UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

_________________

FORM 10Q

_________________

(Mark One)

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

For the quarterly period ended June 30, 2015

 

[  ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from __________ to ___________

 

 

Commission file number: 000-54759

 

 

GREENHOUSE SOLUTIONS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

8400 Crescent Pkwy., Suite 600, Greenwood Village, Colorado 80111

(Address of principal executive offices)

 

(970) 439-1905

(Registrant's Telephone number)

 

                                                                                           

 (Former Address and phone of principal executive offices)

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  past 12 months (or for such  shorter  period that the  registrant  was required  to file  such  reports),  and  (2)  has  been  subject  to the  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 for 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

[_]

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Indicate by check mark whether the registrant is a large accelerated file, 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]

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

As of August 31, 2015, there were 88,272,000 shares of the registrant's common stock issued and outstanding.

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TABLE OF CONTENTS

 

	PART 1 - FINANCIAL INFORMATION	Page
Item 1.	Financial Statements (Unaudited)	2
	Condensed Balance Sheets - June 30, 2015 and March 31, 2015	3
	Condensed Statements of Operations  -  Three months ended June 30, 2015 and 2014	4
	Statements of Stockholder's Equity - June 30 2015	5
	Condensed Statements of Cash Flows - Three months ended June 30, 2015 and 2014	6
	Notes to the Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk - Not Applicable	15
Item 4.	Controls and Procedures	15
	PART II- OTHER INFORMATION
Item 1.	Legal Proceedings -Not Applicable	16
Item 1A.	Risk Factors -  Not Applicable	16
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	16
Item 3.	Defaults Upon Senior Securities - Not Applicable	17
Item 4.	Mine Safety Disclosure - Not Applicable	17
Item 5.	Other Information - Not Applicable	17
Item 6.	Exhibits	17
	Signatures	18

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PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

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GREENHOUSE SOLUTIONS, INC.
CONDENSED BALANCE SHEETS
(Unaudited)
									June 30,		March 31,
									2015		2015
	ASSETS
		Current assets
		Cash							$             10,774		$          11,164
		Accounts receivable							19,366		19,366
		Total Current assets							30,140		30,530
		Fixed assets
		Office equipment							1,398		1,398
		Accumulated depreciation							(163)		(23)
									1,235		1,375
		Other assets
		Investment							50,000		50,000
		Total Assets							$             81,375		$          81,905
	LIABILITIES & STOCKHOLDERS' DEFICIT
		Current liabilities
		Accounts payable							$             58,152		$          86,250
		Customer refund due							5,128		$            5,128
		Notes payable							5,150		55,161
		Total current liabilities							68,430		146,539
		Stockholders' Deficit
		Preferred stock, 25,000,000 shares authorized
		with $0.0001 par value. No Preferred
		shares issued or outstanding
		Common stock, 200,000,000 shares authorized
		with $0.0001 par value. 88,272,000 issued and
		outstanding (March 31, 2015 - 86,822,000)
									8,827		8,682
		Additional paid in capital							425,755		105,900
		Common stock subscribed							-		90,000
		Accumulated deficit							(421,637)		(269,216)
		Total Stockholders' Deficit							12,945		(64,634)
		Total Liabilities and Stockholders' Deficit							$   81,375		$        81,905
The accompanying notes are an integral part of these financial statements.

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GREENHOUSE SOLUTIONS, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
								For the Quarter Ended
								June 30,
								2015		2014
	REVENUE							$                -		$                -
	Cost of revenues							-		-
	GROSS PROFIT							-		-
	Operating Expenses:
	Consulting services							52,989		-
	Management consulting							9,000
	Professional fees							41,302		5,500
	General and administrative							49,130		675
	Total operating expenses							152,421		6,175
	Net operating loss							(152,421)		(6,175)
	Net loss							$       (152,421)		$          (6,175)
	Net income (loss) per share
	(Basic and fully diluted)							$            (0.00)		$            (0.00)
	Weighted average number of
	common shares outstanding							87,909,500		86,760,000
The accompanying notes are an integral part of these financial statements.

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GREENHOUSE SOLUTIONS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
							Three Months		Three Months
							Ended		Ended
							June 30, 2015		June 30, 2014
	Cash Flows From Operating Activities:
	Net income (loss)						$                (152,421)		$                    (6,175)
	Adjustments to reconcile net loss to net cash used
	in operating activities:
	Depreciation						140
	Changes in operating assets and liabilities
	Increase (decrease) in accounts payable and accrued liabilities						(78,109)		6,175
	(Increase) decrease in accounts receivable and other current assets						-		-
	NET CASH USED IN OPERATING ACTIVITIES						(230,390)		-
	CASH FLOWS USED IN INVESTING ACTIVITIES								$                          -
	Investment						-
	Purchase of Fixed assets						-
	NET CASH USED IN INVESTING ACTIVITIES						-
	CASH FLOWS FROM FINANCING ACTIVITIES
							-		-
	Proceeds from Common Stock sales						230,000		-
							-		-
	NET CASH PROVIDED BY FINANCING ACTIVITIES						230,000		-
	Net Increase (Decrease) In Cash						(390)		-
	Cash At The Beginning Of The Period						11,164		-
	Cash At The End Of The Period						$                   10,774		$                          -
	Schedule of Non-Cash Investing and Financing Activities
	Advances contributed to capital by related party						$                          -		$               42,082.00
							$                          -		$                          -
	Supplemental Disclosure
	Cash paid for interest						$                            -		$                            -
	Cash paid for income taxes						$                            -		$                            -
The accompanying notes are an integral part of these financial statements.

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GREENHOUSE SOLUTIONS, INC.
STATEMENT OF STOCKHOLDER'S EQUITY
					Common Stock						Common
							Amount		Paid in		Stock		Accumulated		Stockholders'
					Shares		($0.001 Par)		Capital		Subscribed		Deficit		Deficit
	Balances - March 31, 2013				86,760,000		$       8,676		$    32,824		$             -		$  (111,727)		$       (70,227)
	Forgiveness of debt related party
	July 3, 2013								42,082						42,082
	Common stock subscribed										31,000				31,000
	Net loss for the period												(20,391)		(20,391)
	Balances - March 31, 2014				86,760,000		8,676		74,906		31,000		(132,118)		(17,536)
	Sale of common stock				62,000		6		30,994		(31,000)				-
	Common stock subscribed										90,000				90,000
	Net loss for the period												(137,098)		(137,098)
	Balances - March 31, 2015				86,822,000		8,682		105,900		90,000		(269,216)		(64,634)
	Common stock subscribed										230,000				230,000
	Common stock issued				1,450,000		145		319,855		(320,000)				-
	Net loss for the period												(152,421)		(152,421)
	Balances - June 30, 2015				88,272,000		$       8,827		$   425,755		$             -		$  (421,637)		$         12,945
The accompanying notes are an integral part of these financial statements.

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GREENHOUSE SOLUTIONS, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2015

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION:

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

Basis of presentation - Unaudited Financial Statements

The accompanying unaudited financial statements have been prepared in accordance with U. S. generally accepted accounting principles for financial information and with the instructions to Form 10-Q. They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there has been no material change in the information disclosed in the notes to the financial statements for the year ended June 30, 2015 included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission. The unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for  the three months ended June 30, 2015 are not necessarily indicative of the results that may be expected for the year ending June 30, 2016.

Going Concern

The Company's financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has incurred an accumulated deficit since inception of $421,637 through June 30, 2015, and has not yet established a minimal on-going source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

The Company may raise additional capital through the sale of its equity securities, through an offering of debt securities, or through borrowings from financial institutions or related parties. By doing so, the Company hopes to generate sufficient capital to execute its business plan of providing financial consulting services on an ongoing basis. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern.

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

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GREENHOUSE SOLUTIONS, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2015

 

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and cash equivalents

The Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties and all highly liquid investments with an original maturity of three months or less as cash equivalents.

Revenue recognition

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

Basic and Diluted Loss per Share

The Company computes loss per share in accordance with "ASC-260," "Earnings per Share" which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common share during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. As of June 30, 2015 and 2014 there were no potentially dilutive securities outstanding.  

Income Taxes

The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases.

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

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GREENHOUSE SOLUTIONS, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2015

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

Carrying Value, Recoverability and Impairment of Long-Lived Assets

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

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

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

The impairment charges, if any, are included in operating expenses in the accompanying statements of operations.

Use of Estimates

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

The Company's significant estimates include income taxes provision and valuation allowance  of deferred tax assets; the fair value of financial instruments; the carrying value and recoverability of long-lived assets, and the assumption that the Company will continue as a going concern. Those significant accounting estimates

 

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GREENHOUSE SOLUTIONS, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2015

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

Fair value of Financial Instruments

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

Office Furniture and Equipment

Office furniture and equipment are recorded at cost and depreciated under the straight line method over the estimated useful life of the asset. At June 30, 2015 the Company had computer equipment of $1,398 with corresponding accumulated depreciation of $163 which is being depreciated over 3 years. There were no corresponding balances for the fiscal year ended June 30, 2014. Depreciation expense for the quarters ended June 30, 2015 and 2014 were $140 and Nil respectively.

Long Lived Assets

In accordance with ASC 350 the Company regularly reviews the carrying value of intangible and other long lived assets for the existence of facts or circumstances both internally and externally that suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long lived asset exceeds its fair value.

Stock-based Compensation

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

As of June 30, 2015 the Company had no stock-based compensation plans nor had it granted any stock options. Accordingly no stock-based compensation has been recorded to date.

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GREENHOUSE SOLUTIONS, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2015

Recent pronouncements

In June 2015, the FASB issued ASU 2015-10, "Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation". The guidance eliminates the definition of a development stage entity thereby removing the incremental financial reporting requirements from U.S. GAAP for development stage entities, primarily presentation of inception to date financial information. The provisions of the amendments are effective for annual reporting periods beginning after March 15, 2015, and the interim periods therein. However, early adoption is permitted. Accordingly, the Company has adopted this standard as of June 30, 2014.

Management has evaluated accounting standards and interpretations issued but not yet effective as of June 30, 2015, and does not expect such pronouncements to have a material impact on the Company's financial position, operations, or cash flows.

NOTE 3 -  RELATED PARTY TRANSACTIONS

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

During the quarter ended June 30, 2015 a stockholder of the Company advanced a total of $0, had a balance of $50,011 at the beginning of the quarter of which $50,011 was repaid. These advances are unsecured, not represented by any formal loan agreement and bear no interest.

NOTE 4 - STOCKHOLDER'S DEFICIT

The total number of common shares authorized that may be issued by the Company is 200,000,000 shares with a par value of $0.0001 per share. The Company is authorized to issue 25,000,000 shares of preferred stock with a par value of $0.0001 per share. As at June 30, 2015 there are no preferred shares issued or outstanding.

As at June 30, 2015 the total number of common shares outstanding was 88,272,000. On August 1, 2014, the Company received $45,000 in net proceeds through a private placement for $0.60 per share and will issue 75,000 common shares of the Company. On September 23, 2014 the Company issued 362,000 shares of common stock for monies previously received for common stock at $0.50 per share. On February 18, 2015 the Company received $25,000 in net proceeds through a private placement for $0.20 per share and will issue 125,000 common shares of the Company. On March 3, 2015 the Company received $20,000 in net proceeds through a private placement for $0.20 per share and will issue 100,000 common shares of the Company. During the quarter ended June 30, 2015 the Company received $230,000 in net proceeds through a private placement for $0.20 per share and will issue 1,150,000 common shares of the Company.

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GREENHOUSE SOLUTIONS, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2015

NOTE 5 - INCOME TAXES

A reconciliation of the provision for income taxes at the United States federal statutory rate compared to the Company's income tax expense as reported is as follows:

		June 30, 2015		June 30, 2014
Net loss before income taxes	$	(152,421)	$	(6,175)
Income tax rate		34%		34%
Income tax recovery		(51,823)		(2,099)
Valuation allowance change		51,823		2,099
Provision for income taxes	$	-	$	-

The significant components of deferred income tax assets at June 30, 2015 and 2014 are as follows:

			June 30, 2015		June 30, 2014
Net operating loss carry-forward		$	334,439	$	51,095
Valuation allowance			(334,439)		(51,095)
Net deferred income tax asset		$	-	$	-

As of June 30, 2015 and 2014, the Company has no unrecognized income tax benefits. The Company's policy for classifying interest and penalties associated with unrecognized income tax benefits is to include such items as tax expense. No interest or penalties have been recorded during the years ended June 30, 2015 and 2014, and no interest or penalties have been accrued as of June 30, 2015 and 2014. As of June 30, 2015 and 2014 the Company did not have any amounts recorded pertaining to uncertain tax positions.

The tax years from 2010 and forward remain open to examination by federal and state authorities due to net operating loss and credit carryforwards. The Company is currently not under examination by the Internal Revenue Service or any other taxing authorities.

NOTE 6 - INVESTMENTS

On March 2, 2015 the Company invested $50,000 in Panorama Investment Group for a 2 ½% interest in the group's operation. This was released by Panorama, and the Company has entered into a Joint Venture Agreement with Koios, LLC to market a nutritional product currently in development. For valuation purposes the investment is carried at cost until such time as future events would indicate a revaluation in necessary.

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

The following discussion should be read in conjunction with our unaudited financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission.  Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking  statements are necessarily based upon estimates and assumptions that are inherently  subject to significant  business,  economic and competitive uncertainties and  contingencies,  many of which are beyond our control and many of which,  with  respect to future  business  decisions,  are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or on our behalf.  We disclaim any obligation to update forward-looking statements.

The independent registered public accounting firm's report on the Company's financial statements as of March 31, 2015, and for each of the years in the two-year period then ended, includes a "going concern" explanatory paragraph, that describes substantial doubt about the Company's ability to continue as a going concern. 

PLAN OF OPERATIONS

We were incorporated under the laws of the State of Nevada on April 8, 2009. We are involved in the sale and distribution of gardening products, greenhouses, and CBD enhanced nutraceutical products in the North American market.

We may raise additional capital through the sale of our equity securities, through an offering of debt securities, or through borrowings from financial institutions or related parties. By doing so, we hope to generate sufficient capital to execute our business plan of providing greenhouse consulting services, retailing greenhouse and urban gardening products, and producing and retailing CBD enhanced nutraceutical products for human and animal use on an ongoing basis. Management believes that actions presently being taken to obtain additional funding provide the opportunity for us to continue as a going concern.

We do not expect to generate revenue for the next 12 months, which would be sufficient to sustain our operations. Accordingly, for the foreseeable future, we will continue to be dependent on additional financing in order to maintain our operations and continue with our corporate activities. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

RESULTS OF OPERATIONS

For the three month period ended June 30, 2015, we had $Nil in revenues compared to $Nil for the same period one year earlier. For the three month period ended June 30, 2015, general and administrative expenses were $49,130 as compared to general and administrative expenses of $6,175 for the three month period ended June 30, 2014. For the three month period ended June 30, 2015, we incurred expenses of $52,989 for consulting services and $41,302 for professional fees

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and $9,000 for management fees; these are in comparison to $Nil in each of the respective categories for the three month period ended June 30, 2014. For the three month period ended June 30, 2015 we incurred an operating loss of ($152,421). This compares to the net loss of ($6,175) sustained for the three months ended June 30, 2014.

Our auditor has expressed substantial doubt as to whether we will be able to continue to operate as a "going concern" due to the fact that we have an accumulated deficit of ($421,637) as of June 30, 2015, and have not yet established an ongoing source of revenues sufficient to cover our operating costs and allow us to continue as a going concern. The ability of us to continue as a going concern is dependent on us obtaining the adequate capital to fund operating losses until we become profitable. If we are unable to obtain adequate capital, we could be forced to cease operations.

FINANCING ACTIVITIES

The Company achieved $230,000 in financing through the private placement of common stock in the amount of 1,150,000 common shares at $0.20 and 1,150,000 warrants to purchase a share at $0.25.

INVESTING ACTIVITIES

We intend to seek additional funding through public or private financings to fund our operations through fiscal 2016 and beyond. However, if we are unable to raise additional capital when required or on acceptable terms, or achieve cash flow positive operations, we may have to significantly delay product development and scale back operations both of which may affect our ability to continue as a going concern.

LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2015, our cash balance was $10,774 as compared to $Nil at June 30, 2014. Our plan for satisfying our cash requirements for the next twelve months is through the sale of shares of our common stock, third party financing, and/or traditional bank financing. We do not anticipate generating sufficient amounts of revenues to meet our working capital requirements. Consequently, we intend to make appropriate plans to insure sources of additional capital in the future to fund growth and expansion through additional equity or debt financing or credit facilities.

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

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The Independent Registered Public Accounting Firm's report on the Company's Financial Statements as of March 31, 2015, and for each of the preceding years then ended, includes a "Going Concern" explanatory paragraph that describes substantially doubt about the Company's ability to continue as a going concern.

OFF BALANCE SHEET ARRANGEMENTS

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

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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

ITEM 4.  CONTROLS AND PROCEDURES 

Management's Report on Disclosure Controls and Procedures

The matters involving internal controls and procedures that our Company's management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee and lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; (3) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (4) ineffective controls over period end financial disclosure and reporting processes. The aforementioned material weaknesses were identified by our Board in connection with the audit of our financial statements as of June 30, 2015 and 2014 and communicated the matters to our management.

Management believes that the material weaknesses set forth in items (2), (3) and (4) above did not have an affect on our Company's financial results. However, management believes that the lack of a functioning audit committee, lack of a Chief Financial Officer, and lack of a majority of outside directors on our Company's board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures may result in our Company's financial statements for the future years being subject to error and inaccurate if controls, procedures, and professional financial officers are not maintained.

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

 

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

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

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 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 quarterly report.

Changes in Internal Control over Financial Reporting

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

 

PART II - OTHER INFORMATION

 

ITEM 1.  LEGAL PROCEEDINGS

 

None.

 

ITEM 1A.  RISK FACTORS

 

Not Applicable to Smaller Reporting Companies.

 

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

 

The Company sold in a private placement, 1,150,000 common shares of common stock at $0.20 and 1,150,000 warrants to purchase shares of common stock at $0.25 for proceeds of $230,000.  The Company relied on the exemption from registration provided under Regulation D, Rule 506.

 

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ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4.  MINE SAFETY DISCLOSURE

 

Not Applicable.

 

ITEM 5.  OTHER INFORMATION

 

None.

 

ITEM 6.  EXHIBITS

 

Exhibits.  The following is a complete list of exhibits filed as part of this Form 10-Q.  Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K.

 

31.1		Certification of Chief Executive Officer and Acting Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934
32.1		Certification of Chief Executive Officer and Acting Chief Financial Officer under Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		XBRL Instance Document (1)
101.SCH		XBRL Taxonomy Extension Schema Document (1)
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document (1)
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document (1)
101.LAB		XBRL Taxonomy Extension Label Linkbase Document (1)
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document (1)

(1) Pursuant to Rule 406T of Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

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SIGNATURES

Pursuant to the requirements of Section 12 of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

GREENHOUSE SOLUTIONS, INC.

(Registrant)

 

 

 

Dated:  September 3, 2015

 By: /s/ Rik J. Deitsch

 Rik J. Deitsch

 (Chief Executive Officer, Principal Executive

 Officer, Acting Chief Financial Officer

 and Principal Accounting  Officer)

 

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