange
for facilities provided by related party
    -       -       6,000       -       6,000  
                                         
Net loss
    -       -       -       (16,176 )     (16,176 )
                                         
Balance - September 30, 2010
    3,766,500     $ 3,767     $ 43,808     $ (95,576 )   $ (48,001 )
                                         
Issuance of common stock for cash,
April 6, 2011
    128,333       128       15,272       -       15,400  
                                         
Additional paid-in capital in exchange
for facilities provided by related party
    -       -       6,000       -       6,000  
                                         
Net loss
    -       -       -       (107,829 )     (107,829 )
                                         
Balance - September 30, 2011
    3,894,833     $ 3,895     $ 65,080     $ (203,405 )   $ (134,430 )
                                         
Additional paid-in capital in exchange
for facilities provided by related party
    -       -       3,000       -       3,000  
                                         
Net income
    -       -       -       (27,335     (27,335
                                         
Balance - March 31, 2012 (unaudited)
    3,894,833     $ 3,895     $ 68,080     $ (230,740 )   $ (158,765 )
                                         
                                         
 
The accompanying notes are an integral part of these financial statements.

 
 
5

 
 
SUR VENTURES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOW
(UNAUDITED)

                   
               
FOR THE PERIOD
 
               
FROM INCEPTION
 
   
FOR THE
   
FOR THE
   
(DECEMBER 4, 2007)
 
   
SIX MONTHS ENDED
   
SIX MONTHS ENDED
   
THROUGH
 
   
MARCH 31, 2012
   
MARCH 31, 2011
   
MARCH 31, 2012
 
CASH FLOWS FROM OPERATING ACTIVITIES:
             
    Net income (loss)
  $ (27,335   $ (73,184 )   $ (230,740 )
                         
Adjustments to reconcile net (loss)
                       
  to net cash used in operating activities:
                       
    Additional paid-in capital in exchange for facilities provided by related party
    3,000       3,000       25,500  
    Common stock issued for services
    -       -       1,000  
    Depreciation
    370       370       2,094  
                         
Change in assets and liabilities
                       
    (Increase) Decrease in accounts receivable
    (83,088 )     60,160       (86,416 )
    Increase (Decrease) in accounts payable and accrued expenses
    62,329       37,169       195,275  
          Net cash provided by (used in) operating activities
    (44,724 )     27,515       (96,287 )
                         
CASH FLOWS USED IN INVESTING ACTIVITIES:
                 
    Purchase of property and equipment
    -       -       (3,694 )
          Net cash (used in) investing activities
    -       -       (3,694 )
                         
CASH FLOWS FROM FINANCING ACTIVITIES:
                       
    Proceeds received from note payable
    94,905       24,280       262,465  
    Payments on stockholder loans
    (15,000 )     (94,780 )     (154,780 )
    Proceeds from issuance of common stock
    -       -       45,475  
          Net cash provided by financing activities
    79,905       (70,500 )     153,160  
                         
                         
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    35,181       (42,985 )     53,179  
 
                       
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD
    17,998       59,317       -  
 
                       
CASH AND CASH EQUIVALENTS - END OF PERIOD
  $ 53,179     $ 16,332     $ 53,179  
                         
                         
                         
SUPPLEMENTAL CASH FLOW INFORMATION:
                       
  Cash paid during the period for:
                       
       Interest
  $ -     $ -     $ -  
       Taxes
  $ -     $ -     $ -  
                         
                         
   
The accompanying notes are an integral part of these condensed financial statements.

 
6

 
 
SUR VENTURES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
March 31, 2012
(Unaudited)

1.   NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Sur Ventures, Inc. (the Company) is currently a development stage company under the provisions of Statement of Accounting Standards Codification (ASC) No. 915, Development Stage Entities, and was incorporated under the laws of the State of Nevada on December 4, 2007. Since inception, the Company has produced minimal revenues and will continue to report as a development stage company until significant revenues are produced.

The Company is a computer equipment and services company which sells computer equipment and various computer related services.

The Company previously operated an event planning and management division. In September 2011, the Company closed this division and accordingly, all amounts associated with the event planning services have been reclassified and presented as discontinued operations as further described in Note 9.

Basis of Presentation

The unaudited financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. They do not include all information and notes required by generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the annual report on Form 10-K for the fiscal year ended September 30, 2011. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended March 31, 2012 are not necessarily indicative of the results that may be expected for any other interim period or the entire year.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 reported periods. Actual results could materially differ from those estimates.

Recent Accounting Pronouncements

There are no recently issued accounting standards with pending adoptions that the Company’s management currently anticipates will have a material impact on its financial statements.


 
7

 
SUR VENTURES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2012
(Unaudited)

2.   GOING CONCERN

As shown in the accompanying financial statements, the Company has incurred a net operating loss of ($230,740) from inception (December 4, 2007) through March 31, 2012. The Company is subject to those risks associated with development stage companies. The Company has sustained losses since inception and additional debt and equity financing will be required by the Company to fund its development activities and to support operations. However, there is no assurance that the Company will be able to obtain additional financing. Furthermore, there is no assurance that technological changes, changing customer needs and evolving industry standards will enable the Company to introduce new products on a continual and timely basis so that profitable operations can be attained. In September 2011, management discontinued the Company's event planning business to further focus on its computer memory sales. Management anticipates that this will assist the Company in achieving profitable operations in the future, but cannot be reasonably assured if, and when, profitability will occur.

3.   FAIR VALUE OF FINANCIAL INSTRUMENTS

Pursuant to ASC No. 825, Financial Instruments, the Company is required to estimate the fair value of all financial instruments included on its balance sheet. The carrying value of cash, accounts payable and accrued expenses approximate their fair value due to the short period to maturity of these instruments.

4.   COMPENSATED ABSENCES

The Company currently does not have any employees other than the Company’s officer. The majority of development costs and services have been provided to the Company by the founders and outside, third-party vendors. As such, there is no accrual for wages or compensated absences as of September 30, 2011.

5.   LOANS FROM STOCKHOLDER

The Company has outstanding notes payable with a stockholder in the aggregate amount of $107,685 and $27,780 as of March 31, 2011 and September 30, 2011, respectively. Per the terms of the notes, the loans are due upon demand and accrue interest at the rate of 10% per annum. The loan funds are to be used for working capital purposes.


 
8

 

 
SUR VENTURES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2012
(Unaudited)

6.   COMMON STOCK
 
On December 5, 2007, the Company issued 1,000,000 shares of its common stock to a director for services rendered of $1,000 which was considered a reasonable estimate of fair value.
 
On January 25, 2008, the Company issued 2,500,000 shares of its common stock to an officer for cash of $5,000 which was considered a reasonable estimate of fair value.
 
On June 5, 2009, the Company issued 31,500 shares of its common stock to unrelated investors for cash of $1,575 pursuant to the Company’s private placement offering under Reg. D.
 
On April 1, 2010, the Company issued 235,000 shares of its common stock to unrelated investors for cash of $23,500 pursuant to the Company’s private placement offering under Reg. D.
 
On April 6, 2011, the Company issued 128,333 shares of its common stock to unrelated investors for cash of $15,400 pursuant to the Company’s Registration Statement on Form S-1.
 
7.   PROVISION FOR INCOME TAXES
 
Deferred income taxes are reported using the liability method. Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

As of March 31, 2012 and September 30, 2011, the Company had federal net operating loss carryforwards of approximately ($230,000) and ($210,000), respectively, which can be used to offset future federal income tax. The federal and state net operating loss carryforwards expire at various dates through 2031. Deferred tax assets resulting from the net operating losses are reduced by a valuation allowance, when, in the opinion of management, utilization is not reasonably assured.

A summary of the Company’s deferred tax assets as of December 31, 2011 and September 30, 2011 are as follows:
 
      3/31/2012     9/30/2011  
               
  Federal net operating loss (at 30% and 25%, respectively)   $ 69,000     $ 52,500  
  Less: valuation allowance   (69,000 )     (52,000 )
                   
  Net deferred tax assets   $ -     $ -  
                   
 
The valuation allowance increased by $16,500 for the six months ended March 31, 2012 and increased by $32,875 the year ended September 30, 2011.
 

 
 
9

 
 
SUR VENTURES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2012
(Unaudited)

8.   RELATED PARTY TRANSACTIONS

From the Company’s inception (December 4, 2007) through March 31, 2012, the Company has utilized office space of an officer and stockholder at no charge. The Company treated the usage of the office space as additional paid-in capital and charged the estimated fair value rent of $500 per month to operations. For the six months ended March 31, 2012, the Company recorded rent expense of $3,000.

Effective December 15, 2007, the Company agreed to compensate its President $2,000 per month for services rendered, and to pay such compensation at a later date when sufficient funds are available. The accrued compensation due to the President totaled $104,000 and $92,000 at March 31, 2012 and September 30, 2011, respectively.

9.   DISCONTINUED OPERATIONS

In September 2011, the Company discontinued its event planning management services. Accordingly, all items of income and expense associated with this activity have been classified as discontinued operations within the Company's statements of operations for all periods presented in accordance with ASC 205-20. The Company does not expect any continuing cash flows or involvement in the event planning activity.
 
10.     SUBSEQUENT EVENTS
 
On May 9, 2012, we borrowed $290,000 from Linda Fischer, our officer and director, in exchange for a senior secured promissory note. The note is due July 16, 2012 and accrues interest at the rate of 10% per annum.
 


 
10

 
 
This following information specifies certain forward-looking statements of management of the company. Forward-looking statements are statements that estimate the happening of future events and are not based on historical fact. Forward-looking statements may be identified by the use of forward-looking terminology, such as “may,” “shall,” “could,” “expect,” “estimate,” “anticipate,” “predict,” “probable,” “possible,” “should,” “continue,” or similar terms, variations of those terms or the negative of those terms. The forward-looking statements specified in the following information have been compiled by our management on the basis of assumptions made by management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guarantee, or warranty is to be inferred from those forward-looking statements.
 
The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. We cannot guarantee that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.
 
Critical Accounting Policy and Estimates. Our Management’s Discussion and Analysis of Financial Condition and Results of Operations section discusses our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. These accounting policies are described at relevant sections in this discussion and analysis and in the notes to the financial statements included in our Annual Report on Form 10-K for the year ended September 30, 2011 and this Quarterly Report on Form 10-Q for the period ended March 31, 2012.

Overview. Sur Ventures, Inc. (“We” or the “Company”) was incorporated in the State of Nevada on December 4, 2007.  We were formed to be a provider of lead generation services for event planners in various locations and began to offer event planning services in 2009. In July 2010, we began distributing and selling computer memory modules, flash memory cards and solid state storage products under the trade name Sur Technologies. In September 2011, we discontinued our event planning, management and lead generation division to devote all of our business efforts to our computer memory modules division.

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements for the period ended March 31, 2012, together with notes thereto, which are included in this report.

 
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For the three months ended March 31, 2012, as compared to the three months ended March 31, 2011.
 
Results of Operations.
 
Revenues. We generated revenues of $175,616 for the three months ended March 31, 2012 from the sale of our computer memory modules, as compared to revenues of $38,538 for the three months ended March 31, 2011. Our cost of revenues for the three months ended March 31, 2012 was $99,768, as compared to cost of revenues of $28,109 for the three months ended March 31, 2011. Therefore, our gross profit for the three months ended March 31, 2012 was $75,848, as compared to a gross profit of $10,429 for the three months ended March 31, 2011.  The increase in revenues between the comparable periods is primarily due to additional sales of our computer memory products and the shift of our primary business activity from event planning to solely computer memory and module sales. We expect to generate more significant revenues as we continue to grow our operations and increase our product offerings.
 
Operating Expenses. For the three months ended March 31, 2012, our total operating expenses were $51,413, as compared to operating expenses of $37,515 for the three months ended March 31, 2011. Our operating expenses for the three months ended March 31, 2012 were comprised of officer compensation of $6,000 and general and administrative expenses of $45,413. In comparison, our operating expenses for the three months ended March 31, 2011 were comprised of officer compensation of $6,000 and general and administrative expenses of $31,515.  The increase in operating expenses between the comparable periods is primarily related to sales commissions that were paid by us during the three months ended March 31, 2012.

Net Income (Loss).   For the three months ended March 31, 2012, our net income was $23,027, which consisted of net income before discontinued operations of $24,435 and interest expense of $1,408.  In comparison, for the three months ended March 31, 2011, our net loss was $32,530, which consisted of net loss before discontinued operations of $27,086, loss from discontinued operations of $4,625 and interest expense of $819.  The shift from net loss to net income between the comparable periods is primarily due to an increase in sales orders we received from customers and the shift of our primary business activity from event planning to solely computer memory and module sales.

For the six months ended March 31, 2012, as compared to the six months ended March 31, 2011.
 
Results of Operations.
 
Revenues. We generated revenues of $192,265 for the six months ended March 31, 2012 from the sale of our computer memory modules, as compared to revenues of $52,477 for the six months ended March 31, 2011. Our cost of revenues for the six months ended March 31, 2012 was $102,876, as compared to cost of revenues of $28,109 for the six months ended March 31, 2011. Therefore, our gross profit for the six months ended March 31, 2012 was $89,389, as compared to a gross profit of $24,368 for the six months ended March 31, 2011.  The increase in net income between the comparable periods is primarily due to additional sales of our computer memory products and the shift of our primary business activity from event planning to solely computer memory and module sales. We expect to generate more significant revenues as we continue to grow our operations and increase our product offerings.
 
Operating Expenses. For the six months ended March 31, 2012, our total operating expenses were $114,672, as compared to operating expenses of $51,454 for the six months ended March 31, 2011. Our operating expenses for the six months ended March 31, 2012 were comprised of officer compensation of $12,500 and general and administrative expenses of $102,172. In comparison, our operating expenses for the six months ended March 31, 2011 were comprised of officer compensation of $12,000 and general and administrative expenses of $39,454.  The increase in operating expenses between the comparable periods is directly related to an increase in costs associated with being a public company, such as legal and accounting costs, as well as sales commissions that were paid by us during the six months ended March 31, 2012.

 
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Net Loss.   For the six months ended March 31, 2012, our net loss was $27,335, which consisted of net loss before discontinued operations of $25,283 and interest expense of $2,052.  In comparison, for the six months ended March 31, 2011, our net loss was $73,184, which consisted of net loss before discontinued operations of $27,086, loss from discontinued operations of $44,527 and interest expense of $1,571.  The decrease in net loss between the comparable periods is primarily due to an increase in sales orders we received from customers and the shift of our primary business activity from event planning to solely computer memory and module sales.

Liquidity and Capital Resources. As of March 31, 2012, we have cash $53,179 and accounts receivable of $89,416, which comprises our current assets. Our current assets and property and equipment of $1,600 represent our total assets of $144,195 as of March 31, 2012.
 
As of March 31, 2012, we had total current liabilities of $302,960, which were represented by accounts payable and accrued expenses of $195,275 and loans from stockholder of $107,685.  The accounts payable and accrued expenses are comprised primarily of legal fees payable and accrued officer compensation due to Linda Fischer, our officer and director. The loans from stockholder are payable to Linda Fischer, our officer and director. Per the terms of the notes, the loans are due upon demand and accrue interest at the rate of 10% per annum.  The loan funds are to be used for working capital purposes and to finance purchase orders that we receive from our customers.  We had no other long term liabilities, commitments or contingencies as of March 31, 2012.

During 2012, we expect to incur significant legal and accounting costs as a result of being a public company. We also expect to generate more significant revenues from the sale of our computer memory modules in the next twelve months. Those anticipated increases in sales will require additional funds to pay for the costs of the goods sold. Our legal and accounting costs and the costs of goods sold will be higher as our business volume and activity increases. Other than the anticipated increases in legal and accounting costs due to the reporting requirements of being a reporting company and increases in the costs of goods sold, we are not aware of any other known trends, events or uncertainties, which may affect our future liquidity.
 
We have cash of $53,179 as of March 31, 2012. In the opinion of management, available funds will not satisfy our working capital requirements to operate at our current level of activity for the next twelve months.  Our forecast for the period for which our financial resources will be adequate to support our operations involves risks and uncertainties and actual results could fail as a result of a number of factors. We will need to raise additional capital to expand our operations significantly.  Linda Fischer, our officer and director, has provided loans to us to finance purchase orders that we receive from our customers and we expect Ms. Fischer will continue to do so, although she is not obligated to provide those loans.  We also believe that we can finance purchase orders that we receive from our customers with other parties as well, although we cannot guarantee that we can finance those purchase orders on favorable terms.
 
We are not currently conducting any research and development activities.  We do not anticipate conducting such activities in the near future. In the event that we expand our customer base, then we may need to hire additional employees or independent contractors as well as purchase or lease additional equipment. Our management believes that we do not require the services of independent contractors to operate at our current level of activity.

Off-Balance Sheet Arrangements.   We have no off-balance sheet arrangements.
   
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
 
Not applicable.
 
 
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Evaluation of disclosure controls and procedures. We maintain controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 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 our management including our principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosures. Based upon their evaluation of those controls and procedures performed as of the end of the period covered by this report, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective.
 
Changes in internal controls. There were no changes in our internal control over financial reporting that occurred during the fiscal quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
  
 
 PART II — OTHER INFORMATION
 
 
None.
 
 
Not applicable.
 
 
None.
 
Item 3.  Defaults Upon Senior Securities.
 
None.
 
 
Not applicable.

 
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The information set forth below is included herewith for the purpose of providing the disclosures required under “Item 8.01 - Other Events” of Form 8-K.

On May 17, 2012, we launched a corporate website, located at www.surventuresinc.com.  Our website provides a link to our computer memory modules division, Sur Technologies.  In addition, our corporate website hosts the Company’s Annual, Quarterly and Current Reports filed with the Securities and Exchange Commission, as well as corresponding XBRL Interactive Data Files.  Our corporate website also lists the Company’s contact information.
 
 
101.ins
XBRL Instance Document
101.sch
XBRL Taxonomy Schema Document
101.cal
XBRL Taxonomy Calculation Linkbase Document
101.def
XBRL Taxonomy Definition Linkbase Document
101.lab
XBRL Taxonomy Label Linkbase Document
101.pre
XBRL Taxonomy Presentation Linkbase Document
 

 

 
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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.
 
 
 
 
 
Sur Ventures, Inc.,
a Nevada corporation
 
 
       
May 18, 2012
By:
/s/ Linda Fischer  
 
   
Linda Fischer  
Chief Executive Officer, President, Chief Financial Officer, Secretary and a Director 
(Principal Executive, Financial and Accounting Officer) 
 
 
 
 
 
 
 
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