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EX-31.1 - EXHIBIT 31.1 - Canfield Medical Supply, Inc.ex31x1.htm
EX-32.2 - EXHIBIT 32.2 - Canfield Medical Supply, Inc.ex32x2.htm
EX-32.1 - EXHIBIT 32.1 - Canfield Medical Supply, Inc.ex32x1.htm
EX-31.2 - EXHIBIT 31.2 - Canfield Medical Supply, Inc.ex31x2.htm


U.S. 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 September 30, 2017

   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _________

Commission File No. 000-55114

CANFIELD MEDICAL SUPPLY, INC.
(Name of registrant in its charter)

Colorado
 
34-1720075
(State or other jurisdiction of incorporation or formation)
  
(I.R.S. employer identification number)

4120 Boardman-Canfield Road, Canfield, Ohio 44406
(Address of principal executive offices)
 
(330) 533-1914
(Registrant's telephone number, including area code) 

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
¨ Yes     No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
  Yes     No

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

Large accelerated filer 
 
Accelerated filer 
Non-accelerated filer   
(Do not check if a smaller reporting company)
Emerging growth company 
 
Smaller reporting company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
  Yes     No

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.  As of November 6, 2017, there were 11,277,100 shares of Common Stock issued and outstanding.
 
 

CANFIELD MEDICAL SUPPLY, INC.
FORM 10-Q

TABLE OF CONTENTS

PART I.  FINANCIAL INFORMATION
 
Page
 
 
 
 
Item 1.
Financial Statements
 
3
 
     
 
  Condensed Balance Sheets (Unaudited)
 
3
 
  Condensed Statements of Operations (Unaudited)
 
4
 
  Condensed Statements of Cash Flows (Unaudited)
 
5
 
  Notes to Condensed Financial Statements (Unaudited)
 
6-10
 
 
 
 
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations
 
11
 
 
 
 
Item 3.
Quantitative and Qualitative Disclosures about Market Risk
 
13
 
 
 
 
Item 4.
Controls and Procedures
 
13
 
 
 
 
PART II.  OTHER INFORMATION
 
14
 
 
 
 
Item 1.
Legal Proceedings
 
14
 
 
 
 
Item 1A.
Risk Factors
 
14
 
 
 
 
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
 
14
 
 
 
 
Item 3.
Defaults Upon Senior Securities
 
14
 
 
 
 
Item 4.
Mine Safety Disclosures
 
14
 
 
 
 
Item 5.
Other Information
 
14
 
 
 
 
Item 6.
Exhibits
 
14
 
 
 
 
 
Signatures
 
15
 
 
 
 
 
2

PART I—FINANCIAL INFORMATION

Item 1.  Financial Statements.

CANFIELD MEDICAL SUPPLY, INC.
CONDENSED BALANCE SHEETS
(Unaudited)

 

   
September 30,
   
December 31,
 
ASSETS
 
2017
   
2016
 
             
Current Assets
           
Cash
 
$
37,281
   
$
61,659
 
Accounts receivable
   
231,010
     
206,254
 
Inventory
   
29,037
     
25,231
 
Total Current Assets
   
297,328
     
293,144
 
                 
Property and equipment, net of accumulated depreciation of $87,184 and $76,197
   
56,155
     
62,190
 
                 
                 
         Total Assets
 
$
353,483
   
$
355,334
 
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
               
                 
Current Liabilities
               
Accounts payable and accrued liabilities
 
$
231,768
   
$
209,069
 
Line of credit
   
64,619
     
70,373
 
Current portion of long-term debt
   
10,973
     
10,918
 
Total Current Liabilities
   
307,360
     
290,360
 
                 
Long-term debt
   
17,096
     
25,305
 
                 
          Total Liabilities
   
324,456
     
315,665
 
                 
Stockholders' Equity
               
Preferred stock, no par value; 5,000,000 shares authorized; no shares
   
-
     
-
 
 issued and outstanding
               
Common stock, no par value; 100,000,000 shares authorized;
               
11,277,200 (September 30, 2017) and 10,927,200 (Dec. 31, 2016) shares
         
 issued and outstanding
   
243,515
     
208,515
 
Accumulated deficit
   
(214,488
)
   
(168,846
)
Total Stockholders' Equity
   
29,027
     
39,669
 
Total Liabilities and Stockholders' Equity
 
$
353,483
   
$
355,334
 
                 
 
 
The accompanying footnotes are an integral part of these unaudited condensed financial statements.
 
3

CANFIELD MEDICAL SUPPLY, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
 

    
Three months
   
Three months
   
Nine months
   
Nine months
 
    
ended
   
ended
   
ended
   
ended
 
    
September 30,
2017
   
September 30,
2016
   
September 30,
2017
   
September 30,
2016
 
                         
Sales (net of returns)
 
$
319,015
   
$
236,059
   
$
739,647
   
$
695,697
 
Cost of goods sold
   
148,664
     
113,572
     
343,034
     
348,686
 
Gross profit
   
170,351
     
122,487
     
396,613
     
347,011
 
                                 
Operating expenses:
                               
Salaries and wages
   
80,347
     
75,649
     
241,891
     
214,787
 
Professional Fees
   
4,851
     
6,054
     
36,751
     
24,378
 
Depreciation
   
14,421
     
17,125
     
51,720
     
40,281
 
Other selling, general and administrative
   
37,664
     
35,891
     
116,009
     
101,495
 
    Total operating expenses
   
137,283
     
134,719
     
446,371
     
380,941
 
                                 
Income (loss) from operations
   
33,068
     
(12,232
)
   
(49,758
)
   
(33,930
)
                                 
Other income (expense):
                               
Interest expense
   
(1,186
)
   
(1,258
)
   
(3,660
)
   
(3,156
)
Gain on disposal of property and equipment
   
3,526
     
1,636
     
7,776
     
4,063
 
     
2,340
     
378
     
4,116
     
907
 
                                 
Income (loss) before provision for income taxes
   
35,408
     
(11,854
)
   
(45,642
)
   
(33,023
)
Provision for income tax
   
-
     
-
     
-
     
-
 
                                 
Net income (loss)
 
$
35,408
   
$
(11,854
)
 
$
(45,642
)
 
$
(33,023
)
                                 
Net income (loss) per share (basic and fully diluted)
 
$
0.00
   
$
(0.00
)
 
$
(0.00
)
 
$
(0.00
)
                                 
Weighted average number of common shares outstanding
   
11,277,200
     
10,527,200
     
11,264,379
     
10,470,010
 

 

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

4

CANFIELD MEDICAL SUPPLY, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)

    
Nine months ended
   
Nine months ended
 
    
September 30,
   
September 30,
 
   
2017
   
2016
 
Cash Flows From Operating Activities:
           
Net income (loss)
 
$
(45,642
)
 
$
(33,023
)
Adjustments to reconcile net loss to net cash provided by (used for) operating activities:
         
Gain on disposal of property and equipment
   
(7,776
)
   
(4,063
)
Depreciation
   
51,720
     
40,281
 
(Increase) decrease in accounts receivable
   
(24,756
)
   
15,887
 
(Increase) in inventory
   
(3,806
)
   
(5,252
)
Decrease in accounts payable and accrued liabilities
   
22,699
     
13,426
 
     Net cash provided by (used for) operating activities
   
(7,561
)
   
27,256
 
                 
Cash Flows From Investing Activities:
               
Proceeds from sale of property and equipment
   
10,290
     
4,958
 
Purchases of property and equipment
   
(48,199
)
   
(43,194
)
     Net cash (used for) investing activities
   
(37,909
)
   
(38,236
)
                 
Cash Flows From Financing Activities:
               
Net payments on line of credit
   
(5,754
)
   
(5,448
)
Payments on long-term debt
   
(8,154
)
   
(6,173
)
Proceeds from sales of common stock.
   
35,000
     
50,000
 
       Net cash provided by financing activities
   
21,092
     
38,379
 
                 
Net Increase (Decrease) in Cash
   
(24,378
)
   
27,399
 
Cash At The Beginning Of The Period
   
61,659
     
7,343
 
                 
Cash At The End Of The Period
 
$
37,281
   
$
34,742
 
                 
Schedule Of Non-Cash Investing And Financing Activities
               
Purchase of equipment with long-term debt
 
$
-
   
$
16,295
 
                 
Supplemental Disclosure
               
Cash paid for interest
 
$
(3,660
)
 
$
(3,156
)
Cash paid for income taxes
 
$
-
   
$
-
 
                 


The accompanying footnotes are an integral part of these unaudited condensed financial statements.
 
5

CANFIELD MEDICAL SUPPLY, INC.
CONDENSED NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 2017 and 2016 (Unaudited)
 

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Canfield Medical Supply, Inc. (the “Company”), was incorporated in the State of Ohio on September 3, 1992, and changed domicile to Colorado on April 18, 2012. The Company is in the business of home health services, primarily the selling of durable medical equipment and medical supplies to the public, nursing homes, hospitals, and other end users.

The accompanying financial statements have been prepared by the Company without audit.  In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for the three and nine months ended September 30, 2017 and 2016 have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s December 31, 2016 audited financial statements.  The results of operations for the periods ended September 30, 2017 and 2016 are not necessarily indicative of the operating results for the full year.

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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. Actual results could differ from those estimates.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of twelve months or less as cash equivalents.

Accounts receivable

The majority of the Company’s revenues are received from Medicare, Medicaid, and private insurance companies.  As such, the Company records revenues at allowable amounts, net of estimated allowances and discounts based on contracted prices and historical collection rates.  The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary. At September 30, 2017 and December 31, 2016, the Company has determined that no allowance for doubtful accounts is necessary.

Property and equipment

Property and equipment are recorded at cost and depreciated under straight line methods over each item's estimated useful life.
 
 
 

6

CANFIELD MEDICAL SUPPLY, INC.
CONDENSED NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 2017 and 2016 (Unaudited)
 

 
NOTE 1.  ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

Inventory

The Company carries inventory of durable medical equipment and medical supplies for resale.  Inventory is accounted for on a first–in first-out basis.

Revenue recognition

The Company’s primary source of revenue is reimbursement from Medicare, Medicaid, and private insurance companies for the sale of medical equipment and supplies to patients. Revenue from product sales is recognized subsequent to a patient (customer) ordering a product at an agreed-upon price, and when delivery has occurred and collectability is reasonably assured. A purchase arrangement is evidenced by a written order, with delivery considered as made after physical customer acceptance. Although rare, defective products may be returned, with other return issues considered on a case-by-case basis. Services, such as periodic scheduled deliveries, are contracted in writing, and generally billed monthly. Any service revenue earned by the Company for services, such as safety and set up consulting or claims processing, is recorded after the service is performed. Rental of durable home medical equipment is evidenced by written contract, with revenue recognized when rent is earned.

Advertising costs

Advertising costs are expensed as incurred. The Company had advertising costs during the nine months ended September 30, 2017 and 2016 of $5,215 and $4,149 respectively.

Income tax

The Company accounts for income taxes pursuant to ASC 740. Under ASC 740, deferred taxes are provided for using the 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. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

Net income (loss) per share

The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.

There were no potentially dilutive debt or equity instruments issued or outstanding during the nine months ended September 30, 2017 or 2016.



 

7

CANFIELD MEDICAL SUPPLY, INC.
CONDENSED NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 2017 and 2016 (Unaudited)
 

 
NOTE 1.  ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

Financial instruments

The carrying value of the Company’s financial instruments, as reported in the accompanying balance sheets, approximates fair value.

Concentrations

Financial instruments that potentially subject the Company to concentrations of credit risk include cash and cash equivalents.  The Company places its cash and cash equivalents at well-known financial institutions, where at times, such balances may exceed FDIC insurance limits.

The Company receives a significant amount of its revenues in reimbursements from Medicare and Medicaid through competitive bidding processes.  There is no guarantee that the Company will continue to be selected as a winning contract supplier under future bidding rounds.

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.

Products and services, geographic areas and major customers

The Company’s business of medical supply sales constitutes one operating segment. All revenues each year were domestic and to external customers.


 

8


CANFIELD MEDICAL SUPPLY, INC.
CONDENSED NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 2017 and 2016 (Unaudited)
 

 
NOTE 2.  PROPERTY AND EQUIPMENT

Fixed assets are comprised of office equipment, vehicles, and the wheelchair and hospital bed rental pool, which consists of wheelchairs and hospital beds rented to customers over the shorter of the 13-month rental period mandated by Medicaid and Medicare, or the period over which the customer requires use of the wheelchair or hospital bed.  At the end of the use period, the wheelchair or hospital bed is either returned to the pool to be rented to another customer, or title of the chair or bed is transferred to the customer.  Depreciation is computed over the estimated useful life of the assets, ranging from 13 months to 7 years, on the straight-line basis.  Depreciation expense for the nine months ended September 30, 2017 and 2016 was $51,720 and $40,281, respectively.  Accumulated depreciation totaled $87,184 and $76,197 at September 30, 2017 and December 31, 2016, respectively.

NOTE 3.  LINE OF CREDIT

At September 30, 2017 and December 31, 2016, the Company owed a bank $64,619 and $70,373 respectively, under a revolving line of credit. The line of credit is secured by all Company assets, is capped at $100,000, is due on demand, and bears interest at variable rates approximating 6% on average. Interest expense under the note approximated $3,336 and $2,250 during each of the nine months ended September 30, 2017 and 2016, respectively.  During the nine months ended September 30, 2017 and 2016, the Company made principal payments of $5,754 and $5,448, respectively.

NOTE 4.  LONG-TERM DEBT

Long-term debt consists of the following:

   
September 30,
2017
   
December 31,
2016
 
             
3.53% installment note payable $352 monthly,  including    interest, through July 2019, collateralized by vehicle with carrying value of $4,078
 
$
7,496
   
$
10,426
 
3.79% installment note payable $299 monthly, including
               
interest, through July 2021, collateralized by vehicle with carrying value of $12,466
   
12,764
     
15,052
 
                 
2.99% installment note payable $350 monthly, including    interest, through August 2019, collateralized by vehicle with carrying value of $6,806
   
7,809
     
10,745
 
     
28,069
     
36,223
 
Less principal due within one year
   
(10,973
)
   
(10,918
)
                 
     TOTAL LONG-TERM DEBT
 
$
17,096
   
$
25,305
 
 


 

9


CANFIELD MEDICAL SUPPLY, INC.
CONDENSED NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 2017 and 2016 (Unaudited)

NOTE 5.  COMMON STOCK

On January 10, 2017 the Company issued 350,000 shares of its common stock at $.10 per share for total proceeds of $35,000 to unaffiliated individuals.

NOTE 6.  LEASE COMMITMENTS

The Company rents office space under a non-cancellable lease through September 2020 with monthly payments of approximately $2,292 plus costs.

Lease expense incurred for each of the nine months ended September 30, 2017 and 2016 was approximately $20,620. Subsequent to September 30, 2017, future minimum payments under the leases total approximately $75,625 including:  2017 (balance) $6,875, 2018 - $27,500, 2019 - $27,500, and 2020 - $13,750.

NOTE 7.  GOING CONCERN

The Company has suffered losses from operations and has working capital and stockholders’ equity deficits. In all likelihood, the Company will be required to make significant future expenditures in connection with marketing efforts along with general administrative expenses. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

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 selling medical supplies 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.

NOTE 8.  SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the date these financial statements were available to be issued and determined that there are no reportable subsequent events.


 
10

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the Condensed Financial Statements (unaudited) and Notes to Condensed Financial Statements (unaudited) filed herein.

BUSINESS OVERVIEW

We primarily provide services to the rehabilitation market, which consists primarily of home medical equipment and supplies.  More than 50% of our revenues are derived from the sale and rental of durable home medical equipment including such items as wheeled walkers, manual and power wheelchairs, hospital beds, ramps, bedside commodes, and miscellaneous bathroom equipment.  The balance of our revenue is from the sale of various home medical supplies including diabetic testing, incontinence, ostomy, wound care, and catheter care.  Our emphasis is on helping patients with mobility related limitations, but our overall business is aimed at helping patients remain in their homes instead of having to go to hospitals, rehab centers and other similar facilities.  Most of the equipment and supplies that we sell are prescribed by a physician as part of an overall care plan.

RESULTS OF OPERATION FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2017 AS COMPARED TO THE THREE MONTHS ENDED SEPTEMBER 30, 2016.

Revenues for the three months ended September 30, 2017 were $319,015 as compared to the revenues of $236,059 for the three months ended September 30, 2016.  The 35% increase in sales is due to an increasing trend in powerchair sales.

Cost of goods sold for the three months ended September 30, 2017 were $148,664 as compared to cost of goods sold for the three months ended September 30, 2016 of $113,572.  The 31% increase in the latest three months is primarily due to the 35% increase in sales.

Operating expenses for the three months ended September 30, 2017 were $137,283 as compared to $134,719 for the three months ended September 30, 2016.  The 2% increase in operating expenses was primarily due to the 6% increase in salaries and wages which was offset in part by small decreases in professional fees and depreciation.

The net income for the three months ended September 30, 2017 was $35,408 as compared to a net loss of $11,854 for the three months ended September 30, 2016.  The reasons for the $47,262 improvement include the fact that the sales increased by $82,956 while the cost of good sold only increased by $35,092.
 
 
11

 
 
RESULTS OF OPERATION FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 AS COMPARED TO THE NINE MONTHS ENDED SEPTEMBER 30, 2016.

Revenues for the nine months ended September 30, 2017 were $739,647 as compared to the revenues of $695,697 for the nine months ended September 30, 2016.  The 6% increase in sales is primarily due to an increasing trend in power chair sales.

Cost of goods sold for the nine months ended September 30, 2017 were $343,034 as compared to cost of goods sold for the nine months ended September 30, 2016 of $348,686.  The 2% decrease in the latest nine month period was due to the net effect of a decrease in cost of enteral nutrition products and increase in the purchase of high-price items such as power chairs, scooters, power vehicle lifts, and manual lifts.

Operating expenses for the nine months ended September 30, 2017 were $446,371 as compared to $380,941 for the nine months ended September 30, 2016.  The 17% increase is due to the $27,104 increase in salaries and wages attributable to pay raises and the hiring of a sales representative during the third quarter of 2016, the $12,373 increase in professional fees incurred during the latest nine months for the audit of our December 31, 2016 financial statements and Form 10-K filing (we did not commence our December 31, 2015 audit until the second quarter of 2016), and the $14,514 increase in other general and administrative expenses comprised primarily of our new website development and outsourcing of our billing collections.

The net loss for the nine months ended September 30, 2017 was $45,642 as compared to a net loss of $33,023 for the nine months ended September 30, 2016.  The reason for the increased loss in the first nine months of 2017 was primarily the $65,430 increase in operating expenses discussed above.

LIQUIDITY AND CAPITAL RESOURCES

As of September 30, 2017, we had negative working capital of ($10,032) compared to working capital of $2,784 as of December 31, 2016.

Net cash (used for) operating activities during the nine months ended September 30, 2017 was ($7,561) as compared to net cash provided by operating activities in the nine months ended September 30, 2016 of $27,256.  The primary reason for the change in cash used for operating activities was the increase in the net loss from $33,023 in the nine months ended September 30, 2016 to a net loss of $45,642 in the latest nine-month period as explained previously. 
 
Net cash used for investing activities during the nine months ended September 30, 2017 was $37,909 which included $48,199 used for the purchase of equipment.  In comparison, during the nine months ended September 30, 2016, the Company used $43,194 for the purchase of equipment.

Net cash provided by financing activities during the nine months ended September 30, 2017 was $21,092 as compared to $38,379 provided by financing activities in the nine months ended September 30, 2016.  The Company sold shares of its common stock during the nine months ended September 30, 2017 and 2016 to raise $35,000 and $50,000, respectively, to help pay for the costs associated with being a public company.  Minimal payments towards the Company’s line of credit and notes payable were also made during each of the nine-month periods ended September 30, 2017 and 2016.
 
 
12

CONTRACTUAL OBLIGATIONS

None.

OFF-BALANCE SHEET ARRANGEMENTS

We do not have any off-balance sheet arrangements (as that term is defined in Item 303 of Regulation S-K) that are reasonably likely to have a current or future material effect on our financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk. 

Not applicable.

Item 4.  Controls and Procedures.

(a)  Evaluation of Disclosure Controls and Procedures.

Our Chief Executive Officer and Principal Financial Officer have evaluated the effectiveness of the design and operations of our disclosure controls and procedures as of the end of the period covered by this quarterly report, and have concluded that our disclosure controls and procedures are adequate.

(b)  Changes in Internal Control over Financial Reporting.

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


 
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PART II – OTHER INFORMATION

Item 1.    Legal Proceedings.

None.

Item 1A.  Risk Factors.

Not applicable.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds.

 None.

Item 3.    Defaults Upon Senior Securities.

None.

Item 4.    Mine Safety Disclosures.

Not applicable.

Item 5.    Other Information.

None.

Item 6.    Exhibits.

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

Exhibits
Description





101
XBRL Exhibits


 
 
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SIGNATURES

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

 
 
CANFIELD MEDICAL SUPPLY, INC.
 
 
 
 
 
 
Date:  November  13, 2017
By:
/s/ Michael J. West
 
 
Michael J. West, President and CEO
(Principal Executive Officer)
 
 
 
 
 
 
Date:  November 13, 2017
By:
/s/ Stephen H. West
 
 
Stephen H. West, CFO
(Principal Financial Officer and Principal Accounting Officer)



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