IMK GROUP, INC. - FORM 10-K

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EXCEL - IDEA: XBRL DOCUMENT - IMK GROUP, INC.	Financial_Report.xls
EX-31 - EXHIBIT 31.1 - IMK GROUP, INC.	ftpr20130524_10kex31-1.htm
EX-32 - EXHIBIT 32.1 - IMK GROUP, INC.	ftpr20130524_10kex32-1.htm

KU.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

[X]

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

For the fiscal year ended February 28, 2013

[_]

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

For the transition period from ___________ to ___________

Commission file number: 000-54211

FUTURA PICTURES, INC.

____________________________________________

(Name of small business issuer in its charter)

Delaware

(State or other jurisdiction of incorporation or organization)

56-2495218

(IRS Employer Identification No.)

17337 Ventura Boulevard, Suite 216, Encino, California

(Address of principal executive offices)

91316

(Zip Code)

(818) 784-0040

______________________

(Issuer's telephone number)

Securities registered under Section 12(b) of the Exchange Act:

Title of each class registered: None Name of each exchange on which registered: None

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, par value $.0001

_____________________________

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes

No X

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes

No X

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes X

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every interactive data file required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 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 X No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐

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.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☐ (Do not check if smaller reporting company)	Smaller reporting company ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.)

Yes

No X

Approximate aggregate market value of the registrant’s common stock held by non-affiliates as of February 28, 2013, based upon the last sale price reported for such date on the OTC Bulletin Board was $146,700

At May 20, 2013, the registrant had 1,599,750 shares of Common Stock, $.0001 par value, issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None

CONTENTS

			PAGE

PART I
	Item 1.	Description of Business	5
	Item 2.	Description of Property	11
	Item 3.	Legal Proceedings	11
	Item 4.	Mine Safety Disclosures	11

PART II
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchase of Equity Securities	12
	Item 6.	Select Financial Data	12
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	12
	Item 7A	Quantitative and Qualitative Disclosures About Market Risk.	16
	Item 8	Financial Statements and Supplementary Data.	17
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	28
	Items 9A.	Controls and Procedures	28
	Item 9B.	Other Information	29

PART III
	Item 10.	Directors, Executive Officers, and Corporate Governance	29
	Item 11.	Executive Compensation	31
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	32
	Item 13.	Certain Relationships and Related Transactions, and Director Independence	32
	Item 14.	Principal Accountant Fees and Services	33

PART IV
	Item 15.	Exhibits and Financial Statement Schedules	34

SIGNATURES			35

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This fiscal 2013 Annual Report on Form 10-K, including the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” contains “forward-looking statements” that include information relating to future events, future financial performance, strategies, expectations, competitive environment, regulation and availability of resources. These forward-looking statements include, without limitation, statements regarding: proposed new products or services; our statements concerning litigation or other matters; statements concerning projections, predictions, expectations, estimates or forecasts for our business, financial and operating results and future economic performance; statements of management’s goals and objectives; trends affecting our financial condition, results of operations or future prospects; our financing plans or growth strategies; and other similar expressions concerning matters that are not historical facts. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes” and “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements.

Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by which, that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause these differences include, but are not limited to:

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our inability to raise additional funds to support operations and capital expenditures;

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our inability to achieve greater and broader market acceptance of our products and services in existing and new market segments;

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our inability to successfully compete against existing and future competitors;

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our inability to manage and maintain the growth of our business;

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our inability to protect our intellectual property rights; and

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other factors discussed under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business.”

Forward-looking statements speak only as of the date they are made. You should not put undue reliance on any forward-looking statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable securities laws. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

Item 1. Description of Business

(a) Background

We were incorporated in the State of Delaware on December 10, 2003. From the date of incorporation through December 2007 the sole component of our business plan called for the producing and co-financing of motion pictures whose production budgets are estimated to range between $500,000 and $1,500,000, produced solely for distribution to the domestic and international home video markets.

As a result of not being able to raise the necessary funds to either co-finance or produce any motion pictures, management changed the Company’s business plan to that of producing and distributing self- improvement/educational DVDs and workforce training programs. The major reason for this decision was that the funds needed to produce or acquire self- improvement/educational DVDs and workforce training programs are substantially less than required for the production of motion pictures. During the next 12 months we will be seeking to produce, or acquire another one or two “self-improvement/educational” DVDs, and to expand our library of training programs.

Effective January 1, 2011, pursuant to an Asset Transfer, Assignment and Assumption Agreement, we acquired from Progressive Training, Inc. all of its assets and liabilities related to Progressive’s workforce training business. Among the assets we acquired in the transaction described above are fourteen training video programs including: Twelve Angry Men: Teams That Don't Quit. The video is based on the classic film starring Henry Fonda and utilizes 12 minutes of clips from the film, The Cuban Missile Crisis: A Case Study in Decision Making and Its Consequences. This video is based on the decision making process of President Kennedy and his Cabinet during the Cuban missile crisis, It’s a Wonderful Life: Leading Through Service, features film clips from the classic motion picture It’s a Wonderful Life, starring Jimmy Stewart, along with on-camera commentary by Dr. Wheatley, How Do You Put A Giraffe Into A Refrigerator? an animated short that is used as a meeting opener to stimulate the thinking of the participants, Character in Action: The United States Coast Guard on Leadership. This video demonstrates the highest qualities of leadership, and how to apply them, using the example of the United States Coast Guard. Additionally, we acquired the best-selling and critically acclaimed training video entitled Work Teams and The Wizard of Oz.

In addition to the assets listed above, we acquired a website, www.advancedknowledge.com for the online sale and marketing of our products. We market and sell all our training programs and self-improvement DVDs under the Company’s dba Advanced Knowledge. See COMPANY HISTORY page 11.

(b) Description of Business

As stated earlier, our initial business plan called for the co-financing or producing of motion pictures whose production budgets are estimated to range between $500,000 and $1,500,000, produced solely for distribution to the domestic and international home video markets. As a result of not being able to raise the necessary funds to either co-finance or produce any motion pictures, management altered the Company’s business plan to that of producing and distributing self- improvement/educational DVDs and workforce training programs. During the next 12 months we will be seeking to produce, or acquire another one or two “self-improvement/educational” DVDs, and to expand our library of workforce training programs.

WORKFORCE TRAINING INDUSTRY OVERVIEW

General

Except where specifically indicated, the following industry views and analysis are based on management's interpretations and beliefs resulting from their experience in the production, sales and marketing of workforce training videos, and their attendance at industry events such as the annual American Society for Training & Development (ASTD) meeting where industry trends are discussed.

According to the Annual Industry Report published by Nielsen Business Media in its November/December 2012 issue of its industry publication, TRAINING MAGAZINE:

●

Approximately $55.8 billion was spent for training in 2012 by U.S. organizations with 100 or more employees. This compares to approximately $59.7 billion total industry spending in 2011. These figures were calculated by projecting the average training budget to a weighted universe of companies, using the Dun & Bradstreet counts of U.S. organizations with more than 100 employees. The 6.5 % reduction was attributed to downward economic trend that continued during 2012. Some 65 percent of organizations either saw their training budget remain the same or decrease in 2012. Training payroll increased substantially, from $31.3 billion to $36.4 billion, but spending on outside products and services decreased $1.7 billion to 7.4 billion.

Average training expenditures for large companies decreased from $12.7 million in 2011 to $11.3 million in 2012, but midsize and small companies saw slight increases (from $1.8 million to $2 million for midsize organizations and from $256,082 to $294,532 for small companies). Some 29 percent of organizations said they increased staff from the year before (the same as in 2011), while 51 percent said the level remained the same (down from 55 percent in 2011). Some 20 percent said it was lower, vs. 16 percent in 2011. Retailers/wholesalers have the largest personnel costs at an average of $1.8 million. Across all organization types, larger companies spend roughly six times as much as midsize ones, and midsize companies spend approximately four times as much as small ones. The average payroll figure for large companies was $4.7 million; for midsize organizations, it was $763,549; for small companies, it was $187,354. The overall average for all companies was $1.2 million.

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$7.4 billion of that $55.8 billion was spent on outside providers of products and services in 2012. This compares to $9.1 billion in 2011. The 1.7 billion reduction is consistent with the overall reduction of corporate spending for training. These products and services include "off-the-shelf" materials (our videos and work books are included in this category). Management feels that the decline in expenditures for outside products and services is a result of general economic conditions causing corporations to reduce their training expenditures by less use of outside consultants, and more utilization of in-house developed training materials.

"Soft-Skill" training and Information Technology training represent the industry's two major distinct sources of revenue. Soft-Skill training includes management skills/development, supervisory skills, communication skills, new methods and procedures, customer relations/services, clerical/secretarial skills, personal growth, employee/labor relations, and sales. Information Technology training includes client/server systems, internet/intranet technologies, computer networks, operating systems, databases, programming languages, graphical user interfaces, object-oriented technology and information technology management.

Training Video Production

The process of producing training videos is comprised of three stages. They are: (a) pre-production, (b) principal photography, and (c) post production. Budgets for the production of these programs can vary widely as there are a number of factors that contribute to the production budget. Included among these factors are the number of locations and sets, the size of the cast and crew, the amount paid to the on-camera host, and the quality of the post production process. In many cases production budgets range from a low of $50,000 to a high of $150,000.

During prior fiscal years approximately 25% to 30% of our revenue was derived from the sale of training videos produced by other companies. However, during fiscal year ended February 28, 2013, due to our lack of cash resources we operated without any sales personnel. As a result, the Company derived minimal revenue from the sale of third party videos during fiscal 2013. If our cash resources permit we hope to employ one or two sales personnel during fiscal 2014, which should result in a higher portion of our revenue being derived from the sale of videos produced by other companies. Most producer/distributors enter into non-exclusive sub-distribution agreements with other industry distributors to market and sell their videos. Additionally, there are many independent producers who produce one or two videos a year. These independent producers then enter into distribution agreements for the marketing and sale of their videos. Such agreements are usually on a royalty basis, and may include an advance against royalties.

The Soft Skill Training Market

There are over thirty different specific soft-skill training subjects utilized by organizations to increase employee productivity and awareness. Among the top ten subjects are: new-employee orientation, leadership, sexual harassment, new-equipment orientation, performance appraisals, team-building, safety, problem-solving/decision-making, train-the-trainer, and product knowledge.

We have produced and are marketing training videos that address a number of the above mentioned soft-skill categories. These videos address such categories as leadership, team-building, and problem solving/decision-making. These three categories match the focus of the videos in our current library.

Although many organizations continue to maintain in-house training departments, outside suppliers represent a significant portion of the training budget. Training Magazine reported in its recent industry report that training delivered by outside sources represented approximately 19% of the total dollars spent on training.

The Information Technology Market

To date, we have not produced any training programs for the information technology market. For the foreseeable future we do not anticipate producing products for this segment of the market due to the cost of producing such products. Therefore, no discussion of the Information Technology market is included in this report.

Products and Services

During fiscal 2013 we devoted our limited resources to the distribution of workforce training videos acquired from Progressive Training, and we completed and commenced the distribution of two new workforce training DVDs. The first DVD is entitled Chilean Mine Rescue: The Unstoppable Team. This DVD is based on the resourceful teamwork during the successful Chilean mine rescue. Our newest DVD is entitled, The Power of Teamwork. This DVD teaches the extraordinary elements of teamwork employed by the Navy’s world renowned Blue Angel flight demonstration team.

Accompanying each of the videos is a workbook that is designed to be given to all employees participating in the training program. These workbooks are written for us by training professionals and serve to reinforce and enhance the lasting effectiveness of the video.

Training videos typically have a running time of 20 to 35 minutes. The price range for training videos is from a low of $295 to over $895 per video. Except for our video entitled HOW DO YOU PUT A GIRAFFE INTO A REFRIGERATOR?, which is used as a short 3 minute meeting opener, the videos we acquired fall within the 25 to 35 minute running time range and are sold within the price range mentioned above. The wide variance in the pricing structure is due to such factors as quality of production, on-camera personalities, source of material, sophistication of graphics, and accompanying reference materials. To date, our strategy has been to concentrate on producing high caliber videos utilizing elements and production values that will generate sales at the higher end of the price range, where profit margins are greater.

The price differential between a corporate training video and a standard consumer video is justified by the fact that an organization will purchase a video and utilize it to train hundreds of employees over many years.

Sales and Marketing

As stated earlier, the Company's business is conducted under the dba Advanced Knowledge. Accordingly, all of our marketing and sales materials incorporate the Advance Knowledge name and logo. In most cases, the sale of management and general workforce training videos involve direct mail solicitation, preview request fulfillment, and telemarketing. We begin our sales effort by identifying prospective buyers and soliciting them through direct mail appeals that offer the recipient a free preview. In addition, we market and distribute our work force training videos via our web site at www.advancedknowledge.com. During the past year there has been a significant increase within the training industry on the utilization of the internet to both market and deliver training products.

Preview request fulfillment represents a major part of our sales plan. It has been our experience that most professional trainers will not purchase a training video until they have previewed it in its entirety, affording them an opportunity to evaluate the video's applicability to their specific objective and to judge its effectiveness as a training tool. Rather than shipping preview copies, most customers now preview videos on-line. Within a short period of time following the preview request, a representative will call the prospective buyer to obtain their comments and to ascertain their level of interest.

Telemarketing

We manage our telemarketing efforts by utilizing part-time staff or free-lance telephone representatives who focus primarily on following up on leads that have been generated through our website. Before calling potential customers our telemarketers are provided with information on a customer's buying history and past needs.

DIRECT MAIL

As a result of our clients’ preference for receiving product information on-line, along with the cost saving, we have almost completely abandoned the use of direct mail solicitation.

COMPANY WEBSITE

Our experience during the past few years has been that increasingly corporate training managers and others responsible for the purchase of training videos are utilizing the internet to research and make their purchases. As a result, we anticipate spending available funds to upgrade our website’s functionality by improving its overall design, and by adding additional features, such as the ability to preview videos online, broaden the website's database to include more content information on most videos, increase the website's search capabilities, and to generally make the website more user friendly.

Additionally, in an effort to increase traffic to our website, we have paid both Google and Yahoo for better placement on their search engines. We intend to continue to pay these search engines for prime placement, as our financial resources permit.

COMPETITION

The workforce training industry is highly fragmented, with low barriers to entry and no single competitor accounting for a dominant market share. Among our competitors are companies such as Media Partners Corp., the LearnCom Corporation, Coastal Training Technologies, and CRM Learning. Many of our competitors have a competitive edge, as demonstrated by the fact that these companies were able to spend significantly more money for the production, and marketing of new videos. Additionally, we compete with the internal training departments of companies and other independent education and training companies.

INTERNAL TRAINING DEPARTMENTS

We have learned that internal training departments generally provide companies with the most control over the method and content of training, enabling them to tailor the training to their specific needs. However, because internal trainers in many cases find it difficult to keep pace with new training concepts and technologies and lack the capacity to meet demand, organizations supplement their internal training resources with externally supplied training in order to meet their requirements.

Independent Training Providers

Our experience has revealed that independent training providers range in size and include publishers of texts, training manuals and newsletters, as well as providers of videos, software packages, training programs, and seminars.

As a result of the need for external training products and services, many large corporations have entered the field by establishing corporate training divisions. Among the larger competitors are: Times Mirror Corporation; Sylvan Learning Systems, Inc.; Berkshire Hathaway; and Harcourt General. Additional competitors currently producing training products include Blanchard Training & Development, Career Track, American Media, Pfeiffer & Company, CRM Films, Charthouse International, and Learning Works. In all cases, the companies listed above have established credibility within the training industry and, compared to us, have substantially greater name recognition and greater financial, technical, sales, marketing, and managerial resources.

The workforce training market is characterized by significant price competition, and we expect to face increasing price pressures from competitors as company training managers demand more value for their training budgets. There can be no assurance that we will be able to provide products that compare favorably with workforce instructor-led training techniques, interactive training software or other video programs, or that competitive pressures will not require us to reduce our prices significantly.

Summary

It is our belief that these foregoing factors have resulted in an increase in training requirements for employees who must perform new job functions or multiple job tasks that require knowledge of varied software applications, technologies, business specific information, and other training topics. Furthermore, since we believe that many businesses use hardware and software products provided by a variety of vendors, their information technology professionals require training on an increasing number of products and technologies which apply across vendors, platforms and operating systems.

“EDUCATIONAL/SELF-IMPROVEMENT” DVD PRODUCTION

The process of producing “Self-improvement” DVDs is comprised of the same stages of production as outlined above for the production of training videos. They are: (a) pre production, (b) principal photography, and (c) post production. We anticipate that the budgets for the production of these DVDs will range between $50,000 and $100,000.

The Self Improvement Market

Products and services within the industry are mainly comprised of: books, audiotapes, CDs, DVDs, seminars and workshops, infomercials, catalogs, and lectures. Among the topics covered by these products are: inspirational/motivational, losing weight, leadership, sales skills, improving relationships, gaining financial independence/money making opportunities, exercise programs or equipment, stress management, memory improvement, and speed reading.

According to Marketdata’s report the self-improvement market is largely comprised of female customers, especially for programs related to relationships, weight loss, exercise, spirituality and Far Eastern topics. Seventy percent of self-improvement book buyers and seminar participants are women. For men, the market is concentrated primarily on business and organizational skills improvement, and money making opportunities like real estate investment or stock trading systems. Programs related to stress management and relaxation techniques are more broad-based, applicable to both sexes. A substantial share of our customers is located on the two coasts of the United States. California is especially receptive to “new age” topics, Far Eastern disciplines, holistic and alternative health care.

Customers

We market the “The 5 Communication Secrets That Swept Obama To The Presidency,” DVD, and will market any future self-improvement/educational DVDs that we may produce through several distribution channels to individuals seeking to improve their professional skills and personal qualities, educational institutions, i.e. libraries and universities for teaching purposes, and to organizations for employee training. Our current distribution channels are comprised of a network of both domestic and international distributors.

Product

Given our current inability to raise sufficient funds to initiate the co-financing or production of low budget motion pictures, our product during the next twelve months will be limited to self-improvement/educational DVDs. In an attempt to enhance the product’s revenue potential we created a “Personal Version” and “Business Version” of “The 5 Communication Secrets That Swept Obama To The Presidency,” DVD. The “Personal Version,” consisting of the DVD and Workbook is marketed to individuals and to libraries and schools. The “Business Version,” consisting of the DVD, Facilitator’s Guide, Participant Workbook, Power Point presentation, and Reminder Cards is marketed to organizations for employee training. We anticipate following this formula for any future DVDs we produce.

Sales and Distribution

US Sales and Distribution

We sell the “Personal” version of “The 5 Communication Secrets That Swept Obama To The Presidency,” under a distribution agreement with Gaiam, Inc., a leading lifestyle media company. Gaiam places product in a variety of retailers, including bookstores such as Barnes & Noble and Borders; media stores such as Best Buy and Blockbuster; and mass merchant stores such as WalMart and Target. Additionally, the DVD is being sold to libraries and learning institutions under a distribution agreement with Films For The Humanities, a distribution company specializing in marketing and sales to the educational market.

The “Business Edition” version is being marketed via a network of both domestic and international distributors specializing in the sales of employee training products. Among the domestic distributors selling the DVD are, Workplace Publishing, Advanced Knowledge, and Learncom. We have agreements with a number of international distributors for the sale and marketing of “The 5 Communication Secrets That Swept Obama To The Presidency,” DVD, in countries including Canada, Mexico, Israel, India, South Africa, England and Hong Kong.

Competition

Both the educational/self-improvement and the personnel training industries are comprised of numerous large, mid-sized, and small independent production companies. Many of these companies have access to vast financial resources. Additionally, they have established long standing relationships with talent and distribution outlets throughout the world.

Some of the companies in the these industries have been operating since the 1930s, while others have just recently become popular by virtue of a best- selling book/DVD.

Company History

As stated above, we were incorporated in the State of Delaware on December 10, 2003. From the date of incorporation through December 2007 the sole component of our business plan called for the producing and co-financing of motion pictures whose production budgets are estimated to range between $500,000 and $1,500,000, produced solely for distribution to the domestic and international home video markets.

As a result of not being able to raise the necessary funds to either co-finance or produce any motion pictures, management changed the Company’s business plan to that of producing and distributing self- improvement/educational DVDs and workforce training programs. The major reasons for this decision was that the funds needed to produce or acquire self- improvement/educational DVDs and workforce training programs are substantially less than required for the production of motion pictures. Additionally, our management has years of experience in the production and distribution of this type of product.

In November 2008, the Company commenced the production of a 47 minute “self-improvement/educational” DVD entitled, “The 5 Communication Secrets That Swept Obama to the Presidency.” The DVD uses video examples of President Barack Obama’s most memorable speeches to illustrate five essential secrets of effective public and personal communication. International communication analyst and coach Richard Greene hosts the DVD and instructs in the system of communication techniques he created. The DVD was completed in February 2009, and is being sold and marketed to individuals via the internet and through distributors specializing in the sale of product to the educational market, i.e. libraries, universities etc. Additionally, the Company created a “Business Edition” version of the DVD. This version includes the 47 minute DVD, along with a Leader Guide, Participant workbook, and Power Point presentation. It is being marketed both domestically and internationally by distributors to organizations for the training of their personnel in communication skills.

Since the acquisition mentioned above we have worked to expand both our domestic and foreign distributor network. We have succeeded in establishing non-exclusive distribution agreements with a number of additional distributors to market and sell our product. In many instances, we have mutual non-exclusive distribution agreements to market/distribute their products.

During the second quarter of fiscal 2013, we completed and commenced the distribution of one new workforce training DVD. The DVD is based on the resourceful teamwork during the successful Chilean mine rescue. In the beginning of the third quarter of fiscal 2013, we completed and commenced the distribution of a second DVD that teaches the extraordinary elements of teamwork employed by the Navy’s world renowned Blue Angel flight demonstration team.

ITEM 1A. Risk Factors.

Not applicable because the Company is a smaller reporting company.

Item 2. Description of Property

Through August 2012, we had been leasing a 750 square feet office space from Encino Gardens LLC, an unaffiliated third party, on a month-to-month basis for $900 per month. In September 2012, we terminated that agreement and signed a new six month lease with Encino Gardens for a smaller office space, consisting of a total of approximately 450 square feet, for $600 per month, located at 17337 Ventura Boulevard, Suite 216 Encino, California 91316. As of February 28, 2013 this lease converted to a month-to-month basis and the rent going forward is $650 per month.

Total rent expense was $9,000 and $10,800 for the year ended February 28, 2013 and February 29, 2012, respectively.

Item 3. Legal Proceedings

As of the date hereof, we are not a party to any material legal proceedings, and we are not aware of any such claims being contemplated against us.

Item 4. Mine Safety Disclosures

Not Applicable

PART II

Item 5. Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock has been quoted on the OTC Bulletin Board under the symbol “FTPR” since January 28, 2011.

	High		Low
Year Ended February 28, 2013
1st Quarter	$	1.20	$	1.20
2nd Quarter		1.20		1.01
3rd Quarter		1.01		1.01
4th Quarter		1.01		0.55

Year Ended February 29, 2012
1st Quarter	$	1.50	$	0.51
2nd Quarter		0.60		0.51
3rd Quarter		0.75		0.60
4th Quarter		1.20		0.60

Holders

As of February 28, 2013, we have 1,599,750 shares of common stock issued and outstanding held by approximately 70 shareholders of record. We currently have no outstanding options or warrants for the purchase of our common stock and have no securities outstanding which are convertible into common stock. We have not yet adopted or developed any plans to adopt any stock option, stock purchase or similar plan for our employees.

Common Stock

The Company’s certificate of incorporation provides for the authorization of 100,000,000 shares of common stock, $0.0001 par value. As of February 28, 2013, 1,599,750 shares of common stock were issued and outstanding, all of which are fully paid and non-assessable.

Dividend Policy

We have not declared any cash dividends on our common stock since our inception and do not anticipate paying such dividends in the foreseeable future. We plan to retain any future earnings for use in our business. Any decisions as to future payments of dividends will depend on our earnings and financial position and such other facts as the board of directors deems relevant. We are not limited in our ability to pay dividends on our securities.

Recent Sales of Unregistered Securities

None

Item 6. Selected Financial Data

Not applicable.

Item 7. Management’s Discussion and Analysis or Plan of Operation

You should read this section together with our financial statements and related notes thereto included elsewhere in this report. In addition to the historical information contained herein, this report contains forward-looking statements that are subject to risks and uncertainties. Forward-looking statements are not based on historical information but relate to future operations, strategies, financial results or other developments. Forward-looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. Certain statements contained in this Form 10, including, without limitation, statements containing the words "believe," "anticipate," "estimate," "expect," "are of the opinion that" and words of similar import, constitute "forward-looking statements." You should not place any undue reliance on these forward-looking statements.

You should be aware that our results from operations could materially be effected by a number of factors, which include, but are not limited to the following: economic and business conditions specific to the motion picture, television, and home video industries; competition from other producers of home video content; and television documentaries, our ability to control costs and expenses, access to capital, and our ability to meet contractual obligations. There may be other factors not mentioned above or included elsewhere in this report that may cause actual results to differ materially from any forward-looking information.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition and results of operations are based upon our statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. In consultation with our Board of Directors, we have identified two accounting policies that we believe are key to an understanding of our financial statements. These are important accounting policies that require management's most difficult, subjective judgment.

Going Concern. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company's current financial resources are not considered adequate to fund its planned operations. This condition raises substantial doubt about its ability to continue as a going concern. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company's continuation as a going concern currently is dependent upon timely procuring significant external debt and/or equity financing to fund its immediate and near-term operations, and subsequently realizing operating cash flows from sales of its film products sufficient to sustain its longer-term operations and growth initiatives, including its desired marketing and new potential film screenplays.

Revenue Recognition. The Company sells videos produced by the Company, as well as videos produced by third parties. Sales are recognized upon shipment of videos to the customer or upon website download by the customer. The products sold may not be returned by the customer. Accordingly, the Company has made no provision for returns. , The Company derived minimal revenue from the sale of third party videos during fiscal 2013.

Non-Cash Equity Issuances. We periodically issue shares of our common stock in exchange for, or in settlement of, services. Our management values the shares issued in such transactions at either the then market value of our common stock, as determined by the Board of Directors and after taking into consideration factors such as the volume of shares issued or trading restrictions, or the value of the services received, whichever is more readily determinable.

General

As a result of not being able to raise the necessary funds to either co-finance or produce any motion pictures, management changed the Company’s business plan to that of producing and distributing self- improvement/educational DVDs and workforce training programs. The major reasons for this decision was that the funds needed to produce or acquire self- improvement/educational DVDs and workforce training programs are substantially less than required for the production of motion pictures. Additionally, our management has years of experience in the production and distribution of this type of product.

In November 2008, the Company commenced the production of a 47 minute “self-improvement/educational” DVD entitled, “The 5 Communication Secrets That Swept Obama to the Presidency.”

The DVD uses video examples of President Barack Obama’s most memorable speeches to illustrate five essential secrets of effective public and personal communication. International communication analyst and coach Richard Greene hosts the DVD and instructs in the system of communication techniques he created. The DVD was completed in February 2009, and is being sold and marketed to individuals via the internet and through distributors specializing in the sale of product to the educational market, i.e. libraries, universities etc. Additionally, the Company created a “Business Edition” version of the DVD. This version includes the 47 minute DVD, along with a Leader Guide, Participant workbook, and Power Point presentation. It is being marketed both domestically and internationally by distributors to organizations for the training of their personnel in communication skills.

For the Year Ended February 28, 2013 Compared to Year Ended February 29, 2012

Revenues

Our revenues for the year ended February 28, 2013 were $62,187. Revenues for the year ended February 29, 2012 were $76,822. This decrease in revenue resulted from less royalty earned during fiscal 2013.

The cost of revenues during the year ended February 28, 2013, was $4,622. The cost of revenues during the year ended February 29, 2012, were $9,708. The decrease in the cost of revenues is due to lesser amount in marketing costs for the training programs acquired from Progressive Training in January 2011, and payments made to purchase videos from third party producers for resale. Although there may be occasional variances, we anticipate that the cost of goods sold (excluding production costs expensed) as a percentage of total revenues will generally be approximately within the 7 to 15 percent range while most of our revenue is generated from the sale of videos produced by us, as was the case in fiscal 2013.

In prior fiscal years a portion of our revenue was generated from the sale of training videos produced by other companies with which we have distribution contracts. In fiscal 2011 we generated approximately $22,500, and in fiscal 2012 approximately $18,750 of our total revenue was derived from the sale of training programs produced by third parties. The terms of these distribution contracts vary with regard to the percentage of discount that we receive. These discounts range from a low of 35% to a high of 50% of gross receipts. Due to our limited cash resources during fiscal 2013, we were unable to retain the service of sales personnel to market programs produced by others. As a result, during fiscal 2013, minimal revenue was generated from sales of third party product.

Expenses

Selling, general and administrative expenses were $122,703 during the year ended February 28, 2013 as compared to $126,059 during the year ended February 29, 2012. The decrease was the result of less professional fees paid during fiscal 2013.

Selling and marketing expenses were $22,095 for the year ended February 28, 2013 as compared to $10,481 for the year ended February 29, 2012. The increase is due to the development and marketing expense incurred during the production and initial distribution of our two recently completed training programs.

During the year ended February 28, 2013, we incurred a total of $100,608 in general and administrative expenses. This consisted primarily of $41,600 of contributed services by our CEO, Buddy Young, and $31,727 of professional fees incurred for our audited financial statements and related filings. We valued the contributed services from Buddy Young at $100 per hour. During the same period in 2012, we incurred a total of $115,579 general and administrative expenses. This consisted primarily of $41,600 of contributed services by our CEO, Buddy Young, and $52,470 of professional fees incurred for our audited financial statements and related filings.

We incurred $18,306 and $16,268 in interest expense during the years ended February 28, 2013 and February 29, 2012, respectively. Of these amounts, $14,399 and $6,823 related to the interest charges we incur on our loan from Buddy Young in each period, respectively. The remaining interest expense relates to a company credit card and the line of credit.

Plan of Operation

During the past twelve months we concentrated our efforts on maximizing the revenue potential of the training programs we acquired in January 2011, by expanding our domestic and international distributor network. Additionally, we acquired the master distribution rights to a new training program entitled, “The Power of Teamwork”. The program is based on the extraordinary elements of teamwork employed by the Navy’s world renowned Blue Angel flight demonstration team. Further, during the last quarter of fiscal 2012, we developed and completed production of a new training program entitled, “Chilean Mine Rescue: The Unstoppable Team.” This program focuses on the resourceful teamwork during the successful Chilean mine rescue. Both programs were brought to market during the third quarter of fiscal 2013.

We anticipate that during the next 12 months our efforts will consist of: (a) raising funds through a private placement sale of equity, to be used for the purpose of adding to our library of programs, (b) continue to improve the functionality and visibility of our website advancedknowledge.com, (c) increase revenue by hiring additional commissioned sales personnel and (d) concentrate on the marketing and distribution of the two new training programs mentioned above.

We expect that cash resulting from the further sales and licensing of our existing programs, and the sales of the two new workforce training videos that were released during fiscal 2013, along with the funds provided to us by our president and principal shareholder, under a promissory note dated February 16, 2005, as amended, will be sufficient to fund our cash requirements to continue our efforts through February 2014.

If during the next twelve months our revenue is insufficient to continue operations, and we are unable to raise funds through the sale of additional equity, or from traditional borrowing sources, we may be required to scale back our planned operations, or be forced to totally abandon our business plan and seek other business opportunities in a related or unrelated industry. Such opportunities may include a reverse merger with a privately held company. The result of which could cause the existing shareholders to be severely diluted.

Employees

Due to our very limited financial resources, the Company’s President, Buddy Young, along with Joseph Adelman, and Mel Powell, our Director of acquisitions, work on a part-time basis. We have one part-time administrative employee Additionally, we regularly utilize the services of independent firms to handle our accounting and certain administrative matters. If and when our capital resource permits, we will hire full-time professional and administrative employees.

Liquidity and Capital Resources

We had a cash balance of $5,972 on February 28, 2013. To date other than funds received from the sale of videos acquired from Progressive Training, and the further sales of our two recently completed videos, our only other known cash resource comes from an agreement with our President and majority shareholder to fund any shortfall in cash flow up to $225,000, through December 31, 2013. As of February 28, 2013 the balance owing on this agreement is $186,354. Payment of principal and interest is due on this loan on June 30, 2014.

We expect that cash resulting from the further sales and licensing of our existing programs, along with the funds provided to us by our president and principal shareholder, under a promissory note dated February 16, 2005, as amended, will be sufficient to fund our cash requirements to continue our efforts through February 2014.

ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable because the Company is a smaller reporting company.

Item 8. Financial Statements and Supplementary Data

FUTURA PICTURES, INC.

INDEX TO FINANCIAL STATEMENTS

	Page

Report of Independent Registered Public Accounting Firm	18

Balance Sheets as of February 28, 2013 and February 29, 2012	19

Statements of Operations Years Ended February 28, 2013 and February 29, 2012	20

Statements of Stockholders’ Deficit Years Ended February 28, 2013 and February 29, 2012	21

Statements of Cash Flows Years Ended February 28, 2013 and February 29, 2012	22

Notes to Financial Statements – February 28, 2013	23

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of Futura Pictures, Inc.:

We have audited the accompanying balance sheet of Futura Pictures, Inc. as of February 28, 2013 and February 29, 2012 and the related statements of operations, stockholders’ deficit and cash flow for each of the years then ended. Futura Pictures, Inc.’s management is responsible for the financial statement. Our responsibility is to express an opinion on the financial statement based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provided a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Futura Pictures, Inc. as of February 28, 2013 and February 29, 2012 and the results of its operations and its cash flows for each of the years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company’s current financial resources are not considered adequate to fund its planned operations. This condition raises substantial doubt about its ability to continue as a going concern. Management’s plans regarding this matter is described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Farber Hass Hurley LLP

Camarillo, California

May 28, 2013

FUTURA PICTURES, INC.

BALANCE SHEETS

	February 28, 2013			February 29, 2012
ASSETS

Cash	$	5,972		$	2,409
Accounts receivable, net		6,260			2,483
Prepaid expenses		-			270

TOTAL CURRENT ASSETS		12,232			5,162

Deposits		900			900

TOTAL ASSETS	$	13,132		$	6,062


LIABILITIES

Line of credit	$	-		$	39,421
Accrued expenses		26,679			41,708
Unearned revenue		1,300			100
Accrued interest – related party		32,604			18,205
Loan payable – related party		186,354			98,989

TOTAL LIABILITIES		246,937			198,423

STOCKHOLDERS’ DEFICIT

Common stock, par value $0.0001 per share Authorized – 100,000,000 shares Issued and outstanding – 1,599,750 shares		160			160
Additional paid-in capital		358,604			317,004
Accumulated deficit		(592,569	)		(509,525	)

TOTAL STOCKHOLDERS’ DEFICIT		(233,805	)		(192,361	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	13,132		$	6,062

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

FUTURA PICTURES, INC.

STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED FEBRUARY 28, 2013 AND FEBRUARY 29, 2012

	For the Year Ended February 28, 2013			For the Year Ended February 29, 2012

REVENUE	$	62,187		$	76,822

COST OF REVENUE		4,622			9,708

GROSS PROFIT		57,565			67,114

OPERATING EXPENSES
Selling, general and administrative		122,703			126,059

TOTAL OPERATING EXPENSES		122,703			126,059

LOSS FROM OPERATIONS		(65,138	)		(58,945	)

OTHER INCOME (EXPENSE)
Other income		1,200			1,487
Interest expense		(18,306	)		(16,268	)

TOTAL OTHER INCOME (EXPENSE)		(17,106	)		(14,781	)

LOSS BEFORE INCOME TAXES		(82,244	)		(73,726	)

Tax provision		800			800

NET LOSS	$	(83,044	)	$	(74,526	)

NET LOSS PER COMMON SHARE
Basic and diluted	$	(0.05	)	$	(0.05	)

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
Basic and diluted		1,599,750			1,599,750

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

FUTURA PICTURES, INC.

STATEMENT OF STOCKHOLDERS’ DEFICIT

FOR THE YEARS ENDED FEBRUARY 28, 2013 AND FEBRUARY 29, 2012

	Common Stock									Total
	Shares		Amount		Additional Paid- in Capital		Accumulated Deficit			Stockholders’ Equity (Deficit)
Balance, March 1, 2011		1,599,750	$	160	$	275,404	$	(434,999	)	$	(159,435	)

Contributed services		-		-		41,600		-			41,600

Net loss for the year ended February 29, 2012		-		-		-		(74,526	)		(74,526	)

Balance, February 29, 2012		1,599,750	$	160	$	317,004	$	(509,525	)	$	(192,361	)

Contributed services		-		-		41,600		-			41,600

Net loss for the year ended February 28, 2013		-		-		-		(83,044	)		(83,044	)

Balance, February 28, 2013		1,599,750	$	160	$	358,604	$	(592,569	)	$	(233,805	)

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

FUTURA PICTURES, INC.

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED FEBRUARY 28, 2013 AND FEBRUARY 29, 2012

	For the Year Ended February 28, 2013			For the Year Ended February 29, 2012

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(83,044	)	$	(74,526	)
Adjustments to reconcile net loss to net cash (used) by operating activities:
Amortization expense		270			361
Contributed services		41,600			41,600
Bad debt expense		5,160			-
Changes in operating assets and liabilities:
Accounts receivable		(8,937	)		721
Prepaid expenses		-			197
Accrued expenses		(630	)		12,628
Unearned revenue		1,200			(14,490	)

NET CASH (USED) BY OPERATING ACTIVITIES		(44,381	)		(33,509	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of line of credit		(39,421	)		-
Proceeds from loan payable – related party		90,365			30,550
Repayment of loan payable – related party		(3,000	)		(4,315	)

NET CASH PROVIDED BY FINANCING ACTIVITIES		47,944			26,335

NET INCREASE (DECREASE) IN CASH		3,563			(7,274	)

CASH AT THE BEGINNING OF THE PERIOD		2,409			9,683

CASH AT THE END OF THE PERIOD	$	5,972		$	2,409

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Interest paid	$	3,907		$	9,446
Taxes paid	$	800		$	800

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

FUTURA PICTURES, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FEBRUARY 28, 2013

NOTE 1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Nature of Business

Futura Pictures, Inc. (the “Company”) was incorporated under the laws of the state of Delaware on December 10, 2003. The Company was formed to engage in the production and the co-financing of films, documentaries and similar products produced solely for the distribution directly to the domestic and international home video markets.

Unclassified Balance Sheet

As permitted by ASC Topic 926, the Company has elected to present an unclassified balance sheet.

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 certain estimates and assumptions that affect the reported amounts and timing of revenues and expenses, the reported amounts and classification of assets and liabilities, and the disclosure of contingent assets and liabilities. These estimates and assumptions are based on the Company’s historical results as well as management’s future expectations. The Company’s actual results could vary materially from management’s estimates and assumptions.

Disclosure About Fair Value of Financial Instruments

The Company estimates that the fair value of all financial instruments at February 28, 2013 does not differ materially from the aggregate carrying values of its financial instruments recorded in the accompanying balance sheet. The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies. Considerable judgment is required in interpreting market data to develop the estimates of fair value, and accordingly, the estimates are not necessarily indicative of the amounts that the Company could realize in a current market exchange.

Concentrations and Credit Risk

Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of accounts receivable.

Two customers represented approximately 44% (10% and 34%) of total accounts receivable as of February 28, 2013. Five customers represented approximately 89% (11%, 12%, 19%, 23%, and 24%) of total accounts receivable as of February 29, 2012.

Three customers represented approximately 33% (10%, 11%, and 12%) of total revenue for the year ended February 28, 2013. Two customers represented approximately 38% (19% and 19%) of total revenue for the year ended February 29, 2012.

No other customers represented greater than 10% of total revenues in the years ended February 28, 2013 and February 29, 2012, or total accounts receivable as of February 28, 2013 and February 29, 2012.

Revenue Recognition

The Company sells videos produced by the Company, as well as videos produced by third parties. Sales are recognized upon shipment of videos to the customer or upon website download by the customer. The products sold may not be returned by the customer. Accordingly, the Company has made no provision for returns. , The Company derived minimal revenue from the sale of third party videos during fiscal 2013.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts

The Company establishes the allowance for doubtful accounts based on its assessment of the collectability of individual customer accounts. The adequacy of these allowances is regularly reviewed by considering internal factors such as historical experience, credit quality and age of the receivable balances as well as external factors such as economic and political conditions that may affect a customer's ability to pay, historical default rates, and long-term historical loss rates published by major third-party credit-rating agencies. The Company also considers the concentration of receivables outstanding with a particular customer in assessing the adequacy of its allowances. An allowance for doubtful accounts is provided for at the point it is probable that the receivable is uncollectible. An Allowance for Doubtful Accounts amounting to $6,952 and $1,792 is recorded as of February 28, 2013 and February 29, 2012, respectively. The Company does not require collateral to support its accounts receivables nor does it accrue interest thereon.

Prepaid Expenses

The Company amortizes its prepaid expenses on a straight-line basis over the period during which it will receive the underlying services.

Production Costs

The Company expenses production costs as incurred when the costs are related to videos where there is no historical revenue to aid the Company in accurately forecasting revenues to be earned on the related videos.

Value of Stock Issued for Services

The Company periodically issues shares of its common stock in exchange for, or in settlement of, services. The Company’s management values the shares issued in such transactions at either the then market price of the Company’s common stock, as determined by the Board of Directors and after taking into consideration factors such as volume of shares issued or trading restrictions, or the value of the services rendered, whichever is more readily determinable.

Net Income (Loss) Per Share

The Company adopted ASC No. 260, “Earnings Per Share”, that requires the reporting of both basic and diluted earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. In accordance with ASC No. 260, “Earnings Per Share”, any anti-dilutive effects on net income (loss) per share are excluded. The Company has no potentially dilutive securities outstanding at February 28, 2013.

Income Taxes

Provisions for income taxes are based on taxes payable or refundable for the current year and deferred taxes on temporary differences between the amount of taxable income and pretax financial income and between the tax bases of assets and liabilities and their reported amounts in the financial statements. Deferred tax assets and liabilities are included in the financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled as prescribed in ASC No. 740, “Accounting for Income Taxes”. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes.

Recent Pronouncements

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

NOTE 2

SIGNIFICANT UNCERTAINTY REGARDING THE COMPANY’S ABILITY TO CONTINUE AS A GOING CONCERN AND MANAGEMENT PLANS

The Company has incurred significant losses over recent years and currently has a working capital deficit of approximately $233,000. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company's current financial resources are not considered adequate to fund its planned operations. This condition raises substantial doubt about its ability to continue as a going concern. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company's continuation as a going concern currently is dependent upon timely procuring significant external debt and/or equity financing to fund its immediate and near-term operations, and subsequently realizing operating cash flows from sales of its film products sufficient to sustain its longer-term operations and growth initiatives. During the next 12 months the Company will be seeking to produce, or acquire another one or two “self-improvement/educational” DVDs, and to expand their library of workforce training programs.

NOTE 3

UNEARNED REVENUE

On August 12, 2009, the Company signed an agreement with Gaiam America, licensing them the distribution rights to "The Five Secrets of Communication That Swept Obama to the Presidency." Under the terms of the agreement, Gaiam America will distribute the DVD throughout the world to the non-educational market. Further, pursuant to the agreement the Company received the $15,000 advance on September 14, 2009. Sales of the DVD under the Gaiam America distribution agreement commenced during the last quarter of fiscal 2010 and the company has recorded $361 of income since the effective date of the agreement. Due to minimal sales of the DVD under the Gaiam America distribution agreement, management estimated that only about $100 can be collected in the future, and the rest of the advance in the amount of $14,539 was recognized as revenue during the fiscal year ended February 29, 2012.

On October 17, 2012, the Company signed an agreement with EBSCO Publishing, Inc., licensing them the distribution rights to four DVD’s owned by the Company in exchange for royalties on the net revenue collected. Under the terms of the agreement, the Company received a $1,200 advance on royalties. The entire amount is classified as Unearned Income on the accompanying Balance Sheet as of February 28, 2013 as there have not been any sales of the DVD reported to the Company.

NOTE 4

RELATED PARTY TRANSACTION

Prepaid Loan Commitment

On February 16, 2005, the Company’s President, Buddy Young, accepted an unsecured promissory note from the Company and agreed to lend up to $225,000 to the Company to fund any cash shortfalls through December 31, 2013. The note bears interest at 8% and is due upon demand, no later than June 30, 2014. The outstanding balance was $186,354 as of February 28, 2013.

NOTE 5

STOCKHOLDERS’ DEFICIT

For the years ended February 28, 2013 and February 29, 2012, the Company’s President devoted time to the development process of the Company. Compensation expense totaling $41,600 has been recorded in each period. The President has waived reimbursement of $41,600 during each of the years ended February 28, 2013 and February 29, 2012, and accordingly the amounts have been recorded as a contribution to capital.

NOTE 6

INCOME TAXES

Deferred Tax Components

Significant components of the Company’s deferred tax assets are as follows at February 28, 2013:

Net operating loss carry-forward	$	48,982
Less valuation allowance		(48,982	)
Net deferred tax assets	$	0

Summary of valuation allowance:

Balance, March 1, 2012	$	42,221
Addition for the year ended February 28, 2013		6,761
Balance, February 28, 2013	$	48,982

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.

Net Operating Loss

The Company has approximately $212,000 net operating loss carry-forwards, which expire in various years through 2032.

Examination

The Company’s tax returns are open to examination for the year ended 2009 and forward. The Company recognizes and measures uncertain tax positions using a more-likely-than-not approach. The Company had no material uncertain tax positions at February 28, 2013 or February 29, 2012.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None

Item 9A. Controls and Procedures

DISCLOSURE CONTROLS AND PROCEDURES

The Company has adopted and maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), such as this Form 10-K, is collected, recorded, processed, summarized and reported within the time periods specified in the rules of the Securities and Exchange Commission. The Company’s disclosure controls and procedures are also designed to ensure that such information is accumulated and communicated to management to allow timely decisions regarding required disclosure. As required under Rule 13a-15 of the Exchange Act, the Company’s management, including the Chief Executive Officer and Principal Financial Officer, has conducted an evaluation of the effectiveness of disclosure controls and procedures as of the end of the period covered by this report.

Based upon its current evaluation, the Company has concluded that the Company’s current disclosure controls and procedures are not effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, 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 the Company’s management, including the Company’s CEO, as appropriate, to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15 of the Exchange Act. The Company’s internal control over financial reporting is designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the preparation and fair presentation of published financial statements. Management conducted an assessment of the Company’s internal control over financial reporting based on the framework and criteria established by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control – Integrated Framework. Based on the assessment, management concluded that, as of February 28, 2013 the Company’s internal control over financial reporting is not effective. The assessment identified a material weakness in the internal control over financial reporting resulting from the Company not having adequate resources to employ sufficient personnel to provide adequate segregation of duties and have personnel knowledgeable in accounting and reporting.

The Company’s management, including its Chief Executive Officer and Principal Financial Officer, does not expect that the Company’s disclosure controls and procedures and its internal control processes will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of error or fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that the breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Changes in Internal Control

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during the year ended February 28, 2013, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to rules of the Securities and Exchange Commission, which permanently exempt smaller reporting companies.

Item 9B. Other Information

None

PART III

Item 10. Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act.

Name	Age	Position

Buddy Young	77	President, Chief Executive Officer, Chief Financial Officer and Chairman

Joseph Adelman	79	Vice President and Director

Mel Powell	48	Secretary and Director

Dennis Spiegelman	64	Director

Buddy Young has served as president, chief executive officer, chief financial officer and chairman of the board of directors of Futura Pictures, Inc. since its inception in December 2003. From June 2000, until December 2006, he has served as an officer and director of Dematco, Inc., (f.k.a. Advanced Media Training), a company that produced and distributed management and general workforce training products. Prior to that Mr. Young served as a director and chief executive officer of a number of firms including, MGPX Ventures, Inc., now known as Contango Oil & Gas, Bexy Communications, Inc., now known as Cheniere Energy, and Color Systems Technology, Inc. Prior to joining Color Systems, Mr. Young served as Director of West Coast Advertising and Publicity for United Artists Corporation, as well Director of Worldwide Advertising and Publicity for Columbia Pictures Corp and Vice President of Worldwide Advertising and Publicity for MCA/Universal Pictures, Inc. For over forty-five years, Mr. Young has been an active member of The Academy of Motion Picture Arts and Sciences and has served on a number of industry-wide committees.

Joseph Adelman has served as an officer and director of Futura Pictures since December 2004. Since 1991 he has served as the Chief Executive Officer of International Entertainment Enterprises, a leading independent sales and business representative for United States and international producers and owners of feature films, documentaries and children’s animation. He started his entertainment industry career in 1958 when he joined the New York legal department at United Artists Corp. In 1962 he moved to Los Angeles where he assumed the position of Vice-President, West Coast Business Affairs for United Artists. From 1977 to 1979 Mr. Adelman served as the Chief Operating Officer of the Association of Motion Picture & Television Producers, where his responsibilities included negotiating on behalf of the major motion picture companies with Hollywood labor unions and with government regulatory agencies.

From 1979 to 1983, he served as Vice President of Business Affairs at Paramount Pictures supervising all of the feature film production and distribution negotiations with producers, directors, writers, stars, and composers.

Mr. Adelman is a graduate of New York University and Harvard law School, and a member of the Bar in both California and New York. He is currently a member of the Executive Branch of the Academy of Motion Picture Arts and Sciences, and the National Association of Television Programming Executives.

Mel Powell has served as a director since December 2004. Mr. Powell brings a background in law, writing, and marketing to the Company. He attended Yale as an undergraduate, and graduated from UCLA Law School in 1988. Mr. Powell is a member of the California Bar Association, and practiced family law from 1988 through 1992 at the Los Angeles based law firm of Trope & Trope. Additionally, since June 2000, he has served as an officer and director of Advanced Media Training. Since 1992, Mr. Powell has been self-employed through his privately held company, Breakaway Entertainment. During his time at Breakaway, he has written feature screenplays, teleplays, radio screenplays for Premiere Radio Networks, and screenplays for corporate training videos. Additionally, he is an independent associate with Pre-Paid Legal Services, Inc., a company that provides legal services to middle- and lower-income individuals and families, as well as providing legal and other consultation services to small businesses. He is a member of the Sherman Oaks, CA, Chamber of Commerce and the State Bar of California.

Dennis Spiegelman has served as a director of Futura Pictures since December 2004. Mr. Spiegelman is an experienced sales and marketing executive with a successful track record in many aspects of the entertainment industry. From June 2000, until December 2006, he served as an officer and director of Advanced Media Training. He is currently senior vice president of worldwide sales for Axium Entertainment, a privately held technology and financial services provider to the entertainment industry. Prior to rejoining Axium in 2004 he served as vice president of sales and marketing at Cast & Crew Entertainment Services, Inc., a position he accepted in April 1998. From 1995 to April 1998, Mr. Spiegelman was the vice president of sales and marketing for Axium Entertainment, Inc. Both Cast & Crew and Axium specialize in providing payroll and payroll related services to the motion picture and television entertainment industries. Before joining Axium, he held similar positions with AP Services, Inc. and IDC Entertainment Services. During his career of more than 25 years, Mr. Spiegelman has held various other senior positions, including director of operations at Heritage Entertainment, and president and director of All American Group, Inc. While at these companies, Mr. Spiegelman was mainly responsible for the sale of feature films to foreign theatrical, video, and television markets.

Directors are elected in accordance with our bylaws to serve until the next annual stockholders meeting and until their successors are elected and qualified or until their earlier resignation or removal.

Officers are elected by the board of directors and hold office until the meeting of the board of directors following the next annual meeting of stockholders and until their successors shall have been chosen and qualified. Any officer may be removed, with or without cause, by the board of directors. Any vacancy in any office may be filled by the board of directors.

There is no family relationship between any director or executive officer of Futura Pictures.

Item 11. Executive Compensation

Name

Year

Salary

Bonus

Other Annual

Compensation

Restricted

Stock

Awards

Securities Underlying Options/ SARS

LTIP Payouts

All Other

Compensation

Buddy Young

2011

2012

2013

-0-

(1) (3)

Mel Powell

2011

2012

2013

-0-

(1) (2)

Joseph Adelman

2011

2012

2013

-0-

(1) (2)

Dennis Spiegelman

2011

2012

2013

-0-

(1) (2)

(1) All officers and directors assumed their positions in January 2004.

(2) Each received 10,000 shares in January, 2004 in exchange for services to the Company.

(3) For the years ended February 28, 2013 and February 29, 2012, Mr. Young devoted time to the development process of the Company. Compensation expense totaling $41,600 has been recorded in each year. Of this amount, Mr. Young was paid $-0- during the years ended February 28, 2013 and February 29, 2012, respectively. Mr. Young has waived reimbursement of $41,600 during each of the years ended February 28, 2013 and February 29, 2012, respectively.

EMPLOYMENT AND CONSULTING AGREEMENTS

We do not have any employment or consulting agreements with any of our executive officers.

OPTION/SAR GRANTS

We have not granted any options or stock appreciation rights to any of our executive officers or employees.

AGGREGATED OPTION/SAR EXERCISES

Since we have never granted any options or stock appreciation rights to any of our executive officers or employees, none exist to be exercised.

COMPENSATION OF DIRECTORS

Other than the issuance of common stock as described above, directors of the Company have not and do not receive any compensation for serving on the board or for attending any meetings. Directors who are also officers of the Company receive no additional consideration for their service as a director.

Item 12. Security Ownership of Certain Beneficial Owners and Management

The following table sets forth information about the beneficial ownership of our outstanding common stock by each person beneficially owning more than 5% of the shares, by each of our directors and officers, and by all of our directors and officers as a group. The table shows the number and percentage of shares held by each person as of February 29, 2012. The address of each person listed in the table is 17337 Ventura Boulevard, Suite 305, Encino, California 91316.

Name and Address	Number of Shares Owned			Percentage of Class Owned

Young Family Trust		1,190,000	₍₁₎		74.39	%

Buddy Young and Rebecca Young		1,190,000	₍₁₎		74.39	%

Joseph Adelman		10,000			0.63	%

Mel Powell		10,000			0.63	%

Dennis Spiegelman		10,000			0.63	%

All officers and directors as a group (5 persons)		1,220,000			76.28	%

(1)	All of the shares beneficially owned by the Young Family Trust are also beneficially owned by Buddy Young and Rebecca Young, who, as co-trustees of the Trust, share voting and investment power over the shares. Buddy Young is a director and executive officer of Futura Pictures

Item 13. Certain Relationships and Related Transactions

We have an agreement with our President and majority shareholder to borrow up to $225,000 at 8% interest through December 31, 2013. Repayment is to be made when funds are available with the balance of principal and interest due June 30, 2014. Through February 28, 2013, the Company has borrowed a total of $186,354 under this agreement. On February 16, 2005, the Company paid Mr. Young 190,000 shares of the Company’s common stock with an aggregate value of $19,000 for the loan commitment.

The promoters of the Company consist of the following founding shareholders, all of whom received their stock in January, 2004. Buddy Young formed the Company with a capital contribution of $10,000 in exchange for 1,000,000 shares. Mr. Young had those shares issued to the Young Family Trust. Mr. Young and his wife are beneficiaries and trustees of the Young Family Trust. In addition, the Young Family Trust received an additional 190,000 shares in exchange for Mr. Young’s commitment to provide certain financing to the Company. Joseph Adelman, Dennis Spiegelman, and Mel Powell, each received 10,000 shares for services rendered to the Company.

Item 14. Principal Accounting Fees and Services

AUDIT FEES

The aggregate fees billed for professional services rendered by our principal accountants for the audit of our financial statements and for the reviews of the financial statements included in our annual report on Form 10-K and 10-Qs respectively, and for other services normally provided in connection with statutory filings were $13,200 and $13,672, respectively, in the years ended February 28, 2013 and February 29, 2012.

TAX FEES

The aggregate fees billed by our auditors for tax compliance matters were $1,250 in both fiscal years ended February 28, 2013 and February 29, 2012.

ALL OTHER FEES

We did not incur any fees for other professional services rendered by our independent auditors during the years ended February 28, 2013 and February 29, 2012.

Item 15. Exhibits, Financial Statement Schedules

The following documents are included or incorporated by reference as exhibits to this report:

	31.1	Certification of CEO Pursuant to Securities Exchange Act Rules 13a-14 and 15d-14, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

	32.1	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

	101.INS	XBRL Instance

	101.SCH	XBRL Taxonomy Extension Schema

	101.CAL	XBRL Taxonomy Extension Calculation

	101.DEF	XBRL Taxonomy Extension Definition

	101.LAB	XBRL Taxonomy Extension Label

	101.PRE	XBRL Taxonomy Extension Presentation

Signatures

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

	FUTURA PICTURES, INC.


	By:	/s/ Buddy Young
	Buddy Young
	President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

Name	Title	Date

/s/ Buddy Young	President, Chief Executive Officer,	May 28, 2013
Buddy Young	Chief Financial Officer and Director (Principal Executive, Financial and Accounting Officer)

/s/ Joseph Adelman	Director	May 28, 2013
Joseph Adelman


/s/ Mel Powell	Director	May 28, 2013
Mel Powell


/s/ Dennis Spiegelman	Director	May 28, 2013
Dennis Spiegelman

Attached files

IMK GROUP, INC. Reports

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