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EX-32.1 - CERTIFICATION - COSMO VENTURES INCcsmo_ex321.htm
EX-31.1 - CERTIFICATION - COSMO VENTURES INCcsmo_ex311.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

 

For the quarterly period ended December 31, 2017

 

Commission File Number 333-1888873

 

COSMO VENTURES INC.

(Exact name of registrant as specified in its charter)

 

Nevada

 

33-1227173

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

VPO – Bham Distt, Hoshiarpur Tehsil Ghars, Punjab, India 14613

(Address of principal executive offices)(Zip Code)

 

800-582-3042

(Registrant’s telephone number, including area code)

 

N/A

(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    x No

 

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

 

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

 

Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

¨

Smaller reporting company

x

(Do not check if a smaller reporting company)

Emerging growth 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). x Yes    ¨ No

 

As of February 14, 2018, there were 13,000,000 shares of common stock issued and outstanding.

 

 
 
 
 

TABLE OF CONTENTS

 

 

PART I—FINANCIAL INFORMATION

 

Item 1.

Financial Statements

 

3

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

4

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

 

5

 

Item 4.

Controls and Procedures.

 

5

PART II—OTHER INFORMATION

 

Item 1.

Legal Proceedings.

 

6

 

Item 1A.

Risk Factors.

 

6

 

Item 2.

Unregistered Sales of Securities and Use of Proceeds.

 

6

 

Item 3.

Defaults Upon Senior Securities.

 

6

 

Item 4.

Mining Safety Disclosure

 

6

 

Item 5.

Other Information.

 

6

 

Item 6.

Exhibits.

 

7

 

 

2

 
Table of Contents

 

PART I—FINANCIAL INFORMATION

 

Item 1. Financial Statements.

 

Cosmo Ventures Inc.

FINANCIAL STATEMENTS

CONTENTS

 

Balance Sheets - As of December 31, 2017 and March 31, 2017 (unaudited)

 

F-1

 

 

 

 

 

Statements of Operations - For the Three Months and Nine Months ended December 31, 2017 and 2016 (unaudited)

 

F-2

 

 

 

 

 

Statements of Cash Flows - For the Nine Months ended December 31, 2017 and 2016 (unaudited)

 

F-3

 

 

 

 

 

Notes to Financial Statements (unaudited)

 

F-4

 

 

 

3

 
Table of Contents

 

COSMO VENTURES INC.

BALANCE SHEETS

As of December 31, 2017 and March 31, 2017

(unaudited)

 

 

 

December 31,

2017

 

 

March 31,

2017

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

Cash

 

$ 756

 

 

$ 151

 

TOTAL ASSETS

 

$ 756

 

 

$ 151

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Accounts payable

 

$ 7,546

 

 

$ 6,548

 

Due to related party

 

 

26,496

 

 

 

11,041

 

TOTAL CURRENT LIABILITIES

 

$ 34,042

 

 

$ 17,589

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

Common stock - 75,000,000 shares authorized, $0.001 par value; 13,000,000 shares issued and outstanding

 

$ 13,000

 

 

$ 13,000

 

Additional paid-in capital

 

 

12,000

 

 

 

12,000

 

Accumulated deficit

 

 

(58,286 )

 

 

(42,438 )

 

 

 

 

 

 

 

 

 

TOTAL STOCKHOLDERS’ DEFICIT

 

 

(33,286 )

 

 

(17,438 )

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

$ 756

 

 

$ 151

 

 

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

 

 
F-1
 
Table of Contents

 

COSMO VENTURES INC.

STATEMENTS OF OPERATIONS

For Three and Nine Months ended December 31, 2017 and 2016

(unaudited)

 

 

 

Three months

ended

December 31,

2017

 

 

Three months

ended

December 31,

2016

 

 

Nine months

ended

December 31,

2017

 

 

Nine months

ended

December 31,

2016

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

$ 5,802

 

 

$ 8,227

 

 

$ 15,848

 

 

$ 8,836

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL OPERATING EXPENSES

 

 

5,802

 

 

 

8,227

 

 

 

15,848

 

 

 

8,836

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET LOSS

 

$ (5,802 )

 

$ (8,227 )

 

$ (15,848 )

 

$ (8,836 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS PER COMMON SHARE – BASIC AND DILUTED

 

$ (0.00 )

 

$ (0.00 )

 

$ (0.00 )

 

$ (0.00 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING – BASIC AND DILUTED

 

 

13,000,000

 

 

 

13,000,000

 

 

 

13,000,000

 

 

 

13,000,000

 

 

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

 

 
F-2
 
Table of Contents

 

COSMO VENTURES INC.

STATEMENTS OF CASH FLOWS

For the Nine Months ended December 31, 2017 and 2016

(unaudited)

 

 

 

Nine months

ended

December 31,

2017

 

 

Nine months

ended

December 31,

2016

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net loss

 

$ (15,848 )

 

$ (8,836 )

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

 

998

 

 

 

28

 

 

 

 

 

 

 

 

 

 

NET CASH USED IN OPERATING ACTIVITIES

 

 

(14,850 )

 

 

(8,808 )

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Advances from related party

 

 

15,455

 

 

 

2,000

 

 

 

 

 

 

 

 

 

 

NET CASH PROVIDED BY FINANCING ACTIVITIES

 

 

15,455

 

 

 

2,000

 

 

 

 

 

 

 

 

 

 

NET INCREASE (DECREASE) IN CASH

 

 

605

 

 

 

(6,808 )

 

 

 

 

 

 

 

 

 

CASH, BEGINNING OF PERIOD

 

 

151

 

 

 

7,159

 

 

 

 

 

 

 

 

 

 

CASH, END OF PERIOD

 

$ 756

 

 

$ 351

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL CASH FLOW DISCLOSURES:

 

 

 

 

 

 

 

 

Cash paid for interest

 

$ -

 

 

$ -

 

Cash paid for income taxes

 

$ -

 

 

$ -

 

 

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

 

 
F-3
 
Table of Contents

 

Cosmo Ventures Inc.

Notes to Financial Statements

(unaudited)

 

NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The Company

 

Cosmo Ventures Inc. (the “Company”) was incorporated in the State of Nevada on February 3, 2013, with a year end of March 31. The Company intends to purchase overstocked inventory items from manufacturers and retailers and offer them to the public at discounted prices via a web-based on-line store.

 

Basis of Presentation – Unaudited Financial Statements

 

The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for financial information and with the instructions to Form 10-Q. They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the fiscal year ended March 31, 2017 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. The unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the nine months ended December 31, 2017 are not necessarily indicative of the results that may be expected for the year ending March 31, 2018.

 

Use of Estimates and Assumptions

 

Preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain 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 period. Accordingly, actual results could differ from those estimates.

 

Cash and Cash Equivalents

 

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

 

Earnings (Loss) per Common Share

 

The basic earnings (loss) per common share is calculated by dividing the Company’s net income (loss) available to common shareholders by the weighted average number of common shares during the period. The diluted earnings (loss) per share is calculated by dividing the Company’s net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items in the Company. As of December 31, 2017, there were no common stock equivalents outstanding.

 

Income Taxes

 

The Company follows the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances and tax loss carry-forwards.

 

 
F-4
 
Table of Contents

 

Income Taxes (continued)

 

Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.

 

Stock-based Compensation

 

The Company estimates the fair value of each stock-based compensation award at the grant date by using Black-Scholes Option Pricing Model. The fair value determined represents the cost of the award and is recognized over the vesting period during which an employee is required to provide service in exchange for the award. As stock-based compensation expense is recognized based on awards ultimately expected to vest. Excess tax benefits, if any, are recognized as additional paid in capital.

 

Recent Accounting Pronouncements

 

The Company does not expect the adoption of any recent accounting pronouncements to have a material impact on its financial statements.

 

Subsequent Events

 

The Company has evaluated subsequent events through the date the financial statements were issued for disclosure consideration.

 

NOTE 2 – GOING CONCERN

 

To date the Company has generated no revenues from its business operations and has incurred operating losses of $56,486 since inception. The Company requires additional funding to meet its ongoing obligations and to fund anticipated operating losses. The ability of the Company to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company intends to continue to fund its business by way of private placements and advances from related parties as may be required. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

 

NOTE 3 – RELATED PARTY TRANSACTIONS

 

The Company’s CEO has loaned the Company cash to support operations. Balances as of December 31, 2017 and March 31, 2017 were $26,496 and $11,041, respectively. The balance due is unsecured and non-interest-bearing with no set terms of repayment.

 

 
F-5
 
Table of Contents

 

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

 

This section of this Form 10-Q includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our predictions.

 

Results of Operations

 

For the three-month periods ended December 31, 2017 and December 31, 2016, we had no revenue. Expenses for the three-month period ended December 31, 2017 totaled $5,802 resulting in a net loss of $5,802, compared to expenses for the three-month period ended December 31, 2016, totaled $8,227 resulting in a net loss of $8,227. The net loss for the three-month period ended December 31, 2017 is a result of office and general expense of $5,802 comprised primarily of accounting fees of $4,850, filing fees of $895, and telephone expenses of $57, compared to expenses for the three months ended December 31, 2016 is a result of office and general expenses of $8,227 comprised primarily of accounting fees of $7,500, filing fees of $479, bank service charges of $71 and office supplies of $177. The decrease in expenses for the three month period ended December 31, 2017 compared to December 31, 2016 is primarily due to the decrease in accounting fees.

 

For the nine-month periods ended December 31, 2017 and December 31, 2016, we had no revenue. Expenses for the nine-month period ended December 31, 2017 totaled $15,848 resulting in a net loss of $15,848, compared to expenses for the nine-month period ended December 31, 2016, totaled $8,836 resulting in a net loss of $8,836. The net loss for the nine-month period ended December 31, 2017 is a result of office and general expense of $15,848 comprised primarily of accounting fees of $11,650, filing fees of $3,965, bank service charges of $176, and telephone expenses of $57, compared to expenses for the nine months ended December 31, 2016 is a result of office and general expenses of $8,836 comprised primarily of accounting fees of $7,500, filing fees of $1,073, bank service charges of $71 and office supplies of $192. The increase in expenses for the nine month period ended December 31, 2017 compared to December 31, 2016 was primarily due to the increase in accounting fees and filing fees for the period.

 

Capital Resources and Liquidity

 

There is substantial doubt if we can continue as an on-going business for the next twelve months unless we obtain additional capital. No substantial revenues are anticipated until we have completed the financing from this offering and implemented our plan of operations. With the exception of cash advances from our sole Officer and Director, our only source for cash at this time is investments by others by way of private placements. Since inception, we have raised $25,000 through the sale of Company’s common stock. We must raise additional cash to implement our strategy and stay in business.

 

As of December 31, 2017, we had $756 in cash as compared to $151 in cash at March 31, 2017. The funds available to the Company will not be sufficient to fund the planned operations of the Company and maintain a reporting status. As of December 31, 2017, the Company’s sole officer and director, Mr. Ram has loaned the Company $26,496 and he has indicated that he may be willing to provide a maximum of $50,000, required to maintain the reporting status, in the form of a non-secured loan for the next twelve months as the expenses are incurred if no other proceeds are obtained by the Company. However, there is no contract or written agreement in place.

 

We anticipate that we will begin the development of our proposed business plan to purchase overstocked inventory items and offer them to the public via a web-based on-line store and hire additional consultants to setup out website within the next 180 days.

 

 
4
 
Table of Contents

 

Off-balance sheet arrangements

 

Other than the situation described in the section titled Capital Recourses and Liquidity, the company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect or change on the company’s financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the company is a party, under which the company has (i) any obligation arising under a guarantee contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

 

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

 

Item 4. Controls and Procedures.

 

Disclosure Controls and Procedures

 

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time period specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is accumulated and communicated to management including our principal executive officer and principal financial officer as appropriate, to allow timely decisions regarding required disclosure.

 

In connection with this quarterly report, as required by Rule 15d-15 under the Securities Exchange Act of 1934, we have carried out an evaluation of the effectiveness of the design and operation of our company’s disclosure controls and procedures. The material weaknesses in our disclosure control procedures are as follows:

 

1. Lack of formal policies and procedures necessary to adequately review significant accounting transactions. We utilize a third party independent contractor for the preparation of our financial statements. Although the financial statements and footnotes are reviewed by our management, we do not have a formal policy to review significant accounting transactions and the accounting treatment of such transactions. The third party independent contractor is not involved in our day to day operations and may not be provided information from our management on a timely basis to allow for adequate reporting/consideration of certain transactions.

 

2. Audit Committee and Financial Expert. We do not have an audit committee with a financial expert and, thus, we lack the appropriate oversight within the financial reporting process.

 

We intend to initiate measures to remediate the identified material weaknesses, including, but not necessarily limited to, the following:

 

 

· Establishing a formal review process of significant accounting transactions that includes participation of our principal executive officer, principal financial officer and corporate legal counsel.

 

 

 

 

· Form an audit committee that will establish policies and procedures that will provide our Board of Directors with a formal review process that will among other things, assure that management controls and procedures are in place and being maintained consistently.

 

Changes in Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) or 15d-15(f)) during the quarter ended December 31, 2017 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

 

 
5
 
Table of Contents

 

PART II—OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

Currently, we are not involved in any pending litigation or legal proceeding.

 

Item 1A. Risk Factors.

 

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

 

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

 

None

 

Item 3. Defaults Upon Senior Securities.

 

None

 

Item 4. Mine Safety Disclosures

 

None

 

Item 5. Other Information.

 

None

 

 
6
 
Table of Contents

 

Item 6. Exhibits.

 

31.1

Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer

31.2

Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer *

32.1

Section 1350 Certification of Chief Executive Officer

32.2

Section 1350 Certification of Chief Financial Officer **

__________

* Included in Exhibit 31.1

 

** Included in Exhibit 32.1

 

 
7
 
 

 

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.

 

  Cosmo Ventures Inc.

 

(Registrant)

 

       
Date: February 14, 2018 By: /s/ Sonu Ram

 

 

Sonu Ram President and Director

 
   

Principal and Executive Officer

 
   

Principal Financial Officer

 

 

 

Principal Accounting Officer

 

 

 

8