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EXCEL - IDEA: XBRL DOCUMENT - CYTTA CORP.Financial_Report.xls

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10 Q

(Mark One)

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

For the quarterly period ended March 31, 2013

or

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: 333-139669

 

 

 

CYTTA CORP.

(Exact name of Registrant as specified in its charter)

 

 

 

Nevada

 

98-0505761

(State or other jurisdiction of incorporation or organization)

 

(IRS Employer Identification No.)

 

 

 

Suite 101- 6490 West Desert Inn Road, Las Vegas Nevada 89146

(Address of principal executive offices)

 

(702) 307-1680

(Registrant’s telephone number, including area code)

 

 

(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



1



Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No x

Indicate by check mark whether the Registrant is a large accelerated filer, 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 (Check one).


 

 

 

Large accelerated filer o

 

Accelerated filer o

 

 

 

Non-accelerated filer o

 

Smaller reporting company x

(Do not check if a smaller reporting company)

 

 

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of May 24th, 2013, there were 12,630,489 (3,789,146,700 pre-split) shares of the issuer’s common stock, par value $0.001 ($0.00001 pre-split), outstanding.





PART I – FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's September 30, 2012 Form 10-K filed with the SEC on December 26, 2012. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.




2




Cytta Corp.

Condensed Balance Sheets

 

 

 

 

March 31,

 

September 30,

 

 

 

 

2013

 

2012

 

 

 

 

(Unaudited)

 

(Audited)

ASSETS

CURRENT ASSETS

 

 

 

 

Cash and cash equivalents

 $         41,891

 

 $         36,080

 

 

 

 

 

 

 

 

 

Total Current Assets

            41,891

 

            36,080

 

 

 

 

 

 

 

OTHER ASSETS

 

 

 

 

MVNO License-net of amortization

             7,560

 

             8,640

 

Software license-net of amortization

             3,251

 

             3,751

 

Notes receivable

            23,835

 

            23,835

 

Collateralized loan to shareholder

            17,500

 

            17,500

 

Computers

             6,489

 

             6,489

 

 

 

 

 

 

 

 

 

Total Other Assets

            58,635

 

            60,215

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 $       100,526

 

 $         96,295

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES

 

 

 

 

Accounts payable and accrued liabilities

 $           7,165

 

 $         19,499

 

Due to related parties

          897,840

 

          660,532

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES

          905,005

 

          680,031

 

 

 

 

 

 

 

STOCKHOLDERS' DEFICIT

 

 

 

 

Preferred stock:

 

 

 

 

 

100,000,000 shares authorized, $0.001 par value

 

 

 

 

 

 

933,350 and 15,651,536 issued

                933

 

            15,652

 

 

 

Additional paid-in capital - preferred

            67,066

 

       1,217,348

 

Common stock:

 

 

 

 

 

100,000,000 shares authorized, $0.001 par value

 

 

 

 

 

 

12,630,489 and 5,566,927 shares issued

            12,629

 

                  54

 

 

 

Additional paid-in capital - common

       2,946,426

 

       1,188,444

 

Common shares pending cancellation

                    2

 

                    2

 

Subscriptions payable

          166,200

 

          303,063

 

Deficit accumulated during the development stage

      (3,997,735)

 

      (3,308,299)

 

 

 

 

 

 

 

 

 

Total Stockholders' Deficit

         (804,479)

 

         (583,736)

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT

 $       100,526

 

 $         96,295



3




Cytta Corp.

Condensed Statements of Operations

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

March 31,

 

March 31,

 

 

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

REVENUES

 $             -

 

 $             -

 

 $             -

 

 $       12,000

 

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

              -   

 

             -   

 

             -   

 

         10,909

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

              -   

 

             -   

 

             -   

 

           1,091

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Professional fees

       24,201

 

               -

 

       50,201

 

                  -

 

Management fees

       90,353

 

     112,497

 

     190,055

 

        219,607

 

General and administrative

      245,463

 

     735,788

 

     449,180

 

        952,240

 

Impairment of licensing agreement

                -

 

               -

 

               -

 

                  -

 

 

 

 

 

 

 

 

 

 

 

 

Total Operating Expenses

      360,017

 

     848,285

 

     689,436

 

     1,171,847

 

 

 

 

 

 

 

 

 

 

NET LOSS FROM OPERATIONS

     (360,017)

 

    (848,285)

 

    (689,436)

 

    (1,170,756)

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

 

 

 

Interest income

                -

 

               7

 

               -

 

              158

 

Interest expense

                -

 

               -

 

               -

 

                  -

 

 

Total Other Income (Expense)

                -

 

               7

 

               -

 

              158

 

 

 

 

 

 

 

 

 

 

NET LOSS BEFORE TAXES

     (360,017)

 

    (848,278)

 

    (689,436)

 

    (1,170,598)

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

                -

 

               -

 

               -

 

                  -

 

 

 

 

 

 

 

 

 

 

NET LOSS

 $  (360,017)

 

 $ (848,278)

 

 $ (689,436)

 

 $ (1,170,598)

 

 

 

 

 

 

 

 

 

 

PER SHARE DATA:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted income

 

 

 

 

 

 

 

 

 

(loss) per common share

 $       (0.05)

 

 $      (0.15)

 

 $      (0.10)

 

 $         (0.21)

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of

 

 

 

 

 

 

 

 

 

common shares outstanding

7,776,360

 

5,566,927

 

6,659,504

 

5,489,150



4




Cytta Corp.

Condensed Statements of Cash Flows

(Unaudited)

 

 

 

 

For the Six Months Ended

 

 

 

 

March 31,

 

 

 

 

2013

 

2012

OPERATING ACTIVITIES

 

 

 

 

Net income (loss)

 $    (689,436)

 

 $  (1,170,598)

 

Adjustments to reconcile net income (loss) to net

 

 

 

 

cash from operating activities:

 

 

 

 

 

Depreciation and amortization

            1,580

 

            1,580

 

 

Impairment of licensing agreement

                   -

 

                   -

 

 

Issuance of preferred stock

 

 

 

 

 

 

for services and expenses

                   -

 

        632,000

 

 

Issuance of common stock

 

 

 

 

 

 

for services and expenses

        173,893

 

          91,000

 

 

Operating expenses paid on behalf of the

 

 

 

 

 

 

Company by a related party

                   -

 

                   -

 

Changes in Operating Assets and Liabilities:

 

 

 

 

 

Inventory

                   -

 

         (29,734)

 

 

Accounts payable and accrued liabilities

         (12,334)

 

            4,440

 

 

Prepaid fees and services

                   -

 

                   -

 

 

 

Net cash from operating activities

       (526,297)

 

       (471,312)

 

 

 

 

 

 

 

INVESTING ACTIVITIES

 

 

 

 

Collateralized loan to shareholder

                   -

 

         (17,500)

 

Purchase of property and equipment

                   -

 

                   -

 

 

Net cash from investing activities

                   -

 

         (17,500)

 

 

 

 

 

 

 

FINANCING ACTIVITIES

 

 

 

 

Preferred stock issued for cash

                   -

 

        300,000

 

Proceeds from stock subscriptions payable

        294,800

 

                   -

 

Advances from related parties

        237,308

 

        180,468

 

Repayment of advances from related parties

                   -

 

                   -

 

 

Net cash from financing activities

        532,108

 

        480,468

 

 

 

 

 

 

 

NET CHANGE IN CASH

            5,811

 

           (8,344)

CASH AT BEGINNING OF PERIOD

          36,080

 

          97,899

CASH AT END OF PERIOD

 $       41,891

 

 $       89,555

 

 

 

 

 

 

 

SUPPLEMENTAL CASH FLOW DISCLOSURES

 

 

 

 

Cash paid for interest

 $                -

 

 $                -

 

Cash paid for income taxes

 $                -

 

 $                -

 

 

 

 

 

 

 

NON-CASH INVESTING AND FINANCING ACTIVITIES

 

 

 

Preferred stock issued for fees and services

 

 

 $     632,000

 

Common stock issued for services

 $     173,893

 

 $       91,000




5



CYTTA CORP

Condensed Notes to Financial Statements

March 31, 2013 and September 31, 2012

NOTE 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 March 31, 2013, 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 September 30, 2012 audited financial statements. The results of operations for the period ended March 31, 2013 is not necessarily indicative of the operating results for the full year.

NOTE 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.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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 at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.


The following have been added to United States generally accepted accounting standards.



6




Intangibles – Goodwill and Other (Topic 350) issued September 15, 2011.

The amendments in this will allow an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test.  Under these amendments, an entity would not be required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount.  The amendments include a number of events and circumstances for an entity to consider in conducting the qualitative assessment.

Compensation-Retirement Benefits-Multiemployer Plans (Subtopic 715-80) issued September 21, 2011.

This amendment requires additional disclosures about an employer’s participation in a multiemployer plan.

Property, Plant and Equipment (Topic 360 issued December 14, 2011

These amendments resolve the diversity in practice about whether the guidance in Subtopic 360-20, Property, Plant, and Equipment-Real Estate Sales, applies to a parent that ceases to have a controlling financial interest (as described in Subtopic 810-10, Consolidation-Overall) in a subsidiary that is in substance real estate as a result of default on the subsidiary’s nonrecourse debt.  This change does not address whether the guidance in Subtopic 360-20 would apply to other cir4cumstances when a parent ceases to have a controlling financial interest in a subsidiary that is in substance real estate.

Balance Sheet (Topic 210) issued December 16, 2011

This change provides enhanced disclosures that will enable users of its financial statements to evaluate the effect or potential effect of netting arrangements on an entity’s financial position.  This includes the effect or potential effect of rights of setoff associated with an entity’s recognized assets and recognized liabilities within the scope of this amendment.  The amendment requires enhance disclosures by requiring improved information about financial instruments and derivative instruments that are wither (1) offset in accordance with wither Section 210-20-45 or Section 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with wither Section 210-20-45 or Section 815-10-45.


Comprehensive Income (Topic 210) issued December 23, 2011

This change pushes back some of the previous changes to comprehensive income until the Board can decide on presentation policies for presentation requirements for reclassifications out of accumulated other comprehensive income for annual and interim financial statements for public, private, and non-profit entities.


Health Care Entities (Topic 954) issued July 24, 2012

This amendment is to clarify the reporting for refundable advance fees received by continuing care retirement communities.



7




Intangibles – Goodwill and Other (Topic 350) issued July 27, 2012


These amendments will allow an entity to first assess qualitative factors to determine whether it is necessary to perform a quantitative impairment test.  Under these amendments, an entity would not be required to calculate the fair value of an indefinite-lived intangible asset unless the entity determines, based on qualitative assessment, that it is not more likely than not, the indefinite-lived intangible asset is impaired.  The amendments include a number of events and circumstances for an entity to consider in conducting the qualitative assessment.

None of these new standards have a direct effect on the quarterly financial statements.

NOTE 4- RELATED PARTY NOTES PAYABLE

As of March 31, 2013 and September 30, 2012 the Company owed various related parties $897,840 and $660,532 respectively. The notes are unsecured, bear no interest and are due on demand.

NOTE 5 - STOCKHOLDERS' EQUITY

In November 2012 the Company increased the number of authorized common to 3,900,000,000 pre –split shares.

During the six months ended March 31, 2013 the company issued 496,000,000 pre-split common shares for $431,663 in subscriptions, 193,000,000 pre-split common shares for $173,893 in services, and converted 14,718,186 preferred shares into 1,471,818,600 pre-split common shares

As of April 9, 2013 the Company reverse split its common shares 1 for 300 reducing the number of authorized shares to 13,000,000. All common stock disclosures appearing in the accompanying financial statements have been retroactively restated to reflect the reverse split of shares.

NOTE 6 - SUBSEQUENT EVENTS

As of April 9, 2013 the Company reverse split its common shares 1 for 300 reducing the number of authorized shares to 13,000,000. All common stock disclosures appearing in the accompanying financial statements have been retroactively restated to reflect the reverse split of shares.

Since March 31, 2013 the Company has received $50,000 in common stock subscriptions

In accordance with ASC 855-10 the Company has evaluated all material subsequent events from the balance sheet date through the date of this report. There have been no other reportable subsequent events.



8




ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words “expects,” “anticipates,” “intends,” “believes” and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed herein as well as in the “Description of Business – Risk Factors” section in our Annual Report on Form 10-K for the year ended September 30, 2012. You should carefully review the risks described in our Annual Report and in other documents we file from time to time with the Securities and Exchange Commission. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.

Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.

All references in this Form 10-Q to the “Company,” “Cytta,” “we,” “us,” or “our” are to Cytta Corp.

Results of Operations

We are a development stage corporation. We have generated $-0- in revenues from our business operations since September 30, 2012 and have incurred $ 360,017 in expenses this quarter.

The following table provides selected financial data about our Company as of March 31, 2013 and September 30th, 2012, respectively.


Balance Sheet Data

March 31, 2013

September 30, 2012

Cash and cash equivalents

$41,891

$36,080

Total Assets

$100,526

$96,295

Total Liabilities

$905,005

$680,031

Shareholder Equity (Deficit)

$(804,479)

$(583,736)


Net cash used in operating activities during the quarter was $ 526,297



9




Plan of Operation

Cytta’s technology called Cytta Connect TM is the world’s first open source Special Purpose Medical Network.  Our unique and proprietary system allows us to connect all forms of Bluetooth enabled monitoring devices (FDA and Non FDA) seamlessly through an Android Smartphone and deliver the data in real-time to a cloud based data repository which can easily be customized to our client’s requirements.


The Cytta Connect TM system is a cost effective system that works with any manufacturers’ off the shelf Bluetooth enabled monitoring device and any Android Smartphone provisioned with the Cytta platform.  The Cytta Connect system works seamlessly everywhere there is cellular service.  Cytta Connect is currently implementing systems to monitor, COPD, Asthma, Diabetes, Hypertension and Obesity as well as several major causes of hospital readmission

On June 18th, 2009, the Company entered into a Licensing Agreement with Lifespan, Inc. a Nevada Corporation.  Through a series of transactions and business developments commencing in 2002 Lifespan had acquired the expertise and licenses to manufacture, distribute and market various technology based internet and telephony based access and computing products and services, consisting of internet access devices, related software and hardware and a series of medical peripherals designed and adapted to provide remote patient monitoring (RPM) of home based and remote patients.  

On November 10th, 2010, the Company entered into an MVNO Mobile Virtual Network Operator Agreement (herein “MVNO Agreement”) with Vonify Inc. of Toronto, Canada and Georgetown, Grand Cayman Island, BWI (herein “Vonify”) and MVNO Mobile Virtual Network Operator Corp (herein “MVNO”) of New Westminster, Canada (“MVNO Corp.”) a company owned and controlled by Mr. Gary Campbell an Officer and Director and controlling shareholder of Cytta for a license to provide all the “Services” of the Vonify Network to third parties, in the medical marketplace in the USA as a Special Purpose Medical Network.  Cytta may only resell Services to third parties who are also End Users and such third parties may not further resell the Services.  Cytta is expressly permitted to use and develop their own applications and programing for the phones and may develop and utilize applications which require modification of the “native” or “core” programing of the Smartphones provided it does not have a deleterious effect upon the Network.

The Vonify Network includes those integrated mobile switching facilities, servers, cell sites, telecom and internet connections, billing systems, validation systems, gateways, landline switches and other related facilities used to provide the Services.   Vonify operates the network utilizing the C & F Block Spectrum Licenses and associated roaming agreements and all the land, towers and antennas along with the associated network agreements.  

Pursuant to Cytta’s MVNO agreement with Vonify, the Services to be marketed by Cytta are defined as wireless telecommunications services for the Global System for Mobile (GSM) communications.   The Company is fully utilizing the Vonify network in the US and utilizing Vonify SIM cards installed on numerous brands of android smartphones and tablets deployed in various parts of the US.  The Vonify network is fully functional and compliant in regards to voice, data and SMS connectivity.  The network is suitable in all aspects for utilization by Cytta for the movement of medical, health and wellness information gathered from Bluetooth enabled remote medical monitoring devices.  The Cytta Connect TM Medical smartphones and tablets are also fully functional voice, data and SMS cell phones.



10




On January 25th, 2012, the Company’s Board ratified an executed Wireless Data Machine to Machine (M2M) Communications Agreement with ATT Mobility II, LLC on behalf of its affiliates AT&T or AT&T Mobility (herein AT&T) pursuant to the terms of which Cytta agrees to purchase from AT&T and AT&T agrees to sell to Cytta wireless service for use in machine to machine communications on AT&T’s Wireless Data Network.  Through AT&T, Cytta can offer a nationwide Data GSM/GPRS footprint across 100 percent of the AT&T service area. GSM also provides global compatibility resulting in more international roaming potential.  Cytta has currently activated its first AT&T SIMs through its VPN and has distributed the first SIMs to evaluate their market potential.  Additional setup, activation and details are currently being explored between the parties. This transaction is more fully described in our Current Report on Form 8-K filed with the Securities and Exchange Commission on January 31st, 2012.


Since the acquisition of the Lifespan technology, and the rights to utilize the Vonify Wireless Network through the Vonify MVNO Agreement, and the AT&T Data MVNO agreement, and the Agreements with the medical device manufacturers, the Company has now completed the development of a remote medical monitoring model or remote patient monitoring (RPM) system designed to deliver seamless, near real-time, medical data transmission from home to Insurer/Provider.  The Company’s system seamlessly collects the data generated by the portable or home based medical monitoring devices (such as blood pressure, scale, blood glucose, pulse oxygen etc.), utilizing Bluetooth connectivity. This medical data is sent via Bluetooth from the medical device to the Company’s Medical Smartphone, which is also located in the home and/or held by the patient.

The Company’s Medical Smartphone, contains proprietary device resident or “native” programming, consisting of a “Firmware Client” or “Super App” developed by Connected Health Pte. Ltd. in conjunction with the Cytta Special Purpose Network and which is licensed to Cytta pursuant to the July 14 th , 2011 License Agreement.  This application for the phones is designed to automatically receive Bluetooth data and perform autonomous control and connectivity functions utilizing the voice, data and SMS capability of the Smartphone or tablet. Connected Health is a wireless health innovator committed to developing health monitoring connectivity solutions which when installed on the Cytta Medical Smartphone, automatically receives the medical data and utilizes the Company’s wireless telecommunication services, to transmit the data through the cellular network to Cytta’s proprietary online or Cloud based Cytta Data repository Dashboard called the ‘Instant EMR TM’ .  

From the Online or Cloud based Cytta Data repository Dashboard or ‘Instant EMR TM ’ the data can be utilized as part of the electronic medical monitoring systems (EMR’s) of the major Medical Groups (such as Insurance Companies, Disease Management Companies, Health Delivery Organizations, Health Plans, Home Health Agencies, Managed Care Organizations, Medical Groups and IPAs) who have placed the systems in the homes of their clients requiring remote patient monitoring.  These Medical Groups contract with Cytta and are responsible for installing, monitoring and financing the system in the homes of their clients who require monitoring.

The Company has currently entered into agreements with respected medical device manufacturers A&D Medical, Nonin Medical, ForaCare, and Entra Health, which have allowed Cytta to design our ecosystem to incorporate their double FDA approved medical monitoring devices to for measurement of Blood Pressure, Glucose Values, Weight, Temperature, Pulse, and Oxygen Saturation. The Company is now capable of adding any Bluetooth remote monitoring device to the Cytta Connect ecosystem whether FDA approved or Non FDA approved and is currently working to add PT/INR, ECG Rhythms, Respiration, and a personal emergency response system (PERS) into the Cytta Ecosystem.



11




The Company has now completed the integration of the proprietary Firmware Client with other elements of the system and have installed the technology on several Nexus One, HTC My Touch, HTC Wildfire, HTC Sense, Sony Xperia android smartphones as well as with the Samsung and HTC tablets.  The testing and integration of the combination Smartphone/tablets and Firmware Client, which has collectively been described as the Cytta Medical Smartphone or the Cytta Medical Tablet, with the double FDA blood pressure, weight scale, pulse/oximetry and blood glucose devices, has been completed and are all functioning seamlessly.  The Company has completed the development of the relational data base and the GUI developed therefrom consisting of ‘Online Data Presentation Screens” Dashboard or ‘Instant EMR TM ’ to represent the data captured by the system for its clients.  

The Company began its first trial installations of the complete Cytta Ecosystems in September 2011 in the US, with two Medical Group clients wishing to utilize and or participate in the Company’s “medical monitoring ecosystem’. In March 2012 the Company commenced its first major installation and product evaluation with a major medical Insurance Co/Payor.  The Company also delivered its second round of orders to its first two medical group clients and has received notice of upcoming further installations.


Upon successful conclusion of the Insurance co/Payor Pilot Program evaluation, the Company planned to begin full deployment of its systems and commence operations as a Medical Health Service Provider (MHSP). In November 2012 the Company received the 6 Month Pilot Program Whitepaper dated September 30, 2012 independently prepared by the major medical Insurance Co/Payor with whom the Pilot program was conducted.  The conclusions of their Independent Whitepaper stated,

“This trial demonstrated the ability to significantly reduce costs for high risk patients through use of the CYTTA Connect Ecosystem.  The trial demonstrated the ability to quickly achieve cost savings, decrease resource utilization, improve care coordination, and increase adherence to evidence based guidelines.  Adherence to evidence based guidelines is increasingly important as CMS 5 STAR ratings garner importance

Care costs were reduced on average by $11,078 [or $1,846 per member per month] for each trial participant.  This trial did not specifically address long term cost of care.  However, these patients were selected for the inabilities of the existing healthcare system and care coordination programs to cost effectively address their short or long term healthcare needs.  One trial participant noted he realized more value and benefit in 2 months of trial participation compared to his previous 17 months of participation in the best available care coordination services.  A quite handsome return on investment is present if the care coordination system is priced at less than $2,000 per year.



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  Summary of Trial results


 

 

 

 

 

 

 

Pre-trial

Post-trial

Last 90 days of trial

Change

Cost Savings

Admits

28

17

3

9

$198,000

Readmits

12

5

0

7

$140,000

Bed Days

90

143

80

(53)

 

ER Visits

44

26

4

18

$21,600

UC Visits

12

4

1

8

$720

Specialists

102

92

36

10

$1,250

PCP

92

78

18

14

Capitated

Total Cost Savings  

 

 

 

 

$221,570

Cost Savings per Member over 6 months

 

 

 

 

$11,078

Cost savings per Member per month (PM/PM)

 

 

 

 

$1,846


This trial also demonstrated that home biometric monitoring using the CYTTA Connect Ecosystem can be easily introduced, dispensed and utilized in the home setting.  Care team training was easily completed.  CYTTA Connect was easy for patients and care coordinators to learn and effectively use.  Technical troubleshooting was prompt and effective.


Improved patient engagement and ability to self-manage care will become increasingly important and require new resource allocation because CMS will soon require Stage II Readiness participation.  Through repeated collection and review of biometric data patients learn how to titrate medications and adjust behaviors to achieve target goals which is a cornerstone of CMS 5 STAR performance and CMS Stage II Readiness.   Patients and the care coordination team are prompted by alerts to evaluate and to intervene in real time.  This produces a patient who is more engaged and prospectively aware of how they must modify behaviors and medications to meet target metrics through self-management.  Additionally, improved achievement of target metrics produces significant provider and care team satisfaction.  Efforts of both become both more effective and more efficient.  

Effective use of the CYTTA Connect Ecosystem requires the managing physicians to develop and communicate care plans and standing orders to adjust medications to achieve target goal.  Too often the goals of care and associated care plans including medication administration are poorly communicated or not present.  Patients travel through various sites of service and levels of care without a clear understanding of the expected behaviors and medication usage to be executed in the home setting.  CYTTA Connect in conjunction with care coordination resolves this deficit and allows for care plan and medication revision as the patient disease processes change in the home environment.  Through repeated measurement and with focused care coordination the patient learns how to better manage their health care needs.  This produces a patient who is more engaged and prospectively aware of how they must modify behaviors and medications to meet target metrics.  This also produces a more satisfied patient, physician, and care coordination team.  



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This trial discovered patients view CYTTA Connect and remote telemonitoring as a special benefit to patients who are encouraged to retain their relationship with Heritage to continue to access and build their personal health database.  Patients develop a special relationship with their care coordination team. The patients viewed CYTTA Connect and care coordination activities as a value rather than an intrusion because information and advice generated by the trial were specific to the patient and time sensitive.  

This trial enabled physicians and care coordinators to more effectively manage a larger number of patients.  Current care coordination ratios can be expanded by 20% using biometric remote telemonitoring through reduced telephone tag and elimination of unfocused, subjective, generic discussions with patients.  Instead specific biometric data, medication usage, review of the active care plan, and comparison to target metrics produces a focused discussion.  Patients and care coordinators are taught through rapid cycle improvement to Plan, Do, Study, and ACT.  Barriers to successful self-management are identified and addressed.  Patients now learn how to revise and update their care management in the home setting rather than a physician office, emergency or hospital room followed by an attempt to translate and implement the care plan in their home setting upon discharge.  Patient contacts have become value oriented with immediate return on investment to the care coordinators and patient.”  

As can be seen from the above conclusion, the Company’s integrated and completely autonomous system provides numerous advantages over current monitoring systems, as well as a pricing structure designed to generate a positive return on investment (ROI) for the Medical Groups utilizing the system.  To this end the Company is currently demonstrating and actively marketing the Cytta Connect TM system to numerous Medical Group clients wishing to utilize and or participate in the Company’s “medical monitoring ecosystem”.  

Cytta currently has limited operating costs and expenses at the present time due to our relatively new business activities. However we anticipate significantly increasing our activities as a result of the first sales of our systems and the installation thereof. We have entered into certain management and consulting contracts with our senior Officers and non-affiliated consultants who will be providing business services to the Company in the health care arena. Additionally, we will be required to raise significant capital over the next twelve months, in connection with our operations resulting from our marketing Agreements. We have engaged in significant product research and development over the past year while the technology and system was being developed. The Company’s business may cause us to engage in further research and development in the foreseeable future.


 We have no present plans to purchase or sell any plant or significant equipment although we will have to acquire some equipment related to the marketing Agreements. We also have immediate plans to add employees and we will continue to do so in the future as a result of the operations related to the marketing of our systems.

Liquidity and Capital Resources

Our cash and cash equivalents balance as of March 31, 2012 was $41,891.

We currently have limited marketing operations.

We have limited funds on hand to pursue our business objectives for the near future, however we cannot commence full scale operations without seeking additional funding. We currently do not have a specific plan of how we will obtain such funding.



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Loans to the Company

We have been receiving loans from shareholders of the company to pay general operating costs. As of March 31, 2012, we had $897,840 in loans outstanding.

We have minimal operating costs and expenses at the present time due to our limited business activities. Currently our operating activities in the healthcare arena are conducted by our senior Officers and engaged consultants.  We will, however, be required to raise additional capital over the next twelve months to meet our current administrative expenses and to develop our operations. This financing may take the form of additional sales of our equity or debt securities to, or loans from, stockholders, or from our officers and directors or other individuals. There is no assurance that additional financing will be available from these or other sources, or, if available, that it will be on terms favorable to us.

Going Concern

Our auditors have included an explanatory paragraph in their report on our financial statements relating to the uncertainty of our business as a going concern, due to our limited operating history, our lack of historical profitability, and our limited funds. We believe that we will be able to raise the required funds for operations and to achieve our business plan.

Off-Balance Sheet Arrangements

We have never entered into any off-balance sheet financing arrangements and have not formed any special purpose entities with the exception of the Cytta Connect LLC joint venture which has ceased operations. We have not guaranteed any debt or commitments of other entities or entered into any options on non-financial assets.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4T.

CONTROLS AND PROCEDURES

Evaluation of Our Disclosure Controls

Under the supervision and with the participation of our senior management, including our principal executive officer and chief financial officer, Gary Campbell, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this quarterly report (the “Evaluation Date”). Based on this evaluation, our chief executive officer and chief financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective such that the information relating to us, required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2013 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.



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PART II – OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

In the ordinary course of our business, we may from time to time become subject to routine litigation or administrative proceedings which are incidental to our business. As at March 31, 2013 we are not a party to nor are we aware of any existing, pending or threatened lawsuits or other legal actions involving us.

ITEM 1A.

RISK FACTORS

Not applicable.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the quarter ended March 31st, 2013, the Company sold/issued securities that were not registered under the Securities Act of 1933 as follows:

During the six months ended March 31, 2013 the company issued 496,000,000 pre-split common shares for $431,663 in subscriptions, 193,000,000 pre-split common shares for $173,893 in services, and converted 14,718,186 preferred shares into 1,471,818,600 pre-split common shares in reliance upon the exemption from registration contained in Section 4(2) of the Securities Act of 1933, as amended. The Company did not engage in any general solicitation or advertising. The Company issued the stock certificates and affixed the appropriate legends to the restricted stock.

None of the transactions involved any underwriters or underwriting discounts. All of the purchasers were deemed to be sophisticated financially and with regard to an investment in our securities.

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On April 25 th , 2013 the Company received notice from the Financial Industry Regulatory Authority (FINRA) that they had received the documentation necessary to effect the Reverse Stock Split. This corporate action was announced on April 26 th , 2013 and will took effect at the open of business on April 29 th , 2013.


Trading of the Common Stock on the OTC QB will continue, on a Reverse Split-adjusted basis and its ticker symbol (CYCA) will remain unchanged, although a "D" will be placed on the CYCA ticker symbol (CYCAD) for 20 business days to alert the public about the Reverse Split. The new CUSIP number for the Common Stock following the Reverse Split is 12673W407.


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On April 9 th , 2013, Cytta Corp (the Company), received confirmation from the Secretary of State of the State of Nevada that the Certificate of Change Pursuant to NRS 78.209 (the Certificate of Change) to the Amended and Restated Articles of Incorporation to effect a reverse split and par value increase of the Company’s Common Stock, $0.00001, par value per share (the Common Stock), at a ratio of 1-for-300 with all fractional shares rounded up to the next whole share (the Reverse Stock Split) was duly filed on April 9 th , 2013 to be effective April 29 th , 2013. After the Reverse Stock Split, the Company has approximately 12,630,490 common shares $0.001 par value outstanding. Pursuant to the Reverse Stock Split, the number of authorized shares of the Company’s Common Stock was reduced to 13,000,000 shares of Common Stock.


Each shareholder's percentage ownership interest in the Company and proportional voting power remains unchanged after the Reverse Stock Split except for minor changes and adjustments resulting from rounding up the fractional shares. The rights and privileges of the holders of Company’s Common Stock are substantially unaffected by the Reverse Stock Split.

 

On April 10, 2013, the Company filed a Certificate of Amendment to its Amended and Restated Articles of Incorporation pursuant to NRS 78.385 and 78.390 (the Certificate of Amendment) to increase the number of authorized shares of the Company’s Common Stock from 13,000,000 to 100,000,000 shares (the Capital Increase Amendment) on April 29 th , 2013 following the Reverse Stock Split.


The Reverse Stock Split and Capital Increase Amendment were approved by the Board of Directors of the Company on April 5th, 2013. In addition, the actions taken by the Board of Directors with respect to the Capital Increase Amendment were approved by the written consent dated as of April 5 th , 2013 of the Company’s stockholders entitled to vote a majority of the shares of Common Stock then outstanding.


The primary objective of the Reverse Split is to increase the per share price of the Common Stock in order to potentially allow the Company to seek a listing of the Common Stock on a more established trading market, including a stock exchange.


The Company elected to affect a reverse stock split as part of its efforts to better align the stock price with its accomplishments and future growth potential. The Company believes that an increase in the share price of its common stock may enhance its ability to attract new investors and broaden its shareholder base. Many institutional investors and investment funds may be reluctant to invest, and in some cases prohibited from investing, in lower-priced stocks. In addition, the Company expects that the reverse stock split should provide benefits to Cytta Corp. stockholders by facilitating lower transaction costs, improving trading liquidity of the stock, and reducing share price volatility.


Further, we believe that our current low stock price negatively affects the marketability of our existing shares and our ability to raise additional capital.  Although we cannot guarantee it, we hope that the Reverse Split will increase the market price of our stock. Theoretically, the increase should occur in a direct inverse proportion to the Reverse Split ratio.  In other words, with a Reverse Split ratio of 1 to 300 the assumption is that the market price of our stock should increase by three hundred (300) following the Reverse Split. Stockholders should note that the effect of the Reverse Stock split upon the price of the Company’s Common Stock cannot be accurately predicted.


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Finally, we are hopeful that the Reverse Split and the resulting anticipated increased price level will encourage interest in our Common Stock and possibly promote greater liquidity for our shareholders; however we cannot guarantee any of the foregoing.

ITEM 5.

OTHER INFORMATION

None.

ITEM 6.

EXHIBITS

The following exhibits are included as part of this report:

Exhibit No.                                                        Description

31.1 / 31.2  Rule 13(a)-14(a)/15(d)-14(a) Certification of Principal Executive and Financial             Officer

32.1 / 32.2      Rule 1350 Certification of Principal Executive and Financial Officer



18




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.

CYTTA CORP.

Dated: May 24th, 2013

By:/s/ Gary Campbell

Gary Campbell
President, Principal Executive and Financial Officer





19



                                                  EXHIBIT 31.1


      CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER


I, Gary Campbell, certify that:


1.   I have reviewed this report on Form 10-Q of Cytta Corp.


2.   Based on my  knowledge,  this  quarterly report  does not  contain any untrue

     statement of a material fact or omit to state a material fact  necessary to

     make the statements  made, in light of the  circumstances  under which such

     statements  were made, not misleading with respect to the period covered by

     this report;


3.   Based on my  knowledge,  the  financial  statements,  and  other  financial

     information  included  in  this  report,  fairly  present  in all  material

     respects the financial  condition,  results of operations and cash flows of

     the registrant as of, and for, the periods presented in this report;


4.   The  registrant's  other  certifying  officer(s) and I are  responsible for

     establishing and maintaining disclosure controls and procedures (as defined

     in Exchange Act Rules  13a-15(e) and 15d-15(e))  and internal  control over

     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and

     15d-15(f)) for the registrant and have;


     (a)  Designed  such  disclosure  controls  and  procedures,  or caused such

          disclosure   controls  and   procedures   to  be  designed   under  my

          supervision,  to ensure  that  material  information  relating  to the

          registrant,  including its consolidated subsidiaries, is made known to

          me by others within those entities,  particularly during the period in

          which this report is being prepared;

     (b)  Designed such internal  control over  financial  reporting,  or caused

          such internal control over financial reporting to be designed under my

          supervision, to provide reasonable assurance regarding the reliability

          of financial reporting and the preparation of financial statements for

          external  purposes in accordance  with generally  accepted  accounting

          principles;

     (c)  Evaluated the  effectiveness of the registrant's  disclosure  controls

          and procedures  and presented in this report my conclusions  about the

          effectiveness of the disclosure controls and procedures, as of the end

          of the period covered by this report based on such evaluation; and

     (d)  Disclosed  in this  report  any  change in the  registrant's  internal

          control  over  financial  reporting  that  occurred  during the period

          covered by this annual  report  that has  materially  affected,  or is

          reasonably  likely to materially  affect,  the  registrant's  internal

          control over financial reporting; and




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5.   The  registrant's  other  certifying  officer(s) and I have disclosed,

     based on our most recent  evaluation  of internal  control  over  financial

     reporting,  to  the  registrant's  auditors  and  the  audit  committee  of

     registrant's  board of  directors  (or persons  performing  the  equivalent

     functions):


     (a)  All significant  deficiencies and material weaknesses in the design or

          operation  of internal  control  over  financial  reporting  which are

          reasonably  likely to  adversely  affect the  registrant's  ability to

          record, process, summarize and report financial information; and

     (b)  Any fraud, whether or not material, that involves management or other

          employees who have a  significant  role in the  registrant's  internal

          control over financial reporting.


Dated: May 24, 2013



By: /s/ Gary Campbell

   ----------------------------------------------

   Gary Campbell

   President, Chief Executive and Chief Financial Officer





21



                                                      EXHIBIT 32.1


      CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

                       PURSUANT TO 18 U.S.C. SECTION 1350,

                             AS ADOPTED PURSUANT TO

                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection  with the Quarterly  Report of Cytta Corp. (the "Company") on Form

10-Q for the quarter  ended March 31, 2013 as filed  with the  Securities  and

Exchange  Commission  on the date hereof (the  "Report"),  I, Gary Campbell,

Chief Executive and Chief Financial Officer of the Company, certify,  pursuant to

18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley

Act of 2002, that;


     (1)  The Report fully  complies with the  requirements  of Section 13(a) or

          15(d) of the Securities Exchange Act of 1934; and


     (2)  The  information  contained  in the  Report  fairly  presents,  in all

          material respects,  the financial  condition and results of operations

          of the Company.


A signed  original of this  written  statement  required by Section 906 has been

provided to the Company and will be retained by the Company and furnished to the

Securities and Exchange Commission or its staff upon request.



Dated: May 24, 2013



By: /s/ Gary Campbell

   ----------------------------------------------

   Gary Campbell

   President, Chief Executive and Chief Financial Officer











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