SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

For the Quarterly period ended October 31, 2016

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Commission File No. 333-203471

 

ZIWIRA, INC.

 (Exact Name of Small Business Issuer as specified in its charter)

 

	Delaware		36-4803614
	(State or other jurisdiction incorporation or organization)		(IRS Employer File Number)

 

	445 Park Avenue
	9th Floor
	New York, NY		10022
	(Address of principal executive offices)		(zip code)

 

	(800)-953-6593
	(Registrant’s telephone number, including area code)

 

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 past 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days.    Yes ☒  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 such shorter period that the registrant was required to submit and post such files. Yes ☐  No ☒

 

Indicate by check mark whether the registrant is a large accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “small reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer   ☐ (Do not check if a smaller reporting company)	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 ☒

 

As of December 20, 2016, registrant had outstanding 57,235,000 shares of the registrant’s common stock.

 

 

 

 FORM 10-Q

 

ZWIRIA, INC.

TABLE OF CONTENTS

 

PART I  FINANCIAL INFORMATION			PAGE
Item 1.	Financial Statements for the period ended October 31, 2016		3
		Balance Sheets (Unaudited)	3
		Statements of Operations (Unaudited)	4
		Statement of Cash Flows (Unaudited)	5
		Notes to Unaudited  Financial Statements	6
Item 2.	Management’s Discussion and Analysis and Plan of Operation		10
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		20
Item 4.	Controls and Procedures		20
PART II  OTHER INFORMATION
Item 1.	Legal Proceedings		21
Item 1A.	Risk Factors		21
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		21
Item 3.	Defaults Upon Senior Securities		21
Item 4.	Mine Safety Disclosures		21
Item 5.	Other Information		21
Item 6.	Exhibits		22
Signatures			23

 

 

ZIWIRA, INC.
BALANCE SHEETS
(UNAUDITED)

		October 31,				January 31,
		2016				2016
ASSETS
Current assets:
Cash		$	—			$	17,816
Prepaid expenses			2,522				—
Total current assets			2,522				17,816
Property and equipment, net			616				—
Intangible assets - website, net			386,180				494,224
Total assets		$	389,318			$	512,040
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable		$	18,980			$	13,560
Accounts payable - related party			5,000				10,000
Advances from shareholders			213,806				—
Convertible note - related party			599,060				—
Accrued interest payable - related party			61,219				16,248
Cash overdraft			4,674				—
Total current liabilities			902,739				39,808
Long-term liabilities:
Convertible note - related party			—				599,060
Total long-term liabilities			—				599,060
Total liabilities			902,739				638,868
Stockholders' deficit:
Common stock, $0.0001 par value, 250,000,000 shares authorized; 57,235,000 shares issued and outstanding as of October 31, 2016 and  57,130,000 shares issued and outstanding as of January 31, 2016			5,724				5,713
Additional paid-in-capital			747,879				711,140
Accumulated deficit			(1,267,046	)			(843,681	)
Accumulated other comprehensive income			22				—
Total stockholders' deficit			(513,421	)			(126,828	)
Total liabilities and stockholders' deficit		$	389,318			$	512,040

 

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

 

 

ZIWIRA, INC. 

STATEMENTS OF OPERATIONS

(UNAUDITED) 

		For the Nine Months Ended October 31,								For the Three Months Ended October 31,
		2016				2015				2016				2015
Membership revenue		$	623			$	—			$	—			$	—
Operating expenses:
General and administrative			378,106				17,262				98,283				2,607
Total operating expenses			378,106				17,262				98,283				2,607
Loss from operations			(377,483	)			(17,262	)			(98,283	)			(2,607	)
Other expense
Interest expense - related party			(44,971	)			(1,970	)			(15,100	)			(1,970	)
Interest expense			(911	)			—				(692	)			—
Total other expense			(45,882	)			(1,970	)			(15,792	)			(1,970	)
Loss before income taxes			(423,365	)			(19,232	)			(114,075	)			(4,577	)
Income taxes			—				—				—				—
Net loss		$	(423,365	)		$	(19,232	)		$	(114,075	)		$	(4,577	)
Net loss per common share, basic and diluted		$	(0.01	)		$	(0.00	)		$	(0.00	)		$	(0.00	)
Weighted average number of common shares outstanding
Basic and diluted			57,217,962				99,960,145				57,235,000				100,000,000

 

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

 

 

ZIWIRA, INC. 

STATEMENT OF CASH FLOWS

(UNAUDITED)

 

		For the Nine Months Ended October 31,
		2016				2015
Cash flows from operating activities:
Net loss		$	(423,365	)		$	(19,232	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense			186				—
Amortization expense			134,790				—
Expenses paid by founders			—				11,902
Common stock issued for services			—				1,500
Changes in operating assets and liabilities:
Prepaid expenses			(2,522	)			—
Accounts payable			5,420				3,860
Accounts payable - related party			(5,000	)			1,970
Accrued interest payable - related party			44,971				—
Net cash used in operating activities			(245,520	)			—
Cash flows from investing activities:
Purchase of intangible assets - website			(26,746	)			—
Purchases of equipment			(802	)			—
Net cash used in investing activities			(27,548	)			—
Cash flows from financing activities:
Advances from shareholders			226,850				—
Repayments on advances from shareholders			(13,044	)			—
Issuance of common shares for cash			36,750				—
Cash overdraft			4,674				—
Net cash provided by financing activities			255,230				—
Effect of exchange rates on cash			22				—
Net (decrease) increase in cash			(17,816	)			—
Cash at beginning of period			17,816				—
Cash at end of period		$	—			$	—
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest		$	—			$	—
Income taxes		$	—			$	—
Non-cash investing and financing activities:
Related party convertible note issued for acquisition of Intangible asset - website		$	—			$	539,154
Related party convertible note issued for accrued stockholder distribution		$	—			$	59,906
Deferred offering costs paid by founders		$	—			$	15,000
Common stock issued for deferred offering costs		$	—			$	2,500

 

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

 

 

ZIWIRA, INC. 

NOTES TO THE FINANCIAL STATEMENTS  

(UNAUDITED)

 

NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES

 

Ziwira Inc. (“Ziwira” or “Company”) was established on January 21, 2015 in the State of Delaware. The Company currently has authorized 250,000,000 shares of common stock, par value $0.0001. The Company intends to operate an online portal for green industry topics, products and services. The Company has acquired a web-based platform that acts as a green energy portal, where users can exchange ideas and information, and can also buy and sell environmentally friendly services and products. The Company plans to receive fees for advertisement from users and a commission when products or services are purchased on the platform between users.

 

The Company’s current business plans include developing its online platform, in order to feature information, user services and products, and also grow its user base. The Company’s immediate plan is to generate revenue by way of receiving commissions and subscription fees from users, with the goal of becoming a one stop shop of information, products and services in the green industry. The Company intends to provide the platform whereby green information, products and services may be shared, bought and sold between users. The terms website, platform, marketplace and portal are used interchangeably in this prospectus.

 

NOTE 2 – BASIS OF PRESENTATION AND GOING CONCERN

 

The financial statements are presented in United States dollars (“USD).

 

The Company operates in one segment in accordance with accounting guidance Financial Accounting Standards Board (“FASB”) ASC Topic 280, Segment Reporting. Our Chief Executive Officer has been identified as the chief operating decision maker as defined by FASB ASC Topic 280.

 

The Accounting Standards Codification (“Codification” or “ASC”) is the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”).

 

The unaudited interim financial statements as of October 31, 2016, and for the three and nine months ended October 31, 2016 have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. They do not include all of the information and footnotes required by GAAP for complete financial statements. Therefore, these unaudited interim financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended January 31, 2016 filed in a Form 10-K on July 13, 2016.

 

Going Concern

 

The accompanying unaudited interim 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. The Company had a working capital deficit of $900,217 at October 31, 2016 and had net losses of $114,075 and $423,365 for the three and nine months ended October 31, 2016, with minimal revenue earned, and a lack of operational history. These matters, among others, raise substantial doubt about our ability to continue as a going concern.

 

While the Company is attempting to commence operations and generate revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate 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 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 revenues.

 

The unaudited interim financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Revenue Recognition

 

Revenue is principally derived from portal membership and advertising services. The Company recognizes revenue, net of sales discounts, when: (1) persuasive evidence exists of an arrangement with the customer reflecting the terms and conditions under which products or services will be provided; (2) delivery has occurred or services have been provided; (3) the fee is fixed or determinable; and (4) collection is reasonably assured. For all revenue transactions, the Company considers customer registration, payment, or third party acknowledgement to be persuasive evidence of an arrangement. Sales taxes collected, if any, from customers and remitted to governmental authorities are presented on a net basis and therefore are excluded from revenues in the Statements of Operations.

 

 

Membership revenue

 

The Company generates membership revenue through an online registration process to its Business Blogger Association (“BBA”), which allows members access to a web-based marketing and advertising support product that provides access to the Company’s database of materials of similar companies. The Company does not retransmit or distribute content.

 

Membership to the BBA is for a period of one month and membership revenue is recognized in the month of purchase. All membership fees are collected at the time of purchase.

 

NOTE 4 – INTANGIBLE ASSETS

 

Internet Portal

 

Pursuant to an Asset Purchase Agreement dated October 24, 2015, the Company acquired all of the rights, title, and interest in the Company’s Internet Portal from an entity controlled by the Company’s previous CEO, Dliar Adam Merza, who at the time of acquisition was a majority shareholder of the Company, in exchange for a convertible note payable (see Note 5). The asset acquisition was accounted for as a purchase of assets in accordance with ASC 805-10-55-4. The Company treated this transaction as an acquisition of assets under common control and as such the asset is accounted for using the historical carryover basis under US GAAP which is $539,154. The excess cost of $59,906 was accounted for as an accrued distribution to the stockholder.

 

ASC 350-50 requires expensing of all costs of the preliminary project stage and the training and application maintenance stage and the capitalization of all internal or external direct costs incurred during the application and infrastructure development stage. Upgrades or enhancements that add functionality are capitalized while other costs during the operating stage are expensed as incurred. The Company evaluated the historical carry over cost under ASC 350-50 and accounted for $539,154 as intangible assets which are considered to have an estimated life of three years. The total net book value of the intangible asset as of October 31, 2016 is $359,434.

 

The Company recorded amortization expense of $44,930 and $134,790 for the three and nine months ended October 31, 2016, respectively, and $44,930 for the year ended January 31, 2016 as the Company has launched its website and begun to market its products.

 

Website Development Costs

 

The Company evaluated the cost incurred and pursuant to ASC 350-50 capitalized $26,746 as website development under intangible assets in the accompanying Balance Sheet at October 31, 2016. Website development costs are expected to have an estimated life of three years.

 

Intangible assets consisted of the following: 

		Estimated life		October 31, 2016				January 31, 2016
Internet Portal		3 years		$	539,154			$	539,154
Website		3 years			26,746				—
Accumulated amortization					(179,720	)			(44,930	)
				$	386,180			$	494,224

 

NOTE 5 – Convertible Promissory Note – RELATED PARTY

 

On October 29, 2015, the Company issued a convertible promissory note in the principal amount of $599,060 for the purchase of the Company’s Internet Portal from the Company’s former CEO, Dliar Adam Merza, who as of the date of purchase was considered to be a majority shareholder the Company. The convertible promissory note bears interest at 10% per annum and is due and payable in two years. The holder of this note has the right, at the holder’s option, upon the consummation of a sale of all or substantially all of the equity interest in the Company or private placement transaction of the Company’s equity securities or securities convertible into equity securities, exclusive of the conversion of this note or any similar notes, to convert the principal amount of this note, in whole or in part, plus any interest which accrues hereon, into fully paid and nonassessable shares at a conversion price of $0.35 per share. The shares issued to the holder of this note on conversion shall have the same rights, preferences, privilege, and restrictions as any other common shares issued. The principal balance due at October 31, 2016 is $599,060 and the accrued interest payable to related party is $61,219. The entire note and accrued interest balance is due on October 29, 2017 and is presented as a short term liability in the balance sheet as of October 31, 2016.

 

 

The Company analyzed the conversion option in the notes for derivative accounting treatment under ASC Topic 815, “Derivatives and Hedging,” and determined that the instrument does not qualify for derivative accounting. The Company therefore performed an analysis to determine if the conversion option was subject to a beneficial conversion feature and determined that the instrument does not have a beneficial conversion feature.

 

NOTE 6 – stockHOLDERS’ DEFICIT

 

During the nine months ended October 31, 2016, the Company issued 105,000 shares of common stock for aggregate gross proceeds of $36,750 to Firas Khaleel Al Haddad, the Company’s CEO. Mr. Al Haddad subsequently transferred these shares to other individuals.

 

NOTE 7 – Related Party Transactions

 

On March 23, 2015, Allan Bradley (“Bradley”) resigned from his positions as CEO and director of the Company. Through December 31, 2015, Bradley was engaged as a consultant to the Company compensated under a verbal agreement at an hourly rate of $215. As of October 31, 2016, there was no amount due and outstanding in accounts payable – related party to Bradley under this verbal agreement. On December 15, 2015, as amended July 27, 2016, the Company entered into a consulting agreement with Bradley to manage the Company’s global operations. The Company incurred consulting fees of $15,000 and $83,229 for the three and nine months ended October 31, 2016, and had an accounts payable – related party balance of $5,000 as of October 31, 2016 (see Note 8).

 

On October 24, 2015, the Company issued a convertible promissory note in the principal amount of $599,060 for the purchase of the Company’s Internet Portal from the Company’s former CEO, Dliar Adam Merza, who as of the date of purchase was considered to be a majority shareholder of the Company (see Note 5). The principal balance due as of October 31, 2016 and January 31, 2016 is $599,060 and the accrued interest payable to related party is $61,219 and $16,248, respectively.

 

During the nine months ended October 31, 2016, the Company issued 105,000 shares of common stock for aggregate gross proceeds of $36,750 to Firas Khaleel Al Haddad, the Company’s CEO. Mr. Al Haddad subsequently transferred these shares to other individuals.

 

From time to time, the Company borrows funds from the Company’s CEO and a member of the Company’s Board of Directors (“Director”) for working capital purposes. As of October 31, 2016, the Company received advances totaling $226,850 and made repayments of $13,044. Advances are unsecured, non-interest bearing and due on demand. These loans and advances from our CEO and Director were not made pursuant to any loan agreements or promissory notes, nor will any future loans and advances from our CEO and Director be made pursuant to loan agreements or promissory notes.

 

NOTE 8 – COMMITMENTS AND CONTINGENCIES

 

Consulting Agreement

 

On December 15, 2015, as amended July 27, 2016, the Company entered into a consulting agreement with Bradley to manage the Company’s global operations. The agreement is effective from January 1, 2016 and continues for 24 months. The Company agreed to pay Bradley a monthly consulting fee of $10,000 for the first six (6) months and $5,000 per month for each month thereafter. In addition, should the Company achieve monthly revenues of $425,000, Bradley’s monthly consulting fee will increase to $17,500 and Bradley will be issued 500,000 shares of the Company’s common stock. The Company incurred consulting fees of $15,000 and $83,229 for the three and nine months ended October 31, 2016, and had an accounts payable – related party balance of $5,000 as of October 31, 2016.

 

Operating Lease

 

In January 2016, the Company entered into a month-to-month lease for office space in Toronto, Canada. The rent is 5,225 CAD per month (or approximately $3,850 USD).

 

On February 12, 2015, the Company entered into a month-to-month lease for its office space in New York, New York. The rent is $119 per month.

 

The Company had rent expense totaling $11,689 and $34,738, and $357 and $1,071 for the three and nine months ended October 31, 2016 and 2015, respectively.

 

 

NOTE 9 – SUBSEQUENT EVENTS

 

Subsequent to October 31, 2016, the Company received advances totaling $12,357 and made repayments of $3,170 to the Company’s CEO and Director for working capital purposes.

 

 

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

 

SELECTED FINANCIAL DATA

 

The following table summarizes our selected financial data for the periods and as of the dates indicated. Our selected balance sheet data as of January 31, 2016, has been derived from our audited financial statements. Our selected statements of operations data for the three and nine months ended October 31, 2016 and our selected balance sheet data as of October 31, 2016, have been derived from our unaudited interim financial statements included in this filing. The unaudited interim financial statements have been prepared on the same basis as the annual audited financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the information for the periods presented. Our financial statements are prepared and presented in accordance with generally accepted accounting principles in the United States. Our historical results are not necessarily indicative of the results to be expected for any future periods. Our selected financial data should be read together with the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and with our financial statements and their related notes, which are included elsewhere in this filing. 

		For the Nine Months Ended October 31,								For the Three Months Ended October 31,
		2016				2015				2016				2015
Membership revenue		$	623			$	—			$	—			$	—
Operating expenses:
General and administrative			378,106				17,262				98,283				2,607
Total operating expenses			378,106				17,262				98,283				2,607
Loss from operations			(377,483	)			(17,262	)			(98,283	)			(2,607	)
Other expense
Interest expense - related party			(44,971	)			(1,970	)			(15,100	)			(1,970	)
Interest expense			(911	)			—				(692	)			—
Total other expense			(45,882	)			(1,970	)			(15,792	)			(1,970	)
Loss before income taxes			(423,365	)			(19,232	)			(114,075	)			(4,577	)
Income taxes			—				—				—				—
Net loss		$	(423,365	)		$	(19,232	)		$	(114,075	)		$	(4,577	)
Net loss per common share, basic and diluted		$	(0.01	)		$	(0.00	)		$	(0.00	)		$	(0.00	)
Weighted average number of common shares outstanding
Basic and diluted			57,217,962				99,960,145				57,235,000				100,000,000

 

 

		October 31, 2016				January 31, 2016
ASSETS
Current assets:
Cash		$	—			$	17,816
Prepaid expenses			2,522				—
Total current assets			2,522				17,816
Property and equipment, net			616				—
Intangible assets - website, net			386,180				494,224
Total assets		$	389,318			$	512,040
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable		$	18,980			$	13,560
Accounts payable - related party			5,000				10,000
Advances from shareholders			213,806				—
Convertible note - related party			599,060				—
Accrued interest payable - related party			61,219				16,248
Cash overdraft			4,674				—
Total current liabilities			902,739				39,808
Long-term liabilities:
Convertible note - related party			—				599,060
Total long-term liabilities			—				599,060
Total liabilities			902,739				638,868
Stockholders’ deficit:
Common stock, $0.0001 par value, 250,000,000 shares authorized; 57,235,000 shares issued and outstanding as of October 31, 2016 and 57,130,000 shares issued and outstanding as of January 31, 2016			5,724				5,713
Additional paid-in-capital			747,879				711,140
Accumulated deficit			(1,267,046	)			(843,681	)
Accumulated other comprehensive income			22				—
Total stockholders’ deficit			(513,421	)			(126,828	)
Total liabilities and stockholders’ deficit		$	389,318			$	512,040

 

 

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

You should read the following discussion and analysis of our financial condition and results of operations together with the section entitled “Selected Financial Data” and our financial statements and related notes included elsewhere in this Information Statement. Some of the information contained in this discussion and analysis or set forth elsewhere in this Information Statement, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. See “Cautionary Note Regarding Forward-Looking Statements.” Our actual results may differ materially from those described below. You should read the “Risk Factors” section of this Information Statement for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

 

Overview

 

Ziwira, Inc. (“we” “our”or “us”) was established on January 21, 2015 in the State of Delaware.

 

We are an eco-focused platform for all environmental wants, products and information. We intend to develop an online marketplace and mediatory trading platform that bundles environmental topics for eco-products and services, connecting buyers and sellers with environmental products and people.

 

We intend for our portal to contain an unmatched wealth of ecologic and sustainable traders, the latest technology developments, industry-related information and resources, like publications, events, articles, job postings, press releases and eco news, ensuring that professionals use us as a professional tool and keep coming back to stay in touch with what is happening in the industry.

 

Partners will acquire a package that includes the following features and benefits:

 

●

Full access to Open Opportunity Notices for buying organizations

●

Unlimited preview and download of the tender documents posted by us and other buying organizations

●

Free Notification of Amendments

●

Free Automatic Delivery of Amendments

●

6 free Opportunity Matching profile

●

Free delivery of Opportunity Matching results (email, fax or online)

●

Low fixed annual pre-paid subscription fee

●

E-bid Submission: Suppliers have the option to submit their bid to the buyer electronically

 

We are currently located in New York, New York, and have an office in Toronto Canada, and will expand to have offices in the Middle East as well as in key economic hubs around the globe, including Japan, the United Kingdom, the United States, India, Russia and China.

 

On January 21, 2015 our articles of incorporation were adopted. Pursuant to the articles of incorporation, we are authorized to issue 250,000,000 shares of common stock, each having a par value of $0.0001, with each share of common stock entitled to one vote for all matters on which a shareholder vote is required or requested.

 

Recent Developments

 

Advances from Shareholders

 

From time to time, we borrow funds from our CEO and a member of our Board of Directors (“Director”) for working capital purposes. During the nine months ended October 31, 2016, we received advances totaling $226,850 and made repayments of $13,044. Advances are unsecured non-interest bearing and due on demand. These loans and advances from our CEO and Director were not made pursuant to any loan agreements or promissory notes, nor will any future loans and advances from our CEO and Director be made pursuant to loan agreements or promissory notes. Subsequent to October 31, 2016, we received advances totaling $12,357 and have made repayments of approximately $3,170 to our CEO and Director for working capital purposes.

 

Common Stock

 

In the nine months ended October 31, 2016, we issued 105,000 shares of common stock for aggregate gross proceeds of $36,750 to Firas Khaleel Al Haddad, the Company’s CEO. Mr. Al Haddad subsequently transferred these shares to other individuals.

 

In December 2015 and January 2016, we issued 130,000 shares of our common stock for aggregate gross proceeds of $45,500 to Firas Khaleel Al Haddad, our CEO. Mr. Al Haddad subsequently transferred these shares to four individuals.

 

 

On November 12, 2015, Dliar Adam Merza resigned from his positions as our CEO and a director. In conjunction with his resignation, Mr. Merza returned 45,000,000 shares of our common stock for $0 consideration and were retired by us.

 

On November 3, 2015, we issued 2,000,000 shares of our common stock to a director, Haidar Al-Saadi, for director fees, valued at $700,000 (based on current sales of common stock).

 

On February 22, 2015, we entered into an agreement with an unrelated third party, pursuant to which we will be provided with outsourced accounting solutions for 300,000 shares of restricted common stock, valued at $1,500 (based on the fair value of the services on the date of grant) and $2,000 cash.

 

On February 4, 2015, we entered into an agreement with an unrelated third party, pursuant to which we will be provided with outsourced legal services for 500,000 shares of restricted common stock, valued at $2,500 (based on the fair value of the services on the date of grant) and $10,000 cash. The fair value of these shares and the cash paid were accounted as stock issued for deferred offering costs which were expensed during the year ended January 31, 2016.

 

On January 21, 2015, we issued 99,200,000 restricted common shares to founder’s, recorded at par value of $9,920. The issuance was an isolated transaction not involving a public offering pursuant to Section 4(2) of the Securities Act of 1933.

 

On January 21, 2015, our articles of incorporation were adopted. Pursuant to the articles of incorporation, we are authorized to issue 250,000,000 shares of common stock, each having a par value of $0.0001, with each share of common stock entitled to one vote for all matters on which a shareholder vote is required or requested.

 

Consulting Agreement

 

On December 15, 2015, as amended July 27, 2016, the Company entered into a consulting agreement with Allan Bradley (“Bradley), a founder, to manage our global operations. The agreement is effective from January 1, 2016 and continues for 24 months. We agreed to pay Bradley a monthly consulting fee of $10,000 for the first six (6) months and $5,000 per month for each month thereafter. In addition, should we achieve monthly revenues of $425,000, Bradley’s monthly consulting fee will increase to $17,500 and Bradley will be issued 500,000 shares of our common stock. We incurred consulting fees of $15,000 and $83,229 for the three and nine months ended October 31, 2016, and had an accounts payable – related party balance of $5,000 as of October 31, 2016.

 

Limited Operating History; Need for Additional Capital

 

There is no historical financial information about us on which to base an evaluation of our performance. To date, we have generated minimal revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, and possible cost overruns due to increases in the cost of services. To become profitable and competitive, we must receive additional capital. We have no assurance that future financing will materialize. If that financing is not available we may be unable to continue operations.

 

Overview

 

The following Management’s Discussion and Analysis (“MD&A”) or Plan of Operations includes the following sections:

 

•

Plan of Operations

 

•

Results of Operations

 

•

Liquidity and Capital Resources

 

•

Capital Expenditures

 

•

Going Concern

 

•

Critical Accounting Policies

 

•

Off-Balance Sheet Arrangements

 

Plan of Operations

 

We have begun our planned principal operations. Operating revenues are expected to be significant in fiscal year 2017 as we continue to develop our online marketplace and mediatory trading platform that bundles environmental topics for eco-products and services, connecting buyers and sellers with environmental products and people, and look to expand beyond the Middle East.

 

 

At October 31, 2016 and January 31, 2016, we had minimal cash to no cash.

 

How We Generate Revenue

 

We recognize revenues in accordance with the guidelines of the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin (“SAB”) No. 104 “Revenue Recognition”.

 

Under SAB 104, four conditions must be met before revenue can be recognized: (i) there is persuasive evidence that an arrangement exists, (ii) delivery has occurred or service has been rendered, (iii) the price is fixed or determinable, and (iv) collection is reasonably assured.

 

General and administrative expenses consisted of professional service fees, and other general and administrative overhead costs. Expenses are recognized when incurred.

 

Depending on the extent of our future growth, we may experience significant strain on our management, personnel, and information systems. We will need to implement and improve operational, financial, and management information systems. In addition, we are implementing new information systems that will provide better record-keeping, customer service and billing. However, there can be no assurance that our management resources or information systems will be sufficient to manage any future growth in our business, and the failure to do so could have a material adverse effect on our business, results of operations and financial condition.

 

Results of Operations

 

Three Months Ended October 31, 2016 Compared to the Three Months Ended October 31, 2015

 

We had no revenue for the three months ended October 31, 2016 and 2015.

 

Operating expenses

 

For the three months ended October 31, 2016, we had general and administrative expenses of $98,283 primarily due consulting fees of $27,879, amortization expense of $44,930, office rent of $11,689, advertising costs of $3,424, internet related costs of $3,768, regulatory fees of $3,386 and other general and administrative expenses of $3,022 as a result of adding administrative infrastructure, primarily consulting, advertising, and office space, for our current and anticipated sales growth.

 

For the three months ended October 31, 2015, we had general and administrative expenses of $2,607 primarily due to professional fees.

 

Other expense

 

For the three months ended October 31, 2016, we had other expense of $15,792 primarily due to interest expense –related party, and $1,970 for the three months ended October 31, 2015 due to interest expense –related party as a result of adding administrative infrastructure for our current and anticipated sales growth.

 

Net loss before income taxes

 

Net loss before income taxes for the three months ended October 31, 2016 totaled $114,075 primarily due to consulting fees, interest expense – related party, amortization expense, office rent, and advertising costs.

 

Net loss before income taxes for the three months ended October 31, 2015 totaled $4,577 primarily due to professional fees and interest expense – related party.

 

Nine Months Ended October 31, 2016 Compared to the Nine Months Ended October 31, 2015

 

We had minimal revenue for the nine months ended October 31, 2016 and 2015.

 

Operating expenses

 

For the nine months ended October 31, 2016, we had general and administrative expenses of $378,106 primarily due consulting fees of $158,410, amortization expense of $134,790, office rent of $34,738, advertising costs of $21,192, internet related costs of $14,811, regulatory fees of $6,400 and other general and administrative expenses of $7,765 as a result of adding administrative infrastructure, primarily consulting, advertising, and office space, for our current and anticipated sales growth.

 

 

For the nine months ended October 31, 2015, we had general and administrative expenses of $17,262 primarily due to professional fees.

 

Other expense

 

For the nine months ended October 31, 2016, we had other expense of $45,882 primarily due to interest expense –related party, and $1,970 for the nine months ended October 31, 2015 primarily due to interest expense –related party as a result of adding administrative infrastructure for our current and anticipated sales growth.

 

Net loss before income taxes

 

Net loss before income taxes for the nine months ended October 31, 2016 totaled $423,365 primarily due to consulting fees, interest expense – related party, amortization expense, office rent, and advertising costs.

 

Net loss before income taxes for the nine months ended October 31, 2015 totaled $19,232 primarily due to professional fees and interest expense – related party.

 

Liquidity and Capital Resources

 

General – Overall, we had a decrease in cash flows of $17,816 in the nine months ended October 31, 2016 resulting from cash used in operating activities of $245,520, cash used in investing activities of $27,548, cash provided by financing activities of $255,230, and the effect of exchange rates on cash of $22.

 

Assets and Liabilities

 

Assets were $389,318 as of October 31, 2016. Assets consisted of intangible assets of $386,180, net of accumulated amortization of $179,720, and property and equipment (net of accumulated depreciation) of $616. Liabilities were $902,739 as of October 31, 2016. Liabilities consisted of accounts payable of $18,980, accounts payable – related party of $5,000, advances (net of repayments) from shareholders of $213,806, accrued interest payable – related party of $61,219, cash overdraft of $4,674, and short-term convertible notes of $599,060.

 

Assets were $512,040 as of January 31, 2016. Assets consisted of intangible assets of $494,224, net of accumulated amortization of $44,930, and cash of $17,816. Liabilities were $638,868 as of January 31, 2016. Liabilities consisted of accounts payable of $13,560, accounts payable – related party of $10,000, accrued interest payable – related party of $16,248, and long-term convertible notes of $599,060.

 

The following is a summary of our cash flows provided by (used in) operating, investing, and financing activities during the periods indicated:

 

		For the Nine Months Ended October 31,
		2016				2015
Net cash provided by (used in):
Operating activities		$	(245,520	)		$	—
Investing activities			(27,548	)			—
Financing activities			255,230				—
Effect of exchange rates on cash			22				—
Net decrease in cash		$	(17,816	)		$	—

 

Cash Flows from Operating Activities – For the nine months ended October 31, 2016, net cash used in operating activities was $245,520. Net cash used in operations was primarily due to a net loss of $423,365 for the nine months ended October 31, 2016, an increase in prepaid expenses of $2,522, and a decrease in accounts payable – related party of $5,000, offset primarily by increases in accounts payable of $5,420, accrued interest payable – related party of $44,971, amortization expense of $134,790, and depreciation expense of $186.

 

For the nine months ended October 31, 2015, net cash was primarily due to non- cash expenses paid by founders of $11,902, the non-cash estimated fair value of stock issued for services of $1,500, the increase in accounts payable of $3,860, and the increase in accrued interest payable – related party of $1,970, offset by a net loss of $19,232.

 

Cash Flows from Investing Activities – For the nine months ended October 31, 2016, net cash used in investing activities was $27,548 primarily due to the purchase of intangible assets – website of $26,746 and the purchase of equipment of $802. We had no cash provided by investing activities for the nine months ended October 31, 2015.

 

 

Cash Flows from Financing Activities – For the nine months ended October 31, 2016, net cash provided by financing activities was $255,230. Net cash provided by financing activities for the nine months ended October 31, 2016 was primarily due to the issuance of common shares for cash of $36,750, advances from shareholders of $226,850, and cash overdraft of $4,674, partially offset by repayments on advances from shareholders of $13,044. We had no cash provided by financing activities for the nine months ended October 31, 2015.

 

Financing – We expect that our current working capital position, together with our expected future cash flows from operations will be insufficient to fund our operations in the ordinary course of business, anticipated capital expenditures, debt payment requirements and other contractual obligations for at least the next twelve months. However, this belief is based upon many assumptions and is subject to numerous risks (see “Risk Factors”), and there can be no assurance that we will not require additional funding in the future.

 

We have no present agreements or commitments with respect to any material acquisitions of other businesses, products, product rights or technologies or any other material capital expenditures. However, we will continue to evaluate acquisitions of and/or investments in products, technologies, capital equipment or improvements or companies that complement our business and may make such acquisitions and/or investments in the future. Accordingly, we may need to obtain additional sources of capital in the future to finance any such acquisitions and/or investments. We may not be able to obtain such financing on commercially reasonable terms, if at all. Due to the ongoing global economic crisis, we believe it may be difficult to obtain additional financing if needed. Even if we are able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing.

 

Stock Transactions

 

During the nine months ended October 31, 2016, we issued 105,000 shares of common stock for aggregate gross proceeds of $36,750 to Firas Khaleel Al Haddad, the Company’s CEO. Mr. Al Haddad subsequently transferred these shares to other individuals.

 

In December 2015 and January 2016, we issued 130,000 shares of our common stock for aggregate gross proceeds of $45,500 to Firas Khaleel Al Haddad, our CEO. Mr. Al Haddad subsequently transferred these shares to four individuals.

 

On November 12, 2015, Dliar Adam Merza resigned from his positions as our CEO and a director. In conjunction with his resignation, Mr. Merza returned 45,000,000 shares of our common stock for $0 consideration and were retired by us.

 

On November 3, 2015, we issued 2,000,000 shares of our common stock to a director, Haidar Al-Saadi, for director fees, valued at $700,000 (based on current sales of common stock).

 

On February 22, 2015, we entered into an agreement with an unrelated third party, pursuant to which we will be provided with outsourced accounting solutions for 300,000 shares of restricted common stock, valued at $1,500 (based on the fair value of the services on the date of grant) and $2,000 cash.

 

On February 4, 2015, we entered into an agreement with an unrelated third party, pursuant to which we will be provided with outsourced legal services for 500,000 shares of restricted common stock, valued at $2,500 (based on the fair value of the services on the date of grant) and $10,000 cash. The fair value of these shares and the cash paid were accounted as stock issued for deferred offering costs which were expensed during the year ended January 31, 2016.

 

On January 21, 2015, we issued 99,200,000 restricted common shares to founder’s, valued at $9,920 (based on the par value on the date of grant). The issuance was an isolated transaction not involving a public offering pursuant to Section 4(2) of the Securities Act of 1933.

 

On January 21, 2015, our articles of incorporation were adopted. Pursuant to the articles of incorporation, we are authorized to issue 250,000,000 shares of common stock, each having a par value of $0.0001, with each share of common stock entitled to one vote for all matters on which a shareholder vote is required or requested.

 

Asset Purchase Agreement

 

Pursuant to an Asset Purchase Agreement dated October 29, 2015, we acquired all of the rights, title, and interest in our Internet Portal from an entity controlled by our previous CEO, Dliar Adam Merza, who at the time of acquisition was a majority shareholder of the Company, in exchange for a convertible note payable in the principal amount of $599,060. The asset acquisition was accounted for as a purchase of assets in accordance with ASC 805-10-55-4. We treated this transaction as an acquisition of assets under common control and as such the asset is accounted for using the historical carryover basis under US GAAP which is $539,154. The excess cost of $59,906 was accounted for as an accrued distribution in the form of a related party convertible note. The convertible promissory note bears interest at 10% per annum and is due and payable in two years. The holder of this note has the right, at the holder’s option, upon the consummation of a sale of all or substantially all of our equity interest or private placement transaction of our equity securities or securities convertible into equity securities, exclusive of the conversion of this note or any similar notes, to convert the principal amount of this note, in whole or in part, plus any interest which accrues hereon, into fully paid and nonassessable shares at a conversion price of $0.35 per share. The shares issued to the holder of this note on conversion shall have the same rights, preferences, privilege, and restrictions as any other common shares issued. The principal balance due at October 31, 2016 is $599,060 and the accrued interest payable to related party is $61,219. The entire note and accrued interest balance is due on October 29, 2017 and is presented as a short term liability in the balance sheet.

 

 

The Company analyzed the conversion option in the notes for derivative accounting treatment under ASC Topic 815, “Derivatives and Hedging,” and determined that the instrument does not qualify for derivative accounting. The Company therefore performed an analysis to determine if the conversion option was subject to a beneficial conversion feature and determined that the instrument does not have a beneficial conversion feature.

 

ASC 350-50 requires the expensing of all costs of the preliminary project stage and the training and application maintenance stage and the capitalization of all internal or external direct costs incurred during the application and infrastructure development stage. Upgrades or enhancements that add functionality are capitalized while other costs during the operating stage are expensed as incurred. The Company evaluated the historical carry over cost under ASC 350-50 and accounted for $539,154 as intangible assets which are considered to have an estimated life of three years. The total net book value of this intangible asset as of October 31, 2016 is $359,434, net of $179,720 of amortization.

 

Website Development Costs

 

We evaluated the cost incurred and pursuant to ASC 350-50 capitalized $26,746 as website development under intangible assets in the accompanying Balance Sheet at October 31, 2016. Website development costs are expected to have an estimated life of three years.

 

Capital Expenditures

 

Other Capital Expenditures

 

We expect to purchase approximately $125,000 of equipment in connection with the expansion of our business.

 

Fiscal year end

 

Our fiscal year end is January 31.

 

Going Concern

 

We had a working capital deficit of $900,217 at October 31, 2016 and had net losses of $114,075 and $423,365 for the three and nine months ended October 31, 2016, respectively, and cash used in operating activities for the nine months ended October 31, 2016, with minimal revenue earned since inception, and a lack of operational history.

 

While we are attempting to commence operations and generate revenues, our cash position may not be significant enough to support our daily operations. We intend to raise additional funds by way of a public or private offering. We believe that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for us to continue as a going concern. While we believe in the viability of our strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect. Our ability to continue as a going concern is dependent upon our ability to further implement our business plan and generate revenues.

 

The unaudited interim financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

 

Critical Accounting Policies

 

The Commission has defined a company’s critical accounting policies as the ones that are most important to the portrayal of our financial condition and results of operations and which require us to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, we have identified the critical accounting policies and judgments addressed below. We also have other key accounting policies that are significant to understanding our results.

 

The following are deemed to be the most significant accounting policies affecting us.

 

 

Use of Estimates

 

The preparation of these unaudited interim financial statements in accordance 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 disclosures of contingent assets and liabilities at the dates of the unaudited interim financial statements and the reported amounts of net sales and expenses during the reported periods. Actual results may differ from those estimates and such differences may be material to the unaudited interim financial statements. The more significant estimates and assumptions by management include among others: property and equipment, foreign currency transactions and translations, and common stock valuation. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions.

 

Intangible Assets

 

Acquired intangible assets other than goodwill are amortized over their useful lives unless the lives are determined to be indefinite. Acquired intangible assets are carried at cost, less accumulated amortization. For intangible assets purchased in a business combination or received in a nonmonetary exchange, the estimated fair values of the assets received (or, for non-monetary exchanges, the estimated fair values of the assets transferred if more clearly evident) are used to establish the cost basis, except when neither of the values of the assets received or the assets transferred in non-monetary exchanges are determinable within reasonable limits. Valuation techniques consistent with the market approach, income approach and/or cost approach are used to measure fair value. Amortization of finite-lived intangible assets is computed over an estimated three year useful life.

 

As of October 31, 2016, we have recognized $539,154 as intangible asset – website representing the historical carryover basis in a website acquired from a majority owner of the Company. We recorded amortization expense of $44,930 and $134,790 for the three and nine months ended October 31, 2016 as we have launched our website and begun to market our products.

 

We evaluated the cost incurred and pursuant to ASC 350-50 capitalized $26,746 as website development under intangible assets in the accompanying Balance Sheet at October 31, 2016. Website development costs are expected to have an estimated life of three years.

 

Derivative Financial Instruments

 

We evaluate our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, we use a Black-Scholes option pricing model, in accordance with ASC 815-15 “Derivative and Hedging” to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date.

 

Beneficial Conversion Features

 

The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible note payable and may not be settled in cash upon conversion, is treated as a discount to the convertible note payable. This discount is amortized over the period from the date of issuance to the date the note is due using the effective interest method. If the note payable is retired prior to the end of its contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the common shares at the commitment date to be received upon conversion.

 

Revenue Recognition

 

Revenue is principally derived from portal membership and advertising services. The Company recognizes revenue, net of sales discounts, when: (1) persuasive evidence exists of an arrangement with the customer reflecting the terms and conditions under which products or services will be provided; (2) delivery has occurred or services have been provided; (3) the fee is fixed or determinable; and (4) collection is reasonably assured. For all revenue transactions, the Company considers customer registration, payment, or third party acknowledgement to be persuasive evidence of an arrangement. Sales taxes collected, if any, from customers and remitted to governmental authorities are presented on a net basis and therefore are excluded from revenues in the Statements of Operations.

 

Membership revenue

 

The Company generates membership revenue through an online registration process to its Business Blogger Association (“BBA”), which allows members access to a web-based marketing and advertising support product that provides access to the Company’s database of materials of similar companies. The Company does not retransmit or distribute content.

 

 

Membership to the BBA is for a period of one month and membership revenue is recognized in the month of purchase. All membership fees are collected at the time of purchase.

 

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 interim financial reporting dates. For the three and nine months ended October 31, 2016 and 2015, the Company recorded $0 and $0, and $1,357 and $14,512, respectively, for equity instruments issued to non-employees for acquiring goods or services.

 

Stock Based Compensation

 

For purposes of determining the variables used in the calculation of stock compensation expense under the provisions of FASB ASC Topic 505, “Equity” and FASB ASC Topic 718, “Compensation — Stock Compensation,” we perform an analysis of current market data and historical Company data to calculate an estimate of implied volatility, the expected term of the option and the expected forfeiture rate. With the exception of the expected forfeiture rate, which is not an input, we use these estimates as variables in the Black-Scholes option pricing model. Depending upon the number of stock options granted, any fluctuations in these calculations could have a material effect on the results presented in our statements of operations and comprehensive income. In addition, any differences between estimated forfeitures and actual forfeitures could also have a material impact on our unaudited interim financial statements. For the three and nine months ended October 31, 2016 and 2015, the Company recorded $0 and $0 and $0 and $1,500, respectively, for common stock issued for services.

 

Non-Cash Equity Transactions

 

Shares of equity instruments issued for non-cash consideration are recorded at the fair value of the consideration received based on the market value of services to be rendered, or at the value of the stock given, considered in reference to contemporaneous cash sale of stock.

 

Fair Value of Financial Instruments

 

We apply the provisions of accounting guidance, FASB Topic ASC 825 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 October 31, 2016, we had no assets or liabilities that required fair value accounting.

 

Recent Accounting Pronouncements

 

In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40) – Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which provides guidance regarding management’s responsibility to assess whether substantial doubt exists regarding the ability to continue as a going concern and to provide related footnote disclosures. In connection with preparing financial statements for each annual and interim reporting period, management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). This ASU is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company does not expect that the adoption of this ASU to have a material effect on the Company’s financial position, operations, or cash flows.

 

In June 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-10, “Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation." This ASU removes the definition of a development stage entity from the ASC, thereby removing the financial reporting distinction between development stage entities and other reporting entities from GAAP. In addition, the ASU eliminates the requirements for development stage entities to (1) present inception-to-date information in the statements of operations, cash flows, and stockholders’ equity, (2) label the financial statements as those of a development stage entity, (3) disclose a description of the development stage activities in which the entity is engaged, and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage. In addition, ASU 2014-10 requires an entity that has not commenced principal operations to provide disclosures about the risks and uncertainties related to the activities in which the entity is currently engaged and an understanding of what those activities are being directed toward. This ASU is effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. Early adoption is permitted. We have elected to adopt this ASU and its adoption resulted in the removal of previously required development stage disclosures. Adoption of this ASU did not impact our financial position, operations or cash flows.

 

 

Future Contractual Obligations and Commitment

 

We incur contractual obligations and financial commitments in the normal course of our operations and financing activities. Contractual obligations include future cash payments required under existing contracts, such as debt and lease agreements. These obligations may result from both general financing activities and from commercial arrangements that are directly supported by related operating activities.

 

Consulting Agreement

 

On December 15, 2015, as amended July 27, 2016, the Company entered into a consulting agreement with Allan Bradley (“Bradley), a founder, to manage our global operations. The agreement is effective from January 1, 2016 and continues for 24 months. We agreed to pay Bradley a monthly consulting fee of $10,000 for the first six (6) months and $5,000 per month for each month thereafter. In addition, should we achieve monthly revenues of $425,000, Bradley’s monthly consulting fee will increase to $17,500 and Bradley will be issued 500,000 shares of our common stock. We incurred consulting fees of $15,000 and $83,229 for the three and nine months ended October 31, 2016, respectively, and had an accounts payable – related party balance of $5,000 as of October 31, 2016.

 

Off-Balance Sheet Arrangements

 

As of October 31, 2016, we have not entered into any transaction, agreement or other contractual arrangement with an entity unconsolidated under which it has:

 

	●	a retained or contingent interest in assets transferred to the unconsolidated entity or similar arrangement that serves as credit;
	●	liquidity or market risk support to such entity for such assets;
	●	an obligation, including a contingent obligation, under a contract that would be accounted for as a derivative instrument; or
	●	an obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held by, and material to us, where such entity provides financing, liquidity, market risk or credit risk support to or engages in leasing, hedging, or research and development services with us.

 

Inflation

 

We do not believe that inflation has had a material effect on our results of operations.

 

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 information required by this Item.

 

ITEM 4. CONTROLS AND PROCEDURES

 

The Company’s management conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and Rule 15d-15(e) under the 1934 Act) pursuant to Rule 13a-15 under the 1934 Act.  The Company’s disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports it files or submits under the 1934 Act is recorded, processed, summarized and reported on a timely basis and that such information is communicated to management and the Company’s board of directors to allow timely decisions regarding required disclosure.

 

Based on this evaluation, it has been concluded that the design and operation of our disclosure controls and procedures are not effective since the following material weaknesses exist:

 

	●	Our chief executive officer also functions as our chief financial officer.  As a result, our officers may not be able to identify errors and irregularities in the financial statements and reports.
	●	We were unable to maintain full segregation of duties within our financial operations due to our reliance on limited personnel in the finance function.  While this control deficiency did not result in any material adjustments to our financial statements, it could have resulted in a material misstatement that might have been prevented or detected by a segregation of duties.
	●	Documentation of all proper accounting procedures is not yet complete.

 

To the extent reasonably possible given our limited resources, as financial resources become available we intend to take measures to cure the aforementioned weaknesses, including, but not limited to, the following:

 

●

Increasing the capacity of our qualified financial personnel to ensure that accounting policies and procedures are consistent across the organization and that we have adequate control over financial statement disclosures.

 

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

There are no legal proceedings, to which we are a party, which could have a material adverse effect on our business, financial condition or operating results.

 

ITEM 1A. RISK FACTORS

 

As a smaller reporting company, we are not required to provide this information.

 

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

 

During the nine months ended October 31, 2016, the Company issued 105,000 shares of common stock for aggregate gross proceeds of $36,750 to Firas Khaleel Al Haddad, the Company’s CEO.

 

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4.  MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5.  OTHER INFORMATION

 

None.

 

 

ITEM 6. EXHIBITS

 

EXHIBITS. The following exhibits required by Item 601 to be filed herewith are incorporated by reference to previously filed documents:

 

Exhibit Number		Description
31.1		Certification of Chief Executive Officer pursuant to Section 302
31.2		Certification of Chief Financial Officer pursuant to Section 302
32.1		Certification of Chief Executive Officer pursuant to Section 906
32.2		Certification of Chief Financial Officer pursuant to Section 906
101.INS**		XBRL Instance Document
101.SCH**		XBRL Taxonomy Schema
101.CAL**		XBRL Taxonomy Calculation Linkbase
101.DEF**		XBRL Taxonomy Definition Linkbase
101.LAB**		XBRL Taxonomy Label Linkbase
101.PRE**		XBRL Taxonomy Presentation Linkbase

 

**

Furnished herewith. XBRL (eXtensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 

SIGNATURES

 

In accordance with Section 12 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 on December 23, 2016.

 

	Ziwira, Inc.
	By:	/s/ Firas Khaleel Al Haddad
		Firas Khaleel Al Haddad, Chief Executive Officer, Chief Financial Officer Chief Operating Officer and Director

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed   below by the following person on behalf of the Registrant and in the capacity and on the date indicated.

 

/s/ Firas Khaleel Al Haddad		Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer and Director		December 23, 2016
Firas Khaleel Al Haddad		Title		Date
/s/ Haidar Al-Saadi		Director		December 23, 2016
Haidar Al-Saadi		Title		Date