UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10−Q

(Mark One)

 

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

 

For the quarterly period ended: September 30, 2018

 

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

 

For the transition period from ____________ to _____________

 

Commission File Number: 333-204518

 

DD’s Deluxe Rod Holder Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

Nevada		61-1748028
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

3^rd Floor, Golden Sunset Community, Wencang Village, Yueping Township, Yan Feng District,

Hengyang City, Hunan Province, China 421000

(Address of principal executive offices, Zip Code)

 

+86 0734-8476607

(Registrant’s telephone number, including area code)

 

Room 402, Unit 1, Building 1, No. 1 Huaxing Street,

Zhengxiang District, Hengyang City, Hunan

Province, China 421000

 

 

(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 every Interactive Data File required to be submitted 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 such files). Yes [X] No [  ]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 [X]		Smaller reporting company [X]
		Emerging growth company [X]

 

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 [X]

 

The number of shares outstanding of each of the issuer’s classes of common stock, as of November 19, 2018 is as follows:

 

Class of Securities		Shares Outstanding
Common Stock, $0.001 par value		234,000,000

 

 

 

DD’S DELUXE ROD HOLDER INC.

 

 

TABLE OF CONTENTS

 

PART I
FINANCIAL INFORMATION
Item 1.	Financial Statements.	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	14
Item 4.	Controls and Procedures.	15
PART II
OTHER INFORMATION
Item 1.	Legal Proceedings.	16
Item 1A.	Risk Factors.	16
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	16
Item 3.	Defaults Upon Senior Securities.	16
Item 4.	Mine Safety Disclosures.	16
Item 5.	Other Information.	16
Item 6.	Exhibits	16

 

 

PART I

FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS.

 

DD’S DELUXE ROD HOLDER INC.

CONDENSED FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017

 

(Stated in US Dollars)

 

CONTENTS
Unaudited Condensed Balance Sheets	2
Unaudited Condensed Statements of Operations and Comprehensive Loss	3
Unaudited Condensed Statements of Cash Flows	4
Notes to Financial Statements	5 - 11

 

 

DD’S DELUXE ROD HOLDER, INC.

UNAUDITED CONDENSED BALANCE SHEETS

AS OF SEPTEMBER 30, 2018 AND DECEMBER 31, 2017

 

		September 30, 2018				December 31, 2017
		(Unaudited)
ASSETS
Current Assets
Cash and cash equivalents		$	-			$	8,227
Total Current Assets			-				8,227
Intangible Assets			-				1,860
TOTAL ASSETS		$	-			$	10,087
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities
Line of Credit		$	-			$	48,449
Accounts Payable			1,178				225
Related Party Payable			17,637				67,594
Accrued Liabilities			2,500				4,019
Total Current Liabilities			21,315				120,287
TOTAL LIABILITIES		$	21,315			$	120,287
Stockholders’ Deficit
Common stock, $0.001 par value, 120,000,000 shares authorized; 4,000,000 shares issued and outstanding			4,000				4,000
Additional paid in capital			170,273				36,000
Accumulated deficit			(195,588	)			(150,200	)
Total Stockholders’ Deficit		$	(21,315	)		$	(110,200	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT		$	-			$	10,087

 

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

 

 

DD’S DELUXE ROD HOLDER, INC.

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017

 

		Three Months Ended September 30,								Nine Months Ended September 30,
		2018				2017				2018				2017
Sales - Net		$	-			$	-			$	-			$	-
Operating expenses
Legal and Professional			11,240				5,631				26,387				18,099
Accounting and Audit			2,500				2,600				8,900				12,425
Transfer agent and public company			-				1,390				7,000				2,615
General and administrative			42				46				197				91
Total operating expense			13,782				9,667				42,484				33,230
Loss from operations			(13,782	)			(9,667	)			(42,484	)			(33,230	)
Other income (expense)			-				-				(2,257	)			-
Interest income (expense)			-				(501	)			(647	)			(1,311	)
Total other expenses			-				(501	)			(2,904	)			(1,311	)
Income tax			-				-				-				-
Net loss		$	(13,782	)		$	(10,168	)		$	(45,388	)		$	(34,541	)
Net Loss per share of common stock – basic and diluted		$	(0.00	)		$	(0.00	)		$	(0.00	)		$	(0.00	)
Weighted average number of shares outstanding – basic and diluted			4,000,000				4,000,000				4,000,000				4,000,000

 

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

 

 

DD’S DELUXE ROD HOLDER, INC.

UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017

 

		Nine Months ended
		September 30,
		2018				2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(45,388	)		$	(34,541	)
Changes in operating assets and liabilities:
Gain on change of control			13,589				-
Impairment loss on assets			2,257				-
Accounts payable			1,178				200
Legal fees payable			-				17,054
Accrued liabilities			2,500				-
Accrued interest payable			-				1,312
Net Cash Used in Operating Activities			(25,864	)			(15,975	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Related party payables			17,637				-
Borrowings under line of credit							18,000
Net Cash Provided in Financing Activities			17,637				18,000
Net (decrease)/increase in cash and cash equivalents			(8,227	)			2,025
Cash and cash equivalents, beginning of period			8,227				10,892
Cash and cash equivalents, end of period		$	-			$	12,917
Supplemental cash flow information
Interest received		$	-			$	-
Interest paid		$	-			$	-
Income taxes paid		$	-			$	-
Non-cash financing transactions:
Conversion of liabilities to additional paid in capitals from former shareholder’s assumption of liabilities		$	134,273			$	-

 

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

 

 

NOTE 1 - NATURE OF OPERATIONS

 

DD’s Deluxe Rod Holder, Inc. (“Deluxe” or the “Company”) was incorporated on September 26, 2014 under the laws of the State of Nevada. The business purpose of the Company is to sell, through its yet-to-be-developed, website, Deluxerodholder.com, a fishing rod holder primarily for use in the sport of ice fishing. The Company has selected December 31 as its fiscal year end.

 

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

This summary of significant accounting policies is presented to assist in understanding the financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States.

 

Going Concern

 

As shown in the accompanying financial statements, the Company has incurred operating losses since inception. As of September 30, 2018, the Company has no financial resources with which to achieve its objectives and obtain profitability and positive cash flows. As shown in the accompanying balance sheets and statements of operations, the Company has an accumulated deficit of $195,588. At September 30, 2018, the Company’s working capital deficit is a $21,315. Achievement of the Company’s objectives will be dependent upon the ability to obtain additional financing, and generate revenue from current and planned business operations, and control costs. The Company is in the development stage and has generated no operating income. The Company plans to fund its future operations by joint venturing or obtaining additional financing from investors and/or lenders. However, there is no assurance that the Company will be able to achieve these objectives, therefore substantial doubt about its ability to continue as a going concern exists. The financial statements do not include adjustments relating to the recoverability of recorded assets nor the implications of associated bankruptcy costs should the Company be unable to continue as a going concern.

 

Use of Estimates

 

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant areas requiring the use of management assumptions and estimates relate to valuation of deferred tax and lives of intangible assets. Actual results could differ from these estimates and assumptions and could have a material effect on the Company’s reported financial position and results of operations.

 

 

Recent Accounting Pronouncements

 

In January 2017, the FASB issued Accounting Standards Update No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (ASU 2017-01). The ASU provides guidance to evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. If substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single asset or a group of similar assets, the assets acquired (or disposed of) are not considered a business. The guidance will be applied prospectively for annual periods and interim periods beginning after December 15, 2017. We adopted this guidance effective January 1, 2018. The adoption of this guidance did not have a material impact on our financial position, results of operations, and disclosures.

 

In February 2018, the FASB issued Accounting Standards Update No. 2018-02 Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (ASU 2018-02). The standard provides financial statement preparers with an option to reclassify stranded tax effects within Accumulated Other Comprehensive Income (AOCI) to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act (or portion thereof) is recorded. ASU 2018-02 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on the Company’s condensed consolidated financial statements.

 

In March 2018, the FASB issued Accounting Standards Update No. 2018-05, Income Taxes (Topic 740), Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 (ASU 2018-05). The ASU adds various Securities and Exchange Commission (“SEC”) paragraphs pursuant to the issuance of the December 2017 SEC Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”), which was effective immediately. The SEC issued SAB 118 to address concerns about reporting entities’ ability to timely comply with the accounting requirements to recognize all of the effects of the Tax Cuts and Jobs Act in the period of enactment. SAB 118 allows disclosure that timely determination of some or all of the income tax effects from the Tax Cuts and Jobs Act are incomplete by the due date of the financial statements and if possible to provide a reasonable estimate. We have accounted for the tax effects of the Tax Cuts and Jobs Act under the guidance of SAB 118, on a provisional basis. Our accounting for certain income tax effects is incomplete, but we have determined reasonable estimates for those effects and have recorded provisional amounts in our condensed consolidated financial statements as of September 30, 2018 and December 31, 2017.

 

 

Cash and Cash Equivalents

 

For the purposes of the statement of cash flows, the Company considers all highly liquid investments with original maturities of three months or less when acquired to be cash equivalents.

 

Intangible Assets

 

Intangible assets with definite lives are subject to amortization. At September 30, 2018 and December 31, 2017, such intangible assets consist of fees paid to the United States Patent and Trademark Office on the filing of a non-provisional patent application which will be amortized on a straight-line basis over the patent life of 20 years, once approved. Intangible assets with definite lives are tested for impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable. These conditions may include an economic downturn, regulations, or a change in the assessment of future operations. At September 30, 2018, none of the Company’s patent applications have been approved.

 

Start-up Costs

 

In accordance with ASC 720-15-20, “Start-up Activities,” the Company expenses all costs incurred in connection with the start-up and organization of the Company.

 

Office Space and Labor

 

The Company’s sole Officer and Director will provide the labor required to execute the business plan and supply the necessary office space and facilities for the initial period of operations. The Company will recognize the fair value of services and office space provided by our sole Officer and Director as contributed capital in accordance with ASC 225-10-S99-4. From inception through September 30, 2018, the fair value of services and office space provided was estimated to be nil.

 

Financial Instruments

 

The Company’s financial instruments include cash and cash equivalents and line of credit. All instruments are accounted for on a historical cost basis, which, due to the short-term nature of these financial instruments approximates fair value at September 30, 2018.

 

 

Fair Value Measures

 

When required to measure assets or liabilities at fair value, the Company uses a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used. The Company determines the level within the fair value hierarchy in which the fair value measurements in their entirety fall. The categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Level 1 uses quoted prices in active markets for identical assets or liabilities, Level 2 uses significant other observable inputs, and Level 3 uses significant unobservable inputs. The amount of the total gains or losses for the period are included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date. At September 30, 2018 and December 31, 2017, the Company had no assets or liabilities accounted for at fair value on a recurring or nonrecurring basis.

 

Loss Per Share

 

Basic Earnings Per Share (“EPS”) is computed as net income (loss) available to common stockholders divided by the weighted average number of common shares outstanding for the period.

 

Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options and warrants. The Company has no potentially dilutive securities such as options, warrants, or convertible bonds currently issued and outstanding. Consequently, basic and diluted earnings per share are the same, as shown in the Statement of Operations.

 

Income Taxes

 

The Company recognizes provision for income tax using the liability method. Deferred income tax liabilities or assets at the end of each period are determined using the tax rates expected to be in effect when the taxes are actually paid or recovered. A valuation allowance is recognized on deferred tax assets when it is more likely than not that some or all of these deferred tax assets will not be realized.

 

Commitments and contingencies

 

Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. Management assessed that the Company was not subject to any capital commitments that required the accrual of financial obligation.

 

 

Comprehensive income

 

Comprehensive income is defined to include all changes in equity except those resulting from investments by owners and distributions to owners. Among other disclosures, all items that are required to be recognized under current standards as components of comprehensive income are required to be reported in a financial statement that is presented with same prominence as other financial statements. The Company’s current component of other comprehensive income includes the foreign currency translation adjustment and unrealized gain or loss.

 

NOTE 3 – LINE OF CREDIT

 

On March 1, 2016, the Company entered into a short-term line of credit agreement with Crest Business Solutions, LLC (“Crest”). The agreement provides that Crest will provide the Company with up to $50,000 via the line of credit. All amounts borrowed by the Company pursuant to the line of credit was due and payable (with accrued interest thereon) in one balloon payment on February 28, 2017. The Company had the option to extend the term of the line of credit for an additional year to February 28, 2018 which was exercised. Interest accrues on the principal amount borrowed pursuant to the line of credit at the rate of five percent per annum. Interest expense for the nine months period ended September 30, 2018 and 2017, was $647 and $810, respectively. Accrued interest payable at September 30, 2018 and December 31, 2017, was $0 and $4,019, respectively.

 

On April 11, 2018, the former director assumed the liability of the line of credit per Assignment of Rights and Assumptions of Liabilities Agreement.

 

NOTE 4 – STOCKHOLDERS’ DEFICIT

 

Common Stock

 

As of September 30, 2018, the Company has 120,000,000 shares of common stock authorized with a par value of $0.001 per share. Founder’s shares of 1,000,000 were issued during 2014 at a price of $0.01 per share for $10,000 which was used for organizational costs and other working capital requirements.

 

On February 9, 2016, the Company issued 3,000,000 shares of its common stock for cash at $0.01 per share for a total of $30,000.

 

As of September 30, 2018, the Company had 4,000,000 shares of common stock issued and outstanding with a par value of $0.001 per share.

 

 

NOTE 5 – INCOME TAXES

 

The Company accounts for income taxes in accordance with U.S. GAAP for income taxes. Under the asset and liability method as required by this accounting standard, the recognition of deferred income tax liabilities and assets for the expected future tax consequences of temporary differences between the income tax basis and financial reporting basis of assets and liabilities. Provision for income taxes consists of taxes currently due plus deferred taxes.

 

The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

 

Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. Deferred tax liabilities are recognized for all future taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable income will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled.

 

Deferred tax is charged or credited in the operations of statement, except when it is related to items credited or charged directly to equity. 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. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities.

 

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted by the U.S. government which included a wide range of tax reform affecting businesses including the corporate tax rates, international tax provisions, tax credits and deduction with majority of the tax provision effective after December 31, 2017.

 

The Tax Act made broad and complex changes to the U.S. tax code, including, but not limited to, (i) reducing the U.S. federal corporate tax rate from 35 percent to 21 percent; and (ii) requiring companies to pay a one-time transition tax on certain unremitted earnings of foreign subsidiaries.

 

The Tax Act also established new tax laws that affect 2018, including, but not limited to: (i) the reduction of the U.S. federal corporate tax rate discussed above; (ii) a general elimination of U.S. federal income taxes on dividends from foreign subsidiaries; (iii) a new provision designed to tax global intangible low-taxed income (“GILTI”); (iv) the repeal of the domestic production activity deductions; (v) limitations on the deductibility of certain executive compensation; (vi) limitations on the use of foreign tax credits to reduce the U.S. income tax liability; and (vii) a new provision that allows a domestic corporation an immediate deduction for a portion of its foreign derived intangible income (“FDII”).

 

 

The Securities and Exchange Commission staff issued Staff Accounting Bulletin (“SAB”) 118, which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the related accounting under ASC 740, Accounting for Income Taxes. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Tax Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for a certain income tax effect of the Tax Act is incomplete, but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act.

 

Certain activities conducted in foreign jurisdictions may result in the imposition of U.S. corporate income taxes on the Company when its subsidiaries, controlled foreign corporations (“CFCs”), generate income that is subject to Subpart F or GILTI under the U.S. Internal Revenue Code beginning after December 31, 2017. Due to the complexity of the new GILTI tax rules, the Company is continuing to evaluate the provision of the Tax Act and the application of ASC 740. The Company will continue to analyze the full effects of the Tax Act on its consolidated financial statements.

 

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. As of September 30, 2018, and December 31, 2017, the Company had no uncertain tax positions, and will continue to evaluate for uncertain positions in the future.

 

NOTE 6 – SUBSEQUENT EVENTS

 

On November 13, 2018 we completed a reverse acquisition transaction with Golden Sunset pursuant to the Share Exchange Agreement, whereby we issued to the Shareholders 230,000,000 shares of our common stock in exchange for all of the issued and outstanding capital stock of Golden Sunset. Golden Sunset thereby became our wholly owned subsidiary and the former stockholders of Golden Sunset became our controlling stockholders. As a result of this transaction, we ceased to be a shell company and through our subsidiaries and affiliated entities, we are currently engaged in the elderly care business.

 

 

ITEM 2.

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

 

The following management’s discussion and analysis should be read in conjunction with our financial statements and the notes thereto and the other financial information appearing elsewhere in this report. Our financial statements are prepared in U.S. dollars and in accordance with U.S. GAAP.

 

Special Note Regarding Forward Looking Statements

 

In addition to historical information, this report contains forward-looking statements. We use words such as “believe,” “expect,” “anticipate,” “project,” “target,” “plan,” “optimistic,” “intend,” “aim,” “will” or similar expressions which are intended to identify forward-looking statements. Forward-looking statements speak only as of the date they are made, are based on various underlying assumptions and current expectations about the future. Accordingly, such information should not be regarded as representations that the results or conditions described in such statements or that our objectives and plans will be achieved and we do not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. You are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, as well as assumptions, which, if they were to ever materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements.

 

Readers are urged to carefully review and consider the various disclosures made by us in this report and our other filings with the SEC. These reports attempt to advise interested parties of the risks and factors that may affect our business, financial condition and results of operations and prospects. The forward-looking statements made in this report speak only as of the date hereof and we disclaim any obligation, except as required by law, to provide updates, revisions or amendments to any forward-looking statements to reflect changes in our expectations or future events.

 

Overview

 

We were incorporated on September 26, 2014 under the laws of the state of Nevada. We originally intended to build our business by developing, marketing and selling a fishing rod holder for use primarily by ice-fisherman. However, we have conducted limited operations and have had no operating revenues since inception. On April 11, 2018, as a result of a private transaction, 1,000,000 shares of common stock of the Company, representing 25% of the issued and outstanding share capital of the Company on a fully-diluted basis, were transferred from the Company’s former sole officer and director, Desmond Deschambeault to Liu Ling. The consideration paid for the shares was $100,000. Liu Ling acquired an additional 1,200,000 shares of Common Stock from several non-affiliate shareholders, representing 30% of the issued and outstanding share capital of the Company on a fully-diluted basis. The consideration paid for these shares was $122,040.72. As a result, Liu Ling acquired a total of 55% of the issued and outstanding share capital of the Company on a fully-diluted basis, which caused a change in control of the Company.

 

Upon the change of control of the Company, which occurred on April 11, 2018, Desmond Deschambeault ceased to be the Company’s President, Treasurer, Secretary and Director. At the same time, Liu Ling became the new President, CEO, CFO, Treasurer, Secretary and Chairman of the Board of Directors of the Company.

 

On June 15, 2018, we entered into a definitive Share Exchange Agreement (the “Share Exchange Agreement”) with Golden Sunset Group Limited, a Seychelles International Business Company (“Golden Sunset”), and the shareholders of Golden Sunset (the “Shareholders”). Pursuant to the Share Exchange Agreement, the Shareholders have agreed to transfer all of the ordinary shares of Golden Sunset held by them, constituting all of the issued and outstanding capital stock of Golden Sunset, in exchange for a number of newly issued shares of the Company’s common stock that will, in the aggregate, constitute approximately 98.3% of the issued and outstanding capital stock of the Company on a fully-diluted basis as of and immediately after the consummation of the transactions contemplated by the Share Exchange Agreement.

 

We incurred a net loss of $45,388 for the nine months ended September 30, 2018. As of September 30, 2018, we had an accumulated deficit of $195,588. Losses have principally occurred as a result of the lack of a source of recurring revenues and the resources required to maintain our status as a US public company. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

 

 

Recent Developments

 

On November 13, 2018 we completed a reverse acquisition transaction with Golden Sunset pursuant to the Share Exchange Agreement, whereby we issued to the Shareholders 230,000,000 shares of our common stock in exchange for all of the issued and outstanding capital stock of Golden Sunset. Golden Sunset thereby became our wholly owned subsidiary and the former stockholders of Golden Sunset became our controlling stockholders. As a result of this transaction, we ceased to be a shell company and through our subsidiaries and affiliated entities, we are currently engaged in the elderly care business.

 

Please refer to our current report on Form 8-K filed on November 13, 2018 for detailed information with respect to the transactions described above, our current business and management.

 

Results of Operations

 

Comparison of Three Months Ended September 30, 2018 and 2017

 

Revenues

 

We had revenue of $0 and $0 for the three months ended September 30, 2018 and 2017, respectively.

 

Operating Expenses

 

We incurred total operating expenses of $13,782 and $9,667 for the three months ended September 30, 2018 and 2017, respectively. General and administrative and professional fee expenses incurred generally related to corporate overhead, financial and administrative contracted services, such as legal and accounting and developmental costs.

 

Net Loss

 

During the three months ended September 30, 2018 and 2017, we incurred a net loss of $13,782 and $10,168, respectively.

 

Comparison of Nine Months Ended September 30, 2018 and 2017

 

Revenues

 

We had revenue of $0 and $0 for the nine months ended September 30, 2018 and 2017, respectively.

 

Operating Expenses

 

We incurred total operating expenses of $42,484 and $33,230 for the nine months ended September 30, 2018 and 2017, respectively. General and administrative and professional fee expenses incurred generally related to corporate overhead, financial and administrative contracted services, such as legal and accounting and developmental costs.

 

Net Loss

 

During the nine months ended September 30, 2018 and 2017, we incurred a net loss of $45,388 and $34,541, respectively.

 

Liquidity and Capital Resources

 

As of September 30, 2018, the Company had a working capital deficit of $21,315, an accumulated deficit of $195,588 and did not earn any revenue to cover its operating costs.

 

The Company has nominal assets and has not generated revenues since inception. The Company is dependent upon the receipt of capital investment or other financing to fund its ongoing operations and to execute its business plan of seeking a combination with a private operating company. In addition, the Company is dependent upon certain related parties to provide continued funding and capital resources.

 

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company can provide no assurance that it can continue to satisfy its cash requirements for at least the next twelve months. If continued funding and capital resources are unavailable at reasonable terms, the Company may not be able to implement its plan of operations.

 

 

		Nine Months Ended September 30,
		2018				2017
Net cash (used in) operating activities		$	(25,864	)		$	(15,975	)
Net cash (used in) provided by investing activities			-				-
Net cash provided by financing activities			17,637				18,000
Net (decrease) increase in cash and cash equivalents			(8,227	)			2,025
Cash and cash equivalents at the beginning of period			8,227				10,892
Cash and cash equivalents at the end of period		$	-			$	12,917

 

Operating Activities

 

Net cash used in operating activities was $25,864 for the nine months ended September 30, 2018, as compared to $15,975 net cash used in operating activities for the nine months ended September 30, 2017. The change was mainly due to the gain on change in control of $13,589.

 

Investing Activities

 

Net cash used in investing activities was $0 for the nine months ended September 30, 2018, as compared to $0 net cash used in investing activities for the nine months ended September 30, 2017.

 

Financing Activities

 

Net cash provided by financing activities for the nine months ended September 30, 2018 was $17,637, as compared to $18,000 for the nine months ended September 30, 2017. The change was mainly due to the borrowings under line of credit of $18,000 for the prior period.

 

Off-Balance Sheet Transactions

 

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.

 

Contractual Obligations

 

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

 

Critical Accounting Policies

 

Our condensed financial information has been prepared in accordance with U.S. GAAP, which requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and related disclosures. On an on-going basis, we evaluate our estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Since the use of estimates is an integral component of the financial reporting process, our actual results could differ from those estimates. Some of our accounting policies require a higher degree of judgment than others in their application. There have been no material changes to the critical accounting policies previously disclosed in our audited financial statements for the year ended December 31, 2017 included in the Annual Report on Form 10-K filed on March 9, 2018.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

Not applicable.

 

 

ITEM 4. CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures

 

As required by Rule 13a-15 under the Exchange Act, our management has carried out an evaluation, with the participation and under the supervision of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2018. Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating and implementing possible controls and procedures.

 

Management conducted its evaluation of disclosure controls and procedures under the supervision of our chief executive officer and chief financial officer. Based upon, and as of the date of this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were ineffective as of September 30, 2018 due to the following material weaknesses that our management identified in our internal control over financial reporting as of September 30, 2018:

 

a)	Lack of audit committee. The Company does not have a functioning audit committee, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures.
b)	Lack of proper segregation of duties due to limited personnel.
c)	Lack of a formal review process related to financial reporting that includes multiple levels of review.

 

The Company’s management is committed to improving the Company’s internal controls and will: (1) continue to use third party specialists to address shortfalls in staffing and to assist the Company with accounting and finance responsibilities; (2) increase the frequency of independent reconciliations of significant accounts which will mitigate the lack of segregation of duties until there are sufficient personnel; and (3) may consider appointing outside directors and audit committee members in the future.

 

The Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, have discussed the material weakness noted above with the Company’s independent registered public accounting firm. Due to the nature of this material weakness, there is a more than remote likelihood that misstatements which could be material to the annual or interim financial statements could occur that would not be prevented or detected.

 

Changes in Internal Control over Financial Reporting

 

Except for the matters described above, there were no changes in our internal controls over financial reporting during the quarter ended September 30, 2018 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.

 

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. We are currently not aware of any legal proceedings or claims that would require disclosure under Item 103 of Regulation S-K. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.

 

ITEM 1A. RISK FACTORS.

 

As a smaller reporting company, the Company is not required to provide this information.

 

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.

 

The following exhibits are filed as part of this report or incorporated by reference:

 

Exhibit No.		Description
31.1		Certifications of Principal Executive Officer and Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certifications of Principal Executive Officer and Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

 

 

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.

 

Date: November 21, 2018

 

	DD’s Deluxe Rod Holder Inc.
	By:	/s/ Jun Quan
		Jun Quan
		Chief Executive Officer and Chief Financial Officer

 

 

EXHIBIT INDEX

 

Exhibit No.		Description
31.1		Certifications of Principal Executive Officer and Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certifications of Principal Executive Officer and Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document