UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

 

FORM 10-Q

 

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended March 31, 2014
[  ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ___________ to ___________

 

Commission File No. 000-27791

 

Apolo Gold & Energy Inc.

(Exact name of registrant as specified in its Charter)

 

Nevada		98-0412805
(State of Other Jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

 

9th Floor, Kam Chung Commercial Bldg,19-21 Hennessy Road, Wanchai, Hong Kong

(Address of principal executive offices) (Zip Code)

 

(852) 3111 7718

(Registrant’s telephone number including area code)

 

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 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 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]
		(Do not check if a smaller reporting company)

 

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

 

As of March 31, 2014, the Registrant had 27,778,295 shares of Common Stock outstanding. This is after giving effect to a share consolidation of 20:1 approved by shareholders on October 29, 2010, and the issuance of 19,300,000 common shares in the period ending December 31, 2013 and 100,000 common shares issued in the three month period ended March 31, 2014.

 

Transitional Small Business Disclosure Format (check one): Yes [  ] No [X]

 

 

  

TABLE OF CONTENTS

 

		Page
Part I. Financial Information
Item 1. Financial Statements		F-1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations General Overview		3
Item 3. Quantitative and Qualitative Disclosures About Market Risk		4
Item 4. Controls and procedures		4
Part II – Other Information
Item 1. Legal Proceedings		5
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		5
Item 3. Default Upon Senior Securities		5
Item 4. Mine Safety Disclosures		5
Item 5. Other Information		5
Item 6. Exhibits		5
Signatures		6

  

  

Part I. Financial Information

 

Item 1. Financial Statements

 

APOLO GOLD & ENERGY INC.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

		March 31, 2014				June 30, 2013
ASSETS
CURRENT ASSETS
Cash			3,813				417
Total Current Assets			3,813				417
NON-CURRENT ASSETS
MINERAL PROPERTY INTERESTS (note 4)			1,200,000				-
INVESTMENTS (note 5)			4,000,000				-
Total Non-Current Assets			5,200,000				-
TOTAL ASSETS		$	5,203,813			$	417
LIABILITIES & STOCKHOLDER’ DEFICIT
CURRENT LIABILITIES
Accounts payable & accrued expenses		$	11,948			$	24,922
Loans payable, related parties (note 8)			-				86,399
Amount due to director			61,617				-
Total Current Liabilities			73,565				111,321
COMMITMENTS & CONTINGENCIES (note 7)			-				-
STOCKHOLDERS’ DEFICIT
Common stock, 300,000,000 shares authorized, $0.001 par value; 27,778,295 shares issued and outstanding (note 6)			18,723				6,503
Additional paid-in capital			12,980,664				7,558,884
Deferred compensation			(63,083	)			-
Comprehensive income			20,713				-
Accumulated deficit prior to exploration			(1,862,852	)			(1,862,852	)
Deficit accumulated during exploration stage			(5,963,917	)			(5,813,439	)
TOTAL STOCKHOLDERS’ DEFICIT			5,130,248				(110,904	)
TOTAL LIABILITIES & STOCKHOLDERS DEFICIT		$	5,203,813			$	417

 

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

 

 

APOLO GOLD & ENERGY INC.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE LOSS

(Unaudited)

 

																		Period from
																		April 16, 2002
																		(Inception of
																		Exploration Stage
		Three Months Ended								Nine Months Ended								Through)
		March 31, 2014				March 31, 2013				March 31, 2014				March 31, 2013				March 31, 2014
REVENUES		$	-			$	-			$	-			$	-			$	-
EXPENSES
Consulting and professional fees			84,029				1,754				124,683				14,439				2,034,747
Exploration costs			-				-				-				-				2,449,248
Stock compensation expense			-				-				-				-				381,340
General and administrative expenses			16,472				4,350				25,795				12,634				1,065,017
TOTAL EXPENSES			100,501				6,104				150,478				27,073				5,930,352
LOSS FROM OPERATIONS			(100,501	)			(6,104	)			(150,478	)			(27,073	)			(5,930,352	)
OTHER INCOME (EXPENSE)
Loss on sale of mining equipment			-				-				-				-				(177,193	)
Gain on settlement of debt			-				-				-				-				142,442
Other income			-				-				-				-				1,186
			-				-				-				-				(33,565	)
NET LOSS		$	(100,501	)		$	(6,104	)		$	(150,478	)		$	(27,073	)		$	(5,963,917	)
NET LOSS PER SHARE, BASIC & DILUTED		$	(0.00	)		$	(0.00	)		$	(0.02	)		$	(0.00	)
WEIGHTED AVERAGE NUMBER OF COMMON STOCK SHARES OUTSTANDING, BASIC & DILUTED			27,778,295				6,503,295				15,218,806				6,503,295

 

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

 

 

APOLO GOLD & ENERGY INC.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

										Period from
										April 16,2002
										(Inception of
										Exploration Stage
		Nine Months Ended				Nine Months Ended				Through)
		March 31, 2014				March 31, 2013				March 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss		$	(150,478	)		$	(27,073	)		$	(5,963,917	)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation			-				-				95,176
Loss on sale of mining equipments			-				-				177,193
Options exercised for services			-				-				276,691
Gain on settlements of debt			-				-				(142,442	)
Stock issued for current debt			-				-				470,041
Stock issued for officer’s wages & services			-				-				252,700
Stock issued for professional services			20,917				-				247,977
Stock issued for exploration costs			-				-				711,000
Stock options granted			-				-				381,340
Expenses paid on behalf of Company			-				-				42,610
Prepaid expenses			-				(714	)			-
Accounts payable and accrued expenses			(12,974	)			3,612				(524,280	)
Accrued payables, related parties			(24,782	)			-				357,922
Net cash (used) by operating activities			(167,317	)			(24,175	)			(3,617,989	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in Jiangxi Everenergy New Material Co, Ltd.			(1,000,000	)			-				(5,177,097	)
Purchase of fixed assets			-				-				(95,174	)
			(1,000,000	)			-				(5,272,271	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from (repayments of) related party loans			-				24,333				219,092
Proceeds from borrowings			-				-				84,937
Proceeds from subscription receivable			-				-				25,000
Proceeds from sale of common stock			1,150,000				-				3,547,835
Net cash provided by financing activities			1,150,000				24,333				3,876,864
Effect of exchange rate changes on cash			20,713				-				5,015,713
NET INCREASE IN CASH			3,396				158				2,317
Cash, beginning of period			417				314				1,496
Cash, end of period		$	3,813			$	472			$	3,813
NON-CASH INVESTING & FINANCING ACTIVITIES:
Note receivable from sale of mining equipment		$	-			$	-			$	45,000
Common stock issued for mineral property interests		$	1,200,000			$	-			$	1,200,000
Common stock issued for investments		$	3,000,000			$	-			$	3,000,000
Common stock issued on settlement of debt		$	-			$	-			$	529,559

 

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

 

 

APOLO GOLD & ENERGY INC.

CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(An Exploration Stage Company)

March 31, 2014

(Unaudited)

 

 

NOTE 1 – BASIS OF PRESENTATION

 

These consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the interim financial information with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of the Company’s management, all adjustments (consisting of only normal, recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending March 31, 2014.

 

For further information, refer to the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2013.

 

The Company’s fiscal year-end is June 30.

 

NOTE 2 – ACCOUNTING POLICIES

 

This summary of significant accounting policies of Apolo Gold & Energy Inc. is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements. There have been no changes in accounting policies from those disclosed in the notes to the audited financial statements June 30, 2013.

 

Consolidation

 

The financial statements include the accounts of Apolo Gold & Energy Asia Limited, a 100% owned subsidiary of the Company.

 

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 statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Fair Value of Financial Instruments and Concentration of Risk

 

A fair value hierarchy was established that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

 

Level 1: classification is applied to any asset or liability that has a readily available quoted market price from an active market where there is significant transparency in the executed/quoted price.

 

Level 2: classification is applied to assets and liabilities that have evaluated prices where the data inputs to these valuations are observable either directly or indirectly but do not represent quoted market prices from an active market.

 

Level 3: classification is applied to assets and liabilities when prices are not derived from existing market data and requires us to develop our own assumptions about how market participants would price the asset or liability.

 

The fair values of financial instruments, which include cash, accounts payable and accrued liabilities and loans payable to related parties, were estimated to approximate their carrying values due to the immediate or relatively short maturity of these instruments. Management does not believe that the Company is subject to significant interest, currency or credit risks arising from these financial instruments.

 

 

Going Concern

 

As shown in the financial statements, the Company incurred a net loss of $150,478 for the period ended March 31, 2014 and has an accumulated deficit of $7,826,769, no revenues, and limited cash resources as at March 31, 2014.

 

These factors indicate that the Company may be unable to continue in existence. The financial statements do not include any adjustments related to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue existence. The Company’s management is actively seeking additional capital and management believes that new properties can ultimately be developed to enable the Company to continue its operations. However, there are inherent uncertainties in mining operations and management cannot provide assurances that it will be successful in its endeavors. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Accounting Pronouncements

 

Recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not, or are not believed by management to, have a material impact on our present or future financial statements.

 

NOTE 3 – PREFERRED STOCK

 

The Company’s directors authorized 25,000,000 preferred shares with a par value of $0.001. The preferred shares will have rights and preferences set from time to time by the Board of Directors. As of March 31, 2014 and June 30, 2013, the Company has no preferred shares issued and outstanding.

 

NOTE 4 – MINERAL PROPERTY INTERESTS

 

On December 11, 2013, the Company acquired a 70% interest in three gold exploration claims in China’s Xinjiang Province.

 

The Company issued 6-million shares for the following claims:

 

	a)	Gold Mine Reconnaissance in the West of Daqing Gerry River, Qinghe County, comprising of 7.91 sq km, the claims are valid until March 27, 2014.
	b)	Gold Mine Detailed Survey in the Northwest of Sensha Water Mountain, Heshuo, comprising of 15.8 sq km, the claims are valid until July 3, 2015.
	c)	Keler Nebrack Gold Mine Detailed Survey in Habar County, comprising of 10.28 sq km, the claims are valid until February 20, 2015.

 

The claims are automatically extended for twelve months upon payment of US$10,000 per claim.

 

NOTE 5 – INVESTMENTS

 

On December 23, 2013, the Company acquired a 24% interest in Jiangxi Everenergy New Material Co., Ltd. (“Everenergy”) The consideration was settled with the Company of 8-million restricted common stocks at a deemed price of $0.375 per share, plus $1-million in cash. Additionally, on February 19, 2014, the Company acquired an additional 29% interest in Everenergy. The consideration will be settled with the issue of 11-million restricted common stock at a deemed price of $0.45 per share. As at the date of this report, the ownership for both acquisitions have not been completed. Consequently, the acquisitions are treated as investment and no consolidation of the financial statements were adopted.

 

Everenergy produces and sells high-quality lithium batteries, cathode materials and relevant precursor materials.

 

The acquisition of shares in Everenergy is for investment purposes. Apolo from time to time may dispose of, or acquire, additional shares of Everenergy.

 

NOTE 6 – COMMON STOCK

 

At a shareholder meeting held October 29, 2010, shareholders authorized an increase in authorized capital from 200,000,000 to 300,000,000 common shares with a par value of $0.001. In addition, shareholders also authorized a share consolidation of 20:1. These financial statements have been restated retroactively to reflect this share consolidation.

 

There were 1,875,000 shares of common stock issued for a cash consideration of $0.08 per share during the period ending September 30, 2013. The shares were issued to a director of the Company.

 

 

On December 1, 2013, the Company issued 100,000 common shares to a consultant pursuant to an administrative consulting services agreement dated November 16, 2013.

 

Also on December 1, 2013, the Company issued 200,000 common shares to a consultant pursuant to an additional administrative consulting services agreement dated November 16, 2013.

 

On December 6, 2013, the Company issued 5,000,000 common shares at a price of $0.20 per share for proceeds of $1 million.

 

On December 16, 2013, the Company issued 6,000,000 common shares for three mineral properties.

 

On December 23, 2013, the Company issued 8,000,000 common shares to acquire a 24% interest in Everenergy.

 

On February 11, 2014, the Company issued 100,000 common shares to a consultant pursuant to an administrative consulting services agreement dated November 16, 2013.

 

At March 31, 2014, there are 27,778,295 common shares issued and outstanding.

 

There were no stock options, warrants or other potentially dilutive securities outstanding as at March 31, 2013, June 30, 2013 and September 30, 2012.

 

NOTE 7 – COMMITMENTS AND CONTINGENCIES

 

Foreign Operations

  

The accompanying balance sheet at March 31, 2014 includes $3,578 of cash in Canada and $235 in Hong Kong. Although Canada and Hong Kong (China) are considered economically stable, it is always possible that unanticipated events in foreign countries could disrupt the Company’s operations.

 

Compliance with Environmental Regulations

 

The Company’s mining activities are subject to laws and regulations controlling not only the exploration and mining of mineral properties, but also the effect of such activities on the environment. Compliance with such laws and regulations may necessitate additional capital outlays affect the economics of a project, and cause changes or delays in the Company’s activities.

 

Commitments:

 

The Company entered in the following contracts during the period:

 

	●	On the November 1, 2013, Company entered into an agreement with a company controlled by the Chief Financial Officer for management services for a fee of $1,250 per month for a period of one year. The contract allows for additional fees if more than ten hours per month is needed from the Chief Financial Officer.
	●	On September 15, 2013, the Company entered into a consulting services agreement. Under the agreement, the services begin October 1, 2013 and end October 1, 2014. Fees payable under the agreement is HK$80,000 per month (approximately $10,000 per month).
	●	On November 16, 2013, the Company entered into a consulting services agreement, for services to begin December 1, 2013 and end November 30, 2014. Fees payable under the consulting services agreement is $5,000 per month.

 

NOTE 8 – RELATED PARTY TRANSACTIONS

 

The Company incurred various expenses during the period and reimbursement of these expenses to its Chief Executive Officer amounted to $61,617 during the nine months ended March 31, 2014 (2013 - $Nil).

 

The Company incurred $7,038 (2013 – $Nil) to a company controlled by the Chief Financial Officer for management fees.

 

Loans outstanding in the amount of $Nil to its Chief Executive Officer were retired during the nine months ended March 31, 2014.

 

 

ITEM 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations General Overview

 

Apolo Gold & Energy Inc. (“Company”) was incorporated in March 1997 under the laws of the State of Nevada. Its objective was to pursue mineral properties in South America, Central America, North America and Asia. The Company incorporated a subsidiary - Compania Minera Apologold, C.A in Venezuela to develop a gold/diamond mining concession in Southeastern Venezuela. Project was terminated in August 2001, due to poor testing results and the property abandoned. This subsidiary company has been inactive since 2001 and will not be reactivated.

 

On April 16, 2002, the Company announced the acquisition of the mining rights to a property known as the Napal Gold Property, (“NUP”). This property is located 48 km south-west of Bandar Lampung, Sumatra, Indonesia. The property consists of 733.9 hectares and possesses a Production Permit (a KP) # KW. 098PP325.

 

The terms of the Napal Gold Property called for a total payment of $375,000 US over a six-year period of which a total of $250,000 had been made. Subsequent to the year ending June 30, 2008 the Company terminated its agreement on the NUP property and returned all exploration rights to the owner.

 

On October 29, 2010, shareholders approved an increase in the authorized capital of the Company to 300,000,000 shares of common stock from 200,000,000. In addition to this, shareholders also authorized a share consolidation of 20:1 effective immediately.

 

On September 12, 2013, the Company incorporated Apolo Gold & Energy Asia Limited.

 

During the period ending March 31, 2014, the Company completed the sale of 1,875,000 common shares to a director of the Company for cash in the amount of $0.08 per share for a total consideration of $150,000. The Company, also, completed the sale of 5,000,000 common shares for cash in the amount of $0.20 per share for proceeds of $1,000,000.

 

On December 11, 2013, the Company acquired a 70% interest in three gold exploration claims in China’s Xinjiang Province. The Company issued 1.2-million shares for the claims.

 

On December 23, 2013, the Company acquired a 24% interest in Jiangxi Everenergy New Material Co., Ltd. The Company issued 8-million restricted common stocks at a deemed price of $0.375 per share, plus $1-million in cash. Additionally, on February 19, 2014, the Company agreed to acquire an additional 29% interest in Everenergy. The consideration is to be settled with the issuance of 11-million restricted common stock at a deemed price of $0.45 per share. As at the date of this report, the 2^nd acquisitions have not been completed.

 

The Company continues to pursue opportunities in the natural resource industry and will consider an investment in any other energy related business in order to create value.

 

At March 31, 2014, the Company had a working capital deficiency of $69,752.

 

The Company recognizes that it does not have sufficient funds on hand to finance its operations on an ongoing basis. The Company further recognizes that it is dependent on the ability of its management team to obtain the necessary working capital in order to complete projects started and operate successfully. There is no assurance that the Company will be able to obtain additional capital as required, or if the capital is available, to obtain it on terms favorable to the Company. The Company may suffer from a lack of liquidity in the future that could impair its exploration efforts and adversely affect its results of operations.

 

Results of Operations

 

In the nine months ended March 31, 2014, the Company incurred a loss of $150,478 (2013 - $27,073). Consulting and professional fees for the nine months ended March 31, 2014 were $124,683 (2013 - $14,439), as business operations increased with a change in management.

 

General and administrative costs were $25,795 in the nine month period ended March 31, 2014 (2013 - $12,634) due to increased business activity.

 

The Company recognizes that it will require additional capital in order to continue to develop its mineral properties. There is no assurance at this time that said capital can be raised on terms and conditions acceptable to management.

 

At March 31, 2014 there were 27,778,295 shares outstanding. This includes the issuance of 1,875,000 common shares at $0.08 per share for total proceeds of $150,000; 400,000 common shares for services; 5,000,000 common shares issued at $0.20 per share for proceeds of $1,000,000; 6,000,000 common shares for three mineral properties; and 8,000,000 common shares for a 24% interest in Everenergy, a lithium battery manufacturer, during the nine month period ended March 31, 2014. The Company at March 31 2014 had current trade accounts payable of $11,948 compared to $24,922 at June 30, 2013 and $24,581 at March 31, 2013. The trade payables are largely attributed to Everenergy share acquisition. Related party amounts payable were $Nil at March 31, 2014 (June 30, 2013 - $86,399). During the nine months ended March 31, 2014, a new director of the Company advanced $61,617 (2013 - nil) to the Company. The advance is expected to be repaid within three months.

 

On December 23, 2013, the Company agreed to issue 8-million restricted common shares at a deemed price of $0.375 per share and $1-million in cash for a 24% interest in Jiangxi Everenergy New Material Co., Ltd. On February 19 2014, the Company agreed to issue 11-million restricted common shares for an additional 29% interest in Everenergy. At the date of this report, the additional 29% acquisition has not been completed, it is expected that the transaction will be completed in the 4^th quarter.

 

 

Cash on hand at March 31, 2014 amounted to $3,813. The Company is aware that additional financing will be required in order to continue its pursuit of a mineral property opportunity or a comparable opportunity in a related field. There is no assurance that additional funding will be successfully completed.

 

The Company has no employees other than officers and uses consultants as and when necessary.

 

LIQUIDITY AND CAPITAL RESOURCES

 

The Company has limited financial resources at March 31, 2014 with funds on hand of $3,813 (2013 - $417).

 

The Company has current accounts payable at March 31, 2014 of $11,948 (2013 - $24,922).

 

Amounts due to related parties at March 31, 2014 were $Nil (2013 - $86,399). While the Company continues to seek out additional capital, there is no assurance that they will be successful in completing this necessary financing. The Company recognizes that it is dependent on the ability of its management team to obtain the necessary working capital required.

 

During the nine months ended March 31, 2014, a new director of the Company advanced $61,617 (2013 - nil) to the Company. The advance is payable upon demand.

 

While in the pursuit of additional working capital, the Company is also very active in reviewing other resource development opportunities and will continue with these endeavors.

 

Inflation has not been a factor during the nine months ended March 31, 2014.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

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 4. Controls and procedures

 

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer / Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of “disclosure controls and procedures” in Rule 13a-15(f). In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

 

The Company’s 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 purpose in accordance with generally accepted accounting principles.

 

Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

 

Based on this evaluation, management concluded that the Company’s internal control over financial reporting was not effective as of March 31, 2014. The material weakness identified is the lack of segregation of duties due to limited staff.

 

This change in financial reporting was the result of the former Chairman and CEO, who resigned because of illness. The duties of Chairman and CEO were assumed by the CFO who continued with his duties as CFO in addition to new duties as Chairman and CEO. This change created a lack of segregation of duties.

 

This weakness may result in a more than remote likelihood that a material misstatement would not be prevented or detected. The Company currently has no active business being conducted.

 

 

Part II - Other Information

 

Item 1. Legal Proceedings: There are no proceedings to report.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. None

 

Item 3. Default Upon Senior Securities: There are no defaults to report.

 

Item 4. Mine Safety Disclosures: N/A

 

Item 5. Other Information: None

 

Item 6. Exhibits

 

31.1		Sarbanes Oxley Section 302 Certification from C.E.O.
31.2		Sarbanes Oxley Section 302 Certification from C.F.O.
32.1		Sarbanes Oxley Section 906 Certification from C.E.O.
32.2		Sarbanes Oxley Section 906 Certification from C.F.O.
101		Interactive Data Files

 

 

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.

 

APOLO GOLD & ENERGY, INC.
Dated: May 15, 2014
/s/ Kelvin Chak Wai Man
Kelvin Chak Wai Man,
President, Chief Executive Officer and Secretary
/s/ Edward Low
Edward Low,
Chief Financial Officer