UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

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

 

FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 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: 000-54822

 

 

TOA Holdings, Inc.

(Exact name of registrant as specified in its charter)

 

	Delaware	46-0992328
	(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
	C/O TOA Shoko, 1-1-36, Nishiawaji, Higashiyadogawa-ku Osaka, Japan	533-0031 (Zip Code)
	(Address of Principal Executive Offices)

 

  Issuer's telephone number: +81-6-6325-5035

Fax number: +81-6325-5037 

Email: info@toa-group.asia

 

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

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 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). [X] Yes [ ] No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a small reporting company. See definition of large accelerated filer, accelerated filer and small reporting company in Rule 12b-2 of the Securities Exchange Act of 1934.

 

Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [X]

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

 [ ] Yes [X] No

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of February 3, 2015, there were approximately 40,000,000 shares of common stock and 1,000,000 shares of preferred stock issued and outstanding.

 

We are listed on the OTC Marketplace under the symbol THGS.

 

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Table of Contents

INDEX

 

PART I-FINANCIAL INFORMATION

 

			Page
ITEM 1	FINANCIAL STATEMENTS		F1
Balance Sheets			F2
Statements of Operations			F3
Statements of Cash Flows			F4
Notes to Financial Statements			F5
ITEM 2	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS		3
ITEM 3	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		3
ITEM 4	CONTROLS AND PROCEDURES		4
PART II-OTHER INFORMATION
ITEM 1	LEGAL PROCEEDINGS		5
ITEM 1A	RISK FACTORS
ITEM 2	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		5
ITEM 3	DEFAULTS UPON SENIOR SECURITIES		5
ITEM 4	MINE SAFETY DISCLOSURES		5
ITEM 5	OTHER INFORMATION		5
ITEM 6	EXHIBITS		5
SIGNATURES			6

 

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PART I-FINANCIAL INFORMATION

  

ITEM 1

FINANCIAL STATEMENTS

 

TOA HOLDINGS, INC.

 CONSOLIDATED FINANCIAL STATEMENTS

 

INDEX TO FINANCIAL STATEMENTS

 

		Page
Balance Sheets		F2
Statements of Operations		F3
Statements of Cash Flows		F4
Notes to Financial Statements		F5

 

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TOA HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

			As of December 31, 2014		As of September 30, 2014
ASSETS
Current Assets
	Cash and cash equivalents	$	0	$	16
	Trade receivables - Related Party		109,800		109,800
TOTAL CURRENT ASSETS			109,800		109,816
TOTAL ASSETS		$	109,800	$	109,816
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
	Trade payables - Related Party	$	73,200	$	73,200
	Accrued expenses		32,233		36,282
	Loan from director		42,260		27,353
TOTAL CURRENT LIABILITIES			147,693		136,835
TOTAL LIABILITIES		$	147,693	$	136,835
Shareholders’ Equity (Deficit)
	Preferred stock ($.0001 par value, 20,000,000 shares authorized;
	1,000,000 shares issued and outstanding
	as of December 31, 2014 and September 30, 2014)	$	100	$	100
	Common stock ($.0001 par value, 500,000,000 shares authorized,
	40,000,000 shares issued and outstanding
	as of December 31, 2014 and September 30, 2014)		4,000		4,000
	Additional paid-in capital		2,648		2,648
	Accumulated deficit		(51,796)		(37,688)
	Accumulated other comprehensive income		7,155		3,921
TOTAL SHAREHOLDERS' DEFICIT		$	(37,893)	$	(27,019)
TOTAL LIABILITIES AND SHAREHOLDER EQUITY		$	109,800	$	109,816
The accompanying notes are an integral part of these financial statements

 

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TOA HOLDINGS, INC.

CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(UNAUDITED)

			Three months ended		Three months ended
			December 31, 2014		December 31, 2013
Revenues - Related Party		$	-	$	-
Cost of revenues - Related Party			-		-
Gross profit			-		-
General and Administrative Expenses			14,107		296
Total Expenses			14,107		296
NET LOSS		$	(14,107)	$	(296)
OTHER COMPREHENSIVE INCOME (LOSS)
	Foreign currency translation adjustment	$	3,234	$	(414)
TOTAL COMPREHENSIVE LOSS		$	(10,873)	$	(710)
WEIGHTED AVERAGE SHARES OUTSTANDING			40,000,000		40,000,000
NET INCOME(LOSS) PER SHARE		$	(0.00)	$	(0.00)
The accompanying notes are an integral part of these financial statements

 

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TOA HOLDINGS, INC. CONDENSED STATEMENT OF CASH FLOWS (UNAUDITED)

					Three months ended		Three months ended
					December 31, 2014		December 31, 2013
CASH FLOWS FROM OPERATING ACTIVITIES
	Net income (loss)			$	(14,107)	$	(296)
	Adjustments to reconcile net income (loss ) to net cash used in operating activities:
		Change in operating assets and liabilities:
			Trade receivables - Related Party		-		72,000
			Accrued expenses		(4,049)		(4,069)
			AP – Advances from Related Party		-		(28,319)
	Net cash provided by (used in) operating activities			$	(18,156)	$	39,316
CASH FLOWS FROM INVESTING ACTIVITIES
	Advances to a director			$	-	$	(37,646)
	Net cash used in investing activities			$	-	$	(37,646)
CASH FLOWS FROM FINANCING ACTIVITIES
	Loan from director			$	14,906	$	-
	Net cash provided by  financing activities			$	14,906	$	-
Net effect of exchange rate changes on cash				$	3,234	$	(1,653)
Net Change in Cash and Cash Equivalents				$	(16)	$	17
Cash and cash equivalents - beginning of period					16		-
Cash and cash equivalents - end of period					0		17
SUPPLEMENTAL INFORMATION
Interest paid					-		-
Income taxes paid					-		-
The accompanying notes are an integral part of these financial statements.

 

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TOA HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

 

TOA Holdings Inc. conducts a trading business through TOA SHOKO JAPAN, a Japanese Corporation (“TOA Shoko”), which is our wholly owned subsidiary. Our business is engaged in a range of global business activities including worldwide trading of various commodities, organizing and coordinating industrial projects, and assisting in the procurement of raw materials and equipment.

 

The Company is currently headquartered in Osaka Japan.

 

The Company’s business operations are conducted through its wholly-owned subsidiary, TOA Shoko located in Osaka, Japan.

 

NOTE 2 - BASIS OF PRESENTATION

 

The accompanying unaudited condensed financial statements of Toa Holdings, Inc. (the “Company”) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC, including the instructions to Form 10-Q and Regulation S-X. In the opinion of the management of the Company, all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the three month periods and for the period from the date of inception have been made. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. When used in these notes, the terms “Company”, “we”, “us” or “our” mean the Company. Certain information and note disclosure normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America has been condensed or omitted from these statements pursuant to such accounting principles and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited financial statements for the year ended September 30, 2014.

 

NOTE 3 - GOING CONCERN

 

The accompanying financial statements are prepared on a basis of accounting assuming that the Company is a going concern that contemplates realization of assets and satisfaction of liabilities in the normal course of business. The Company is considered a growth company and has few current revenue sources. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s management plans to engage in very limited activities without incurring any liabilities that must be satisfied in cash until a source of funding is secured. The Company will offer noncash consideration and seek equity lines as a means of financing its operations. If the Company is unable to obtain revenue- producing contracts or financing or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders.

 

NOTE 4 - RELATED-PARTY TRANSACTIONS

 

As of December 31, 2014 the Company had a loan from director in the amount of $42,260 owed to its officer and director. The loan payable is due on demand and non-interest bearing.

 

As of December 31, 2014, the Company had trade receivables of $109,800 from BJK Global Ltd., a Bangladeshi Corporation (“BJK”) which Hajime Abe serves as the chairman.

 

As of December 31, 2014, the Company had trade payables of $73,200 from Dong A Sang Gong Co., Ltd, a Korea Corporation (“Dong”) which Hajime Abe serves as the chairman.

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ITEM 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

Our cash balance is $0 as of December 31, 2014. Our cash balance is not sufficient to fund our limited levels of operations for any period of time. We have been utilizing and may utilize funds from Hajime Abe, our president and director, who has informally agreed to advance funds to allow us to pay for filing fees, and professional fees. Hajime Abe, however, has no formal commitment, arrangement or legal obligation to advance or loan funds to the company. In order to implement our plan of operations for the next twelve-month period, we require further funding. Being a start-up company, we have very limited operating history. After a twelve-month period we may need additional financing but currently do not have any arrangements for such financing.

 

We are a start-up company and have generated little revenue to date. Long term financing will be required to fully implement our business plan. The exact amount of funding will depend on funding required for full implementation of our business plan. Our expansion may include expanding our office facilities, hiring sales personnel and expanding into geographical areas such as Bangladesh and Korea. We do not currently have plans for our expansion, and have not yet decided on the scale of our expansion if we decided to do so and on the exact amount of funding needed for our long term financing.

 

If we need additional cash and cannot raise it, we will either have to suspend operations until we do raise the cash we need, or cease operations entirely.

 

ITEM 3

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.

 

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ITEM 4

CONTROLS AND PROCEDURES

 

Management’s Report on Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and our chief financial officer (who is acting as our principal executive officer, principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.

 

As of December 31, 2014, the end of the fiscal period covered by this report, we carried out an evaluation, under the supervision of our chief executive officer, with the participation of our chief financial officer, of the effectiveness of the design and the operation of our disclosure controls and procedures. The officers concluded that the disclosure controls and procedures were not effective as of the end of the period covered by this report due to material weaknesses identified below.

 

Management’s Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of control procedures. The objectives of internal control include providing management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management’s authorization and recorded properly to permit the preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2014. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework. Our management has concluded that, as of December 31, 2014, our internal control over financial reporting was not effective as of the end of the period covered by this report due to identified material weaknesses. Inasmuch as we only have one individuals serving as our officer, and employee we have determined that the Company has inadequate controls and procedures over financial reporting due to the lack of segregation of duties and lack of a formal review process that includes multiple levels of review, resulting in several audit adjustments related to derivative accounting, accounting of the Company’s convertible debt instruments, and write-off of assets. Management recognizes that its controls and procedures would be substantially improved if there was a greater segregation of the duties of Chief Executive Officer and Chief Financial Officer and as such is actively seeking to remediate this issue. Management believes that the material weakness in its controls and procedures referenced did not have an effect on our financial results.

 

This quarterly report does not include an attestation report of our company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit our company to provide only management’s report in this annual report.

 

Inherent limitations on effectiveness of controls

 

Internal control over financial reporting has inherent limitations which include but is not limited to the use of independent professionals for advice and guidance, interpretation of existing and/or changing rules and principles, segregation of management duties, scale of organization, and personnel factors. Internal control over financial reporting is a process which involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements on a timely basis, however these inherent limitations are known features of the financial reporting process and it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Changes in Internal Control over Financial Reporting

 

There have been no changes in our internal controls over financial reporting that occurred during the year ended September 30, 2014 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

 

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PART II-OTHER INFORMATION

 

ITEM 1

LEGAL PROCEEDINGS

 

There are no legal proceedings against the Company and the Company is unaware of such proceedings contemplated against it.

 

ITEM 1A

RISK FACTORS

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.

 

ITEM 2

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

On January 18, 2013 Jeffrey DeNunzio sold 20,000,000 shares of common stock to Hajime Abe.

 

On April 1, 2013, Hajime Abe entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with TOA Holdings, Inc., a Delaware corporation. Pursuant to the Agreement, Hajime Abe will transfer to TOA Holdings, Inc., 1,000,000 shares of TOA Shoko’s common stock which represents all of TOA Shoko’s issued and outstanding shares in consideration of 1,000,000 JPY ($10,089 USD). Following the closing of the share purchase transaction on July 6, 2013, TOA Holdings, Inc. owns a 100% interest in the issued and outstanding shares of TOA Shoko’s common stock. Upon closing TOA Holdings, Inc. is (will be) the controlling shareholder of the Company (TOA Shoko).

 

On April 22, 2013, the Company issued 1,000,000 shares of restricted Series A preferred stock valued at $100 to Hajime Abe as director’s compensation.

 

On April 22, 2013, the Company issued 20,000,000 shares of restricted common stock valued at $2,000 to Hajime Abe as director’s compensation.

 

On April 23, 2013, Mr. Hajime Abe entered into stock purchase agreements with 342 Japanese shareholders (“Japanese Shareholders”). Pursuant to these agreements, Mr. Abe sold 31,400,000 shares of common stock of the Company to these Japanese Shareholders.

 

We claim an exemption from registration afforded by Section 4(2) and/or Regulation S of the Securities Act of 1933, as amended ("Regulation S") for the above sales of the stock since the sales of the stock were made to non-U.S. persons (as defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to offshore transactions, and no directed selling efforts were made in the United States by the issuer, a distributor, any of their respective affiliates, or any person acting on behalf of any of the foregoing.

 

ITEM 3

DEFAULTS UPON SENIOR SECURITIES

 

None

 

ITEM 4

MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5

OTHER INFORMATION

 

None

 

ITEM 6

EXHIBITS

 

(a)	Exhibits required by Item 601 of Regulation S-K.

 

Exhibit No.		Description
3.1		Certificate of Incorporation, as of September 30, 2012. (1)
3.2		By-laws. (1)
31.1		Certification of the Company’s Principal Executive and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s report on Form 10-Q for the quarter ended December 31, 2014. (2)
32.1		Certification of the Company’s Principal Executive and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (2)
101.INS		XBRL Instance Document (3)
101.SCH		XBRL Taxonomy Extension Schema (3)
101.CAL		XBRL Taxonomy Extension Calculation Linkbase (3)
101.DEF		XBRL Taxonomy Extension Definition Linkbase (3)
101.LAB		XBRL Taxonomy Extension Label Linkbase (3)
101.PRE		XBRL Taxonomy Extension Presentation Linkbase (3)

 

(1)	Filed as an exhibit to the Company's Registration Statement on Form 10, as filed with the SEC on October 9, 2012, and incorporated herein by this reference.
(2)	Filed herewith.
(3)	Users of this data are advised that, pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or Annual Report for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Exchange Act of 1934 and otherwise are not subject to liability.

 

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, there unto duly authorized.

 

TOA Holdings Inc.

(Registrant)

 

By: /s/ Hajime Abe 

Hajime Abe, President, Chief Executive Officer

and Principal Financial Officer

Dated: February 3, 2015

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