UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

|X| Quarterly Report under Section 13 or 15(d) of the Securities Exchange

Act of 1934 For the quarterly period ended December 31, 2013

 

[ ] Transition report under Section 13 or 15(d) of the Exchange Act For the transition period from __________ to __________

 

Commission File Number: 333-139482

 

VIKING MINERALS INC.

(Exact name of Registrant as specified in its charter)

 

Nevada	98-0492900
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

 

 

7558 W. Thunderbird Ste. 486

Peoria, AZ, 85381

(Address of principal executive offices)

 

602-885-9792

(Registrant's Telephone number)

 

 

Former Name, Address and Fiscal Year, If Changed Since Last Report

 

Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

 

We had a total of 199,489,181 shares of common stock issued and outstanding at January 25, 2014.

 

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

 

Transitional Small Business Disclosure Format: Yes [ ] No [X]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PART I - FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

The interim financial statements included herein are unaudited but reflect, in management's opinion, all adjustments, consisting only of normal recurring adjustments that are necessary for a fair presentation of our financial position and the results of our operations for the interim periods presented. Because of the nature of our business, the results of operations for the quarterly period ended December 31, 2013 are not necessarily indicative of the results that may be expected for the full fiscal year.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Viking Minerals Ltd.
(a Pre-Exploration Stage Company)
Unaudited Balance Sheets
		December 31, 2013				March 31, 2012
ASSETS
CURRENT ASSETS
Cash		$	—			$	—
			—				—
TOTAL ASSETS		$	—			$	—
LIABILITIES
CURRENT LIABILITIES
Accounts payable		$	101,675			$	60,675
Advances from related party			—				—
Advance			3,438				3,438
TOTAL CURRENT LIABILITIES			105,112				64,113
STOCKHOLDERS' DEFICIT
Common stock, $0.001 par value, Authorized - 400,000,000 common shares, Issued as of December 31, 2013 and March 31, 2013 - 199,447,181 shares			30,649,053				30,649,053
Additional paid-in capital			199,447				199,447
Deficit accumulated during exploration period			(30,953,613	)			(30,912,613	)
TOTAL STOCKHOLDERS' DEFICIT			(105,113	)			(64,113	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT		$	—			$	—
The accompanying notes are an integral part of these unaudited financial statements.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Viking Minerals Ltd.
(a Pre-Exploration Stage Company)
Unaudited Statements of Operations
		For the nine months ended				For the nine months ended				For the three months ended				For the three months ended				From inception (March 24, 2006) to
		31-Dec-13				31-Dec-12				31-Dec-13				31-Dec-12				31-Dec-13
REVENUE		$	—			$	—			$	—			$	—			$	—
EXPENSES
Recognition of an Impairment Loss (Property Expenses)			—				131,000				—				—				181,624
Loss on Extinguishment of debt			—				—				—				—				30,621,661
Office			—				—				—				—				68,891
Professional			—				13,126				—				1,965				13,487
Communications			41,000				—				15,000				—				67,950
TOTAL EXPENSES			41,000				144,126				15,000				1,965				30,953,613
Net loss from operations			(41,000	)			(144,126	)			(15,000	)			(1,965	)			(30,953,613	)
NET INCOME (LOSS)		$	(41,000	)		$	(144,126	)		$	(15,000	)		$	(1,965	)		$	(30,953,613	)
BASIC & DILUTED (LOSS) PER COMMON SHARE		$	(0.00	)		$	(0.00	)		$	(0.00	)		$	(0.00	)
WEIGHTED AVERAGE NUMBER OF SHARES			199,447,181				99,331,273				199,447,181				161,166,696
The accompanying notes are an integral part of these unaudited financial statements.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Viking Minerals Ltd.
(a Pre-Exploration Stage Company)
UNAUDITED STATEMENTS OF CASH FLOWS
From Inception (March 24, 2006) to December 31, 2013
		For the nine months ended				For the nine months ended				From inception (March 24, 2006) to
		31-Dec-13				31-Dec-12				31-Dec-13
OPERATING ACTIVITIES
Net income (loss)		$	(41,000	)		$	(144,126	)		$	(30,953,613	)
Recognition of impairment loss (Mineral Claim)			—				131,000				181,624
Loss on Extinguishment of debt			—				—				30,621,661
Stock issued for services			—				—				7,500
Stock issued for debt			—				—				68,340
Accounts payable			41,000				4,661				101,674
NET CASH USED IN OPERATING ACTIVITIES			—				(8,465	)			27,186
INVESTING ACTIVITIES
Purchase of mineral claims			—				—				(50,624	)
NET CASH USED IN INVESTING ACTIVITIES			—				—				(50,624	)
FINANCING ACTIVITIES
Advances			—				—				3,438
Advances from related party			—				8,465				—
Common stock issued for cash			—				—				20,000
NET CASH USED IN FINANCING ACTIVITIES			—				8,465				23,438
NET CHANGE IN CASH			—				—				—
CASH, at beginning of period			—				—				—
CASH AT END OF PERIOD		$	—			$	—			$	—
CASH PAID FOR:
Interest		$	—			$	—			$	—
Income Tax		$	—			$	—			$	—
SHARES PAID FOR:
Property		$	—			$	—			$	131,000,000
Debt		$	—			$	131,000			$	68,339,181
The accompanying notes are an integral part of these unaudited financial statements.

 

 

 

VIKING MINERALS INC.

(A Pre-Exploration Stage Company)

NOTES TO THE CONDENSED FINANCIAL STATEMENTS

December 31, 2013

(Unaudited)

 

 

1. ORGANIZATION AND BASIS OF PRESENTATION

 

The company was incorporated under the laws of the state of Nevada on March 24, 2006 with 75,000,000 authorized common shares with a par value of $0.001. In January 2011 the company filed an amendment with the state of Nevada to increase the authorized shares to 400,000,000 shares of common stock at a par value of $0.001 per share.

 

The company was organized for the purpose of acquiring and developing mineral claims and is in the pre-exploration stage.

 

The interim financial statements for the three months ended December 31, 2013 and 2012 are unaudited. These financial statements are prepared in accordance with requirements for unaudited interim periods, and consequently do not include all disclosures required to be in conformity with accounting principles generally accepted in the United States of America. The results of operations for the interim periods are not necessarily indicative of the results for the full year. In management’s opinion all adjustments necessary for a fair presentation of the Company’s financial statements are reflected in the interim periods included, and are of a normal recurring nature. These interim financial statements should be read in conjunction with the financial statements included in our Annual Report on Form 10-K, for the year ended March 31, 2013, as filed with the SEC.

 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

ACCOUNTING METHOD

 

The company recognizes income and expenses based on the accrual method of accounting.

 

DIVIDEND POLICY

 

The company has not yet adopted a policy regarding payment of dividends.

 

INCOME TAX

 

The company utilizes the liability method of accounting for income taxes. Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting and the tax bases of the assets and liabilities and are measured using the enacted tax rates and laws that will be in effect, when the differences are expected to reverse. An allowance against deferred tax assets is recorded, when it is more likely than not that such tax benefits will not be realized.

 

FINANCIAL AND CONCENTRATIONS RISK

 

The company has no financial and concentrations risks.

 

BASIC AND DILUTED NET INCOME (LOSS) PER SHARE

 

Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common and common equivalent shares outstanding as if shares had been issued on the exercise of the common share rights, unless the exercise becomes antidilutive, and then the basic and diluted per share amounts are the same. As of December 31, 2013, there are no dilutive securities outstanding.

 

STATEMENT OF CASH FLOWS

 

For the purposes of the statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents.

 

REVENUE RECOGNITION

 

Revenue is recognized on the sale and delivery of a product or the completion of a service provided.

 

ADVERTISING AND MARKET DEVELOPMENT

 

The company expenses advertising and market development costs as research data expenses.

 

IMPAIRMENT OF LONG-LIVED ASSETS

 

The Company reviews and evaluates long-lived assets for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The assets are subject to impairment consideration under ASC 360-10-35-17 if events or circumstances indicate that their carrying amount might not be recoverable. When the Company determines that an impairment analysis should be done, the analysis will be performed using the rules of ASC 930-360-35, Asset Impairment, and 360-10-15-3 through 15-5, Impairment or Disposal of Long-Lived Assets.

 

ENVIRONMENTAL REQUIREMENTS

 

At the report date environmental requirements related to a formally held mineral claim are unknown and therefore any estimate of future costs cannot be made.

 

MINERAL PROPERTY ACQUISITIONS COSTS

 

Costs of acquisition and option costs of mineral rights are capitalized upon acquisition. Mine development costs incurred to develop new ore deposits, to expand the capacity of mines, or to develop mine areas substantially in advance of current production are also capitalized once proven and probable reserves exist and the property is a commercially mineable property. Costs incurred to maintain current production or to maintain assets on a standby basis are charged to operations. If the Company does not continue with exploration after the completion of the feasibility study, the mineral rights will be expensed at that time. Costs of abandoned projects are charged to mining costs including related property and equipment costs. To determine if these costs are in excess of their recoverable amount periodic evaluation of carrying value of capitalized costs and any related property and equipment costs are based upon expected future cash flows and/or estimated salvage value in accordance with Accounting Standards Codification (ASC) 360-10-35-15, Impairment or Disposal of Long-Lived Assets.

 

Various factors could impact our ability to achieve forecasted production schedules. Additionally, commodity prices, capital expenditure requirements and reclamation costs could differ from the assumptions the Company may use in cash flow models from exploration stage mineral interests involves further risks in addition to those factors applicable to mineral interests where proven and proven and probable reserves have been identified, due to the lower level of confidence that the identified mineralized material can ultimately be mined economically.

 

ESTIMATES AND ASSUMPTIONS

 

Management uses estimates and assumptions in preparing financial statements in accordance with general accepted accounting principles. Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were assumed in preparing these financial statements.

 

 

 

FINANCIAL INSTRUMENTS

 

The carrying amounts of financial instruments are considered by management to be their estimated fair values due to their short term maturities.

 

RECENT ACCOUNTING PRONOUNCEMENTS

 

The Company does not expect that the adoption of any recent accounting pronouncements will have a material impact on its financial statements.

 

3. COMMON STOCK

 

At inception the company issued 10,000 private placement common shares for cash of $20,000. On May 18, 2010 the company issued an additional 100 shares for services. The value of these shares was calculated by using 75 hours of consulting at a charge rate of $100 per hour.

 

In January 2011, the company executed a forward split of its common stock on the basis of 35 new common shares for each existing 1 common share. The record date for the action was January 27, 2011, and the payment date was January 28, 2011. The forward split was payable as a dividend. All share references in these financial statements have been retroactively adjusted for this forward split.

 

On June 23, 2011, the company received notice that 245,500 common outstanding shares were cancelled. After this event the current total issued and outstanding number of shares was 108,000 common shares.

 

On July 5, 2012, the company executed a reverse split decreasing shares by 1 for 1000. After this stock split, the total number of common shares issued and outstanding was 108,000. All share references in these financial statements have been retroactively adjusted for this reverse split.

 

On July 10, 2012, the company completed an agreement with GMM Global Multi-Mining Diversified Group Limited (“GMM”) wherein GMM assigned and transferred a 60% interest in a joint venture to the company for 131,000,000 shares of the company’s common stock (valued at $131,000, per the agreement) and $500,000 cash. The 131,000,000 shares of common stock were issued on July 10, 2012; however, the Company failed to pay the required $500,000 and forfeited its right to the 60% interest. The Company recorded a loss on impairment of $131,000.

 

On July 12, 2012, the company completed a transaction whereby it issued 19,950,000 shares of its common stock for $19,950 in debt. The debt was comprised of prior advances from an unrelated third party. This transaction was accounted for as an extinguishment of debt, in accordance with ASC 470-50. The shares were valued at $1.50 per share, which was the price of the Company’s common stock on July 12, 2012. The difference between the price and the net carrying amount of the extinguished debt was recognized as a loss on extinguishment of debt in the statement of operations, in the amount of $29,905,050.

 

On October 31, 2012, the company completed a transaction whereby it issued 15,000,000 shares of its common stock for $15,000 in debt. The debt was comprised of advances from unrelated third parties. This transaction was accounted for as an extinguishment of debt, in accordance with ASC 470-50. The shares were valued at $0.0225 per share, which was the price of the Company’s common stock on October 31, 2012. The difference between the price and the net carrying amount of the extinguished debt was recognized as a loss on extinguishment of debt in the statement of operations, in the amount of $322,500.

 

On January 15, 2013, the Company executed an asset purchase agreement with Trinity Alps Resources Inc. to acquire five past-producing Gold Mines as detailed in a 43-101 technical report, located 80 miles southwest of Yreka, California for an agreed sum of $15,000,000 for a 100% un-divided interest. Under the terms of the agreement, the Company shall pay $ 6,100,000 on or before March 31, 2013 and the balance of $8,900,000 is to be paid over 18 months in equal payments of $494,444 each month, commencing 30 days after all regulatory approvals. As of the date of these financial statements, this agreement has not closed.

 

 

On January 31, 2013, the company completed a transaction whereby it issued 33,389,000 shares of its common stock for $33,389 in debt. The debt was comprised of advances from unrelated third parties.

 

4. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES

 

Officer-directors have acquired less then 1% of the outstanding common capital stock of the company.

 

During the three months ended December 31, 2013, the Director advanced $nil to the Company. These advances are non-interest bearing and payable on demand. Also, included in accounts payable are amounts payable to the Director of $55,750 for accrued management fees.

 

5. GOING CONCERN

 

The accompanying financial statements have been prepared assuming that the company will continue as a going concern. The company does not have a sufficient working capital for its planned activity, and to service its debt, which raises substantial doubt about its ability to continue as a going concern.

 

Continuation of the company as a going concern is dependent upon obtaining additional working capital and the management of the company has developed a strategy which it believes will accomplish this objective through advances from an officer-director, and additional equity investments, which will enable the company to continue operations for the coming year.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ITEM 2. MANAGEMENT`S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.

 

OVERVIEW

 

Viking Minerals Inc. was incorporated in the State of Nevada as a for-profit company on March 24, 2006. The Company is a development stage company that is presently seeking mineral claims for development.

 

RESULTS OF OPERATIONS

 

The Company has not yet generated any revenue from its operations. The Company incurred operating expenses of $15,000 compared to $1,965 for the three months ended December 31, 2013 and 2012, respectively. For the nine months ended December 31, 2013 and 2012 expenses of $41,000 in 2013 and $144,126 in 2012 This was due to the write-down of property expenses of $131,000 in 2012.

 

The Company reported a net loss of $41,000 and $138,104 for the three months ended December 31, 2013 and 2012, respectively; and net loss of $26,000 and $144,126 for the nine months ended December 31, 2013 and 2012, respectively.

 

PLAN OF OPERATION

 

Our current cash holdings will not satisfy our liquidity requirements and we will require additional financing to pursue our planned business activities. We are in the process of seeking equity or debt financing to fund our operations over the next 12 months. Management cautions that financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements.

 

If we are unsuccessful in raising the additional proceeds through equity financing we will then have to seek additional funds through debt financing, which would be very difficult for a new development stage company to secure.

If the company cannot raise proceeds via a financing through its common stock or secure debt financing it would be required to cease business operations. As a result, investors in the company would lose all of their investment.

 

Management does not plan to hire additional employees at this time. Our President will be responsible for current operations. We will use third party consultants should we require assistance in any activities.

 

OFF BALANCE SHEET ARRANGEMENT

 

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not required.

 

 

 

 

ITEM 4. CONTROLS AND PROCEDURES

 

The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as required by Sarbanes-Oxley (SOX) Section 404 A. The Company’s internal control over financial reporting is a process designed under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

 

As of December 31, 2013 management assessed the effectiveness of the Company’s internal control over financial reporting based on the criteria for effective internal control over financial reporting established in SEC guidance on conducting such assessments. Based on that evaluation, they concluded that, during the period covered by this report, such internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules as more fully described below. This was due to deficiencies that existed in the design or operation of our internal control over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.

 

The matters involving internal controls and procedures that the Company’s management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee and lack of a majority of outside directors on the Company's board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; (3) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (4) ineffective controls over period end financial disclosure and reporting processes. The aforementioned material weaknesses were identified by the Company's Chief Financial Officer in connection with the review of our financial statements as December 31, 2013 and communicated the matters to our management.

 

Management believes that the material weaknesses set forth in items (2), (3) and (4) above did not affect the Company's financial results. However, management believes that the lack of a functioning audit committee and lack of a majority of outside directors on the Company's board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures can affect the Company's results and its financial statements for the future years.

 

We are committed to improving our financial organization. As part of this commitment, we will create a position to segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to the Company: i) Appointing one or more outside directors to our board of directors who shall be appointed to the audit committee of the Company resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures; and ii) Preparing and implementing sufficient written policies and checklists which will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.

 

Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on the Company's Board. In addition, management believes that preparing and implementing sufficient written policies and checklists will remedy the following material weaknesses (i) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (ii) ineffective controls over period end financial close and reporting processes. Further, management believes that the hiring of additional personnel who have the technical expertise and knowledge will result proper segregation of duties and provide more checks and balances within the department. Additional personnel will also provide the cross training needed to support the Company if personnel turn over issues within the department occur. This coupled with the appointment of additional outside directors will greatly decrease any control and procedure issues the company may encounter in the future.

 

 

 

We will continue to monitor and evaluate the effectiveness of our internal controls and procedures and our internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

 

There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rules 13a-15 or 15d-15 under the Exchange Act that occurred during the small business issuer's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

PART II. OTHER INFORMATION.

 

ITEM 1. LEGAL PROCEEDINGS.

 

We are not a party to any material legal proceedings and to our knowledge, no such proceedings are threatened or contemplated.

 

 

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

 

Not applicable.

 

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

 

None.

 

 

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

 

No matters were submitted to our security holders for a vote during the period ending December 31, 2013.

 

 

ITEM 5. OTHER INFORMATION.

 

None.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

 

Exhibit Number		Description
3.1		Articles of Incorporation (1)
3.2		Bylaws (1)
31.1		Certification by Chief Executive Officer and Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act, promulgated pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.1		Certification by Chief Executive Officer and Chief Financial Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code,  promulgated pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 filed herewith.
101		Interactive data files pursuant to Rule 405 of Regulation S-T

 

(1) Filed with the SEC as an exhibit to our Form SB-1 Registration Statement originally filed on December 19, 2006.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SIGNATURES

 

In accordance with the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: January 25, 2014

 

 

 

Signature	Title
By: /s/ Charles Irizarry	Chief Executive Officer,	Date: January 25, 2014
Charles Irizarry	Chief Financial Officer,
	President, Secretary, Treasurer and
	Director (Principal Executive Officer
	and Principal Accounting Officer)