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EX-32.1 - EXHIBIT 32.1 - Greenhouse Solutions, Inc.exhibit32-1.htm
EX-31.1 - EXHIBIT 31.1 - Greenhouse Solutions, Inc.exhibit31-1.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2013 or

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

For the transition period from ________________ to ________________

Commission File Number 000-54759

GREENHOUSE SOLUTIONS INC.
(Exact name of registrant as specified in it’s charter)

Nevada 45-2094634
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
   
4 Research Dr., Suite 402, Shelton, Connecticut 06484
(Address of principal executive offices) (Zip Code)

(203) 242-3065
(Registrant’s telephone number, including area code)

______________________________________________________________
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[X] yes     [_] No

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer [_]      Accelerated filer [_]     Non-accelerated filer [_]     (Do not check if a smaller reporting company)     Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
[_] yes     [X] No

As of November 14, 2013 there were 86,760,000 common shares par value $0.001 issued and outstanding.


TABLE of CONTENTS

PART I—FINANCIAL INFORMATION 3
   
Item 1. Financial Statements. 3
   
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. 3
   
Item 3. Quantitative and Qualitative Disclosures About Market Risk 14
   
Item 4. Controls and Procedures. 14
   
PART II—OTHER INFORMATION 15
   
Item 1. Legal Proceedings. 15
   
Item 1A. Risk Factors. 15
   
Item 2. Unregistered Sales of Securities and Use of Proceeds. 15
   
Item 3. Defaults Upon Senior Securities 15
   
Item 4. Submission of Matters to a Vote of Security Holders. 16
   
Item 5. Other Information. 16
   
Item 6. Exhibits. 16
   
SIGNATURES 16

2


PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

 

 

GREENHOUSE SOLUTIONS INC.
(A Development Stage Company)

FINANCIAL STATEMENTS

September 30, 2013
(Unaudited)

 

 

BALANCE SHEETS
 
STATEMENTS OF OPERATIONS
 
STATEMENT OF STOCKHOLDER’S EQUITY
 
STATEMENTS OF CASH FLOWS
 
NOTES TO FINANCIAL STATEMENTS

3


GREENHOUSE SOLUTIONS INC.
(A Development Stage Company)

BALANCE SHEETS

    September 30,     March 31,  
    2013     2013  
    (Unaudited)     (Audited)  
ASSETS    
             
             
CURRENT ASSETS            
     Cash $  3,455   $  1  
             
TOTAL ASSETS $  3,455   $  1  
             
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)  
             
CURRENT LIABILITIES            
     Accounts payable and accrued liabilities $  10,243   $  18,146  
     Due to related parties (Note 3)   47,082     52,082  
             
TOTAL CURRENT LIABILITIES   57,325     70,228  
             
GOING CONCERN (Note 2)            
             
STOCKHOLDERS’ EQUITY(DEFICIT) (Note 5)            
Preferred stock, 25,000,000 shares authorized with $0.0001 par value
No Preferred shares issued or outstanding
Common stock, 200,000,000 shares authorized with $0.0001 par value
Issued and outstanding
      86,760,000 common shares (March 31, 2013 –86,760,000)
  8,676     8,676  
     Additional paid-in-capital   32,824     32,824  
     Shares subscribed   28,500     -  
     Deficit accumulated during development stage   (123,870 )   (111,727 )
             
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)   (53,870 )   (70,227 )
             
TOTAL LIABILITIES & STOCK HOLDERS’ EQUITY (DEFICIT) $  3,455   $  1  

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

4


GREENHOUSE SOLUTIONS, INC.
(A Development Stage Company)

STATEMENTS OF OPERATIONS
(Unaudited)

                            April 8, 2009  
    Three Months Ended     Six Months Ended     (inception) to  
    September 30     September 30     September 30,  
    2013     2012     2013     2012     2013  
                               
REVENUES $  -   $  -   $  -   $  -   $  40,034  
Cost of revenues   -     -     -     -     15,065  
                               
GROSS PROFIT   -     -     -     -     24,969  
                               
GENERAL AND ADMINISTRATIVE EXPENSES                              
     Professional fees $  3,000   $  11,600   $  7,110   $  19,240   $  67,946  
     Advertising and marketing   -     -     -     -     4,509  
     Consulting fees   -     -     -     -     4,007  
     Executive compensation   -     -     -     -     4,200  
     Filing fees   3,738     332     3,738     6,797     32,325  
     Organizational costs   -     -     -     -     838  
     Other costs   -     -     -     -     17,787  
     Transfer agent fees   895     1,200     1,295     1,600     23,993  
                               
TOTAL OPERATING EXPENSES   7,633     13,132     12,143     27,637     155,605  
                               
NET OPERATING LOSS   (7,633 )   (13,132 )   (12,143 )   (27,637 )   (130,636 )
                               
LOSS FROM CONTINUED OPERATIONS   (7,633 )   (13,132 )   (12,143 )   (27,637 )   (130,636 )
                               
DISCONTINUED OPERATIONS                              
Loss from operations of discontinued wholly owned, net of tax   -     -     -     -     (29,265 )
Gain from disposal of discontinued wholly owned Subsidiary, net of tax   -     -     -     -     36,031  
                               
GAIN (LOSS) FROM DISCONTINUED OPERATIONS   -     -     -     -     6,766  
                               
NET INCOME (LOSS) FOR THE PERIOD $  (7,633 ) $ (13,132 ) $  (12,143 ) $  (27,637 ) $  (123,870 )
                   
                               
BASIC LOSS PER COMMON SHARE $  (0.00 ) $  (0.00 ) $  (0.00 ) $ (0.00 )      
                               
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING -BASIC   86,760,000     86,760,000     86,760,000     86,760,000      

The accompanying notes are an integral part of these financial statements


GREENHOUSE SOLUTIONS INC.
(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)
FOR THE PERIOD FROM APRIL 8, 2009 (INCEPTION) TO SEPTEMBER 30, 2013
(Unaudited)

                            Deficit        
                            Accumulated        
    Common Stock     Additional     Share     During the        
    Number of           Paid-in     Subscription     Development        
    shares     Amount     Capital     Receivable     Stage     Total  
                                     
Balance – April 8, 2009   -   $  -   $  -   $  -   $  -   $  -  
                                     
Common stock issued for cash   74,400,000     7,440     (1,240 )   -     -     6,200  
                                     
Net loss for the period   -     -     -     -     (6,202 )   (6,202 )
                                     
Balance – March 31, 2010   74,400,000     7,440     (1,240 )   -     (6,202 )   (2 )
                                     
Common stock issued for cash   42,360,000     4,236     31,064     -     -     35,300  
                                     
Net loss for the period   -     -     -     -     (32,577 )   (32,577 )
                                     
Balance – March 31, 2011   116,760,000     11,676     29,824     -     (38,779 )   2,721  
                                     
Shares cancelled – September 12, 2011   (30,000,000 )   (3,000 )   3,000     -     -     -  
                                     
Net loss for the period   -     -     -     -     (30,724 )   (30,724 )
                                     
Balance – March 31, 2012   86,760,000     8,676     32,824     -     (69,503 )   (28,003 )
                                     
Net loss for the period   -     -     -     -     (42,224 )   (42,224 )
                                     
Balance – March 31, 2013   86,760,000     8,676     32,824     -     (111,727 )   (70,227 )
                                     
Shares subscribed for cash   -     -     -     28,500     -     28,500  
                                     
Net loss for the period   -     -     -     -     (12,143 )   (12,143 )
                                     
Balance, September 30, 2013   86,760,000   $  8,676   $  32,824   $  28,500   $  (123,870 ) $  (53,870 )

As restated for a 12 to 1 forward split effective July 31, 2012

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

6


GREENHOUSE SOLUTIONS INC.
(A Development Stage Company)

STATEMENTS OF CASH FLOWS
(Unaudited)

    Six months     Six months     April 8, 2009  
    ended     ended     (Inception) to  
    September 30,     September 30,     September 30,  
    2013     2012     2013  
                   
CASH FLOWS FROM OPERATING ACTIVITIES                  
   Net loss for the period $  (12,143 ) $  (27,637 ) $  (123,870 )
   Adjustments to reconcile net loss to net cash used in operating activities:                  
         Discontinued operations   -     -     -  
   Changes in operating assets and liabilities:                  
         Increase (decrease) in accounts payable & accrued liabilities   (7,903 )   7,262     10,243  
                   
NET CASH USED IN OPERATING ACTIVITIES   (20,046 )   (20,375 )   (113,627 )
                   
CASH FLOWS FROM INVESTING ACTIVITIES                  
       Due from related party company   -     -     -  
                   
NET CASH USED IN INVESTING ACTIVITIES   -     -     -  
                   
CASH FLOWS FROM FINANCING ACTIVITIES                  
   Loan from director and stockholder – related party   (5,000 )   20,375     47,082  
   Shares subscribed   28,500     -     28,500  
   Proceeds from issuance of common stock   -     -     41,500  
                   
NET CASH PROVIDED BY FINANCING ACTIVITIES   23,500     20,375     117,082  
                   
NET INCREASE IN CASH   3,454     -     3,455  
                   
CASH, BEGINNING   1     1     -  
                   
CASH, ENDING $  3,455   $  1   $  3,455  
                   
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:                  
                   
Cash paid during the period for:                  
     Interest $  -   $  -   $  -  
                   
     Income taxes $  -   $  -   $  -  
                   
     Redemption of common stock and loan from related party $  -   $  -   $  -  

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

7



NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Greenhouse Solutions Inc. (the “Company” or “Greenhouse Solutions”) is a Nevada corporation in the development stage. The Company was incorporation under the laws of the State of Nevada on April 8, 2009. The Company is involved in the sale and distribution of urban gardening products and greenhouses on the North American Market.

All references in these financial statements to number of common shares, price per share and weighted average number of common shares outstanding prior to the 12:1 forward split been adjusted to reflect these stock splits on a retroactive basis, unless otherwise noted. (Refer Note 5)

Basis of presentation – Unaudited Financial Statements

The accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles for financial information and with the instructions to Form 10-Q. They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended March 31, 2013 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. The unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended September 30, 2013 are not necessarily indicative of the results that may be expected for the year ending March 31, 2014.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Going Concern

The Company’s financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has incurred an accumulated net deficit since inception of $123,870 through the six month period ended September 30, 2013 and has not yet established an on-going source of revenues sufficient to cover its operating costs and allow it continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining the adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

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

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

Development Stage Company

The Company is a development stage company as defined by section 915-10-20 of the FASB Accounting Standards Codification. Although the Company has recognized nominal amount of revenue, the Company is still devoting substantially all of its efforts on establishing the business and its planned principal operations have not commenced. All losses accumulated since inception has been considered as part of the Company’s development stage activities.

Cash and Cash Equivalents

For purposes of the Statement of Cash Flows, the Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalent.

Revenue Recognition

The Company is in the development stage and has realized minimal revenues from operations. The Company recognizes revenues when the sale and/or distribution of products is complete, risk of loss and title to the products have transferred to the customer, there is persuasive evidence of an agreement, acceptance has been approved by its customer, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is probable. Net sales will be comprised of gross revenues less expected returns, trade discounts, and customer allowances that will include costs associated with off- invoice markdowns and other price reductions, as well as trade promotions and coupons. The incentive costs will be recognized at the later of the date on which the Company recognized the related revenue or the date on which the company offers the incentive.

8



NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Basic Income (Loss) Per Share

The Company computes loss per share in accordance with “ASC-260,” “Earnings per Share” which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive.

Income Taxes

The Company accounts for income taxes pursuant to SFAS No. 109, “Accounting for Income Taxes” (“SFAS No. 109”). Under SFAS No. 109, now encompassed under ASC 740, deferred tax assets and liabilities are determined based on temporary differences between the bases of certain assets and liabilities for income tax and financial reporting purposes. The deferred tax assets and liabilities are classified according to the financial statement classification of the assets and liabilities generating the differences.

The Company maintains a valuation allowance with respect to deferred tax assets. Greenhouse Solutions establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company’s financial position and results of operation for the current period. Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carryforward period under the Federal tax laws.

Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the realizability of the related deferred tax asset. Any change in the valuation allowance will be included in income in the year of the change estimate.

Fair Value of Financial Instruments measured on a recurring basis

The Company follows paragraph 825-10-50-10 of FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accept in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the in inputs to valuation techniques used to measure fail value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
   

Level 2

Pricing inputs other that quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

   
Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data.

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid rent, accounts payable, accrued expenses, and payroll taxes payable approximated their fair value because of the short maturity of those instruments.

9



NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representation about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated. It is not however, practical to determine the fair value of advances from stockholders due to their related party nature.

Deferred Offering Costs

The Company defers as other assets the direct incremental costs of raising capital until such time as the offering is completed. At the time of completion of the offering, the costs are charged against the capital raised. Should the offering be terminated, deferred offering costs are charged to operations during the period in which the offering is terminated.

Carrying Value, Recoverability and Impairment of Long-Lived Assets

The Company has adopted paragraph 360-10-35-17 of FASB Accounting Standards Codification for its long-lived assets. The Company’s long-lived assets, which include office equipment, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable.

The Company assesses the recoverability of its long-lived assets by comparing the projected undiscounted net cash flows associated with the related long-lived asset or group of long-lived assets over their remaining estimated useful lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over the fair valued of those assets. Fair valued is generally determined using the assets expected future discounted cash flows or market value, if readily determinable. If long-lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated over the newly determined remaining estimated useful lives.

The Company considers the following to be some examples of important indicators that may trigger an impairment review: (i) significant under-performance or losses of assets relative to expected historical or projected future operating results; (ii) significant changes in the manner or use of assets or in the Company’s overall strategy with respect to the manner of use of the acquired assets or changes in the Company’s overall business strategy; (iii) significant negative industry or economic trends; (iv) increased competitive pressures; (v) a significant decline in the Company’s stock price for a sustained period of time; and (vi) regulatory changes. The Company evaluates acquired assets for potential impairment indicators at least annually and more frequently upon the occurrence of such events.

The impairment charges, if any, is included in operating expenses in the accompanying statements of income and comprehensive income (loss).

Common Stock Registration Expenses

The Company considers incremental costs and expenses related to the registration of equity securities with the SEC, whether by contractual arrangement as of a certain date or by demand, to be unrelated to original issuance transactions. As such, subsequent registration costs and expenses are reflected in the accompanying financial statements as general and administrative expenses, and are expensed as incurred.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reported period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

The Company’s significant estimates include income taxes provision and valuation allowance of deferred tax assets; the fail value of financial instruments; the carrying value and recoverability of long-lived assets, and the assumption that the Company will continue as a going concern. Those significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to those estimates or assumptions, and certain estimates or assumptions are difficult to measure or value.

10



NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continue)

Management regularly reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews, and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates.

Subsequent Events

The Company follows the guidance in Sections 855-10-50 of the FASB Accounting Standards Codification for the disclosure of subsequent events. The Company will evaluate subsequent events through the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company as an SEC filer considers its financial statements issued when they are widely distributed to users, such as through filing them on EDGAR.

Fair value of financial instruments

The estimated fair values of financial instruments were determined by management using available market information and appropriate valuation methodologies. The carrying amounts of financial instruments including cash approximate their fair value because of their short maturities.

Stock-based Compensation

The Company accounts for stock-based compensation issued to employees based on FASB accounting standard for Share Based Payment. It requires an entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). That cost will be recognized over the period during which an employee is required to provide service in exchange for the award – the requisite service period (usually the vesting period). It requires that the compensation cost relating to share-based payment transactions be recognized in financial statements. That cost will be measured based on the fair value of the equity or liability instruments issued. The scope of the FASB accounting standard includes a wide range of share-based compensation arrangements including share options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans.

As at September 30, 2013 the Company had no stock-based compensation plans nor had it granted any stock options. Accordingly no stock-based compensation has been recorded to date.

Recent pronouncements

The Company has evaluated the recent accounting pronouncements through ASU 2012-09 and believes that none of them will have a material effect on the company’s financial statements.

NOTE 3 – RELATED PARTY TRANSACTIONS

From time to time, the president and a stockholder of the Company provide advances to the Company for its working capital purposes. These advances bear no interest and are due on demand. During the six month period ended September 30, 2013 no advances were made to the Company (March 31, 2013 - $52,082) and in aggregate $52,082 to the Company and the Company did not make any repayment toward these advances as of September 30, 2013. On July 3, 2013 the Company in consideration for a payment of $10,000 (of which $5,000 was paid on July 3, 2013) the former president of the Company agreed to forgive the balance of the shareholder debt of $42,082 (original total $52,082).

NOTE 4 – SALE OF DISCOUNTINUED OPERATIONS

On September 9, 2011, the Company entered into an agreement with 1850261 Ontario, Inc. (“BUYER”), a note holder, to sell 100% of the interest in Greenhouse Solutions, Inc., a wholly owned subsidiary incorporated under the laws of the Province of Ontario, Canada. The Buyer paid consideration of $1.00 and assumed the subsidiary’s net deficit of $29,264 and a subsidiary receivable of $1,063. The BUYER accepted $10,979 in liabilities from the Company, as well the right to collect $3,150 of prepaid expense from a third party. The gain recorded from the disposal of the subsidiary is $36,031, net of assets minus liabilities transferred.

NOTE 5 – STOCKHOLDERS’ EQUITY (DEFICIT)

The Total number of common shares authorized that may be issued by the Company is 200,000,000 shares with a par value of $0.0001 per share. The Total number of preferred shares authorized that may be issued by the Company is 25,000,000 shares with a par value of $0.0001. No preferred shares have been issued.

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NOTE 5 – STOCKHOLDERS’ EQUITY (DEFICIT) continued

On October 15, 2012 the Company provided an Information Statement to enact the Board of Directors Resolution that was passed on July 31, 2012 by the Board of Directors and the consenting stockholders adopted and approved a resolution to effect an amendment to the Company’s Articles of Incorporation to increase the number of shares authorized common stock from 75,000,000 to 200,000,000 and changed the par value from $0.001 per share to $0.0001 per share. In addition the resolution approved a 12-for-1 forward stock split (12 new shares for 1 old share basis) of the Company and further amended the Articles of Incorporation to create 25,000,000 preferred stock at a par value of $0.0001 per share.

All references in these financial statements to number of common shares, price per share and weighted average number of common shares outstanding prior to the 12:1 forward split been adjusted to reflect these stock splits on a retroactive basis, unless otherwise noted.

During the period inception, (April 8, 2009) to September 30, 2013, the Company issued:

  a)

74,400,000 shares of common stock at $0.000083 per share to its Directors and officers for total proceeds of $6,200: and

     
  b)

42,360,000 shares of common stock at $0.00083 per share for total proceeds of $35,300.

On September 12, 2011, a shareholder of the Company returned 30,000,000 restricted shares of common stock to treasury and the shares were cancelled by the Company. The shares were returned to treasury for no consideration to the shareholder. Following the cancellation the Company now has 86,760,000 shares of common stock outstanding.

On July 3, 2013, the Company received $28,500 in net proceeds through a private placement for $0.50 per share and will issue 57,000 common shares of the Company. Currently amount is shown as Shares subscribed on the balance sheet.

As of September 30, 2013, the Company has not issued any shares, granted any options, or recorded any share-based compensation.

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

Forward-Looking Statements and Associated Risks.

The following discussion should be read in conjunction with the financial statements and the notes to those statements included elsewhere in this Quarterly Report on Form 10-Q. This Quarterly Report on Form 10-Q contains certain statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Certain statements contained in the MD&A are forward-looking statements that involve risks and uncertainties. The forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our industry, business and future financial results. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed in other sections of this Quarterly Report on Form 10-Q.

Plan of Operation

The Company was incorporated under the laws of the State of Nevada on April 8, 2009. The Company was involved in the sale and distribution of gardening products and greenhouses in the North American market. On September 2, 2009 we incorporated a wholly owned (ownership interest – 100%) subsidiary Greenhouse Solutions Inc. an Ontario, Canada, based company to facilitate our operations and cross border goods transfer to and from Canada. We did conduct our operations in Canada through our Canadian subsidiary and our operations in USA through our parent corporation, Greenhouse Solutions Inc. (USA). References in this Report to “Greenhouse Solutions” refer to Greenhouse Solutions Inc. and its subsidiary, on a consolidated basis, unless otherwise indicated or the context otherwise requires. Operations of our subsidiary were discontinued and sold on September 9, 2011.

As of September 30, 2013, we have generated $40,034 in revenues, and have incurred $130,636 in losses since our inception on April 8, 2009. We have relied upon revenues, the sale of our securities in unregistered private placement transactions, and cash advances from our directors to fund our operations during the period from inception on April 8, 2009 to September 30, 2013.

We are a development stage company and we do not expect to generate revenue for the next 12 months which would be sufficient to sustain our operations. Accordingly, for the foreseeable future, we will continue to be dependent on additional financing in order to maintain our operations and continue with our corporate activities. Due to the uncertainty of our ability to meet our financial obligations and to pay our liabilities as they become due, in their report on our financial statements for the period from inception (April 8, 2009) to September 30, 2013, our registered independent auditors included additional comments indicating concerns about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that led to this disclosure by our registered independent auditors. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Results of Operations

 


Three Months Ended
September 30, 2013

Six Months Ended
September 30, 2012
From Inception on
April 8, 2009 Through
September 30, 2013
  Revenue $ Nil $ Nil $ 40,034
  Operating Expenses 7,633 12,143 155,605
  Net Income (Loss)  (7,633)  (12,143)    (130,636)

For the three month period ended September 30, 2013, our operating expenses consist of Professional fees of $3,000, Advertising and marketing expense of Nil, Consulting fees of Nil, Filing cost of $3,738, Other costs of Nil, and Transfer Agent fees of $895 resulting is a loss from continued operations of $7,633 as compared to Professional fees of $11,600, Advertising and marketing expense of Nil, Consulting fees of Nil, Filing fees of $332, Other costs of $Nil, and Transfer Agent fees of $1,200 resulting in a loss from continued operations of $7,633 for the three month period ended September 30, 2013 as compared to a loss from continued operations of 12,143 for the three months ended September 30, 2012.

For the six month period ended September 30, 2013, our operating expenses consist of Professional fees of $7,110, Advertising and marketing expense of Nil, Consulting fees of Nil, Filing cost of $3,738, Other costs of Nil, and Transfer Agent fees of $1,295 resulting is a loss from continued operations of $12,143 as compared to Professional fees of $19,240, Advertising and marketing expense of Nil, Consulting fees of Nil, Filing fees of $6,797, Other costs of $Nil, and Transfer Agent fees of $1,600 resulting in a loss from continued operations of $12,143 for the six month period ended September 30, 2013 as compared to a loss from continued operations of 27,637 for the six months ended September 30, 2012.

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Financing Activities

We intend to seek additional funding through public or private financings to fund our operations through fiscal 2012 and beyond. However, if we are unable to raise additional capital when required or on acceptable terms, or achieve cash flow positive operations, we may have to significantly delay product development and scale back operations both of which may affect our ability to continue as a going concern.

Satisfaction of Our Cash Obligations for the Next Twelve Months

As of September 30, 2013, our cash balance was $3,455 as compared to a cash balance of $1 at March 31, 2013. Our plan for satisfying our cash requirements for the next twelve months is through sale of shares of our common stock, third party financing, and/or traditional bank financing. We do not anticipate generating sufficient amounts of revenues to meet our working capital requirements. Consequently, we intend to make appropriate plans to insure sources of additional capital in the future to fund growth and expansion through additional equity or debt financing or credit facilities.

We do not own, either legally or beneficially, any patents or trademarks. We had applied for a U.S. trademark for “Greenhouse Life” with the U.S. Trademark and Patent Office (U.S.P.T.O.) on August 23, 2010. The serial number for the application is 85113305. We had applied for a trademark in an international class 006 (Metal greenhouse frames; Metal greenhouses; Transportable greenhouses of metal for household use) and international class 019 (Modular greenhouses not of metal; Non-metal greenhouse frames; Pre-fabricated greenhouses not of metal). On July 8 2011 we abandoned the trademark application.

Liquidity and Capital Resources

We have incurred $130,636 in operating losses since inception. As of September 30, 2013, we had $3,455 in cash compared to $1 in cash at March 31, 2013. As of September 30, 2013, we had a working capital deficiency of $54,080, compared to a working capital deficiency of $70,227 as of March 31, 2013.

Net cash used in operating activities for the three months ended September 30, 2013 was $Nil, compared with net cash used in operating activities of $Nil for the three months ended September 30, 2012.

The Company must raise additional funds in order to fund our continued operations. We may not be successful in our efforts to raise additional funds or achieve profitable operations. Even if we are able to raise additional funds through the sale of our securities or through the issuance of debt securities, or loans from our directors or financial institutions our cash needs could be greater than anticipated in which case we could be forced to raise additional capital. At the present time, we have no commitments for any additional financing, and there can be no assurance that, if needed, additional capital will be available to us on commercially acceptable terms or at all. These conditions raise substantial doubt as to our ability to continue as a going concern, which may make it more difficult for us to raise additional capital when needed. If we cannot get the needed capital, we may not be able to become profitable and may have to curtail or cease our operations.

Off Balance Sheet Arrangements

None.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time period specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is accumulated and communicated to management including our principal executive officer and principal financial officer as appropriate, to allow timely decisions regarding required disclosure.

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In connection with this quarterly report, as required by Rule 15d-15 under the Securities Exchange Act of 1934, we have carried out an evaluation of the effectiveness of the design and operation of our company's disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our company's management, including our company's principal executive officer and principal financial officer. Based upon that evaluation, our company's principal executive officer and principal financial officer concluded that subject to the inherent limitations noted in this Part II, Item 9A(T) as of September 30, 2013, our disclosure controls and procedures were not effective due to the existence of material weaknesses in our internal controls over financial reporting, as discussed below.

Management's Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting for our company. Internal control over financial reporting is a process designed 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. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, 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 and procedures may deteriorate.

Our management, including our principal executive officer and principal financial officer, conducted an assessment of the effectiveness of our internal control over financial reporting based on certain criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that our internal control over financial reporting was not effective as of September 30, 2013 due to the following material weaknesses:

Our company does not have in-house personnel with the technical knowledge to identify and address some of the reporting issues surrounding certain complex or non-routine transactions. Going forward, with material, complex and non-routine transactions, management will gain a thorough understanding of the transaction and seek guidance from third-party experts or consultants. Management corrected any errors prior to the release of our company’s September 30, 2013 financial statements.

Our company’s administration is composed of one administrative individual resulting in a situation where there is no segregation of duties. In order to remedy this situation we would need to hire additional staff to provide greater segregation of duties. Currently, it is not feasible to hire additional staff to obtain segregation of duties. Management will reassess this matter in the following year to determine whether improvement in segregation of duties is feasible.

This quarterly report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management's report in this quarterly report.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) or 15d-15(f)) during the quarter ended September 30, 2013 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

Currently we are not involved in any pending litigation or legal proceeding.

Item 1A. Risk Factors.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 2. Unregistered Sales of Securities and Use of Proceeds.

None

Item 3. Defaults Upon Senior Securities.

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None

Item 4. Submission of Matters to a Vote of Security Holders.

None

Item 5. Other Information.

None

Item 6. Exhibits.

The following documents are filed as a part of this report or are incorporated by reference to previous filings, if so indicated:

Exhibit No.   Description
     
31.1  

Section 302 Certification of George Dory - Director, Chief Executive Office, President, Treasurer, chief financial officer and principal accounting officer of the Company *

32.1  

Section 906 Certification of George Dory - Director, Chief Executive Office, President, Treasurer, chief financial officer and principal accounting officer of the Company *

*filed herewith

SIGNATURES*

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

November 18, 2013

GREENHOUSE SOLUTIONS INC.

  By: /s/ Dr. Robert R. Shields
    Dr. Robert R. Shields
    President, Chief Executive Officer (Principal Executive
    Officer) and Director

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