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, 2014

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:  000-55130

DOMAIN MEDIA CORP.

(Exact name of registrant as specified in its charter)

Nevada		N/A
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

3100 W. Ray Road, Suite 201

Chandler, AZ 85226

(Address of principal executive offices) (zip code)

(480) 659-4907

(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 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	.	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       .   No   X .

As of November 14, 2014, there were 30,121,334 shares of registrant’s common stock outstanding.

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DOMAIN MEDIA CORP.

INDEX

		Page
PART I.  FINANCIAL INFORMATION
ITEM 1	Financial Statements	3
	Condensed consolidated balance sheets as of September 30, 2014 (unaudited) and June 30, 2014	3
	Condensed consolidated statements of operations for the three months ended September 30, 2014 and 2013 (unaudited)	4
	Condensed consolidated statements of cash flows for the three months ended September 30, 2014 and 2013 (unaudited)	5
	Notes to condensed consolidated financial statements (unaudited)	6
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	27
ITEM 4.	Controls and Procedures	27
PART II.  OTHER INFORMATION		29
ITEM 1.	Legal Proceedings	29
ITEM 1A.	Risk Factors	29
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
ITEM 3.	Defaults Upon Senior Securities	29
ITEM 4.	Mine Safety Disclosures	29
ITEM 5.	Other Information	29
ITEM 6.	Exhibits	30
SIGNATURES		31

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PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

DOMAIN MEDIA CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

		As of			As of
		September 30, 2014			June 30, 2014
ASSETS
CURRENT ASSETS:
Cash		$	8,952		$	15,476
Accounts receivable			5,673			3,242
Deferred expense			2,803			3,271
Total current assets			17,428			21,989
Property and equipment, net			1,103			1,244
Intangible assets, net			227,652			228,473
Total assets		$	246,183		$	251,706
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable		$	15,639		$	4,007
Accrued expenses			8,370			-
Notes payable - related party, net of debt discount			254,062			252,285
Interest payable			596			404
Total current liabilities			278,667			256,696
Total liabilities			278,667			256,696
COMMITMENTS AND CONTINGENCIES (Note 9)
STOCKHOLDERS' DEFICIT:
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, zero shares issued and outstanding			-			-
Common stock, $0.0001 par value, 100,000,000 shares authorized, 30,121,334 and 29,893,000 shares issued and outstanding as of September 30, 2014 and 2013, respectively			3,011			2,989
Additional paid-in capital			413,178			390,366
Accumulated deficit			(448,673)			(398,345)
Total stockholders' deficit			(32,484)			(4,990)
Total liabilities and stockholders' deficit		$	246,183		$	251,706
See Accompanying Notes to Consolidated Financial Statements.

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DOMAIN MEDIA CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	For the Three Months Ended
	September 30, 2014			September 30, 2013
				(Restated)
REVENUES, NET	$	28,613		$	6,371
OPERATING EXPENSES:
Sales and marketing expenses		31,942			10,250
General and administrative		38,553			14,518
Depreciation and amortization		141			194
Total operating expenses		70,636			24,962
LOSS FROM OPERATIONS		(42,023)			(18,591)
OTHER INCOME (EXPENSE):
Interest expense		(7,468)			(6,552)
Intangible write-off		(837)			-
Miscellaneous income		-			-
Total other expense, net		(8,305)			(6,552)
NET LOSS	$	(50,328)		$	(25,143)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - Basic and Diluted		29,965,808			27,800,418
NET LOSS PER SHARE - Basic and Diluted	$	-		$	-
See Accompanying Notes to Consolidated Financial Statements.

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DOMAIN MEDIA CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW

		For the Three Months Ended
		September 30, 2014			September 30, 2013
					(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(50,328)		$	(25,143)
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization expense			141			194
Common stock issued for formation			-			-
Interest expense related to beneficial conversion feature on related party note payable			6,552			6,552
Common stock issued for services			17,334			52,000
Intangible write-off			837			-
Changes in operating assets and liabilities:
Accounts receivable			(2,431)			9,600
Prepaid expenses and other current assets			468			(43,158)
Accounts payable			11,633			1,812
Accrued commission			8,370			-
Interest payable			192			-
Net cash (used in) provided by operating activities			(7,232)			1,857
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets			-			-
Purchase of domain names, net			(17)			-
Net cash used in investing activities			(17)			-
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from related party notes payable			-			(3,450)
Payments on related party notes payable			(4,775)			35,000
Proceeds from sale of common stock			5,500			-
Net cash provided by financing activities			725			31,550
NET CHANGE IN CASH			(6,524)			33,407
CASH AT BEGINNING OF PERIOD			15,476			4,081
CASH AT END OF PERIOD		$	8,952		$	37,488
SUPPLEMENTAL INFORMATION:
Cash paid during the period for:
Interest		$	-		$	-
Income taxes		$	-		$	-
Non-cash investing and financing activities:
Common stock issued for services		$	-		$	-
Estimated fair value of beneficial conversion feature		$	-		$	-
See Accompanying Notes to Consolidated Financial Statements.

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DOMAIN MEDIA CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THREE MONTHS ENDED SEPTEMBER 30, 2014 AND 2013

(Unaudited)

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies is presented to assist the reader in understanding and evaluating the Company’s consolidated financial statements (the “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 generally accepted accounting principles and have been consistently applied in the preparation of the financial statements.

Basis of Presentation

The accompanying financial statements include the accounts of Domain Media Corp. and its wholly owned subsidiary, Domain Media, LLC, of Arizona (“DMLLC”).  Domain Media Corp. was incorporated in the State of Nevada on June 14, 2013.  On July 10, 2013, Domain Media Corp. acquired DMLLC by issuing 20,000,000 shares of its common stock, constituting 80% of the outstanding shares of Domain Media Corp., after giving effect to their issuance.  Immediately following the closing, 25,000,000 shares were issued and outstanding.  The transaction was accounted for as a reverse acquisition in which DMLLC is deemed to be the accounting acquirer.  Consequently, the operations that will be reflected in the historical financial statements of the combined entity are those of DMLLC, and the financial statements after the business combination will include the operations of Domain Media Corp. from the closing date of the business combination.  All share and per share data presented in these financial statements has been retroactively restated to reflect the equity structure after the effects of the reverse acquisition.

The accompanying (a) condensed consolidated balance sheet at December 31, 2013 has been derived from audited statements and (b) interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q and Article 8 of SEC Regulation S-X. These condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements.  Therefore, these unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended June 30, 2014, included in the Company’s Form 10-K.

The condensed consolidated financial statements included herein as of and for the three months ended September 30, 2014 and 2013 are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of the Company’s management, are necessary to present fairly the condensed consolidated financial position of the Company as of September 30, 2014, the condensed consolidated results of its operations for the three months ended September 30, 2014 and 2013, and the condensed consolidated cash flows for the three months ended September 30, 2014 and 2013.  The results of operations for the three months ended September 30, 2014 are not necessarily indicative of the results to be expected for the full year or any future interim periods.

Principles of Consolidation

The unaudited financial statements of Domain Media Corp. have been prepared in accordance with GAAP and include the accounts of Domain Media Corp. and DMLLC for the three months ended September 30, 2014 and 2013.  All significant inter-company transactions and balances have been eliminated in consolidation.  Any reference herein to “Domain Media Corp.”, the “Company”, “we”, “our” or “us” is intended to mean Domain Media Corp., including the subsidiary indicated above, unless otherwise indicated.

Nature of the Business

We provide Internet-based search, media content, subscription based membership, and advertising services that facilitate access to the specific market niches that we participate in as well as marketing, lead generation and market research services.

On August 5, 2013, we acquired specified assets of The Enthusiast Online Network, Inc. (“EON”), which consists of approximately 100 domain names and 40 media properties principally covering the automotive sector.  In accordance with the Financial Accounting Standards Board (“FASB”) ASC Topic 805, Business Combinations, the Company has determined this transaction to be a purchase of assets and not a business combination.  We currently have approximately 950 domain names, 70 active websites, each of which requires updating and improvement, and approximately 40 websites acquired from EON that were dormant and have recently been re-launched.  The domain names we own are focused on specific market verticals or channels that encompass industries such as automotive, health and wellness, travel and leisure, sports and entertainment, and finance and business services.  We intend to further develop and deliver niche based content where our target audience can connect with our website, the community it is associated with, and interact to obtain useful and entertaining information.

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We also offer business-to-business based marketing, lead generation and sponsored content marketing research services through three websites.  These services are provided on an as ordered basis and are customized to each respective client’s needs.  In addition, we recently launched an e-commerce store, which sells highly specialized electronics products for security and surveillance.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP 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.  Significant estimates made in connection with the accompanying financial statements include fair values in connection with the analysis of intangible and other long-lived assets for impairment, estimated useful lives for intangible assets and property and equipment, valuation of equity compensation and beneficial conversion features and valuation allowances against net deferred tax assets.

Cash and Cash Equivalents

We consider all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.  We had $8,952 in cash and cash equivalents at September 30, 2014 and $15,476 in cash and cash equivalents at June 30, 2014.

We place our cash and cash equivalents with financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000.  Historically, our cash balances have not exceeded FDIC insured limits.  At September 30, 2014 and June 30, 2014, our uninsured cash balances were $0.

Accounts Receivable and Allowance for Doubtful Accounts

We generally do not require collateral, and the majority of our trade receivables are unsecured.  The carrying amount for accounts receivable approximates fair value.

Accounts receivable consisted of the following:

	September 30		June 30,
	2014				2014
Trade receivables	$	5,673			$	3,242
Less:  Allowance for doubtful accounts		-				-
Net accounts receivable	$	5,673			$	3,242

Accounts receivable are periodically evaluated for collectability based on past credit history with clients.  Provisions for losses on accounts receivable are determined on the basis of loss experience, known and inherent risk in the account balance and current economic conditions.

Property and equipment

Property and equipment of the Company is stated at cost.  Expenditures for property and equipment that substantially increase the useful lives of existing assets are capitalized at cost and depreciated.  Routine expenditures for repairs and maintenance are expensed as incurred.

Depreciation is provided principally on the straight-line method over the estimated useful lives ranging from five to ten years for financial reporting purposes.

Intangible Assets

Intangible assets consist primarily of domain names.  The purchases of domain names are recorded at cost and are considered to result in indefinite-lived intangible assets that are subsequently reviewed for impairment, while the costs of renewals are capitalized as deferred expenses and amortized over the period of the renewal that, in most cases, is one year.  Amortization of renewal expense amounted to $1,721 and $1,613 for the three-month periods ended September 30, 2014 and 2013, respectively.

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Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed

The Company reviews its identifiable, indefinite-lived intangible assets for impairment quarterly and other long-lived assets and identifiable finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.  Measurement of any impairment loss for long-lived assets and identifiable intangible assets that management expects to hold and use is based on the amount of the carrying value that exceeds the fair value of the asset.  The annual determination whether a domain name will continue to be renewed is made within 90 days of the renewal date based upon many factors which include, but are not limited to, current industry trends that relate to the domain name, existing web-based projects being undertaken for our owned and operated websites and/or those of our clients, if the domain names have a minimum amount of monthly organic search traffic, if the keyword terms associated with a domain name are of high value, or if we believe the domain name will maintain a reasonable to high resale value.  As a result of such analysis, wrote off non-renewed domains of $837 to our intangible assets in the three months ended September 30, 2014.

Income Taxes

The Company applies the provisions of FASB ASC No. 740 – Income Taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes.  Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.  Valuation allowances are established, when necessary, to reduce deferred income tax assets to the amounts expected to be realized.  For any uncertain tax positions, we recognize the impact of a tax position, only if it is more likely than not of being sustained upon examination, based on the technical merits of the position.  Our policy regarding the classification of interest and penalties is to classify them as income tax expense in our financial statements, if applicable.

Financial Instruments and Fair Value of Financial Instruments

The Company applies the provisions of accounting guidance, FASB Topic ASC 825, Financial Instruments, that requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties.  As of September 30, 2014 and June 30, 2014, the fair value of cash, accounts receivable, accounts payable, accrued expenses and notes payable approximated carrying value due to the short maturity of the instruments, quoted market prices or interest rates which fluctuate with market rates.

The Company defines fair value as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants at the measurement date.  The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement.  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 - Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

·

Level 2 - Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified (contractual) term, a Level 2 input must be observable for substantially the full term of the asset or liability.

·

Level 3 - Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date.

The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis.  Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs.  The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods.  Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared.

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Beneficial Conversion Features and Debt Discounts

The convertible features of debt can provide for a rate of conversion that is below market value.  Such feature is normally characterized as a “beneficial conversion feature” (“BCF”).  The relative fair values of the BCF were recorded as discounts from the face amount of the applicable debt instrument.  The Company amortized the discount using the straight-line method, which approximates the effective interest method through maturity of such instruments.  With respect to our convertible note, we reviewed ASC Topic 470-20, “Debt with Conversion and Other Options”, and determined that our related party convertible note met the criteria of a conventional convertible note and that the note had a beneficial conversion feature.  We used the pricing of recent sales of restricted stock to determine the fair value of the stock for purposes of calculating the beneficial conversion feature, which was determined to be in excess of the recorded amount of the note.  The Company is amortizing the discount to interest expense using the straight-line method, which approximates the effective interest method through the maturity of such note.

Equity Instruments Issued to Non-Employees for Acquiring Goods or Services

Issuances of the Company’s common stock or warrants for acquiring goods or services are measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The measurement date for the fair value of the equity instruments issued to consultants or vendors is determined at the earlier of (i) the date at which a commitment for performance to earn the equity instruments is reached (a “performance commitment” which would include a penalty considered to be of a magnitude that is a sufficiently large disincentive for nonperformance) or (ii) the date at which performance is complete.  When it is appropriate for the Company to recognize the cost of a transaction during financial reporting periods prior to the measurement date, for purposes of recognition of costs during those periods, the equity instrument is measured at the then-current fair values at each of those financial reporting dates.  Based on the applicable guidance, the Company treats forfeitable shares that are issued, but unvested, as unissued for accounting purposes until the shares vest.

Concentration

We have two major customers that comprised 90.6% and 7.69% of the total revenues earned for the three-month period ended September 30, 2014.  The loss of any one of these customers will have a significant impact on our operations.

We have two vendors that accounted for 37.4% and 16.6% of purchases for the three month period ended September 30, 2014.

We have two major customers that comprised 70.6% and 29.4% of the total revenues earned for the three month period ended September 30, 2013.

We have two vendors that accounted for 41.3% and 14.26% of purchases during the three month period ended September 30, 2013.

Revenue and Cost Recognition

We provide Internet search, advertising, and marketing services that facilitate access to niche industry sectors and specific topics of interest, products and related services on the Internet.  We recognize revenue in accordance with Accounting Standard Codification (ASC) 605-10 (previously Securities and Exchange Commission Staff Accounting Bulletin No. 104, Revenue Recognition).  Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.  Our revenues are expected to be derived from:

·

Pay per click (PPC) advertising from providers;

·

Lead generation where we receive a commission for sending users of our websites to third party providers who complete an inquiry form or provide an email submission as a qualified lead;

·

Affiliate revenue from various companies, usually offered through an affiliate network such as ClickBank, Commission Junction, or the like whereby we receive a commission for sales of products or services that occur from traffic that we direct to their site;

·

Sponsorship advertising when we obtain a corporate sponsor to directly advertise on a section of, or our entire, site;

·

Directory listings when local companies and service providers pay to have a premium listing on our sites and the functionality of the directory listings is upgraded and offered into each one of our websites;

·

Membership based subscriptions to specific website that provide unique content, information, and/or resources;

·

Product sales through our ecommerce stores; and

·

Business services that include lead generation, marketing campaign design and management, sponsored market research, and social media campaigns.

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Consumer Internet revenue is earned from online advertising sales and on a cost per thousand impressions (CPM), cost per click (CPC), cost per lead (CPL), cost per action (CPA) and flat-fee basis.

We earn CPM revenue from the display of graphical advertisements.  An impression is delivered when an advertisement appears in pages viewed by users.  Revenue from graphical advertisement impressions is recognized based on the actual impressions delivered in the period.

Revenue from the display of text-based links to the websites of our advertisers is recognized on a CPC basis, and search advertising is recognized as a "click-through" occurs.  A "click-through" occurs when a user clicks on an advertiser's link.

Revenue from advertisers on a CPL basis is recognized in the period the leads are accepted by the advertiser, following the execution of a service agreement and commencement of the services.

Under the CPA format, we earn revenue based on a percentage or negotiated amount of a consumer transaction undertaken or initiated through our websites.  Revenue is recognized at the time of the transaction.

Revenue from flat-fee, business marketing and lead generation services is based on a customer’s receipt of said services, report or leads and payment is made.

Fees for stand-alone projects are fixed-bid and determined based on estimated effort and client billing rates since we can reasonably estimate the required effort to complete each project or each milestone within the project.  Recognition of the revenue and all related costs of these arrangements are deferred until delivery and acceptance of the projects in accordance with the terms of the contract.

Advertising

Advertising costs are charged to operations when incurred.  Advertising expense for the three-month periods ended September 30, 2014 and 2013 was $497 and $89, respectively.

Basic and Diluted Loss Per Share

Basic and diluted earnings or loss per share (“EPS”) amounts in the financial statements are computed in accordance Accounting Standard Codification (ASC) 260 – 10 “Earnings per Share”, which establishes the requirements for presenting EPS.  Basic EPS is computed by dividing net income or loss available to common stockholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period.  Diluted EPS is based on the weighted average number of common shares outstanding and dilutive common stock equivalents.  Potentially dilutive securities, consisting of a convertible note payable, were excluded from the calculation of diluted loss per share, because their effect would be anti-dilutive.

The following table sets forth the computation of basic and diluted net income per share:

		For the Three Months Ended September 30,
		2014		2013
				(Restated)
Net loss attributable to the common stockholders	$	(50,328)	$	(25,143)
Basic weighted average outstanding shares of common stock		29,965,808		27,800,418
Earnings (loss) per share:
Basic and diluted	$	-	$	-

Business Segments

Due to our limited revenues at this time, we currently operate in one segment and in one geographic location in the United States of America.  Therefore segment information is not presented at this time.

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Recently Issued Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 amends the guidance for revenue recognition to replace numerous, industry specific requirements and converges areas under this topic with those of the International Financial Reporting Standards. The ASU implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. The amendment also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, and early adoption is prohibited. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. We are currently assessing the impact the adoption of ASU 2014-09 will have on our consolidated financial statements and disclosures.

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern”. The amendments in this update provide guidance in U.S. GAAP about management's responsibilities to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. The main provision of the amendments are for an entity's management, in connection with the preparation of financial statements, to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued. Management's evaluation should be based on relevant conditions and events that are known or reasonably knowable at the date the consolidated financial statements are issued. When management identifies conditions or events that raise substantial doubt about an entity's ability to continue as a going concern, the entity should disclose information that enables users of the consolidated financial statements to understand all of the following: (1) principal conditions or events that raised substantial doubt about the entity's ability to continue as a going concern (before consideration of management's plans); (2) management's evaluation of the significance of those conditions or events in relation to the entity's ability to meet its obligations; and (3) management's plans that alleviated substantial doubt about the entity's ability to continue as a going concern or management's plans that are intended to mitigate the conditions or events that raise substantial doubt about the entity's ability to continue as a going concern. The amendments in this update are effective for interim and annual reporting periods after December 15, 2016 and early application is permitted. The Company is currently assessing this guidance for future implementation.

NOTE 2 – GOING CONCERN

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business.  As of September 30, 2014, we had cash and cash equivalents of $8,952 and working capital deficit of $261,239.  The Company believes that its existing capital resources may not be adequate to enable it to execute its business plan and that we will require additional cash resources during fiscal 2015 based on our current operating plan and condition.  These conditions raise substantial doubt as to our ability to continue as a going concern.

Our plan to continue as a going concern is to reach the point where we begin generating sufficient revenue from our Internet sites to meet all of our obligations on a timely basis.  In the early stages of our operations, we intend to keep costs to a minimum.  The cost to host our network of websites is approximately $1,400 per month.  Domain name annual registration renewals for our portfolio of an estimated 950 domain names is approximately $9,500 per year.  We will gradually introduce advertising services to improve our sites' positions in general search engines such as Google, Yahoo and Bing.

While the Company is attempting to increase operations and generate additional revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations.  We expect our cash flows from operating activities to improve, primarily as a result of an increase in revenue.  Management also intends to raise additional funds by selling our equity our debt securities to both individual and institutional investors.  There is no assurance that the offering will be successful or that the maximum number of shares or amounts will be attained.  Management believes that the actions presently being taken to further implement its business plan and generate additional revenues provide the opportunity for the Company to continue as a going concern.  While the Company believes in the viability of its strategy to generate additional revenues and in its ability to raise additional funds, there can be no assurances to that effect.  The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate additional revenues.

The accompanying consolidated financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern.  If we fail to generate positive cash flows or obtain additional financing, when required, we may have to modify, delay, or abandon some or all of our business and expansion plans.

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NOTE 3 – RESTATEMENT OF PRIOR PERIOD

Intangible Assets

The original accounting for intangible assets failed to appropriately record the write-off of certain domain names that were not renewed based on changes and circumstances in their fair value, current industry trends that relate to the domain name, existing web-based projects being undertaken for our owned and operated websites and/or those of our clients, if the domain names have a minimum amount of monthly organic search traffic, if the keyword terms associated with a domain name are of high value, or if we believe the domain name will maintain a reasonable to high resale value.

The effect of these changes did not have a significant impact to the condensed consolidated balance sheet, the condensed consolidated statements of operations and cash flows for the quarter ended September 30, 2013. The effect of these restatements on previously issued interim financial statements was insignificant. Accordingly, the consolidated balance sheets and statements of operations and cash flows for the periods described in the preceding sentence have been retroactively adjusted as summarized below:

Beneficial Conversion Feature

The original accounting for the beneficial conversion feature failed to appropriately value the BCF consistent with the estimated fair value of the Company’s common stock. Accordingly, the Company recalculated the BCF and recorded the related change in the restated financial statements for period ended September 30, 2013.

The effect of these changes impacted the condensed consolidated statements of operations and cash flows for the quarter ended September 30, 2013. Accordingly, the condensed consolidated balance sheet and statement cash flows for the period described in the preceding sentence have been retroactively adjusted as summarized below:

Effect of Correction		As Previously Reported			Adjustment			As Restated
Statement of Operations for the period ended September 30, 2013:
Interest expense		$	(314,489)		$	307,937		$	(6,552)
Net Loss			(333,080)			307,937			(25,143)
Net Loss Available to common shareholders			(333,080)			307,937			(25,143)
EPS, Basic and Diluted		$	(0.01)		$	0.01		$	-
Statement of Cash flows for the period ended September 30, 2013:
Net Loss		$	(333,080)		$	307,937		$	(25,143)
Interest expense related to beneficial conversion feature		$	(314,489)		$	307,937		$	(6,552)

NOTE 4 - LONG TERM DEBT

Long-term debt consists of a convertible note of approximately $299,925 as of September 30, 2014 and $304,700 as of June 30, 2014 due to the Company’s president and founder, and entities owned and controlled by the president.  The loan accumulated over time through advances by the president to DMLLC.  The terms of the note were formalized concurrent with the acquisition of DMLLC in July 2013.  The note bears no stated interest, is convertible, at the discretion of the holder, into the common stock of the Company at $0.04 per share, and is due by July 10, 2016.  In the absence of a stated interest rate, we have imputed an interest rate from the Annual Mid-Term Federal Rate of 1.21% per annum.

To properly account for this transaction, we performed a detailed analysis to obtain a thorough understanding of the transaction, including understanding any related derivatives entered into.  We first reviewed ASC Topic 815, “Broad Transactions – Derivatives and Hedging” (“Topic 815”) to identify whether any equity-linked features in the note are freestanding or embedded.  We determined that there were no free standing features.  The note was then analyzed in accordance with Topic 815 to determine if the note should be accounted for at fair value and re-measured at fair value in income.  We determined that the note did not meet the requirements of Topic 815 and therefore accounted for the note as conventional convertible debt.

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We then reviewed ASC Topic 470-20, “Debt with Conversion and Other Options”, and determined that the note met the criteria of a conventional convertible note and that the note had a beneficial conversion feature.  We used the pricing of recent sales of restricted stock to determine the fair value of the stock for purposes of calculating the beneficial conversion feature, which was determined to be in excess of the recorded amount of the note.  As a result, the beneficial conversion feature was valued at $78,622, was recorded as a discount against the recorded debt with a corresponding offset against additional paid-in capital and is being amortized to interest expense over the life of the note using the straight-line method that approximates to effective interest method.  During the three months ended September 30, 2014, the Company amortized $6,552 to interest expense in the accompanying consolidated statements of operations.

NOTE 5 – STOCKHOLDERS’ EQUITY

Preferred Stock

Our certificate of incorporation authorizes the issuance of 10,000,000 shares of preferred stock with designations, rights and preferences determined from time to time by our board of directors, having a par value of $0.0001 per share.  No shares of preferred stock have been designated, issued or are outstanding.  Accordingly, our board of directors is empowered, without stockholder approval, to issue up to 10,000,000 shares of preferred stock with voting, liquidation, conversion, or other rights that could adversely affect the rights of the holders of the common stock.

Common Stock

We were incorporated under the laws of the State of Nevada on June 14, 2013.  Our certificate of incorporation authorizes the issuance of 100,000,000 shares of common stock, having a par value of $0.0001 per share.  We issued 5,000,000 shares of our common stock to our President and Founder at inception in exchange for organizational services totaling $500, which were incurred upon incorporation.  Prior to the acquisition of Domain Media, LLC, we had 5,000,000 shares of common stock issued and outstanding that are owned by Mr. Kern.

Following our formation, on July 10, 2013, we issued 20,000,000 shares of our common stock to the Company’s president for the acquisition of Domain Media, LLC, constituting 80% of the outstanding shares after giving effect to their issuance (See Note 1).  Immediately following the closing, 25,000,000 shares were issued and outstanding.  The transaction was accounted for as a reverse acquisition in which DMLLC is deemed to be the accounting acquirer, and the prior operations of DMLLC are consolidated for accounting purposes.

On August 4, 2013, we issued 80,000 forfeitable common shares to a third party consultant for his appointment and services on our advisory board that he will render to the Company over a one-year period.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $667, which was based on a total of 80,000 shares earned at a fair value of the stock of $0.05 for the first two months and then $0.10 thereafter.

On August 5, 2013, we engaged company counsel to assist us with the preparation and filing of required statements and reports to become a publicly traded company.  As part of this engagement, we issued 300,000 forfeitable common shares as well as a contingent payment due of $7,500 upon the effectiveness of our registration statement by the SEC.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $2,500, which was based on a total of 300,000 shares earned at a fair value of the stock of $0.05 for the first two months and then $0.10 thereafter.

On August 5, 2013, we acquired specified assets from The Enthusiast Online Network, Inc. (“EON”), which consists of approximately 100 domain names and 40 media properties principally covering the automotive sector, from Agile Opportunity Fund, LLC, and issued 3,333,000 common shares as consideration for the EON assets.  At the time we acquired these assets, EON was not an operating entity and all assets acquired were dormant and are currently being re-launched.  The acquisition of the assets was recorded as intangible assets of $166,650, or $0.05 per share.

On August 8, 2013, we issued 80,000 forfeitable common shares to a third party consultant for his appointment and services on our advisory board that he will render to the Company over a one-year period.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $667, which was based on a total of 80,000 shares earned at a fair value of the stock of $0.05 for the first two months and then $0.10 thereafter.

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On September 17, 2013, we issued 80,000 forfeitable common shares to a third party consultant for his appointment and services on our advisory board that he will render to the Company over a one-year period.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $2,000, which was based on a total of 80,000 shares earned at a fair value of the stock of $0.05 for the first month and then $0.10 thereafter.

On January 23, 2014, we issued 150,000 forfeitable common shares to Mr. Jonathan Bonghi for his appointment and services on our board of directors that he will render to the Company over a one-year period.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $3,750, which was based on a total of 112,500 shares earned at a fair value of the stock of $0.10.

On April 22, 2014, we issued 80,000 forfeitable common shares to a third party consultant for his appointment and services on our advisory board that he will render to the Company over a one-year period.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $2,000, which was based on a total of 40,000 shares earned at a fair value of the stock of $0.10.

On June 1, 2014, we issued 80,000 forfeitable common shares to a third party consultant for his appointment and services on our advisory board that he will render to the Company over a one-year period.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $2,000, which was based on a total of 33,334 shares earned at a fair value of the stock of $0.10.

On July 7, 2014, we issued 150,000 forfeitable common shares to a third party consultant for his appointment and services on our advisory board that he will render to the Company over a one-year period.  These shares vest over one-year period and were valued at a fair value consistent with the value of the stock over the period of vesting.  The total amount recorded in general and administrative expense for the period ending September 30, 2014 was $3,750, which was based on a total of 37,500 shares earned at a fair value of the stock of $0.10.

On August 8, 2014, we sold 5,000 shares of our common stock to an accredited investor in a non-brokered private placement, at a purchase price of $0.10 per share for gross proceeds of $500.

On September 30, 2014, we sold 40,000 shares of our common stock to an accredited investor in a non-brokered private placement, at a purchase price of $0.10 per share for gross proceeds of $4,000.  On September 30, 2014, we sold 10,000 shares of our common stock to an accredited investor in a non-brokered private placement, at a purchase price of $0.10 per share for gross proceeds of $1,000.

NOTE 6 –INTANGIBLE ASSETS

Intangible assets consist primarily of domain names.  A rollforward of capitalized intangible assets for the period ended September 30, 2014 is as follows:

	June 30, 2014
Balance at June 30, 2014	$	228,473
Intangible write-off		(837)
Purchases of domain names, net		16
Balance at September 30, 2014	$	227,652

The purchases of domain names are recorded at cost and are considered to result in indefinite-lived intangible assets that are subsequently reviewed for impairment, while the costs of renewals are capitalized as deferred expenses and amortized over the period of the renewal that, in most cases, is one year.

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Acquisition of assets of EON

On August 5, 2013, we acquired specified assets of EON from an unrelated third party, which consist of approximately 100 domain names and 40 media properties principally covering the automotive sector, for 3,333,000 shares of our common stock.  At the time of acquisition, EON was not a going concern and there were no tangible assets or cash flows.  The terms of the purchases were the result of arms-length negotiations.  In acquiring EON - we own and control our technology platform, but also integrate third party data sources, solutions and technologies depending on factors such as the cost/benefit of development, market experimentation and competition.  Our platform runs on .ASP and utilizes SQL server database technologies, housed in a secure data center provided by GoDaddy, as well as our other non-EON websites being hosted in a secure data center provided by MediaTemple (which was recently acquired by GoDaddy).  Via the acquisition of EON, we now have a platform that operates as our primary content management system for the community websites that we provide.  We believe that we now have a robust platform that has integrated many features and functionality not commonly found in other social media platforms or content management systems.  In accordance with FASB ASC Topic 805, the Company has determined this transaction to be a purchase of assets and not as a business combination.  Based on the more readily determinable value of the common shares, the purchase price was recorded at $166,650, or $0.05 per share.  The purchase price was allocated between domain names and the content management system at $150,000 and $16,650, respectively.  The content management system is being amortized over an estimated useful life of 10 years.  The amortization expense for the period ended September 30, 2014 was not significant.

NOTE 7 – RELATED PARTY TRANSACTIONS

As of September 30, 2014 and June 30, 2014, we had balances due to related parties as follows:

		September 30, 2014		June 30, 2014
Note payable – related party	$	299,925		$	304,700
Debt discount		(45,863)			(52,415)
	$	254,062		$	252,285

Upon inception of Domain Media Corp. on June 14, 2013, we issued 5,000,000 shares of our common stock to our President and Founder, Mr. Chris Kern, at inception in exchange for organizational services totaling $500, which were incurred upon incorporation.  In addition, Mr. Kern was issued 20,000,000 shares for the acquisition of Domain Media, LLC (See Note 1).

NOTE 8 – COMMITMENTS AND CONTINGENCIES

Litigation

The Company can, from time-to-time, be a party to certain legal proceedings that arise in the normal course of its business.  The Company experienced no losses from litigation during the years ended June 30, 2014 and 2013.  As of September 30, 2014, the Company was not a party to any pending material legal proceedings.

Employment Agreement

The Company entered into an agreement with its Chief Executive Officer, which expires upon termination of his employment.  The employment agreement requires annual base salary payments of approximately $150,000 per year.  Such salary shall not commence or be in effect until the Company meets various financing, revenue or change of control events.  In addition, the executive is entitled to bonuses of 50% of his base salary based on various factors, as determined by the board of directors.  Pursuant to the agreement, if the executive is terminated without cause, he is entitled to receive severance equal to annual base salary for a period of twelve to eighteen months.

Indemnities and Guarantees

The Company has made certain indemnities and guarantees, under which it may be required to make payments to a guaranteed or indemnified party, in relation to certain actions or transactions.  The guarantees and indemnities do not provide for any limitation of the maximum potential future payments the Company could be obligated to make.  Historically, the Company has not been obligated nor incurred any payments for these obligations and, therefore, no liabilities have been recorded for these indemnities and guarantees in the accompanying consolidated balance sheets.

The Company indemnifies its directors, officers, employees and agents, as permitted under the laws of the States of Arizona and Nevada.

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Lease

Through September 30, 2014, the Company leased office space in from the Company’s President at no cost.  In addition, the Company signed a one-year lease for virtual office space from July 2014 through July 2015 for an annual cost of $2,400.

Other

As of September 30, 2014, the Company is not aware of any other commitments or contingent liabilities that should be reflected in the accompanying financial statements.

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

Forward Looking Statements

This report includes forward-looking statements within the meaning of Section 27A of the Securities Act (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act").  We have based these statements on our beliefs and assumptions, based on information currently available to us.  These forward-looking statements are subject to risks and uncertainties.  Forward-looking statements include the information concerning our possible or assumed future results of operations, our total market opportunity and our business plans and objectives set forth under the sections entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations."

Forward-looking statements are not guarantees of performance.  Our future results and requirements may differ materially from those described in the forward-looking statements.  Many of the factors that will determine these results and requirements are beyond our control.  In addition to the risks and uncertainties discussed in Management's Discussion and Analysis of Financial Condition and Results of Operations, investors should consider those discussed under "Risk Factors" in our annual report on Form 10-K as filed with the Securities and Exchange Commission on September 29, 2014.

These forward-looking statements speak only as of the date of this report.  We do not intend to update or revise any forward-looking statements to reflect changes in our business, anticipated results of our operations, strategy or planned capital expenditures, or to reflect the occurrence of unanticipated events.

Corporate History

We were incorporated under the laws of the State of Nevada on June 14, 2013.  We issued 5,000,000 shares of our common stock to Mr. Kern at inception in exchange for organizational services rendered incurred upon incorporation.  Following our formation, we issued 20,000,000 shares of our common stock to our founder, Chris Kern for the acquisition of Domain Media, LLC from Mr. Kern, including all of its websites and domain names on July 10, 2013, in addition to the assumption of approximately $315,000 due to him in the form of convertible notes.  On August 5, 2013, we acquired the assets of The Enthusiast Online Network, Inc. (“EON”), which consisted of approximately 100 domain names and 40 media properties principally covering the automotive sector from Agile Opportunity Fund and issued 3,333,000 common shares as consideration for the EON assets.  On January 23, 2014, we appointed Mr. Jonathan Bonghi as a member of our board of directors, and issued 150,000 shares of our common stock to him to be earned over a one-year period.  On July 7, 2014, we appointed Mr. Allan Sabo as a member of our board of directors, and issued 150,000 shares of our common stock to him to be earned over a one-year period.  As of September 30, 2014, we had one employee, our founder and president, Mr. Kern, and several part-time consultants.  Through June 2015, Mr. Kern will devote his full time and attention of approximately forty hours a week to us but may increase the number of hours as necessary.

We incur additional website development charges when they are performed, of which there has been increased activity during the past several months due to various client engagements and projects we are launching.  In order to begin earning additional revenues, we need to engage in targeted marketing to generate traffic to our sites, as well as attract advertisers that desire to promote their goods and services on our websites.  In addition, we believe that enhancing our websites with additional features and content may have a positive impact upon our ability to generate revenues.

We derive revenue from the sale of advertising, sponsorships, directory listings, affiliate commission revenue, lead generation, product sales, internet marketing, and related services concentrated towards specific industry sectors such as health and wellness, online education, hospitality and travel, as well as the automotive industry.  In addition, we expect to derive revenue from our business services division by providing various forms of advertising, marketing and email campaigns, sponsored market research, hosting virtual events, digital media consulting and SEO services, and the like.

Industry Overview

Advertisers worldwide will spend $545.40 billion on paid media in 2014, according to new figures from eMarketer.  Total media ad spending will increase 5.7%, eMarketer projects, more than doubling its growth rate of 2.6% from a year ago.

On a country-by-country basis, the U.S. is by far the leader in total media ad spending.  eMarketer estimates that the U.S. will eclipse $180 billion in advertising spending this year, or nearly one-third of the worldwide total.  This spending is also the highest in the world per capita; U.S. advertisers will spend nearly $565 on paid media, on average, to reach each consumer in the country in 2014.

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Spending on ads served to Internet-connected devices including desktop and laptop computers, mobile phones and tablets will reach $137.53 billion in 2014, according to eMarketer’s latest estimates of worldwide paid media spending.  The market size for digital advertising and the overall consumption of digital media has steadily increased its ability to captivate consumers and capture the marketing dollars that follow. These trends are expected to continue for the next several years in addition to higher increases also being attributed to mobile advertising’s breakneck growth providing evidence that marketers are recognizing the tremendous power of mobility and smaller screens. Digital video is also on a strong positive growth trajectory, delivering dynamic content, highly loyal viewers, and incredible brand building opportunities.

At $11.6 billion in the first quarter of 2014, Internet advertising revenues hit an all-time first quarter high.  Internet advertising revenues in the U.S. reached $11.6 billion for the first quarter of 2014, marking a 19% increase over the same period in 2013, according to the latest IAB Internet Advertising Revenue Report figures recently released by the Interactive Advertising Bureau (IAB) and PwC US.  This is a historic first-quarter high and a significant increase over last year’s first quarter revenue level, which was record-setting at $9.6 billion.

Additional market metrics as provided in IAB’s 2013 Full Year Report (Published in April 2014) further demonstrate positive growth for all segments of Internet advertising, and particularly those that the Company participates in:

·

Search revenues accounted for 43% of 2013 yearly revenues, down from 46% for 2012. Search revenues totaled $18.4 billion in for 2013, up 9% from 2012, when Search totaled $16.9 billion.

·

Mobile advertising increases 110% in 2013 for the year — Mobile advertising in the United States totaled $7.1 billion during the 2013 year, a 110% increase from the prior year total of $3.4 billion.

·

2013 annual revenues increased on a year-over-year percentage and dollar basis. The compound annual growth rate (CAGR) over the past ten years for internet advertising of 18% has outpaced U.S. current dollar GDP growth of 4%* over that period.

·

Display-related advertising accounted for $12.8 billion or 30% of total revenues during the 2013 year, up 7% from the $12.0 billion (33% of total) reported for 2012.  For 2013, display-related advertising includes Display/Banner Ads (19% of 2013 revenues, or $7.9 billion), Digital Video (7% or $2.8 billion), Rich Media (3% or $1.3 billion), and Sponsorship (2% or $766 million).

·

Lead Generation revenues accounted for 4% of 2013 yearly revenues, or $1.75 billion, up 4% from the $1.69 billion (5% of total) reported in 2012.

·

Classifieds revenues totaled $2.6 billion or 6% of 2013 revenues, up 7% from the $2.4 billion (7% of total) reported in 2012.

Business Overview

Domain Media, through its owned and operated new media network of industry focused websites, provides an online venue for individuals (as consumers or business people) to meet, learn and/or share with their like minded peers, which also serves as a platform for businesses to connect with these audiences to improve their engagement with them.  The Company has its own content management platform, which currently supports over 40 websites, primarily consisting of our automotive channel, and utilizes other third party platforms to manage its other websites.  The Company provides these unique capabilities to monetize content efficiently across multiple marketing channels, including mobile, video and online display advertising.  We provide Internet-based search, focused media content, and advertising services that facilitate access to the specific market verticals that we participate in as well as marketing, lead generation and market research services.

On August 5, 2013, we acquired specified assets of The Enthusiast Online Network, Inc. (“EON”), which consists of approximately 100 domain names and 40 media properties principally covering the automotive sector.  In accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 805, Business Combinations, the Company has determined this transaction to be a purchase of assets and not a business combination.  We currently have approximately 950 domain names, 70 active websites, each of which requires updating and improvement, and approximately 40 websites acquired from EON that were dormant and have all recently been re-launched.  The domain names we own are focused on specific market verticals or channels that encompass industries such as automotive, health and wellness, travel and leisure, sports and entertainment, and internet marketing services.  We intend to further develop and deliver niche based content where our target audience can connect with our website, the community it is associated with, and interact to obtain useful and entertaining information.

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We also offer business-to-business based marketing, lead generation and sponsored market research services that are marketed through various websites.  These services are provided on an as ordered basis and are customized to each respective client’s needs.  In addition, we recently launched an e-commerce store, which sells highly specialized electronics products for security and surveillance.

The Company currently operates in two general business units – 1) Owned and operated (“O&O”) websites, and 2) Business Services.  Our O&O websites include approximately 950 domain names and 70 active websites, each of which requires updating and improvement.  Our portfolio of O&O websites also includes approximately 40 websites that we acquired from EON that were recently re-launched.  Each one of our websites typically focuses on specific market verticals such as online education, health and wellness, automotive, and travel and leisure, and are slated for additional development to deliver engaging niche based content where our target audience can connect with our website, the community or business it is associated with, and interact to obtain useful and entertaining information.  The websites associated with EON are principally automotive related and include sites such as FordTruckWorld.com, ChevyTruckWorld.com, and ModernVette.com.  In addition, we operate an ecommerce store, TheSpyCamStore.com, which sells highly specialized electronics products for security, monitoring, surveillance, and counter surveillance.  The Company will commence various marketing campaigns in order to attract additional people to visit our O&O sites to increase the amount of business and commerce that is conducted on them in order for us to generate additional revenue.

Our business services unit offers a variety of services to help companies improve their presence on the Internet, generate more leads and sales, and to optimize their online business strategy.  We offer search engine optimization (SEO), lead generation and sponsored content development services geared towards early growth stage companies to lower middle market businesses.  We currently offer our business services through four websites which include ScottsdaleSEOPro.net, in addition, we operate three websites in partnership with C4 Marketing, Inc. which include LeadBistro.com, TheMarketingScope.com, and RecruitingScope.com.  Our business services are provided on an as ordered basis and are customized to each respective client’s needs, which may include a single or combination of any of the services listed above.

The Company currently is comprised of Chris Kern, its founder, President, CEO, two members of our board of directors, Mr. Jonathan Bonghi, and Mr. Allan Sabo, and five advisors, all which provide services to the company on a limited basis.  Each one of our advisors and board members has been compensated with 80,000 shares and 150,000 shares of common stock in the Company, respectively.  In addition, our advisors and board members may be compensated for their time and additional services as independent consultants, paid from corporate funds.  In addition, we hire and outsource work to a number of consultants, or through networks such as Elance or oDesk, on a per-project or as needed basis for website development, technical support, database management, content development, and the like.  There are no agreements with any consulting firms at this time related to website development, technical services, or database management.  Utilizing outsourcing networks such as Elance or oDesk requires its users to agree to their terms of service and terms of use which are found on their website and accepted when signing up for their respective services.

The Company anticipates needing to hire more people either on a full-time basis, or additional consultants on an as needed basis.  Based upon the availability of a budget, we will bring on new personnel to the Company (both full-time, part-time, and outsourced) to extend the development efforts of our O&O websites to enhance their functionality, as well as for marketing, generating traffic to our websites and to help implement additional channels of revenue.  Based upon our experience and the recent development efforts that have taken place on a limited budget during the past six months, we believe that we will be able to continue the development and enhancement of our O&O websites and expand our business services unit, even on a limited budget.

Our current principal sources of revenue include:

·

Pay per click (PPC) advertising from providers;

·

Lead generation where we receive a commission for sending users of our websites to third party providers who complete an inquiry form or provide an email submission as a qualified lead;

·

Affiliate revenue from various companies, usually offered through an affiliate network such as ClickBank, Commission Junction, MaxBounty, or the like whereby we receive a commission for sales of products or services that occur from traffic that we originate that is directed to their site;

·

Product sales through our ecommerce stores; and

·

Business services - include lead generation, SEO services, and sponsored content development. These services are typically provided in a consulting capacity on a per project basis.

Each of the services described above can be found in any one of our specific O&O websites either on a singular basis or in any combination of the other services listed above.

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We anticipate that the Company will also incorporate additional forms of revenue in the near future.  These include:

·

Directory listing whereby local companies and service providers pay to have a premium listing on one of our professional industry or service specific websites;

·

Membership based subscriptions to a specific website that provides unique content, information and/or resources;

·

Sponsorship and direct advertisers that advertise on one or several of our O&O websites; and

·

Content licensing and syndication.

In addition, while we have generated revenue from sales of domain names during the year ended June 30, 2014 and may continue to generate revenue from domain name sales from time-to-time, we do not consider that to be a primary focus for our business in the future.  While we have a growing integrated media network, our business and websites fall into four specific categories that depict their purpose and focus:

·

Communities - such as FordTruckWorld.com, ModernVette.com, and HarleyZone.com;

·

Business Services - which can be found at ScottsdaleSEOPro.net, TheMarketingScope.com, and RecruitingScope.com;

·

Lead Generation/Affiliate Marketing – which include O&O sites such as KidsReadBetter.net and FatLossFoodPlans.com; and

·

E-Commerce – product based sales at O&O sites like TheSpyCamStore.com

The principal focus of the sectors that we participate in include five main channels or brands, which we believe to be the most prevalent sectors to pursue online, all of which have strong growing markets, are highly fragmented industries, and provide the Company with a unique opportunity to be a leading publisher and provider of integrated media and related services:

·

Automotive

·

Health & Wellness

·

Travel & Leisure

·

Sports & Entertainment

·

Business Services

The Company has diligently planned to have a diversified business by selecting not only multiple industries and sectors to participate in, but to also include a wide array of revenue channels to produce sales as outlined above.  We believe this methodology enables us to minimize the risk of participating in only one industry, and only one or two revenue channels.  By creating the diversity in our business model, we believe this enables us to capture a wider base of opportunities that can also be cross marketed and collateralized throughout our network to the other industries and channels we focus on, and provides us with a stronger platform for business growth and building long term sustainability.

The Company is in the early stages of growth and currently relies upon a handful of clients and/or affiliate networks to generate its revenue.  As of September 30, 2014, we had three clients that generated the vast majority of its revenue.  In the instance where we produce revenue from an affiliate network such as Amazon, Clickbank or MaxBounty, there is an agreement of terms that all affiliates agree to when signing up to utilize their network.  While these agreements are material to our business in that it permits us to utilize their networks and generate sales from them, there are a multitude of other companies that we can obtain similar affiliate agreements within a very short timeframe.  In the case where the Company has business services clients, there are agreements or proposals that have been accepted that outline the general terms and conditions that have been agreed to, with additional billings and business typically conducted on a per project and/or per order basis.

Employees

We currently have 1 employee, and hire several consultants and outsource our work on an as needed and per project basis.

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Results of Operations for Three Months Ended September 30, 2014 and 2013

The following table sets forth the results of our operations during the three months ended September 30, 2014 and 2013, and provides information regarding the dollar and percentage increase or (decrease) from 2013 to 2014:

	Three Months Ended September,					$ Increase				% Increase
	2014			2013			(Decrease)			(Decrease)
Revenues	$	28,613		$	6,371		$	22,242		349	%
Operating Expenses		70,636			24,962			45,674		183
Other Income (Expense), net		(8,305)			(6,552)			(1,753)		(21)
Net Income (Loss)	$	(50,328)		$	(25,143)		$	(25,185)		(50)	%

Revenue, increased by approximately 349% to $28,613 during the three months ended September 30, 2014, compared to $6,371 during the corresponding three months ended September 30, 2013.  The increased revenue was primarily related to increases in revenue from search engine optimization, lead generation and content marketing sales, but was offset by a decrease in domain name sales.  The reason for the change in the mix of revenue for the period was due to a change in demand for certain of our business lines and other projects being completed prior to the September 30, 2014 period.

Operating expenses increased by 183% during the three months ended September 30, 2014, as compared to the three months ended September 30, 2013.  The increase in operating expenses is primarily attributable the expense associated with the increases in stock based compensation, an increase in website development and domain name renewal fees, and an increase in professional, marketing consulting and advertising fees.

Other expenses increased to $8,305 for the three months ended September 30, 2014, as compared to $6,552 in the respective period ended September 30, 2013.  Other expenses primarily consisted of interest expense on related party notes payable.

Net loss for the three months ended September 30, 2014 was $(50,328), as compared to a net loss of $(25,143) for the respective period in 2013.

Liquidity and Capital Resources

The following table summarizes total current assets, liabilities and working capital at September 30, 2014 compared to June 30, 2014:

	Period Ended						$			%
	March 31, 2014			June 30, 2013			Increase / (Decrease)			Increase / (Decrease)
Current Assets	$	17,428		$	21,989		$	(4,561)		(21)	%
Current Liabilities		278,667			256,696			21,971		9
Working Capital Deficit	$	(261,239)		$	(234,707)		$	26,532		11	%

As of September 30, 2014, we had a working capital deficit of $261,239, as compared to a working capital deficit of $234,707 as of June 30, 2014, an increase of $26,532.  Our working capital deficit is primarily attributable to the loss from operations, which was offset by capital raised from investors.

Net cash provided by (used in) operating activities for the three months ended September 30, 2014 and 2013 was $7,232 and $(1,857), respectively.  The net loss for the three months ended September 30, 2014 and 2013 was ($50,328) and ($25,143), respectively.  For the three months ended September 30, 2014, the net loss included non-cash operating expenses of $6,552 related to interest expense from the value of a beneficial conversion feature on related party notes payable.

Net cash used in investing activities for the three months ended September 30, 2014 was $17 as compared to zero for the three months ended September 30, 2013.  The Company paid $17 and $0 for the acquisition of domain names during the three months ended September 30, 2014 and 2013, respectively.

Net cash provided by financing activities for the three months ended September 30, 2014 was $725 as compared to $31,550 for the three months ended September 30, 2013.  During the three months ended September 30, 2014, the Company paid $4,775 on related party notes payable.  In addition, the Company’s sold common shares in a private placement for a total of $5,500 to accredited investors.

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Going Concern 

The Company expects its current resources to be insufficient to fund its operations for the next 12 months unless additional financing is received.  As of September 30, 2014, we had cash on hand of approximately $9,000.  At our current monthly burn rate of approximately $8,500, our cash reserves will run out in approximately one month.  In order to prevent this, we will need to either increase revenues or raise funds to continue to operate and implement our business model.  We will require approximately $100,000 - $150,000 to fund our operations for the next twelve months.  If we are unable to increase revenues or raise funds to fulfill our operating budget, we will likely have to discontinue operations.  Management has determined that additional capital will be required in the form of equity or debt securities.  In addition, if we cannot raise additional short-term capital we will be forced to continue to further accrue liabilities due to our limited cash reserves.  There are no assurances that management will be able to raise capital on terms acceptable to the Company.  If we are unable to obtain sufficient amounts of additional capital, we may be required to reduce the scope of our planned development, which could harm our business, financial condition and operating results.  If we obtain additional funds by selling any of our equity securities or by issuing common stock to pay current or future obligations, the percentage ownership of our stockholders will be reduced, stockholders may experience additional dilution, or the equity securities may have rights preferences or privileges senior to the common stock.  If adequate funds are not available to us when needed on satisfactory terms, we may be required to cease operating or otherwise modify our business strategy.

As reflected in the accompanying consolidated financial statements, we had a net loss and net cash used in operations of ($50,328) and $(7,232), respectively, for the three months ended September 30, 2014.

Our ability to continue our operations is dependent on our plans, which include the raising of capital through debt and/or equity markets with some additional funding from other traditional financing sources, including term notes, until such time that funds provided by operations are sufficient to fund working capital requirements.  The Company may need to incur additional liabilities with certain related parties to sustain the Company’s existence.

The Company may require additional funding to finance the growth of its current and expected future operations as well as to achieve its strategic objectives.  There can be no assurance that financing will be available in amounts or terms acceptable to the Company, if at all.  In that event, the Company would be required to change its growth strategy and seek funding on that basis, if at all.

Our auditor, in its report dated September 29, 2014, has expressed substantial doubt about our ability to continue as a going concern.  Our plan regarding these matters is to raise additional debt and/or equity financing to allow us the ability to cover our current cash flow requirements and meet our obligations as they become due.  There can be no assurances that financing will be available or if available, that such financing will be available under favorable terms.  In the event that we are unable to generate adequate revenues to cover expenses and cannot obtain additional financing in the near future, we may be forced to scale back operations and business objectives.  The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should we be unable to continue as a going concern.

Recently Issued Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 amends the guidance for revenue recognition to replace numerous, industry specific requirements and converges areas under this topic with those of the International Financial Reporting Standards. The ASU implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. The amendment also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, and early adoption is prohibited. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. We are currently assessing the impact the adoption of ASU 2014-09 will have on our consolidated financial statements and disclosures.

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In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern ”. The amendments in this update provide guidance in U.S. GAAP about management's responsibilities to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. The main provision of the amendments are for an entity's management, in connection with the preparation of financial statements, to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued. Management's evaluation should be based on relevant conditions and events that are known or reasonably knowable at the date the consolidated financial statements are issued. When management identifies conditions or events that raise substantial doubt about an entity's ability to continue as a going concern, the entity should disclose information that enables users of the consolidated financial statements to understand all of the following: (1) principal conditions or events that raised substantial doubt about the entity's ability to continue as a going concern (before consideration of management's plans); (2) management's evaluation of the significance of those conditions or events in relation to the entity's ability to meet its obligations; and (3) management's plans that alleviated substantial doubt about the entity's ability to continue as a going concern or management's plans that are intended to mitigate the conditions or events that raise substantial doubt about the entity's ability to continue as a going concern. The amendments in this update are effective for interim and annual reporting periods after December 15, 2016 and early application is permitted. The Company is currently assessing this guidance for future implementation.

Other Recently Issued, but Not Yet Effective Accounting Pronouncements

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements.

Critical Accounting Policies

Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”).  GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues and expense amounts reported.  These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition.  We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied.  We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances.  Actual results may differ materially from these estimates under different assumptions or conditions.  We continue to monitor significant estimates made during the preparation of our financial statements.

Our significant accounting policies are summarized in Note 1 of our financial statements.  While all these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical.  Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates.  Actual results may differ from those estimates.  Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause effect on our consolidated results of operations, financial position or liquidity for the periods presented in this report.

We believe the following critical accounting policies and procedures, among others, affect our more significant judgments and estimates used in the preparation of our consolidated financial statements:

Use of Estimates and Assumptions

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.

The Company’s significant estimates and assumptions include the fair value of financial instruments; the carrying value, recoverability and impairment, if any, of long-lived assets; interest rate, income tax rate, income tax provision and valuation allowance of deferred tax 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.

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole 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.

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Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly.

Actual results could differ from those estimates.

Fair Value of Financial Instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted 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 accepted 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 inputs to valuation techniques used to measure fair value into three (3) broad levels.  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 than 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 amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, prepaid expense, deferred costs, accounts payable and accrued liabilities, deferred revenues, approximate their fair values because of the short maturity of these instruments.

The Company’s convertible notes payable approximate the fair value of such instruments based upon management’s best estimate of interest rates that would be available to the Company for similar financial arrangements at September 30, 2014 and June 30, 2014.

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.  Representations 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 related party accounts payable, if any, due to their related party nature.

Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis

The Company uses Level 3 of the fair value hierarchy to measure the fair value of the derivative liabilities and revalues its derivative convertible note and warrant liabilities at every reporting period and recognizes gains or losses in the statements of operations that are attributable to the change in the fair value of the derivative convertible notes and warrant liabilities.

Revenue Recognition

The Company follows paragraph 605-10-S99-1 of the FASB Accounting Standards Codification for revenue recognition.  The Company will recognize revenue when it is realized or realizable and earned.  The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.

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The Company receives non-refundable up-front payments for services.  These payments are initially deferred and subsequently recognized over the subscription period, typically one year.

Stock-Based Compensation for Obtaining Employee Services

The Company accounts for its stock based compensation in which the Company obtains employee services in share-based payment transactions under the recognition and measurement principles of the fair value recognition provisions of section 718-10-30 of the FASB Accounting Standards Codification. Pursuant to paragraph 718-10-30-6 of the FASB Accounting Standards Codification, all transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.  The measurement date used to determine the fair value of the equity instrument issued is the earlier of the date on which the performance is complete or the date on which it is probable that performance will occur.  If the Company is a newly formed corporation or shares of the Company are thinly traded the use of share prices established in the Company’s most recent private placement memorandum (“PPM”), or weekly or monthly price observations would generally be more appropriate than the use of daily price observations as such shares could be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in the market.

The fair value of share options and similar instruments is estimated on the date of grant using a Black-Scholes option-pricing valuation model.  The ranges of assumptions for inputs are as follows: 

·

Expected volatility of the entity’s shares and the method used to estimate it.  Pursuant to ASC Paragraph 718-10-50-2(f)(2)(ii) a thinly-traded or nonpublic entity that uses the calculated value method shall disclose the reasons why it is not practicable for the Company to estimate the expected volatility of its share price, the appropriate industry sector index that it has selected, the reasons for selecting that particular index, and how it has calculated historical volatility using that index.  The Company uses the average historical volatility of the comparable companies over the expected contractual life of the share options or similar instruments as its expected volatility.  If shares of a company are thinly traded the use of weekly or monthly price observations would generally be more appropriate than the use of daily price observations as the volatility calculation using daily observations for such shares could be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in the market.

·

Expected annual rate of quarterly dividends.  An entity that uses a method that employs different dividend rates during the contractual term shall disclose the range of expected dividends used and the weighted-average expected dividends.  The expected dividend yield is based on the Company’s current dividend yield as the best estimate of projected dividend yield for periods within the expected term of the share options and similar instruments.

·

Risk-free rate(s). An entity that uses a method that employs different risk-free rates shall disclose the range of risk-free rates used.  The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods within the expected term of the share options and similar instruments.

The Company’s policy is to recognize compensation cost for awards with only service conditions and a graded vesting schedule on a straight-line basis over the requisite service period for the entire award.

Equity Instruments Issued to Parties Other Than Employees for Acquiring Goods or Services

The Company accounts for equity instruments issued to parties other than employees for acquiring goods or services under guidance of Sub-topic 505-50 of the FASB Accounting Standards Codification (“Sub-topic 505-50”).

Pursuant to ASC Section 505-50-30, all transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.  The measurement date used to determine the fair value of the equity instrument issued is the earlier of the date on which the performance is complete or the date on which it is probable that performance will occur.  If the Company is a newly formed corporation or shares of the Company are thinly traded the use of share prices established in the Company’s most recent PPM or weekly or monthly price observations would generally be more appropriate than the use of daily price observations as such shares could be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in the market.

The fair value of share options and similar instruments is estimated on the date of grant using a Black-Scholes option-pricing valuation model.  The ranges of assumptions for inputs are as follows:

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·

Expected term of share options and similar instruments: Pursuant to Paragraph 718-10-50-2(f)(2)(i) of the FASB Accounting Standards Codification the expected term of share options and similar instruments represents the period of time the options and similar instruments are expected to be outstanding taking into consideration of the contractual term of the instruments and holder’s expected exercise behavior into the fair value (or calculated value) of the instruments.  The Company uses historical data to estimate holder’s expected exercise behavior.  If the Company is a newly formed corporation or shares of the Company are thinly traded the contractual term of the share options and similar instruments is used as the expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term.

·

Expected volatility of the entity’s shares and the method used to estimate it.  Pursuant to ASC Paragraph 718-10-50-2(f)(2)(ii) a thinly-traded or nonpublic entity that uses the calculated value method shall disclose the reasons why it is not practicable for the Company to estimate the expected volatility of its share price, the appropriate industry sector index that it has selected, the reasons for selecting that particular index, and how it has calculated historical volatility using that index.  The Company uses the average historical volatility of the comparable companies over the expected contractual life of the share options or similar instruments as its expected volatility.  If shares of a company are thinly traded the use of weekly or monthly price observations would generally be more appropriate than the use of daily price observations as the volatility calculation using daily observations for such shares could be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in the market.

·

Expected annual rate of quarterly dividends.  An entity that uses a method that employs different dividend rates during the contractual term shall disclose the range of expected dividends used and the weighted-average expected dividends.  The expected dividend yield is based on the Company’s current dividend yield as the best estimate of projected dividend yield for periods within the expected term of the share options and similar instruments.

·

Risk-free rate(s). An entity that uses a method that employs different risk-free rates shall disclose the range of risk-free rates used.  The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods within the expected term of the share options and similar instruments.

Pursuant to ASC paragraph 505-50-25-7, if fully vested, non-forfeitable equity instruments are issued at the date the grantor and grantee enter into an agreement for goods or services (no specific performance is required by the grantee to retain those equity instruments), then, because of the elimination of any obligation on the part of the counterparty to earn the equity instruments, a measurement date has been reached.  A grantor shall recognize the equity instruments when they are issued (in most cases, when the agreement is entered into). Whether the corresponding cost is an immediate expense or a prepaid asset (or whether the debit should be characterized as contra-equity under the requirements of paragraph 505-50-45-1) depends on the specific facts and circumstances. Pursuant to ASC paragraph 505-50-45-1, a grantor may conclude that an asset (other than a note or a receivable) has been received in return for fully vested, non-forfeitable equity instruments that are issued at the date the grantor and grantee enter into an agreement for goods or services (and no specific performance is required by the grantee in order to retain those equity instruments).  Such an asset shall not be displayed as contra-equity by the grantor of the equity instruments.  The transferability (or lack thereof) of the equity instruments shall not affect the balance sheet display of the asset.  This guidance is limited to transactions in which equity instruments are transferred to other than employees in exchange for goods or services.  Section 505-50-30 provides guidance on the determination of the measurement date for transactions that are within the scope of this Subtopic.

Pursuant to Paragraphs 505-50-25-8 and 505-50-25-9, an entity may grant fully vested, non-forfeitable equity instruments that are exercisable by the grantee only after a specified period of time if the terms of the agreement provide for earlier exercisability if the grantee achieves specified performance conditions.  Any measured cost of the transaction shall be recognized in the same period(s) and in the same manner as if the entity had paid cash for the goods or services or used cash rebates as a sales discount instead of paying with, or using, the equity instruments.  A recognized asset, expense, or sales discount shall not be reversed if a share option and similar instrument that the counterparty has the right to exercise expires unexercised.

Pursuant to ASC paragraph 505-50-30-S99-1, if the Company receives a right to receive future services in exchange for unvested, forfeitable equity instruments, those equity instruments are treated as unissued for accounting purposes until the future services are received (that is, the instruments are not considered issued until they vest). Consequently, there would be no recognition at the measurement date and no entry should be recorded.

Off Balance Sheet Arrangements

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).

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Restatement of Prior Period

Intangible Assets

The original accounting for intangible assets failed to appropriately record the write-off of certain domain names that were not renewed based on changes and circumstances in their fair value, current industry trends that relate to the domain name, existing web-based projects being undertaken for our owned and operated websites and/or those of our clients, if the domain names have a minimum amount of monthly organic search traffic, if the keyword terms associated with a domain name are of high value, or if we believe the domain name will maintain a reasonable to high resale value.

The effect of these changes did not have a significant impact to the condensed consolidated balance sheet, the condensed consolidated statements of operations and cash flows for the quarter ended September 30, 2013. The effect of these restatements on previously issued interim financial statements was insignificant. Accordingly, the consolidated balance sheets and statements of operations and cash flows for the periods described in the preceding sentence have been retroactively adjusted as summarized below:

Beneficial Conversion Feature

The original accounting for the beneficial conversion feature failed to appropriately value the BCF consistent with the estimated fair value of the Company’s common stock. Accordingly, the Company recalculated the BCF and recorded the related change in the restated financial statements for period ended September 30, 2013.

The effect of these changes impacted the condensed consolidated statements of operations and cash flows for the quarter ended September 30, 2013. Accordingly, the condensed consolidated balance sheet and statement cash flows for the period described in the preceding sentence have been retroactively adjusted as summarized below:

Effect of Correction		As Previously Reported			Adjustment			As Restated
Statement of Operations for the period ended September 30, 2013:
Interest expense		$	(314,489)		$	307,937		$	(6,552)
Net Loss			(333,080)			307,937			(25,143)
Net Loss Available to common shareholders			(333,080)			307,937			(25,143)
EPS, Basic and Diluted		$	(0.01)		$	0.01		$	-
Statement of Cash flows for the period ended September 30, 2013:
Net Loss		$	(333,080)		$	307,937		$	(25,143)
Interest expense related to beneficial conversion feature		$	(314,489)		$	307,937		$	(6,552)

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable

ITEM 4.  CONTROLS AND PROCEDURES

Internal Control over Financial Reporting

As of the end of the period covered by this report, we have carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures in accordance with Rule 13a-15 under the Securities Exchange Act of 1934.  This evaluation was carried out under the supervision and with the participation of the Company’s management, including the Company’s President, Chief Executive Officer and Chief Financial Officer.  Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were not effective as at the end of the period covered by this report.  There have been no changes in our internal controls over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls over financial reporting.

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Disclosure controls and procedures 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 Securities and Exchange Commission’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 under the Securities Exchange Act of 1934 is accumulated and communicated to management including our President and Chief Executive Officer, to allow timely decisions regarding required disclosure.

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud.  Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs.  Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

Management’s report on internal control over financial reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) of the Exchange Act of 1934.  Management has assessed the effectiveness of our internal control over financial reporting as of June 30, 2014, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.  Our internal control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions and dispositions of our assets; providing reasonable assurance that transactions are recorded as necessary for preparation of our financial statements in accordance with generally accepted accounting principles; providing reasonable assurance that receipts and expenditures are made in accordance with authorizations of management and our directors; and providing reasonable assurance that unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements would be prevented or detected on a timely basis.  As a result of this assessment, management concluded that, as of June 30, 2014, our internal control over financial reporting was not effective in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.  However, because of its inherent limitations, internal control over financial reporting may not provide absolute assurance that a misstatement of our financial statements would be prevented or detected.

The Company restated its consolidated financial statements and other financial information as of June 30, 2013 and for the three-month period then ended as a result of the Company’s determination of the write off of non-renewed domain names.  See the accompanying notes to the consolidated financial statements for more information.

In connection with the restatement our Chief Executive Officer and Chief Financial Officer considered the effect of the error on the adequacy of our disclosure controls and procedures as June 30, 2014.  A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (“PCAOB”) Auditing Standard No. 5) or combination of control deficiencies that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.  Management has identified the following material weaknesses which have caused management to conclude that, as of the period ended September 30, 2014, our disclosure controls and procedures were not effective at the reasonable assurance level:

1)

We do not have written documentation of our internal control policies and procedures.  Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

2)

We do not have sufficient segregation of duties within accounting functions, which is a basic internal control.  Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible.  However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals.  Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

3)

We did not maintain sufficient accounting resources commensurate with our financial reporting requirements and the complexity of our operations and financing transactions, specifically related to the accounting and reporting of debt and intangible assets.  Management evaluated the impact and has concluded that the control deficiency that resulted represented a material weakness.

Management has reviewed the financial statements and underlying information included herein in detail and believes the procedures performed are adequate to fairly present our financial position, results of operations and cash flows for the periods presented in all material respects.

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Remediation of Material Weaknesses

A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (“PCAOB”) Auditing Standard No. 5), or combination of control deficiencies, that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.  While management believes that the Company’s financial statements previously filed in the Company’s SEC reports have been properly recorded and disclosed in accordance with US GAAP, we have designed and plan to implement, or in some cases have already implemented, the specific remediation initiatives described below:

·

We have hired a third party consultant who has the required background and experience in accounting principles generally accepted in the United States of America and with SEC rules and regulations.

·

We are in the process of evaluating, given our limited personnel, how we enhance the supervisory procedures to include additional levels of analysis and quality control reviews within the accounting and financial reporting functions.

·

We are in the process of strengthening our internal policies and enhancing our processes for ensuring consistent treatment and recording of reserve estimates and that validation of our conclusions regarding significant accounting policies and their application to our business transactions are carried out by personnel with an appropriate level of accounting knowledge, experience and training.

While we believe, given the size and limited resources of our Company, that we are taking the appropriate steps to resolve our material weaknesses, we will continue our remediation efforts during fiscal 2015.

Changes in Internal Control over Financial Reporting

No changes in the Company's internal control over financial reporting have come to management's attention during the Company's last fiscal quarter that have materially affected, or are likely to materially affect, the Company's internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

We are currently not a party to any material legal proceedings or claims.

ITEM 1A.  RISK FACTORS

Not required under Regulation S-K for “smaller reporting companies.”

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On August 8, 2014, we sold 5,000 shares of our common stock to an accredited investor in a non-brokered private placement, at a purchase price of $0.10 per share for gross proceeds of $500.

On September 30, 2014, we sold 40,000 shares of our common stock to an accredited investor in a non-brokered private placement, at a purchase price of $0.10 per share for gross proceeds of $4,000.

On September 30, 2014, we sold 10,000 shares of our common stock to an accredited investor in a non-brokered private placement, at a purchase price of $0.10 per share for gross proceeds of $1,000.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.  MINE SAFETY DISCLOSURES

None.

ITEM 5.  OTHER INFORMATION

On July 7, 2014, we issued 150,000 forfeitable common shares to Mr. Allan Sabo for his appointment and services on our board of directors that he will render to the Company over a one-year period.  These shares were valued at a fair value of $0.10 per share.

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ITEM 6.  EXHIBITS

Exhibit No.		Description
31.1*		Certification filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer
31.2*		Certification filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of the Principal Financial Officer and Principal Accounting Officer
32.1*		Certification filed pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer
32.2*		Certification filed pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of the Principal Financial Officer and Principal Accounting Officer
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

_______________

*  Filed herewith.

**  Furnished herewith.  Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of any registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise are not subject to liability under those sections.

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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.

 

	DOMAIN MEDIA CORP.
Date:  November 14, 2014	By:	/s/ Chris J. Kern
		Chris J. Kern
		President, Chief Executive Officer, Secretary and
		Director (Principal Financial Officer)

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