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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                  -------------

                                    FORM 10-K

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

                     FOR THE FISCAL YEAR ENDED JUNE 30, 2013

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

                          COMMISSION FILE NO. 000-21477

                                 JV GROUP, INC.
               (EXACT NAME OF REGISTRANT SPECIFIED IN ITS CHARTER)

                    DELAWARE                                 27-0514566
                    --------                                 ----------
          (STATE OR OTHER JURISDICTION                    (I.R.S. EMPLOYER
        OF INCORPORATION OR ORGANIZATION)              IDENTIFICATION NUMBER)

                                7609 RALSTON ROAD
                             ARVADA, COLORADO 80002
               (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

                                 (303) 422-8127
              (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

Securities registered pursuant to Section 12(b) of the Act: NONE

Securities to be registered  pursuant to Section 12(g) of the Act: COMMON STOCK,
$0.01 PAR VALUE

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 [ ]

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] No [ ]



Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K 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 definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check One). Large accelerated filer [___] Accelerated filer [___] Non-accelerated filer [___] Smaller reporting company [_X_] Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X] The aggregate market value of the voting common stock held by non-affiliates of the Registrant on October 11, 2013 was approximately $8,730 based upon the reported closing sale price of such shares on the Over the Counter Bulletin Board for that date. As of October 11, 2013, there were 98,879,655 shares outstanding of which 582,013 shares were held by non-affiliates.
TABLE OF CONTENTS ITEM DESCRIPTION PAGE Part I Item 1. Business 1 Item 1A. Risk Factors 5 Item 1B. Unresolved Staff Comments 8 Item 2. Description of Properties 9 Item 3. Legal Proceedings 9 Item 4. Mine Safety Disclosures 9 Part II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters, 9 and Issuer Purchases of Equity Securities Item 6. Selected Financial Data 10 Item 7. Management's Discussion and Analysis of Financial Condition 11 and Results of Operations Item 7A. Quantitative and Qualitative Disclosures About Market Risk 14 Item 8. Financial Statements and Supplementary Data 14 Item 9. Changes in and Disagreements with Accountants on Accounting and 27 Financial Disclosure Item 9A. Controls and Procedures 27 Item 9B. Other Information 28 Part III Item 10. Directors, Executive Officers and Corporate Governance 29 Item11. Executive Compensation 32 Item 12. Security Ownership of Certain Beneficial Owners and Management and 33 Related Stockholder Matters Item 13. Certain Relationships and Related Transactions and Director Independence 34 Item 14. Principal Accountant Fees and Services 35 Item 15. Exhibits and Financial Statement Schedules 36 Signatures
FORWARD-LOOKING STATEMENTS In addition to historical information, some of the information presented in this Annual Report on Form 10-K contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform Act"). Although JV Group, Inc. ("JV Group" or the "Company," which may also be referred to as "we," "us" or "our") believes that its expectations are based on reasonable assumptions within the bounds of its knowledge of its business and operations: there can be no assurance that actual results will not differ materially from our expectations. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated, including but not limited to, our ability to reach satisfactorily negotiated settlements with our outstanding creditors, raise debt and, or, equity to fund negotiated settlements with our creditors and to meet our ongoing operating expenses and merge with another entity with experienced management and opportunities for growth in return for shares of our common stock to create value for our shareholders. Cautionary statements regarding the risks, uncertainties and other factors associated with these forward-looking statements are discussed under "Risk Factors" in this Form 10-K. You are urged to carefully consider these factors, as well as other information contained in this Form 10-K and in our other periodic reports and documents filed with the SEC. PART I ITEM 1. BUSINESS Company History and Overview ASPI, Inc. ("APSI") was formed in Delaware in September 29, 2008. On April 25, 2012, ASPI amended its Articles of Incorporation with the State of Delaware to change its name from ASPI, Inc. to JV Group, Inc. ("JV Group") and to increase its authorized capital from One Hundred Million (100,000,000) common shares to One Billion (1,000,000,000) common shares. We have two wholly-owned subsidiaries, Mega Action Limited ("Mega"), a British Virgin Island Corporation, and Prestige Prime Office, Limited ("Prestige"), a Hong Kong Special Administrative Region Corporation (JV Group and its subsidiaries are collectively referred to as the "Company," "we," "our," or "us.") JV Group operates primarily as an office service provider, in Hong Kong, through its wholly-owned subsidiary, Prestige. Prestige provides office space that is fully furnished, equipped and staffed, located at premier addresses in central business districts with convenient access to airports and public transportation. Services include advanced communications system, network access, updated IT and administrative support, as well as a full menu of business services and facilities, such as meeting rooms and video conferencing. Prestige Prime Office, Ltd. Acquisition On June 30, 2010, ASPI entered into an Acquisition Agreement with Prestige Prime Office, Ltd. Under the Agreement, ASPI acquired all of the issued and outstanding common stock of Prestige Prime Office, LTD. ("Prestige"), a Hong Kong Special Administrative Region Corporation. As a result of the acquisition, Prestige became a wholly-owned subsidiary of ASPI. In exchange for $50,000 cash and 60,000,000 restricted shares of the common stock of ASPI, ASPI acquired 100% all of the 4,000,000 issued and outstanding shares of the common stock of Prestige. 1
Prestige had one sole shareholder, Mr. Yeung Cheuk Hung. As a result of the acquisition, Mr. Yeung became the majority shareholder of the Company holding approximately 81.21% of the issued and outstanding common stock of the Company at the time of the acquisition. Mega Action Limited During the year ended June 30, 2010, the Company incorporated a subsidiary, Mega Action Limited, a BVI corporation (the "Subsidiary"). Two of the Company's directors, Yuen Ling Look and Siu Lun Tong, act as directors of Mega Action Limited. In consideration of $1.00, Mega Action Limited issued the Company one share of Mega Action Limited ("Mega"). There is only one share of Mega share issued and outstanding. Mega is a wholly owned Subsidiary of the Company. Mega operates as the eastern operations management division of the Company. Leasehold Acquisition On September 8, 2011, Prestige entered into an Agreement with Huge Earn Investments Limited ("Huge Earn") to purchase certain leaseholds in exchange for 25,000,000 shares of the Company's restricted common stock and a $450,000 promissory note with anticipated due date of six months from issuance. The promissory note was due on March 1, 2012. At the time of this filing, the promissory note is still outstanding. The promissory note does not accrue interest. On October 1, 2012, the leases were transferred to Prestige. The leasehold is approximately 4,419 square feet and includes 24 offices and 2 conference rooms. At the time of the exchange approximately 15 offices were leased out and Huge Earn held approximately $57,725 in deposits from these leases. As part of the transaction, Prestige entered into a new 3 year lease agreement for the space, from October 1, 2011 through September 30, 2014. BUSINESS JV Group's current goal is to be a serviced office provider through its wholly-owned subsidiary, Prestige Prime Office Ltd. in Hong Kong. The office space provided by Prestige is fully furnished, equipped and staffed, located at addresses in central business districts with convenient access to airport or public transportation. Services to be provided include advanced communication systems, network access, updated IT and administrative support, as well as a full menu of business services and facilities, such as meeting rooms and video conferencing. Prestige intends to provide services that will support the growing trend of mobile and at home working. Supporting workers at home and on the road with services such as Virtual Office and Virtual PA, providing dedicated business addresses as their business base, as well as mail and call handling services. Executives across business sectors, geographic locations, and from every size organization, seek to more effectively manage business risk, maximize their financial resources, and increase their flexibility to accommodate growth and the dynamic changes in the market. Companies of all sizes can use the Company's solutions to reduce costs and remove the burden of property ownership and management, but at the same time have a workplace to suit whenever and wherever they want to work. 2
Market Opportunity Cost effective Businesses are increasingly looking at office space requirements as a strategic component of their business plan. Through serviced office space, clients are free to run their business without the financial or management burden that comes with traditional office rental. Prestige provides offices that are equipped and ready for use. All the clients need to do is move in. Clients are not required to shop for and purchase office equipment and furniture, make telecommunications arrangements, etc. Flexibility Workplace outsourcing enables companies to seize new market opportunities because the office infrastructure is already in place, which is particularly beneficial when businesses are setting up offices in emerging markets. The flexible rental length, from 1 week up to 1 year, minimizes the risk and complications of exploring a new market or business opportunities. Gateway Attributing to Hong Kong's location and monetary system, companies set up in Hong Kong are provided a gateway to develop business in Mainland China. Because of this advantage, it's expected that more and more companies will locate businesses in Hong Kong. Prestige is able to provide flexibility and efficiency to companies which are new to the region. Company rightsizing The current economic conditions have led to a chain reaction of company downsizing in order to reduce cost. Most of the companies are left with a minimum number of staff. These companies need an office space that can flexibly fit their company size and budget. While the traditional rental office creates abundant space and heavy capital commitments, compromising companies' liquidity, the serviced office on the other hand provides an optimum office space at a minimized cost, and the flexibility for company downsizing or company expansion. Full support In a serviced office, clients don't need to physically own, install, hire or manage any aspect of a traditional office environment. Clients only pay for what is needed, as it is used. For companies serious about time and cash flow, the serviced office concept provides the ability to focus on strategy and operations. Prestige provides a range of Workstyle Solutions, providing customers with the offices, services, and products they require according to whether they are predominantly in the office, work from home or are regular travelers. 3
Competition There are approximately 50 serviced office providers in Hong Kong offering a varying scale of services. Under the recent economy, some of the providers are expanding to meet the increasing demand, namely SBC, set up in 1995, and Jumpstart, set up in 2002, have 8 and 6 centers, respectively, in Hong Kong. Prestige's Competitive Advantage o Exclusive location and rate The business center is located in the central business area and Prestige can offer clients a competitive rate because of the rental agreement with the landlord. The rate is expected to be 10%-15% lower than the market rate. o Professional support From setting up an office, to holding a meeting or doing any administrative chores, Prestige's staff makes having and running a workplace simple. To meet new business needs, there is constant upgrade of employees' skills as technology and new standards evolve. o Flexibility Prestige offers a wide choice of contract periods. And the clients can, without binding, upgrade the room or transfer the office to any of our locations, without penalty. o Cost effective Prestige helps set up an office at the lowest cost possible. Reserving facilities and office support services at short notice and using them with 10-minute increments so as to avoid the additional charges inherent of an hourly system. Clients only pay for what they use. o Smart technology IP phone and Internet-based offices allow clients to work remotely, reserve facilities and services on the Internet, confirm invoice details online etc. There are regular update and upgrades of the systems to meet the ever changing needs and provide a convenient and user-friendly platform for the customers. o Ongoing development Prestige works to make continuous investments to improve efficiency and provide clients enhanced services and innovative technology at reasonable rates. BUSINESS DEVELOPMENT & FUTURE PROSPECTS Phase-in Approach The Company has a full plan of development that is put into place through different phases. A phase-in approach allows the Company to stabilize cash flow. Also, the experience from running the first center will provide the Company with the necessary experiences that can be used to improve quality and lower costs as it opens new centers. The first center The first center is composed of two units at Silvercord, No.30 Canton Road, Tsimshatsui, which is a premier commercial building in Hong Kong. The center is on one floor and occupies approximately 5,000 square feet. With the experience 4
of operating the first center, Prestige acquired another center in the same building from Huge Earn on September 8, 2011. The second center is of approximately 5,000 square feet. INTELLECTUAL PROPERTY We do not hold any patents or patent applications. EMPLOYEES As of June 30, 2013, we had 8 employees, employed solely by our wholly-owned subsidiary, Prestige. The Company's officers do not have employment agreements at this time. We feel that the relations with our employees are in good standing. ITEM 1A. RISK FACTORS You should be aware that there are various risks associated with our business, and us, including the ones discussed below. You should carefully consider these risk factors, as well as the other information contained in this Form 10-K, in evaluating us and our business. WE HAVE LIMITED WORKING CAPITAL AND LIMITED CASH FUNDS. At June 30, 2013, we have total current assets of $61,291, of which $4,774 is cash on hand. At June 30, 2013, we have total current liabilities of $1,648,524. We have a working capital deficit of $1,587,233 at June 30, 2013. During the year ended June 30, 2013, we recognized revenues of $669,742 but recognized a net loss of $479,335. We have limited funds, and such funds may not be adequate to carry out the business plan. Our cash inflows from our operating activities are not enough to cover the costs incurred by our operational activities. The ultimate success of our business may depend upon our ability to raise additional capital. We have investigated the availability, source, or terms that might govern the acquisition of additional capital. If additional capital is needed, there is no assurance that funds will be available from any source or, if available, that they can be obtained on terms acceptable to us. If not available, our operations will be limited to those that can be financed with its modest capital. RISING EXPENSES AT BOTH THE PROPERTY AND THE COMPANY LEVEL COULD REDUCE OUR CASH FLOWS. Our serviced offices will be subject to operating risks common to offices in general, any or all of which may reduce revenues and cash flows. If any property is not substantially occupied or if services are being paid in an amount that is insufficient to cover operating expenses, we could be required to expend funds with respect to operating expenses. The serviced offices are subject to increases in utility costs, operating expenses, insurance costs, repairs and maintenance and administrative expenses. We could be required to pay some or all of those costs which would reduce our income and cash available for expansion plans. TERMINATIONS COULD REDUCE OUR REVENUES Our success depends upon the occupancy levels, the rental income and the operating expenses of our properties and our company. We may be unable to fill office space at 100% or we may lose clients as their companies expand in size and no longer need a serviced office. These events and others could cause us to recognize less revenue. 5
FLUCTUATION IN THE VALUE OF THE HONG KONG DOLLAR MAY HAVE A MATERIAL ADVERSE EFFECT ON OUR FINANCIAL STATEMENTS. Our operations are located in Hong Kong and as such our financial activities are done in Hong Kong Dollars. In accordance with United States Generally Accepted Accounting Procedures (US GAAP) our financial statements are reported in U.S. Dollars. The value of the Hong Kong Dollar against the U.S. dollar may fluctuate and is affected by, among other things, changes in political and economic conditions. An appreciation of the Hong Kong dollar against the U.S. dollar could result in foreign currency translation losses for financial reporting purposes when we translate our Hong Kong denominated liabilities into U.S. Dollars, as the U.S. Dollar would likely be our reporting currency. JV GROUP IS A HOLDING COMPANY AND THERE ARE LIMITATIONS ON OUR ABILITY TO RECEIVE DISTRIBUTIONS FROM OUR SUBSIDIARIES. We conduct all of our operations through our wholly-owned subsidiaries and are dependent upon dividends or other intercompany transfers of funds from our subsidiaries to meet our obligations. Moreover, our subsidiaries are currently limited in their ability to pay dividends or make distributions to us. We cannot make any assurances that we will be able to fund the operations of the parent company in such manner. OUR SUCCESS DEPENDS SUBSTANTIALLY ON THE CONTINUED RETENTION OF CERTAIN KEY PERSONNEL AND OUR ABILITY TO HIRE AND RETAIN QUALIFIED PERSONNEL IN THE FUTURE TO SUPPORT OUR GROWTH. If one or more of our senior executives or other key personnel are unable or unwilling to continue in their present positions, we may not be able to replace them easily or at all. As a result, our business may be disrupted and our financial condition and results of operations may be materially and adversely affected. While we depend on the abilities and participation of our current management team generally, we have a particular reliance upon Ms. Look, our Chief Executive Officer and Chief Financial Officer. The loss of the services of Ms. Look for any reason could significantly impact our business and results of operations. OUR OFFICERS AND DIRECTORS MAY HAVE CONFLICTS OF INTEREST WHICH MAY NOT BE RESOLVED FAVORABLY TO US. Certain conflicts of interest may exist between us and our officers and directors. Our officers and directors have other business interests to which they devote their attention and may be expected to continue to do so although management time should be devoted to our business. As a result, conflicts of interest may arise that can be resolved only through exercise of such judgment as is consistent with fiduciary duties to us. BECAUSE INSIDERS CONTROL OUR ACTIVITIES, THAT MAY CAUSE US TO ACT IN A MANNER THAT IS MOST BENEFICIAL TO THEM AND NOT TO OUTSIDE SHAREHOLDERS WHICH COULD CAUSE US NOT TO TAKE ACTIONS THAT OUTSIDE INVESTORS MIGHT VIEW FAVORABLY. Mr. Yeung Cheuk Hung, an affiliate of the Company, owns approximately 61% of our issued and outstanding common stock. As a result, Mr. Yeung effectively controls all matters requiring stockholder approval, including the election of directors, the approval of significant corporate transactions, such as mergers and related party transactions. These insiders also have the ability to delay or perhaps even block, by their ownership of our stock, an unsolicited tender offer. This concentration of ownership could have the effect of delaying, deterring or preventing a change in control of our company that you might view favorably. 6
LOSS OF CONTROL BY OUR STOCKHOLDERS MAY OCCUR UPON ISSUANCE OF ADDITIONAL SHARES. We may issue additional shares, in the future, as consideration for cash, assets, or services out of our authorized but unissued common stock that would, upon issuance, represent a majority of our voting power and equity. The result of such an issuance would be those new stockholders and management would control us, and persons unknown could replace our management at this time. Such an occurrence would result in a greatly reduced percentage of ownership of us by our current stockholders. THE REGULATION OF PENNY STOCKS BY SEC AND FINRA MAY HAVE AN EFFECT ON THE TRADABILITY OF OUR SECURITIES. Our securities are currently listed on the Over the Counter Bulletin Board and the Pink Sheets. Our shares are subject to a Securities and Exchange Commission rule that imposes special sales practice requirements upon broker-dealers who sell such securities to persons other than established customers or accredited investors. For purposes of the rule, the phrase "accredited investors" means, in general terms, institutions with assets in excess of $5,000,000, or individuals having a net worth in excess of $1,000,000 or having an annual income that exceeds $200,000 (or that, when combined with a spouse's income, exceeds $300,000). For transactions covered by the rule, the broker-dealer must make a special suitability determination for the purchaser and receive the purchaser's written agreement to the transaction prior to the sale. Consequently, the rule may affect the ability of broker-dealers to sell our securities and also may affect the ability of purchasers in this offering to sell their securities in any market that might develop therefore. In addition, the Securities and Exchange Commission has adopted a number of rules to regulate "penny stocks." Such rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities and Exchange Act of 1934, as amended. Because our securities constitute "penny stocks" within the meaning of the rules, the rules would apply to us and to our securities. The rules may further affect the ability of owners of Shares to sell our securities in any market that might develop for them. Shareholders should be aware that, according to the Securities and Exchange Commission, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (i) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (ii) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (iii) "boiler room" practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (iv) excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and (v) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired consequent investor losses. Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to our securities. OUR STOCK IS THINLY TRADED AND AS A RESULT YOU MAY BE UNABLE TO SELL AT OR NEAR ASK PRICES OR AT ALL IF YOU NEED TO LIQUIDATE YOUR SHARES. The shares of our common stock are thinly-traded on the OTC Bulletin Board, meaning that the number of persons interested in purchasing our shares of common stock at or near ask prices at any given time may be relatively small or non-existent. This situation is attributable to a number of factors, including the fact that we are a small company which is relatively unknown to stock 7
analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if we came to the attention of such persons, they tend to be risk-averse and would be reluctant to follow an unproven, early stage company such as ours or purchase or recommend the purchase of our shares of common stock until such time as we became more seasoned and viable. As a consequence, there are periods of several days or more when trading activity in our shares of common stock is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on Securities price. We cannot give you any assurance that a broader or more active public trading market for our shares of Common Stock will develop or be sustained, or that any trading levels will be sustained. Due to these conditions, we can give investors no assurance that they will be able to sell their shares of common stock at or near ask prices or at all if you need money or otherwise desire to liquidate your shares of common stock of our Company. RULE 144 SALES IN THE FUTURE MAY HAVE A DEPRESSIVE EFFECT ON OUR STOCK PRICE. All of the outstanding shares of common stock held by our present officers, directors, and affiliate stockholders are "restricted securities" within the meaning of Rule 144 under the Securities Act of 1933, as amended. As restricted Shares, these Shares may be resold only pursuant to an effective registration statement or under the requirements of Rule 144 or other applicable exemptions from registration under the Act and as required under applicable state securities laws. Rule 144 provides in essence that a person who has held restricted securities for six months may, under certain conditions, sell every three months, in brokerage transactions, a number of Shares that does not exceed the greater of 1.0% of a company's outstanding common stock or the average weekly trading volume during the four calendar weeks prior to the sale. There is no limit on the amount of restricted securities that may be sold by a nonaffiliate after the owner has held the restricted securities for a period of six months. A sale under Rule 144 or under any other exemption from the Act, may have a depressive effect upon the price of the common stock in any market that may develop. WE DO NOT ANTICIPATE PAYING CASH DIVIDENDS ON OUR COMMON STOCK We do not anticipate paying any cash dividends on our common stock in the foreseeable future. ITEM 1B. UNRESOLVED STAFF COMMENTS None ITEM 2. DESCRIPTION OF PROPERTIES Our mailing address is 7609 Ralston Road, Arvada, Colorado, 80002. Our wholly-owned subsidiary, Prestige, operates from Silvercord, No. 30 Canton Road, Tsimshatsui, which is a premier commercial building in Hong Kong. The centers are located on two floors and occupy approximately 10,000 square feet. We pay an annual rental rate of $367,324. ITEM 3. LEGAL PROCEEDINGS To the best of our knowledge and belief, there is no pending legal action against the Company. ITEM 4. MINE SAFETY DISCLOSURE. Not Applicable. 8
PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS The following table sets forth the range of high and low sales prices for the Company's common stock for each of the fiscal quarters for the past two years as reported on the OTC Bulletin Board. These prices represent inter-dealer prices without adjustments for mark-up, mark-down, or commission and do not necessarily reflect actual transactions. Our common stock's trading symbol is "ASZP." High Low Year Ended June 30, 2013: September 30, 2012 $0.02 $0.02 December 31, 2012 0.02 0.01 March 31, 2013 0.03 0.01 June 30, 2013 0.02 0.02 Year Ended June 30, 2012: September 30, 2011 $0.05 $0.01 December 31, 2011 0.01 0.0011 March 31, 2012 0.06 0.0032 June 30, 2012 0.02 0.01 Holders. As of June 30, 2013, there were approximately 130 holders of record of the common stock. We believe that we have approximately 2,000 beneficial owners of our common stock. In many instances, a registered stockholder is a broker or other entity holding shares in street name for one or more customers who beneficially own the shares. Our transfer agent is Mountain Share Transfer, Inc., P.O. Box 191767, Atlanta, GA, 31119. Mountain Share Transfer's telephone number is 303-460-1149. Dividends. We have not paid or declared cash distributions or dividends on our common stock and do not intend to pay cash dividends in the foreseeable future. Future cash dividends will be determined by our board of directors based upon our earnings, financial condition, capital requirements and other relevant factors. Recent Sales of Unregistered Securities We made the following unregistered sales of our securities from July 1, 2010 through June 30, 2013. Date of Issuance Title of Securities Number of Shares Consideration Holder ---------------- ------------------- ---------------- ------------- ------ 10/1/11 Common Stock 25,000,000 Acquisition of Leases Choy, Po Shu Michael 9
Exemption From Registration Claimed All of the sales by us of our unregistered securities were made in reliance upon Section 4(2) of the Securities Act of 1933, as amended (the "1933 Act"). The entity and individual listed above that purchased the unregistered securities were existing shareholders, known to us and our management, through pre-existing business relationships, as long standing business associates. The entity was provided access to all material information, which it requested, and all information necessary to verify such information and was afforded access to our management in connection with the purchases. The purchaser of the unregistered securities acquired such securities for investment and not with a view toward distribution, acknowledging such intent to us. All certificates or agreements representing such securities that were issued contained restrictive legends, prohibiting further transfer of the certificates or agreements representing such securities, without such securities either being first registered or otherwise exempt from registration in any further resale or disposition. ITEM 6. SELECTED FINANCIAL AND OPERATING DATA As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion should be read in conjunction with our audited financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission. Forward-looking statements are statements not based on historical information and which 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. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or on our behalf. We disclaim any obligation to update forward-looking statements. The independent registered public accounting firm's report on the Company's financial statements as of June 30, 2013, and for each of the years in the two-year period then ended, includes a "going concern" explanatory paragraph, that describes substantial doubt about the Company's ability to continue as a going concern. PLAN OF OPERATION JV Group's strategy is to be a serviced office provider in the Far East through its wholly-owned subsidiary, Prestige Prime Office Ltd. in Hong Kong. The office space provided is fully furnished, equipped and staffed, located at premier addresses in central business districts with convenient access to airports or public transportation. Services include advanced communications system, network access, updated IT, and world-class administrative support, as well as a full menu of business services and facilities, such as meeting rooms and video conferencing. 10
Prestige intends to provide services that will support the growing trend of mobile and at home working. Supporting workers at home and on the road with services such as Virtual Office and Virtual PA, providing dedicated business addresses as their business base, as well as mail and call handling services. The Company will need substantial additional capital to support its budget. The Company has no committed source for any funds as of date hereof. In the event funds cannot be raised when needed, the Company may not be able to carry out its business plan, may never achieve sales or royalty income, and could fail in business as a result of these uncertainties. At June 30, 2013, we have total current assets of $61,291, of which $4,774 is cash on hand. At June 30, 2013, we have total current liabilities of $1,648,524. We have a working capital deficit of $1,587,233 at June 30, 2013. The Company will need substantial additional capital to support its continuing operations. The Company has had minimal revenues. The Company has no committed source for any funds as of the date hereof. In the event funds cannot be raised when needed, the Company may not be able to continue to carry out its business plan, may never be able to grow its revenues and operations, and could fail in business as a result of these uncertainties. The Company may borrow money to finance its future operations, although it does not currently contemplate doing so. Any such borrowing will increase the risk of loss to the investor in the event the Company is unsuccessful in repaying such loans. RESULTS OF OPERATIONS THE FISCAL YEAR ENDED JUNE 30, 2013 COMPARED TO THE FISCAL YEAR ENDED JUNE 30, 2012 Revenue During the year ended June 30, 2013 and 2012, we recognized $669,742 and $576,620, respectively in revenue from the serviced office operations of our wholly-owned subsidiary, Prestige. The cost of such revenues was $80,587 and $78,176, respectively. There was an increase of $93,122 in revenue as a result of an increase in clients. During the year ended June 30, 2013, we recognized a gross profit of $589,155 compared to a gross profit of $498,444 during the year ended June 30, 2012. Operational (Income) Expenses During the year ended June 30, 2013, we recognized operational expenses of $1,068,490 compared to operational expenses of $1,104,153 for the year ended June 30, 2012. The $35,663 decrease in operational expenses was a result of a $18,918 decrease in general and administrative expenses, a $100,294 decrease in amortization expense offset by an $81,742 increase in rent and rates and an increase of $1,876 in depreciation expense. Provision for Income Taxes No provision for income taxes was required in the fiscal years ended June 30, 2013 and 2012 as we had sufficient carriedforward tax losses to offset the profit arising in these periods. 11
Net Loss During the year ended June 30, 2013, we recognized a net loss of $479,335 compared to a net loss of $604,375 during the year ended June 30, 2011. The decrease of $125,050 in net losses was a result of the $93,122 increase in revenues combined with a $35,663 decrease in operational expenses. LIQUIDITY AND CAPITAL As of June 30, 2013, we had total current assets of $61,291 consisting of $4,774 in cash and prepaid expenses and other current assets of $56,517. At June 30, 2013, we had total current liabilities of $1,648,524. Total current liabilities consisted of accounts payable of $99,561, accrued liabilities of $3,363 prepayments from clients of $5,307, notes payable of $452,439 and related parties advances of $984,600. The Company has a working capital deficit of $1,587,233. Going Concern In our Annual Report on Form 10-K for the fiscal years ended June 30, 2013 and 2012, the Report of the Independent Registered Public Accounting Firm included an explanatory paragraph that describes substantial doubt about our ability to continue as a going concern. Our financial statements for the year ended June 30, 2013 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. We reported an accumulated deficit of $2,221,345 and a stockholders' deficit of $1,225,756 as of June 30, 2013. Consequently, we are now dependent on raising additional equity and /or, debt to meet our ongoing operating expenses. There is no assurance that we will be able to raise the necessary equity and, or debt that we will need to fund our ongoing operating expenses. For the year ended June 30, 2013, net cash used in operations was $195,785, compared to $447,230 for the year ended June 30, 2012, a decrease of $251,444. During the year ended June 30, 2013, the net loss of $479,335 was reconciled for the non-cash item of depreciation of $152,404 and amortization of $88,596. During the year ended June 30, 2013, we used $6,352 in investing activities, including the purchase of $6,352 in fixed assets by our wholly-owned subsidiary, Prestige. During the year ended June 30, 2012, we used $367 in investing activities. During the year ended June 30, 2013, we received $195,722 from our financing activities. During the year ended June 30, 2012, we received $431,377 from our financing activities. During the years ended June 30, 2013 and 2012, Mr. Yeung Cheuk Hung, the manager of Prestige and the majority shareholder of the Company, has advanced funds of $181,105 and $363,524, respectively, to support the operations of Prestige. During the year ended June 30, 2013, the Company paid Mr. Hung, $36,298 on the funds owed. The Company owes him $853,876 and $709,070 as of June 30, 2013 and 2012, respectively. Such funds are unsecured, bear no interest, and are due on demand. During the years ended June 30, 2013 and 2012, Ms. Look, an officer and director of the Company and the manager of Mega, advanced funds of $50,916 and $65,727, respectively to Mega to support operations. Ms. Look is owed $124,853 and $79,808 as of June 30, 2013 and 2012, respectively. Such funds are unsecured, bear no interest, and are due on demand. 12
EFFECTS OF INFLATION Although we cannot accurately anticipate the effect of inflation on our operations, we do not believe that inflation has had, or is likely in the future to have, a material effect on our results or financial condition. CRITICAL ACCOUNTING POLICIES Foreign Currency Translation The financial statements of JV Group's wholly-owned subsidiaries, Prestige and Mega are measured using the local currency (the Hong Kong Dollar (HK$)) as the functional currency. Assets and liabilities of Prestige and Mega are translated at exchange rates as of the balance sheet date. Revenues and expenses are translated at average rates of exchange in effect during the period. The resulting cumulative translation adjustments have been recorded as a component of comprehensive income (loss), included as a separate item in shareholders' equity. The Company is exposed to movements in foreign currency exchange rates. In addition, the Company is subject to risks including adverse developments in the foreign political and economic environment, trade barriers, managing foreign operations and potentially adverse tax consequences. There can be no assurance that any of these factors will not have a material negative impact on the Company's financial condition or results of operations in the future. Revenue Recognition The Company recognizes revenue when it is earned and expenses are recognized when they occur. Stock-Based Compensation Beginning January 1, 2006, the Company adopted the provisions of and accounts for stock-based compensation using an estimate of value in accordance with the fair value method. Under the fair value recognition provisions of this statement, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on a straight-line basis over the requisite service period, which generally is the vesting period. The Company elected the modified-prospective method, under which prior periods are not revised for comparative purposes. The valuation method applies to new grants and to grants that were outstanding as of the effective date and are subsequently modified. ITEM 7A. QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Our financial statements and supplementary data are included herein commencing on page 22. 13
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. ITEM 9A. CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES We maintain a system of disclosure controls and procedures (as defined in Securities Exchange Act Rules 13a-15(e) and 15d-15(e)) that is designed to provide reasonable assurance that information that is required to be disclosed is accumulated and communicated to management timely. As required by SEC Rule 15d-15(b), our Chief Executive Officer and our Chief Financial Officer carried out an evaluation under the supervision and with the participation of our management, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 15d-14 as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are not effective in timely alerting them to material information required to be disclosed in the our periodic filings with the SEC. Management's Annual Report On Internal Control Over Financial Reporting Our management, including the Chief Executive Officer and Chief Financial Officer is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f), is a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our Board of Directors, management and other personnel, 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 and includes those policies and procedures that: o Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; o Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and o Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use of disposition of our assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Our management assessed the effectiveness of our internal control over financial reporting as of June 30, 2013. Based on this assessment, management believes that as of June 30, 2013, our internal control over financial reporting is not effective based on those criteria. 14
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 temporary rules of the SEC to provide only management's report in this annual report. Changes in Internal Control Over Financial Reporting During our most recent fiscal quarter, there has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) or 15d-15(f) under the Securities Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION None. PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE DIRECTORS AND EXECUTIVE OFFICERS As of June 30, 2013, our directors and officers were: NAME AGE POSITION Yuen Ling Look 45 President, Chief Executive Officer, Chief Financial Officer and Director Siu Fong Kelly Yeung 43 Director Siu Lun Tong 50 Director YUEN LING LOOK Ms. Look was appointed the Chief Executive Officer, President, Chief Financial Officer and director of the Company on November 9, 2009. Ms. Look is also a manager of both Mega and Prestige. Ms. Look has been employed by La Jacques Fashion Limited for over ten years. Currently, she is the Chief Administrator, responsible for the accounting and administrative work. La Jacques Fashion Limited is a garment trading company. She was educated in Hong Kong and earned a diploma in Business Administration in 1991 from Hong Kong Shue Yan University (formerly called Shue Yan College). She also completed the Certificate Stage of Association of Chartered Certified Accountants in 1999. SIU FONG KELLY YEUNG Ms. Yeung was appointed a director of the Company on November 9, 2009. Ms. Yeung graduated from the Primary school in Hong Kong. She then went to United Kingdom for further studies. In 1988, she finished at Level O. After 15
graduation, she immediately joined and participated in the operations of restaurants. She has almost twenty years experience in the beverage industry. She has been running her own restaurant for over ten years. SIU LUN TONG Mr. Tong was appointed a director of the Company on November 9, 2009. Mr. Tong has been employed by Asian Alliance Garment Limited for more than 15 years. Currently, he is the production manager of Asian Alliance Garment Limited. At Asian Alliance Garment Limited, he specializes in management and control of factories and quality. Sportswear and jeans are the main lines of the company's business. COMMITTEES OF THE BOARD OF DIRECTORS In the ordinary course of business, the board of directors maintains a compensation committee and an audit committee. At this time, the Company's board of directors as a whole serves as its compensation committee and audit committee. The primary function of the compensation committee is to review and make recommendations to the board of directors with respect to the compensation, including bonuses, of our officers. The functions of the audit committee are to review the scope of the audit procedures employed by our independent auditors, to review with the independent auditors our accounting practices and policies and recommend to whom reports should be submitted, to review with the independent auditors their final audit reports, to review with our internal and independent auditors our overall accounting and financial controls, to be available to the independent auditors during the year for consultation, to approve the audit fee charged by the independent auditors, to report to the board of directors with respect to such matters, and to recommend the selection of the independent auditors. In the absence of a separate audit committee our Board of Directors functions as the audit committee and performs some of the same functions of an audit committee, such as recommending a firm of independent certified public accountants to audit the annual financial statements; reviewing the independent auditors independence, the financial statements and their audit report; and reviewing management's administration of the system of internal accounting controls. CONFLICTS OF INTEREST - GENERAL Our directors and officers are, or may become, in their individual capacities, officers, directors, controlling shareholder and/or partners of other entities engaged in a variety of businesses. Thus, there exist potential conflicts of interest including, among other things, time, efforts, and corporate opportunity involved in participation with such other business entities. While each officer and director of our business is engaged in business activities outside of our business, they devote to our business such time as they believe to be necessary. CONFLICTS OF INTEREST - CORPORATE OPPORTUNITIES Presently no requirement contained in our Articles of Incorporation, Bylaws, or minutes which requires officers and directors of our business to disclose to us business opportunities which come to their attention. Our officers and directors do, however, have a fiduciary duty of loyalty to us to disclose to us any 16
business opportunities which come to their attention, in their capacity as an officer and/or director or otherwise. Excluded from this duty would be opportunities which the person learns about through his involvement as an officer and director of another company. We have no intention of merging with or acquiring an affiliate, associate person or business opportunity from any affiliate or any client of any such person. SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Section 16(a) of the Securities Exchange Act requires our Officers and Directors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership and changes in ownership with the SEC. Officers, directors, and greater than 10% shareholders are required by SEC regulation to furnish us with copies of all Section 16(a) forms they file. Based solely on our review of copies of such reports received, and representations from certain reporting persons, we believe that, during the fiscal year ended June 30, 2013, all Section 16(a) filing requirements applicable to our officers, directors and greater than 10% beneficial owners were filed in compliance with all applicable requirements with the exception of Top Growth Holdings Group, Inc., Mr. Yeung Cheuk Hung and Mr. Po Shu Michael Choy. CODE OF ETHICS Due to the limited scope of our current operations, we have not adopted a corporate code of ethics that applies to our principal executive officer, principal accounting officer, or persons performing similar function. ITEM 11. EXECUTIVE COMPENSATION The following table sets forth certain information concerning compensation paid by the Company to its sole officer for the fiscal years ended June 30, 2013, 2012 and 2011 (the "Named Executive Officers"): SUMMARY COMPENSATION TABLE Non-equity Non-qualified incentive deferred Stock Option plan compensation All other Name & Salary Bonus awards awards compensation earnings compensation Total Position Year ($) ($) ($) ($) ($) ($) ($) ($) --------------- -------- --------- --------- --------- -------- --------------- --------------- --------------- ---------- Yuen Ling 2013 $-0- $-0- $ -0- $ -0- $ -0- $-0- $-0- $-0- Look 2012 $-0- $-0- $ -0- $ -0- $ -0- $-0- $-0- $-0- 2011 $-0- $-0- $ -0- $ -0- $ -0- $-0- $-0- $-0- Ms. Look does not have a compensation agreement with the Company at this time. EMPLOYMENT AND CONSULTING AGREEMENTS There were no employment contracts or consulting agreements with our directors or officers during the fiscal year ended June 30, 2013. 17
DIRECTOR COMPENSATION The following table sets forth certain information concerning compensation paid to the Company's directors during the year ended June 30, 2013: Fees Nonqualified earned or Non-equity deferred paid in Stock Option incentive plan compensation All other Name cash awards awards ($) compensation earnings compensation Total ($) ($) ($) ($) ($) ($) ----------------------- ----------- ---------- ----------- ---------------- ---------------- --------------- ------------- Yuen Ling Look $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- Siu Fong Kelly Yeung $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- Siu Lun Tong $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS The following tables set forth certain information regarding beneficial ownership of our common stock, as of June 30, 2013, by: o each person who is known by JV Group to own beneficially more than 5% of the Company's outstanding common stock, o each of the Company's named executive officers and directors, and o all executive officers and directors as a group. Shares of common stock not outstanding but deemed beneficially owned by virtue of the right of an individual to acquire the shares of common stock within 60 days are treated as outstanding only when determining the amount and percentage of common stock owned by such individual. Except as noted below the table, each person has sole voting and investment power with respect to the shares of common stock shown. 18
NUMBER OF PERCENT OF NAME AND ADDRESS OF BENEFICIAL OWNER (1) SHARES OUTSTANDING(4) ---------------------------------------- ------ -------------- Yuen Ling Look (2) President and Director 13,108,000 13.25% Top Growth Holdings Group, Inc. (2) 13,108,000 13.25% Director Siu Fong Kelly Yeung 0 0% Director Siu Lun Tong 0 0% Director Yeung Cheuk Hung (3) 60,000,000 60.67% Po Shu Michael Choy 25,000,000 25.28 All executive officers and directors as a group, 3 people 13,108,000 13.25% (1) The above officers and directors' address is c/o JV Group, Inc. 7609 Ralston Road, Arvada, Colorado, 80002. (2) Ms. Look is the beneficial owner of Top Growth Holdings Group, Inc., which holds 13,108,000 shares of the Company's common stock. (3) Mr. Hung is a manager of Prestige, the Company's wholly-owned subsidiary. (4) Based on 98,879,655 shares of the Company's common stock issued and outstanding at June 30, 2013. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDERPENDENCE During the years ended June 30, 2013 and 2012, Mr. Yeung Cheuk Hung, the manager of Prestige and the majority shareholder of the Company, has advanced funds of $181,105 and $363,524, respectively, to support the operations of Prestige. During the year ended June 30, 2013, the Company paid Mr. Hung, $36,298 on the funds owed. The Company owes him $853,876 and $709,070 as of June 30, 2013 and 2012, respectively. Such funds are unsecured, bear no interest, and are due on demand. During the years ended June 30, 2013 and 2012, Ms. Look, an officer and director of the Company and the manager of Mega, advanced funds of $50,916 and $65,727, respectively to Mega to support operations. Ms. Look is owed $124,853 and $79,808 as of June 30, 2012 and 2011, respectively. During the year ended June 30, 2012 and 2011, Top Growth Holdings Group, Inc., an affiliate and entity of which Ms. Look, an officer and director of the Company, advanced $0 and $750, respectively to the Company. At June 30, 2012, Top Growth Holdings Group, Inc. is owed $0. Such funds are unsecured, bear no interest, and are due on demand. On September 8, 2011, Prestige entered into an Agreement with Huge Earn Investments Limited ("Huge Earn") to purchase certain leaseholds in exchange for 25,000,000 of shares of the Company's restricted common stock and a $450,000 promissory note with anticipated due date of six months from issuance. At the 19
direction of Huge Earn, the promissory note and the shares were issued to Po Shu Michael Choy, making him an affiliate of the Company. The promissory note was due on March 1, 2012. At the time of this filing, the promissory note is still outstanding. The promissory note does not accrue interest. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES GENERAL. De Joya Griffith & Company, LLC ("De Joya") is the Company's independent registered public accounting firm. The Company's Board of Directors has considered whether the provisions of audit services are compatible with maintaining De Joya's independence. The engagement of our independent registered public accounting firm was approved by our board of directors functioning as our audit committee prior to the start of the audit of our consolidated financial statements for the year ended June 30, 2013. The following table represents aggregate fees billed to the Company for the years ended June 30, 2013 and 2012. Year Ended June 30, 2013 2012 ----------------------------- ---------------------------- Audit Fees $27,950 $33,000 Audit-related Fees $0 $0 Tax Fees $0 $0 All Other Fees $0 $0 ----------------------------- ---------------------------- Total Fees $27,950 $33,000 All audit work was performed by the auditors' full time employees. It is the role of the Audit Committee, or in the absence of an audit committee, the Board of Directors, to consider whether, and determine that, the auditor's provision of non-audit services would be compatible with maintaining the auditor's independence. ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS The following documents are filed as a part of this Report. (i) Exhibits. The following is a complete list of exhibits filed as part of this Form 10-K. Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K. EXHIBIT NUMBER DESCRIPTION AND METHOD OF FILING 2.1 Agreement and Plan of Merger and Reorganization Into Holding Company** 2.2 Acquisition Agreement By and Among ASPI, Inc. and Prestige Prime Office, Ltd. and Its Shareholders*** 20
3(i).1 Articles of Incorporation of ASPI, Inc.** 3(i).2 Articles of Incorporation of A08 Holdings, Inc.** 3(i).3 Certificate of Amendment to the Certificate of Incorporation of ASPI, Inc.* 3(ii).1 Bylaws of ASPI, Inc.** 3(ii).2 Bylaws of A08 Holdings, Inc.** 10.1 Agreement by and between Prestige Prime Office, Ltd. and Huge Earn Investments Limited, dated September 8, 2011**** 21.1 Subsidiaries of the Registrant* 31.1 Certification of Chief Executive and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act* 32.1 Certification of Principal Executive and Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act* 101.INS XBRL Instance Document (1)* 101.SCH XBRL Taxonomy Extension Schema Document (1)* 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document (1)* 101.DEF XBRL Taxonomy Extension Definition Linkbase Document (1)* 101.LAB XBRL Taxonomy Extension Label Linkbase Document (1)* 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document (1)* (1) Pursuant to Rule 406T of Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections. * Filed herewith. ** Filed as an Exhibit to the Current Report on Form 8K filed with the SEC on July 7, 2009. *** Filed as an Exhibit to the Current Report on Form 8K filed with the SEC on September 10, 2010. ****Filed as an Exhibit to the Current Report on Form 8K filed with the SEC on August 10, 2011. 21
Office Locations DeJoya Griffith ---------------- Certified Public Accountants and Consultants Las Vegas, NV New York, NY Pune, India Beijing, China REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders JV Group, Inc. We have audited the accompanying consolidated balance sheets of JV Group, Inc. and subsidiaries, (the "Company") as of June 30, 2013 and 2012 and the related consolidated statements of operations, stockholders' deficit, and cash flows for the years then ended. JV Group, Inc.'s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements 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 audits to obtain reasonable assurance about whether the financial statements are 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 audit 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 the 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 audit provides a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of JV Group, Inc. and subsidiaries as of June 30, 2013 and 2012 and the result of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial statements, the Company has suffered losses from operations, which raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. /s/ De Joya Griffith, LLC Henderson, Nevada October 9, 2013 -------------------------------------------------------------------------------- De Joya Griffith, LLC o 2580 Anthem Village Dr. o Henderson, NV o 89052 Telephone (702) 563-1600 o Facsimile (702) 920-8049 www.dejoyagriffith.com 22
JV GROUP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Amounts in USD) (Audited) June 30, June 30, 2013 2012 -------------------------------- ASSETS Current assets Cash and cash equivalents $ 4,774 $ 10,407 Prepaid expenses and other current assets 56,517 56,138 -------------------------------- Total current assets 61,291 66,545 Property and equipment, net of $439,455 and $287,754 accumulated depreciation, respectively 317,756 463,808 -------------------------------- Intangible assets, net of $277,486 and $188,890 accumulated amortization, respectively 42,721 131,317 -------------------------------- Total assets $ 421,768 $ 661,670 ================================ LIABILITIES & STOCKHOLDERS' DEFICIT Current liabilities Accounts payable $ 99,561 62,885 Accrued liabilities 5,307 3,545 Prepayments, clients 106,617 102,123 Notes payable 452,439 452,439 Advances, related parties 984,600 788,878 -------------------------------- Total current liabilities 1,648,524 1,409,870 Total liabilities 1,648,524 1,409,870 -------------------------------- Stockholders' deficit Preferred stock, $0.01 par value: 25,000,000 shares authorized, no shares - - issued and outstanding. Common stock, $0.01 par value: 1,000,000,000 shares authorized 988,797 988,797 98,879,655 shares issued and outstanding at June 30, 2013 and 2012 Other comprehensive income 5,792 5,013 Accumulated deficit (2,221,345) (1,742,010) -------------------------------- Total stockholders' deficit (1,226,756) (748,200) -------------------------------- Total liabilities and stockholders' deficit $ 421,768 $ 661,670 ================================ See accompanying notes to consolidated financial statements. 23
JV GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED JUNE 30, 2013 and 2012 (Amounts in USD) (Audited) 2013 2012 ---------------------------------- Revenue $ 669,742 $ 576,620 Cost of revenue 80,587 78,176 ---------------------------------- Gross profit 589,155 498,444 Operating expenses General and administrative 378,731 397,718 Rent and rates 449,066 367,324 Amortization 88,596 188,890 Depreciation 152,097 150,221 ---------------------------------- Total operating expenses 1,068,490 1,104,153 ---------------------------------- Loss from operations (479,335) (605,709) Other income Interest and other income - 1,334 ---------------------------------- Total other income - 1,334 ---------------------------------- Net loss $ (479,335) $ (604,375) ================================== Other comprehensive income Foreign currency translation adjustment 779 2,745 ---------------------------------- Total comprehensive loss $ (478,556) $ (601,630) ================================== Loss per common share- basic: Net loss $ (0.00) $ (0.01) ================================== Weighted average common shares outstanding: Basic 98,879,655 92,575,285 ================================== See accompanying notes to consolidated financial statements. 24
JV GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT FOR THE YEARS ENDED JUNE 30, 2013 AND 2012 (Amounts in USD) (Audited) Accumulated Common Stock Accumulated Comprehensive Shares Amount Deficit Profit / (Loss) Total ----------------- ----------- ----------------- ----------------- ---------------- Balance, June 30, 2011 73,879,655 $ 738,797 $ (1,137,635) $ 2,268 $ (396,570) Stock for lease acquisition 25,000,000 250,000 - - 250,000 Foreign currency translation - - - 2,745 2,745 Net loss - - (604,375) - (604,375) ----------------- ----------- ----------------- ----------------- ---------------- Balance, June 30, 2012 98,879,655 988,797 (1,742,010) 5,013 (748,200) Foreign currency translation - - - 779 779 Net loss - - (479,335) - (479,335) ----------------- ----------- ----------------- ----------------- ---------------- Balance, June 30, 2013 98,879,655 $ 988,797 $ (2,221,345) $ 5,792 $ (1,226,756) ================= =========== ================= ================= ================ See accompanying notes to consolidated financial statements. 25
JV GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED JUNE 30, 2013 AND 2012 (Amounts in USD) (Audited) 2013 2012 -------------------------------- CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ (479,335) $ (604,375) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 152,404 150,221 Amortization 88,596 188,890 Changes in operating assets and liabilities: Prepaid expenses and other current assets (378) (5,256) Accounts payable and accrued liabilities 38,434 (228,435) Prepayments from clients 4,494 51,725 -------------------------------- Total cash flow used in operating activities (195,785) (447,230) CASH FLOW FROM INVESTING ACTIVITIES Acquisition of assets (6,352) (367) -------------------------------- Total cash flow used in investing activities (6,352) (367) CASH FLOW FROM FINANCING ACTIVITIES Advances from officers and directors 232,020 431,377 Payments on advances from officers and directors (36,298) - -------------------------------- Total cash flow provided by financing activities 195,722 431,377 Effect of exchange rate changes on cash 782 41 -------------------------------- NET CHANGE IN CASH (5,633) (16,179) CASH AT BEGINNING OF PERIOD 10,407 26,587 -------------------------------- CASH AT END OF PERIOD $ 4,774 $ 10,407 ================================ SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION Cash paid for interest $ - $ - -------------------------------- Cash paid for income tax $ - $ - -------------------------------- See accompanying notes to consolidated financial statements. 26
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) NOTE 1 - BUSINESS AND BASIS OF PRESENTATION Company History ASPI, Inc. ("APSI") was formed in Delaware in September 29, 2008. On April 25, 2012, ASPI filed an amendment to its Certificate of Incorporation to change its name from ASPI, Inc. to JV Group, Inc. ("JV Group.") In addition, at that time, JV Group increased the number of authorized common shares from One Hundred Million (100,000,000) shares to One Billion (1,000,000,000) shares. Business JV Group operates primarily as an office service provider through its wholly-owned subsidiary, Prestige Prime Office, Limited ("Prestige"). Prestige provides office space that is fully furnished, equipped and staffed, located at premier addresses in central business districts with convenient access to airport or public transportation. Services include advanced communication systems, network access, updated IT, and world-class administrative support, as well as a full menu of business services and facilities, such as meeting rooms and video conferencing. Basis of Presentation The accompanying consolidated financial statements include the accounts of JV Group, Inc., a Delaware corporation, its wholly-owned subsidiaries, Mega Action Limited ("Mega"), a British Virgin Island Corporation, and Prestige, a Hong Kong Special Administrative Region Corporation (JV Group and its subsidiaries are collectively referred to as the "Company"). All significant intercompany accounts and transactions have been eliminated in consolidation. NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Judgments and estimates of uncertainties are required in applying the Company's accounting policies in certain areas. The following are some of the areas requiring significant judgments and estimates: a) Going concern; b) valuation allowance for deferred tax assets based on estimated future taxable income as described in Note 11; c) Depreciable life for property, plant and equipment and intangible assets. The relevant amounts could be adjusted in the near term if experience differs from current estimates. Cash and Cash Equivalents The Company considers all liquid investments purchased with an initial maturity of three months or less to be cash equivalents. Cash and cash equivalents include demand deposits and money market funds carried at cost which approximates fair value. The Company maintains its cash in institutions insured by the Federal Deposit Insurance Corporation ("FDIC"). 27
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) Foreign Currency Translation The financial statements of JV Group's wholly-owned subsidiaries, Prestige and Mega are measured using the local currency (the Hong Kong Dollar (HK$) is the functional currency). Assets and liabilities of Prestige and Mega are translated at exchange rates as of the balance sheet date. Revenues and expenses are translated at average rates of exchange in effect during the period. The resulting cumulative translation adjustments have been recorded as a component of comprehensive income (loss), included as a separate item in the statement of operations. The Company is exposed to movements in foreign currency exchange rates. In addition, the Company is subject to risks including adverse developments in the foreign political and economic environment, trade barriers, managing foreign operations, and potentially adverse tax consequences. There can be no assurance that any of these factors will not have a material negative impact on the Company's financial condition or results of operations in the future. Fair Value of Financial Instruments Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk. In addition to defining fair value, the standard expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 - inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. Level 2 - inputs are based upon significant observable inputs other than quoted prices included in Level 1, such as quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - inputs are generally unobservable and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques. The carrying value of the Company's financial assets and liabilities which consist of cash, accounts payable, and advances from related parties in management's opinion approximate their fair value due to the short maturity of such instruments. These financial assets and liabilities are valued using level 28
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) 3 inputs, except for cash which is at Level 1. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, exchange, or credit risks arising from these financial instruments. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed principally on the straight-line method over the estimated useful life of each type of asset which ranges from three to five years. Major improvements are capitalized, while expenditures for repairs and maintenance are expensed when incurred. Upon retirement or disposition, the related costs and accumulated depreciation are removed from the accounts, and any resulting gains or losses are credited or charged to income. Intangible Asset On September 8, 2011, the Company entered into an Agreement to purchase certain leaseholds and as a result recognized certain intangibles, such as customer lists. These intangible assets are being amortized over a weighted average period of 1.7 years at a rate of HK$1,953,870 per year. At June 30, 2013, accumulated amortization was translated to equal US$277,486 and amortization expense for the year ended June 30, 2013 was US$88,596. Revenue Recognition The Company recognizes revenue when it is earned and expenses are recognized when they occur in accordance with FASB ASC 605 "Revenue Recognition" ("ASC 605"). The Company recognizes revenue from its office service operations. Clients pay a monthly fee and such fees are recognized at that time. Advertising The Company put advertisements on local newspaper and the internet in order to attract potential customers. It is recognized as expense when it occurs. The Company paid $15,283 and $19,740 as advertising cost for fiscal years ended June 30, 2013 and 2012, respectively. Net Loss per Common Share Basic net loss per common share is calculated by dividing total net loss applicable to common shares by the weighted average number of common and common equivalent shares outstanding during the period. For the years ended June 30, 2013 and 2012, there were no potential common equivalent shares used in the calculation of weighted average common shares outstanding as the effect would be anti-dilutive. Impairment of Long Lived Assets Long-lived assets are reviewed for impairment in accordance with the applicable FASB standard, "Accounting for the Impairment or Disposal of Long- Lived Assets". Under the standard, long-lived assets are tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. An impairment charge is recognized for the amount, if any, which the carrying value of the asset exceeds the fair value. 29
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) Stock-Based Compensation Beginning January 1, 2006, the Company adopted the provisions of and accounts for stock-based compensation using an estimate of value in accordance with the fair value method. Under the fair value recognition provisions of this statement, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on a straight-line basis over the requisite service period, which generally is the vesting period. The Company elected the modified-prospective method, under which prior periods are not revised for comparative purposes. The valuation method applies to new grants and to grants that were outstanding as of the effective date and are subsequently modified. Other Comprehensive Income (Loss) The Company recognizes unrealized gains and loss on the Company's foreign currency translation adjustments as components of other comprehensive income (loss). Income Taxes Provision for income taxes represents actual or estimated amounts payable on tax return filings each year. Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts reported in the accompanying balance sheets, and for operating loss and tax credit carry forwards. The change in deferred tax assets and liabilities for the period measures the deferred tax provision or benefit for the period. Effects of changes in enacted tax laws on deferred tax assets and liabilities are reflected as adjustment to the tax provision or benefit in the period of enactment. FASB ASC 740, "Income Taxes" ("ASC 740") addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position would be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, and accounting for interest and penalties associated with tax positions. As of June 30, 2013 and 2012, the Company does not have a liability for any uncertain tax positions. The income tax laws of various jurisdictions in which the Company operates are summarized as follows: United States JV Group is subject to United States tax at 35%. No provision for income tax in the United States has been made as the Company had no U.S. taxable income for the years ended June 30, 2013 and 2012. BVI Mega is incorporated in BVI and is governed by the income tax laws of BVI. According to current BVI income tax law, the applicable income tax rate for the Company is 0%. 30
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) Hong Kong Prestige is incorporated in Hong Kong. Pursuant to the income tax laws of Hong Kong, the Company is subject to the tax rate 16.5%. Recent Accounting Pronouncements There were various other accounting standards and interpretations issued in 2013 and 2012, none of which are expected to have a material impact on the Company's financial position, operations, or cash flows. NOTE 3 - GOING CONCERN The Company's financial statements for the years ended June 30, 2013 and 2012 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company reported a net loss of $479,335 for the year ended June 30, 2013 and an accumulated deficit of $2,221,345 at June 30, 2013. At June 30, 2013, the Company had total current assets of $61,291 and total current liabilities of $1,648,524 for a working capital deficit of $1,587,233. The Company's ability to continue as a going concern may be dependent on the success of management's plan discussed below. The financial statements do not include any adjustments relating to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. To the extent the Company's operations are not sufficient to fund the Company's capital requirements, the Company may attempt to enter into a revolving loan agreement with financial institutions or attempt to raise capital through the sale of additional capital stock or through the issuance of debt. At the present time, the Company does not have a revolving loan agreement with any financial institution nor can the Company provide any assurance that it will be able to enter into any such agreement in the future or be able to raise funds through the further issuance of debt or equity in the Company. During the 2014 fiscal year, the Company intends to continue its efforts in growing its office service operations. NOTE 4 - LEASE ACQUISITION On September 8, 2011, the Company and its wholly-owned subsidiary, Prestige entered into an Agreement to purchase certain leaseholds from an unrelated third party in exchange for 25,000,000 of shares of the Company's restricted common stock and a $450,000 promissory note. The transfer of leases and the assets and liabilities associated with the leases occurred on October 1, 2011. The $450,000 promissory note has a term of six months and became due on March 1, 2012. The promissory note does not accrue interest. At June 30, 2013, the promissory note is still outstanding. As part of the acquisition of the leases, the Company acquired fixed assets that included furniture, fixtures, and office equipment associated with the acquisition. Such property was considered to have a book value of $384,107, at the time of the purchase. 31
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) The acquisition was accounted for under the purchase method of accounting in accordance with ASC 805. Under the purchase method, the total purchase price is allocated to the net tangible and intangible assets based on their estimated fair values. As part of the acquisition of the leases, the Company acquired such intangible assets as the client base associated with the leases and the contract with the landlord. The client base was valued at $217,609 to be amortized over one year. During the year ended June 30, 2012, the client base was amortized fully. The contract with the landlord was valued at $102,498 to be amortized over a period of three years at a rate of approximately $34,166. Management has made the allocation of the purchase price to the tangible and intangible assets acquired and liabilities assumed that existed as of the date of completion of the acquisition as follows: Purchase Price 25,000,000 shares of the Company's common stock valued at fair value of $0.01 per share $ 250,000 Promissory Note 450,000 --------------- Total Consideration $ 700,000 =============== Allocation of purchase price Furniture and Fixtures $ 332,222 Office Equipment 44,052 Computer Equipment 3,619 Intangible Asset - Client base 217,609 Intangible Asset - Lease Right 102,498 --------------- $ 700,000 =============== NOTE 5 - PROPERTY AND EQUIPMENT At June 30, 2013 and 2012, Property and Equipment consisted of: June 30, June 30, 2013 2012 -------------------- --------------------- Furniture and Fixtures $ 593,536 $ 593,627 Office Equipment 138,284 137,893 25Computer Equipment 25,391 20,042 -------------------- --------------------- 757,211 751,562 Accumulated Depreciation (439,455) (287,754) -------------------- --------------------- Total $ 317,756 $ 463,808 ==================== ===================== Property and equipment held by Prestige have an original cost basis valued in Hong Kong Dollars. During the year ended June 30, 2013, computer equipment and office equipment increased by $6,352 due to the purchases of equipment. Other changes in value are a result of foreign currency exchange differences. 32
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) NOTE 6 - ADVANCES, RELATED PARTIES On September 8, 2011, the Company entered into an Agreement to purchase certain leaseholds from an unrelated third party in exchange for 25,000,000 of shares of the Company's restricted common stock and a $450,000 promissory note. The $450,000 promissory note has a term of six months and therefore became due on March 1, 2012. The promissory note does not accrue interest. At June 30, 2013, the promissory note is still outstanding and includes an additional $2,439 to account for exchange rate differences. During the years ended June 30, 2013 and 2012, Mr. Yeung Cheuk Hung, the manager of Prestige and the majority shareholder of the Company, has advanced funds of $181,105 and $363,524, respectively, to support the operations of Prestige. During the year ended June 30, 2013, the Company paid Mr. Hung, $36,298 on the funds owed. The Company owes him $853,876 and $709,070 as of June 30, 2013 and 2012, respectively. Such funds are unsecured, bear no interest, and are due on demand. During the years ended June 30, 2013 and 2012, Ms. Look, an officer and director of the Company and the manager of Mega, advanced funds of $50,916 and $65,727, respectively to Mega to support operations. Ms. Look is owed $124,853 and $79,808 as of June 30, 2013 and 2012, respectively. Such funds are unsecured, bear no interest, and are due on demand. Prior to the fiscal year ended June 30, 2013, Ms. Look and officer and director of the Company advanced funds of $5,871 to the Company to support operations. As of June 30, 2103, Ms. Look is owed $5,871. Such funds are unsecured, bear no interest and are due on demand. NOTE 7 - PREPAYMENTS, CLIENTS Clients pay a deposit on the Company's provided services upon entering into a lease agreement with the Company. These deposits are recognized by the Company not only as deposits for services, but also as a corresponding liability. At June 30, 2013 and June 30, 2012, the Company had $106,617 and $102,123, respectively in prepayment liabilities. NOTE 8 - COMMITMENTS AND CONTINGENCIES Prestige operates from Silvercord, No.30 Canton Road, Tsimshatsui, which is a premier commercial building in Hong Kong. The center is located on two floors and occupies approximately 10,000 square feet. We paid $449,066 and $367,324 for the lease of our center for the years ended June 30, 2013 and 2012, respectively. The Company's minimum annual rent rate for the following two years are: Fiscal Year Ended June 30, Annual Rent -------- ----------- 2014 $418,257 2015 $247,083 NOTE 9 - STOCKHOLDERS' DEFICIT The authorized capital stock of the Company is 1,000,000,000 shares of common stock with a $0.01 par value and 25,000,000 shares of preferred stock with a par value of $0.01 per share. At June 30, 2013, the Company had 98,879,655 shares of its common stock issued and outstanding. 33
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) During the year end June 30, 2013, the Company did not issue any shares of its common stock. During the year ended June 30, 2012, the Company issued 25,000,000 shares of its common stock valued at $250,000 in connection with the acquisition of certain leases, as discussed in Note 4. NOTE 10 - TAXES The Company is subject to foreign and domestic income taxes. The Company has had no income, and therefore has paid no income tax. As of June 30, 2013 and 2012, the Company had a net operating loss (NOL) carryforward of approximately $1,998,036 and $1,520,645. The NOL carryforward begins to expire in various years through 2032. Because management is unable to determine that it is more likely than not that the Company will realize the tax benefit related to the NOL carryforward, by having taxable income, a valuation allowance has been established at June 30, 2013 and 2012 to reduce the tax benefit asset value to zero. Components of net deferred tax assets, including a valuation allowance, are as follows at June 30: June 30, 2013 2012 -------------------- ------------------------ Deferred tax assets: Foreign deferred tax assets 144,105 78,995 Federal deferred tax assets 126,539 97,109 Valuation allowance (270,644) (176,104) ------------------- ------------------------ Total deferred tax assets $ - $ - The valuation allowance for deferred tax assets as of June 30, 2013 and 2012 was $270,644 and $176,104, respectively. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. As a result, management determined it was more likely than not the deferred tax assets would not be realized as of June 30, 2013 and 2012, and recorded a full valuation allowance. Reconciliation between the statutory rate and the effective tax rate is as follows at June 30, 2013 and 2012: Federal statutory tax rate 35.0% Foreign and U.S. tax rate differential (18.5)% Permanent difference and other (16.5)% -------------------- Effective tax rate 0.0% 34
JV GROUP, INC. AND SUBSIDIARIES Notes to the Consolidated Financial Statements For the Years Ended June 30, 2013 and 2012 (Audited) NOTE 11 - SUBSEQUENT EVENTS The Company has evaluated it activities subsequent to the year ended June 30, 2013 and found no other reportable subsequent events. 35
SIGNATURES In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. JV GROUP, INC. Date: October 15, 2013 By: /s/ Yuen Ling Look ------------------------------- Yuen Ling Look, President, Chief Executive Officer and Chief Financial Officer (Principal Accounting Officer) In accordance with the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Dated: October 15, 2013 JV GROUP, INC. /s/ Yuen Ling Look* -------------------------------------- Yuen Ling Look, Director /s/ Siu Fong Kelly Yeung -------------------------------------- Siu Fong Kelly Yeung, Director /s/ Siu Lun Tong -------------------------------------- Siu Lun Tong, Director 2