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EX-32 - CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUAN - ANDES 7 INC.ex32.htm
EX-31 - CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUAN - ANDES 7 INC.ex31.htm
EX-21 - SUBSIDIARIES - ANDES 7 INC.ex21.htm
EX-10 - CAFE LAND EXTENSION DUE DECEMBER 20, 2020 - ANDES 7 INC.ex102.htm
EX-10 - LAND PURCHASE EXTENSION TO DECEMBER 15, 2020 - ANDES 7 INC.ex101.htm

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-K

 

(Mark One)

 

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

        

For the fiscal year ended December 31, 2019

 

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

 

For the transition period from ______________ to ______________

Commission File Number: 333-229065 

 

 

ANDES 7 Inc.

(Exact name of registrant as specified in its charter)

 

  Delaware   47-4683655  
  (State or Other Jurisdiction of   (I.R.S. Employer  
  Incorporation or Organization)   Identification No.)  
         
 

 424 Clay Street, Lower Level

San Francisco, CA

  94111  
  (Address of Principal Executive Offices)   (Zip Code)  

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
     

 1 
 

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $0.0001 par value per share
(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

[   ] Yes [X] No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. 

[   ] Yes [X] No

 

Indicate by check mark if whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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. [X] 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 [X] No

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

 

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 definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [  ]   Accelerated filer [  ]
Non-accelerated filer [  ]   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 [X] No

The issuer’s common stock is not currently quoted on any market. The issuer therefore cannot estimate the aggregate market value of the issuer’s voting and non-voting common equity held as of June 30, 2019, the last day of the registrant’s most recently completed second fiscal quarter, by non-affiliates of the issuer. As of September 14, 2020, there were 120,140,000 shares of $0.0001 par value common stock issued and outstanding.

 

 

 

 

 

 2 
 

Reliance on Order for Reporting Relief

 

The Company has relied on the U.S. Securities and Exchange Commission's (the “SEC”) March 4, 2020 Order (the “Order”), Release No. 34-88318, as modified on March 25, 2020 under Release No. 34-88465 under Section 36 of the Securities Exchange Act of 1934, granting exemptions from specified provisions of the Exchange Act and certain rules thereunder, published under Release No. 34-88465, dated March 25, 2020.

 

The Company relied on the Order due to the reduction in staff, suspension of in-person operations at certain of the Company’s location, delays in being able to work with the Company’s auditor due to “shelter in place” restrictions, and other financial and operational concerns associated with or caused by COVID-19.

 

The Company has included updated risk factors relating to the impact that COVID-19 has had and is continuing to have on the Company and its business.

 

TABLE OF CONTENTS

 

    Page

 

PART I

 

Item 1. Business 4
Item 1A. Risk Factors 10
Item 1B. Unresolved Staff Comments 12
Item 2. Properties 13
Item 3. Legal Proceedings 13
Item 4. Mine Safety Disclosures 13

 

PART II

 

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 13
Item 6. Selected Financial Data 14
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 14
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 15
Item 8. Financial Statements and Supplementary Data 15
Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure 16
Item 9A. Controls and Procedures 16
Item 9B. Other Information 17

 

PART III

 

Item 10. Directors, Executive Officers and Corporate Governance 17
Item 11. Executive Compensation 18
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 19
Item 13. Certain Relationships and Related Transactions, and Director Independence 20
Item 14. Principal Accountant Fees and Services 20

 

PART IV

Item 15. Exhibits, Financial Statement Schedules 21
Item 16. Form 10-K Summary 21

 

 

 3 
 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Annual Report contains forward-looking statements that involve risks, uncertainties, and assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. The statements contained in this Annual Report that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Forward-looking statements are often identified by the use of words such as, but not limited to, “anticipate,” “believe,” “can,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “seek,” “should,” “target,” “will,” “would,” and similar expressions or variations intended to identify forward-looking statements. These statements are based on the beliefs and assumptions of our management, which are in turn based on information currently available to management. Such forward-looking statements are subject to risks, uncertainties, and other important factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the section titled “Risk Factors included under Part I, Item 1A below. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

 

 PART I

 

ITEM 1.  DESCRIPTION OF BUSINESS.

 

The Company

 

ANDES 7 Inc. was incorporated in the State of Delaware on July 27, 2015. ANDES 7 Inc. was formed as a vehicle to pursue a business combination with an operating company that would have perceived benefits of becoming a publicly traded corporation. Abina Co. Ltd (“Abina”) was incorporated in Thailand on August 3, 2015 and has since then operated a diverse business involved in investments in hotels, resorts, and commercial property. The Company had directed its efforts by the end of 2015 to develop the tallest and largest flagpole in the world in the Chiang Saen District of Chiang Rai, Thailand with measurements of 42 meters in height and 63 meters in length. It was since awarded with the prestigious honor of being the largest flag in Thailand by the Guinness Book of World Records. The flag pole itself is pending development along with a park and concession area for tourists primarily from China.

Abina has secured the exclusive right and license with the local and state government of Thailand for the development of the “tallest flagpole and largest flag” in the world to be a landmark destination in Thailand and to attract, promote local and foreign tourism primarily from China. Having a long history of being ruled by kings, Abina believes that Thailand is a country deep rooted with patriotism and loyalty to their king and national flag. With this belief, under Abina’s license, the Thai government mandated that each citizen must purchase a flag and or souvenirs from the collection of ANDES 7 souvenirs. ANDES 7 intend to promote and sell its souvenir products and flags through souvenir shops and cafes in major cities throughout Thailand.

Following the merger, the Company is planning a full leisure and tourist destination in Chiang Rai, Thailand with agreements with the Thai government as its exclusive authorized merchandising, souvenir and collectables retailer for the Thai flag, and to offer religious merchandise, retail shops, cafes, and build other real estate projects. The Company is seeking to develop a fully integrated hotel and entertainment center in the Chiang Saen District of Chiang Rai, Thailand that will include souvenir shops, a hotel, office buildings, several malls, and a resort entertainment center catering to both local and foreign tourists primarily from China.

The Company seeks to acquire full rights and ownership in 126 hectares of land in the Chiang Saen District of Chiang Rai, Thailand within a Free Trade Zone designated area to develop a leisure and tourist destination designed for both local and foreign tourists. The Company believes that this area holds beneficial value based on the “One Belt, One Road” initiative or “OBOR”. Announced by the Chinese government in 2013, OBOR is a development strategy by the Chinese government which focuses on connectivity and cooperation between Europe, Africa, China and Southeast Asia. The OBOR initiative is designed to increase the flow of trade, aimed at building new infrastructure, and increasing cultural exchanges.

 4 
 

The project and acquisition costs are expected to cost over an estimated $6 million USD, while the construction of the flagpole, mall, office building complex, hotel, spiritual center and shops are expected to cost $120 million USD. As of the date of this Form 10-K, the Company has paid 5 million Thai Baht, or $159,000 in US dollars and owes a balance of 195 million Thai Baht, or $6,228,300 in US dollars (at today’s exchange rates) for the land in Chiang Rai, Thailand and received another extension for the amount due by December 15, 2019. The Company seeks to develop a destination site for locals and foreign tourists by establishing a “100 Years Café” coffee shop and souvenir shops that celebrate over 100 years of the Thai flag.

The Company has secured an exclusive license by the government of Thailand to promote, market, and sell souvenirs and collectable products based on the Thai largest flag in Chiang Rai, Thailand. Currently, the Company has created the flag portion of the tallest flagpole and largest flag project but not the flagpole itself. The flagpole is currently under production by an American company and expected to be delivered by 2019. The flag portion measuring 42 meters in height and 63 meters in length was given honors and recognition by the Guinness Book of World Records on November 30, 2016.

 

 

The Project

The Company seeks to acquire full rights and ownership in 126 hectares of land in the Chiang Saen District of Chiang Rai, Thailand within a Free Trade Zone designated area to develop a leisure and tourist destination designed for both local and foreign tourists. The Company believes that this area holds beneficial value based on the “One Belt, One Road” initiative or “OBOR”. Announced by the Chinese government in 2013, OBOR is a development strategy by the Chinese government which focuses on connectivity and cooperation between Europe, Africa, China and Southeast Asia. The OBOR initiative is designed to increase the flow of trade, aimed at building new infrastructure, and increasing cultural exchanges.

 5 
 

The project and acquisition costs are expected to cost over an estimated $6 million USD, while the construction of the flagpole, mall, office building complex, hotel, spiritual center and shops are expected to cost $120 million USD.As of the date of this Form 10-K, the Company has paid 5 million Thai Baht, or $159,000 in US dollars and owes a balance of 195 million Thai Baht, or $6,228,300 in US dollars (at today’s exchange rates) for the land in Chiang Rai, Thailand due by December 20, 2020. The Company seeks to develop a destination site for locals and foreign tourists by establishing a “100 Years Café” coffee shop and souvenir shops that celebrate over 100 years of the Thai flag.

The Café land purchase was made for 12,000,000 Thai Baht from Prathan Inseeyong. As of the date of this Form 10-K, 6,000,000 Thai Baht was extended via contract to be paid by December 20, 2020. A copy of the Land Purchase Extension is filed as Exhibit 10.1 to this Form 10-K.

The Company has secured an exclusive license by the government of Thailand to promote, market, and sell souvenirs and collectable products based on the Thai largest flag in Chiang Rai, Thailand. Currently, the Company has created the flag portion of the tallest flagpole and largest flag project but not the flagpole itself. The flagpole is currently underproduction by an American company and expected to be delivered by 2019. The flag portion measuring 42 meters in height and 63 meters in length was given honors and recognition by the Guinness Book of World Records on November 30, 2016.

The Area

The Company is seeking to fully acquire and develop 126 hectares of land in the Chiang Saen District of Chiang Rai, Thailand. Chiang Rai is located in northern Thailand near the borders of Laos and Myanmar (formerly Burma). The area is known as a cultural center with attractions and parks with night bazaar markets and many Buddhist temples. In previous years, Chiang Rai has been known as the “Golden Triangle” which it is still called. The Golden Triangle is the area which meaning comes from the proximity to Laos, Myanmar and Thailand.

(Project land site view from road)

 

 

 6 
 

(View of project and surrounding land area)

 

(Map of project site and proximity to the Mekong River)

 

 7 
 

Other notable tourist attractions in the area are royal temples that once housed the Emerald Buddha, a jade structure which was replaced with a replica. There are also 100 Khmer (Cambodian) style pillars and temples. In addition, there are historic museums and cultural parks in the area.

The Thai Flag

The Company had directed its efforts by the end of 2015 to develop the tallest and largest flagpole in the world in the Chiang Saen District of Chiang Rai, Thailand. It was since awarded with the prestigious honor of being the largest flag in Thailand by the Guinness Book of World Records. The flag pole itself is pending development along with a park and concession area for tourists primarily from China.

The flag of Thailand plays a significant role in the Company’s plans to expand its business plan. The flag of Thailand has been the same without change from September 28, 1917 to present, or for over 100 years. To celebrate this fact, the Company has merchandise with the “100 Years” labeling on t-shirts, banners, flags, and other collectables. The people of Thailand are strongly supportive and proud of their country and flag. The national flag is seen on display in many places within the country. The colors of the flag represent three important items to the Thai people, red is said to represent the people and the blood which was shed to keep the country independent, the white represents religion or the purity of Buddhism and the blue represents the monarchy in Thailand.

 

 

 

(ANDES 7 produced the largest Flag in Thailand in connection with the 100 Year’s Anniversary of the flag)

The Tourism Industry

According to the World Travel & Tourism Council, 20.6% of the GDP, (or $82.5 billion USD) of Thailand in 2016 was from tourism. The World Travel & Tourism Council anticipates that by 2027, 31.7% (or $169.9 billion USD) of GDP will be from tourism. The majority of tourists are from other South East Asian countries or ASEAN (Association of South East Nations), followed by China and Europe. The Company believes that with new infrastructure being commissioned and built by both the Thai government and China through its OBOR initiative, is likely to have an impact on tourism in Thailand. In early 2018, the Thai government approved a high speed rail project that would connect major cities in southern Thailand to the north. According to Reuters, in 2016, Thailand had 33 million foreign tourists visiting Thailand, and Bangkok in particular with Chinese tourists comprising over 26% of that figure. Additionally, according to Mastercard Index of Global Destination Cities, in 2016, Bangkok was the world’s top destination beating 132 cities worldwide, such as London, Paris and Dubai. Thailand earned $71.4 billion in 2017 from tourist revenue which was higher by 11% percent from 2015. The Tourism Authority of Thailand attributes the increase in travel to Thailand to the increased demand from short haul markets during school holidays, heavy interest from the China market, and continued development of long haul markets in Europe, the United States and Russia. 

 8 
 

Employees

 

As of the date of this Form 10-K annual report, ANDES 7 Inc. employed a staff of 11 people of which are in management and administration located at 333 Village 6, Amphur Wiang Chiang, Chiang Rai, Thailand 57150. The Company considers its relationship with its employees to be favorable.

 

Facilities and Logistics

The Company maintains a virtual office in San Francisco, California, in the United States at 424 Clay Street, Lower Level, San Francisco, CA 94111. Its headquarters are located at 333, Village 6, Amphur Wiang Chiang, Chiang Rai, Thailand.

     
Location Address Size
San Francisco, California 424 Clay Street, Lower Level n/a (virtual office)
  San Francisco, CA 94111  
Chiang Rai, Thailand 333, Village 6, AmphurWiang Chiang 16,000 square meters
  Chiang Rai, Thailand 57150  

 

Involvement in Certain Legal Proceedings

None of our officers or directors, promoters or control persons have been involved in the past ten years of any of the following:

(1) Any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

(2) Any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

(3) Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

(4) Being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated. 

Patents

The Company has no patents and no intentions at this time to apply for any patents. The Company however, may choose to file for trademarks upon development of its project in Chiang Saen District of Chiang Raito protect its intellectual property.

 

Stock Offering

 

On December 28, 2018, the Company filed its Form S-1 registration statement under The Securities Act of 1933 registering 500,000 shares of common stock for sale at $0.80 cents per share. The Form S-1 went effective as of February 11, 2019. As of the date of this Form 10-K, the Company had sold 5,000 shares of common stock to one investor.

  

 9 
 

ITEM 1A. RISK FACTORS.

 

Risk Factors

 

An investment in our Common Stock is highly speculative in nature, involves a high degree of risk, and is suitable only for persons who can afford to risk the loss of the entire amount invested. Before purchasing any of these securities, you should carefully consider the following factors relating to our business and prospects. If any of the following risks actually occurs, our business, financial condition or operating results could be materially adversely affected. In such case, the eventual trading price of our Common Stock could decline, and you may lose all or part of your investment.  

 

Risks Related to Our Business and Industry

 

Our business is intensely competitive and our revenues are unpredictable as a small company.

 

We are a relatively new business having launched in 2015. We have derived our revenues from selling souvenirs, collectables and flag merchandise since our inception. We plan on acquiring land in northern Thailand and have signed agreements along with initial payment for the land but have not yet acquired full rights to the land. We compete with numerous entities that sell souvenirs in Thailand; however, we hold an exclusive right and license by the government of Thailand to sell souvenirs and collectables based on the “Largest Flag” of Thailand project.

 

A recurrence of Severe Acute Respiratory Syndrome (SARS), Avian Flu, or another widespread public health problem, such as the spread of H1N1 (“Swine”) Flu, or the Coronavirus/COVID-19 in the PRC could adversely affect our operations. (see our disclosure under Special Risk Factor due to the Novel Coronavirus (COVID-19) below)

 

Due to our proximity to China, a renewed outbreak of SARS, Avian Flu or another widespread public health problem, such as the spread of H1N1 (“Swine”) Flu, in China, will have a negative effect on our nascent operations. Such an outbreak will have an impact on our operations as a result of:

  · quarantines or closures of our facilities, which will severely disrupt our operations,
  · the sickness or death of our key officers and employees, and
  · a general slowdown in the Chinese economy which would affect our business in Thailand.
  · Any of the foregoing events or other unforeseen consequences of public health problems will adversely affect our operations.

  

We are subject to the risk that certain key personnel, including key employees named below, on whom we depend, in part, for our operations, will cease to be involved with us.  The loss of any these individuals would adversely affect our financial condition and the results of our operations.

 

We are dependent on the experience, knowledge, skill and expertise of our President and CEO Andrew Khor Poh Kiang. We are also in large part dependent on current CFO, Lee KokKeing. The loss of any of the key personnel listed above could materially and adversely affect our future business efforts. Our success depends in substantial part upon the services, efforts and abilities of Andrew Khor Poh Kiang, our Chairman and Chief Executive Officer, due to his experience, history and knowledge of the leisure and real estate industry in South East Asia and his overall insight into our business direction. The loss or our failure to retain Mr. Khor, or to attract and retain additional qualified personnel, could adversely affect our operations.  We do not currently carry key-man life insurance on Mr. Khor or any of our officers and have no present plans to obtain this insurance.  See “Management.”

 

The lack of public company experience of our management team may put us at a competitive disadvantage.

 

As a company with a class of securities registered under the Exchange Act, we are subject to reporting and other legal, accounting, corporate governance, and regulatory requirements imposed by the Exchange Act and rules and regulations promulgated under the Exchange Act.  Our President, Chairman and CEO has no public company experience and under the Federal securities laws of the United States and rules and regulations of the U.S. Securities and Exchange Commission, which could impair our ability to comply with these legal, accounting, and regulatory requirements.  Such responsibilities include complying with Federal securities laws and making required disclosures on a timely basis.  Our senior management may not be able to implement and effect programs and policies in an effective and timely manner that adequately responds to such increased legal and regulatory compliance and reporting requirements. Our failure to do so could lead to the imposition of fines and penalties and further result in the deterioration of our business.

 

 10 
 

The loss of any of our executive officers could adversely affect our business.

 

We depend to a large extent on the efforts and continued employment of our executive officers, two of these officers are employed at other companies, and their other responsibilities could take precedence over their duties to us. The time Lee Kok Keing plans to devote to our business will primarily be based upon the financial accounting duties as CFO. We do not carry key man life insurance on any of our executive officers.

 

We are seeking additional funding to acquire full rights and ownership to land in Chiang Rai, Thailand. We cannot make any assurances that we will be successful in raising the required funds to execute our business plan.

 

We are seeking to acquire 126 hectares of land in the Chiang Saen District of Chiang Rai, Thailand, within a Free Trade Zone designated area to develop a leisure and tourist destination designed for both local and foreign tourists. The land acquisition costs are expected to cost over an estimated $6 million USD, while the construction of the flagpole, mall, office building complex, hotel, spiritual center and shops are expected to cost $120 million USD. As of the date of this Current Report, the Company has paid 5 million Thai Baht, or $159,000 in US dollars and owes a balance of 195 million Thai Baht, or $6,228,300 in US dollars (at today’s exchange rates) for the land in Chiang Rai, Thailand due by December 15, 2018. We cannot make any assurances that we will be successful with our capital raising plans to execute our business plan. We have already extended our financial commitment by one year in late 2017 and may not be able to further extend this commitment, and if we do, may not be able to do so with favorable terms.

 

If we are successful in acquiring full rights to our proposed land, competition from other real estate or related leisure companies could result in a decrease our business and a decrease in our financial performance.

 

Once engaged in our operations, we will operate in the highly competitive industry. Many of our potential competitors will likely include larger multinational companies, domestic real estate companies with multiple leisure projects, hotels and attractions have existed longer and have larger customer bases, greater brand recognition and significantly greater financial, marketing, personnel, technical and other resources than we do. In addition, many of these competitors may be able to devote significantly greater resources to:

 

·                        research and development of new projects

·                        attracting and retaining key employees;

·                        maintaining a large budget for marketing and promotional expenses

 

Our business plan relies on certain actions and events to occur that we have no control over.

 

We are completely dependent on the continued actions and events from parties we have no control over. Our business plan relies heavily on the condition that China continues to move forward implementing its OBOR initiative and brings additional roads and highways through Thailand. In addition, we are also relying on the Thai government to continue to build out its own domestic high speed rail network to bring additional tourists to northern Thailand. We have no influence, power or ability to determine if these projects by the Chinese government or the Thai government will continue or be successful. If these projects are not completed and do not produce the desired results, our business plan may not be fully implemented and we will likely experience adverse results.

 

Our management does not presently draw an annual salary or bonus.

 

Our management has not taken an annual salary or bonus for work provided towards the Company’s effort to develop its business plan. We plan to initiate reasonable salary and bonuses for our officers and directors in the future when our financial conditions improve and we make successful milestones towards our business plan.

 

 11 
 

Risks Related To Us Doing Business in Thailand

The risk of corruption in Thailand is high.

 

Our operations are located in Thailand and we have open communications and a favorable working relationship with the Thai government, however, risk of government corruption in Thailand is high. While Thailand has the legal framework and range of institutions to counter corruption, companies may regularly encounter bribery or other corrupt practices. Public services, land administration, the judicial system, tax administration, customs administration, public procurement, and natural resources are main points of government corruption. According to Transparency International, Thailand ranks 96 up from 101 in 2017 in its annual corruption index. Thailand improved its ranking as determined by its progress towards democracy and market freedom. We cannot assure you that we will not encounter corrupt practices in our dealings with the government and if we are met with disruption, our legal recourse may be limited against the government.

 

All of our revenues come from operations in Thailand which may affect financial results in U.S. dollar terms and could negatively impact our financial results.

 

All of our revenues come from Thailand and we are paid in Thai Baht. We expect this to continue as we execute our business plan to develop land in Thailand. We have no system in place to combat currency risk and may be affected negatively if the Thai Baht experiences any dramatic currency movements.

  

Contract drafting, interpretation and enforcement in Thailand involve significant uncertainty.

We have entered into numerous contracts governed by Thailand law, many of which are material to our business. As compared with contracts in the United States, contracts governed by Thai law tend to contain less detail and are not as comprehensive in defining contracting parties’ rights and obligations. As a result, contracts in Thailand are more vulnerable to disputes and legal challenges. In addition, contract interpretation and enforcement in Thailand is not as developed as in the United States, and the result of any contract dispute is subject to significant uncertainties. Therefore, we cannot assure you that we will not be subject to disputes under our material contracts, and if such disputes arise, we cannot assure you that we will prevail.

 

Special Risk Factor due to the Novel Coronavirus (COVID-19)

During late 2019, a virus now known as the Novel Coronavirus or “COVID-19” appeared in Wuhan, China. By March 11, 2020, the WHO (World Health Organization) labeled COVID-19 as a pandemic and many countries around the world began closing borders and making efforts to either shelter-in-place or quarantine its population. Our Company and all of our operations are located in Chiang Saen District of Chiang Rai which is located in northern Thailand. To the extent that we generate revenue, our business and operations are largely connected to the economic well-being of China. During the first quarter of 2020, China had placed a mandatory quarantine on certain areas, specifically in Wuhan located in Hubei Province. We experienced a decrease in tourists from China during this period, therefore, the negative effect of COVID-19 on our operations are no longer hypothetical scenarios and during the quarantine period in early 2020, our sales declined as a result.

As of the date of this Form 10-K filing, China has slowly begun to relax some quarantine measures and allowed some businesses to operate again. We cannot make any assurances that COVID-19 will not reappear with new infections and to the extent that COVID-19, or another virus appears, we may encounter prolonged operational lockdown measures which would disrupt our business operations.

Due to the quarantine order, we had difficulties with coordinating employees and staff for our 2019 annual audit and therefore compelled to file for a special extended 45 day period to file our 2019 annual report on Form 10-K with the U.S Securities and Exchange Commission via Form 8-K on March 23, 2020. We relied on the Order provided by the Commission's March 4, 2020 Order, Release No. 34-88318, as modified on March 25, 2020, Release No. 34-88465.

  

ITEM 1B.  UNRESOLVED STAFF COMMENTS.

 

None.

 12 
 

ITEM 2.  DESCRIPTION OF PROPERTY.

 

The Company maintains a virtual office in San Francisco, California, in the United States at 424 Clay Street, Lower Level, San Francisco, CA 94111. Its headquarters are located at 333, Village 6, Amphur Wiang Chiang, Chiang Rai, Thailand.

     
Location Address Size
San Francisco, California 424 Clay Street, Lower Level n/a (virtual office)
  San Francisco, CA 94111  
Chiang Rai, Thailand 333, Village 6, AmphurWiang Chiang 16,000 square meters
  Chiang Rai, Thailand 57150  

 

ITEM 3.  LEGAL PROCEEDINGS.

 

There are not presently any material pending legal proceedings to which the Registrant is a party or as to which any of its property is subject, and no such proceedings are known to the Registrant to be threatened or contemplated against it.

 

ITEM 4.  MINE SAFETY DISCLOSURES.

 

Not applicable.

PART II

 

ITEM 5.  MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES.

 

Market Information for Common Stock

 

Our common stock, par value $0.0001 per share, is not listed or quoted on any securities exchange and there is no public trading market for our common stock or our preferred stock, par value $0.0001 per share.

  

Stock Offering

 

On December 28, 2018, the Company filed its Form S-1 registration statement under The Securities Act of 1933 registering 500,000 shares of common stock for sale at $0.80 cents per share. The Form S-1 went effective as of February 11, 2019. As of the date of this Form 10-K, the Company had sold 5,000 shares of common stock to one investor.

 

Common Stock

 

Our Certificate of Incorporation authorizes the issuance of up to 1,000,000,000 shares of common stock, par value $0.0001 per share (the “Common Stock”) as amended. The Common Stock is not listed on a publicly-traded market or exchange. As of December 31, 2019, there were 120,105,000 shares issued and outstanding.

 

Preferred Stock

 

Our Certificate of Incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock, par value $.0001 per share (the “Preferred Stock”). The Company has issued 500,000 shares of Series A designated preferred stock.

 

Dividends

 

We have not paid any dividends on our common stock to date and do not intend to pay dividends prior to the completion of a business combination. The payment of dividends in the future will be contingent upon our revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of a business combination. The payment of any dividends subsequent to a business combination will be within the discretion of our then board of directors. It is the present intention of our board of directors to retain all earnings, if any, for use in our business operations and, accordingly, our board does not anticipate declaring any dividends in the foreseeable future.

 

 13 
 

Holders of Record

As of the close of business on August 19, 2020, there were 12 stockholders of record of our common stock and 1 stockholder of record of our preferred common stock.

 

Securities Authorized for Issuance under Equity Compensation Plans

 

The Company does not have any equity compensation plans or any individual compensation arrangements with respect to its common stock or preferred stock. The issuance of any of our common or preferred stock is within the discretion of our Board of Directors, which has the power to issue any or all of our authorized but unissued shares without stockholder approval.

 

Issuer Purchases of Equity Securities

 

None.

 

ITEM 6.  SELECTED FINANCIAL DATA.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

  

Results of Operations for the Year Ended December 31, 2019, compared to the Year Ended December 31, 2018

 

Revenues 

Sales revenue for the year ended December 31, 2019, was $12,997, compared to $10,833 for the year ended December 31, 2018, an increase of $2,164.

 

Cost of Goods Sold

Cost of revenue for the year ended December 31, 2019, was $79,735, compared to $7,246 for the year ended December 31, 2018, an increase of $72,489. This increase was due to the inventory reverse included in cost of revenue during the period.

 

Operating Expenses

General and administrative expense was $146,526 for the year ended December 31, 2019, compared to $220,962 for the year ended December 31, 2018, a decrease of $75,800.

 

Rent expense was $11,605 for the year ended December 31, 2019, compared to $13,002 for the year ended December 31, 2018, a decrease of $1,397.

 

Advertising and promotion expenses were $1,154 for the year ended December 31, 2019, compared to $12,233 for the year ended December 31, 2018, a decrease of $11,079. Advertising and promotion expense consists of advertising in magazines and promotional product giveaways of t-shirts and other souvenirs.

 

Professional fees were $28,347 for the year ended December 31, 2019, compared to $12,600 for year ended December 31, 2018, an increase of $15,747.

 14 
 

Other Income (Expenses)

 

Interest income for the year ended December 31, 2019, was $0, compared to $2 for the year ended December 31, 2018.

 

Interest expense for the year ended December 31, 2019, was $1,731, compared to $2,566 for the year ended December 31, 2018.

 

Net Loss

 

Net loss for the year ended December 31, 2019, was $256,101, compared to $257,774 for the year ended December 31, 2018.

 

Off-Balance Sheet Arrangements

 

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s 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” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

 

 

Report of Independent Registered Public Accounting Firm F-1   
     
Consolidated Balance Sheets as of December 31, 2019 and 2018 F-2  
     
Consolidated Statements of Operations for years ended December 31, 2019 and 2018 F-3   
     
Consolidated Statements of Stockholders’ Equity for years ended December 31, 2019 and 2018 F-4  
     
Consolidated Statements of Cash Flows for years ended December 31, 2019 and 2018 F-5  
     
Notes to Consolidated Financial Statements F-6  

 

 15 
 

Report of Independent Registered Public Accounting Firm

 

To the shareholders and the board of directors of ANDES7, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of ANDES7, Inc. as of December 31, 2019 and 2018, the related statements of operations, stockholders' equity (deficit), and cash flows for the years then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

Substantial Doubt about the Company’s Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has suffered recurring losses from operations and has a significant accumulated deficit. In addition, the Company continues to experience negative cash flows from operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

/S/ BF Borgers CPA PC

BF Borgers CPA PC

 

We have served as the Company's auditor since 2018

Lakewood, CO

September 14, 2020 

 F-1 
 

ANDES 7, INC. and Subsidiary
CONSOLIDATED BALANCE SHEETS
           
    December 31,    December 31, 
   2019    2018 
           
ASSETS          
           
Current assets:          
   Cash  $1,269   $2,216 
   Accounts receivable   —      618 
   Inventory, net   8,381    81,279 
   Other current assets   2,914    3,323 
Total current assets   12,564    87,436 
   Office deposit   —      8,042 
   Deposit – land contract   295,849    271,110 
   Construction in progress   22,429    20,646 
   ROU asset - operating lease   14,052    —   
   Property and equipment, net   237,393    245,313 
Total assets  $582,287   $632,547 
           
 LIABILITIES AND STOCKHOLDERS’ EQUITY          
           
Current liabilities:          
   Accounts payable and accrued liabilities  $9,174   $6,751 
   Due to a related party   42,730    43,720 
   Loans from directors   1,495,538    1,236,719 
   Loans payable, current portion   10,196    10,396 
Total current liabilities   1,557,638    1,297,586 
           
Long term liabilities:          
   Loans payable, non-current   3,081    13,538 
   Operating lease liability   14,052    —   
Total liabilities   1,574,771    1,311,124 
           
Stockholders’ Equity (Deficit):          
Preferred stock, $0.0001 par value, 5,000,000 shares authorized; 500,000 shares issued and outstanding as on December 31, 2019 and 2018 respectively   50    50 
Common stock, $0.0001 par value, 1,000,000,000 shares authorized, 120,105,000 and 120,100,000 shares issued and outstanding as on December 31, 2019 and 2018 respectively   12,011    12,010 
Additional paid in capital   243,033    238,044 
Accumulated deficit   (1,147,770)   (891,669)
Accumulated other comprehensive loss   (99,808)   (37,012)
Total stockholders’ deficit   (992,484)   (678,577)
           
Total liabilities and stockholders’ deficit  $582,287   $632,547 
           
The accompanying notes are an integral part of these audited consolidated financial statements.

 F-2 
 

 

ANDES 7, INC. and Subsidiary
CONSOLIDATED STATEMENTS OF OPERATIONS
 
    For the Year Ended December 31,  
   2019    2018  
Revenue  $12,997   $10,833 
Cost of revenue   79,735    7,246 
Gross Margin   (66,738)    3,587 
           
Operating expenses:          
General and administrative   146,526    220,962 
Rent expense   11,605    13,002 
Advertising and promotion   1,154    12,233 
Professional fees   28,347    12,600 
Total operating expenses   187,632    258,797 
Loss from operations   (254,370)   (255,210)
Other income (expense):          
Interest income   —      2 
Interest expense   (1,731)   (2,566)
Total other income (expense)   (1,731)   (2,564)
Loss before income taxes   (256,101)   (257,774)
           
Provision for income taxes   —      —   
Net loss  $(256,101)  $(257,774)
           
Other comprehensive income (loss):          
Foreign currency translation adjustment   (62,796)   13,964 
Comprehensive loss  $(318,4897)  $(243,810)
           
Loss per share basic & diluted  $(0.00)  $(0.00)
           
Weighted average outstanding shares, basic & diluted   120,101,301    64,949,315 
           
The accompanying notes are an integral part of these audited consolidated financial statements
 F-3 
 

 

ANDES 7, INC. and Subsidiary 

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY DECEMBER 31, 2019 AND 2018

 

   Preferred Stock  Common Stock  Additional paid in  Subscriptions  Accumulated  Other Comprehensive 
    Shares    Amount    Shares    Amount    capital    Receivable    Deficit    Income    Total 
                                              
Balance, December 31, 2017   —      —      10,100,000   $1,010   $249,044   $—     $(633,895)  $(50,976)  $(434,817)
Preferred stock issued   500,000    50                                  50 
Shares cancelled under merger plan with Abina   —      —      (1,000,000)   (100)   —      —      —      —      (100)
Shares issued under merger plan with Abina   —      —      111,000,000    11,100    (11,000)   —      —      —      100 
Foreign currency translation adjustment   —      —      —      —      —      —      —      13,964    13,964 
Net loss for the year ended December 31, 2018   —      —      —      —      —      —      (257,774)   —      (257,774)
Balance, December 31, 2018   500,000    50    120,100,000    12,010    238,044    —      (891,669)   (37,012)   (678,577)
Debt forgiveness   —      —      —      —      990    —      —      —      990 
Foreign currency translation adjustment   —      —      —      —      —      —      —      (62,796)   (62,796)
Common shares issued for cash   —      —      5,000    1    3,999    —      —      —      4,000 
Net loss for the year ended December 31, 2019   —      —      —      —      —      —      (256,101)   —      (256,101)
Balance, December 31, 2019   500,000    50    120,105,000    12,011    243,033    —      (1,147,770)   (99,808)   (992,484)
                                              
The accompanying notes are an integral part of these audited consolidated financial statements

 F-4 
 

ANDES 7, INC. and Subsidiary
CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

    For the Year Ended December 31, 
   2019    2018  
Cash flows from operating activities:          
Net loss  $(256,101)  $(257,774)
Adjustments to reconcile net loss to net cash used in operating activities:          

   Depreciation expense

   29,683    27,745 
           
Changes in operating assets and liabilities:          
  (Increase) Decrease in accounts receivable   618    2,974 
  (Increase) Decrease in inventory   72,898    (14,951)
  Decrease in other assets   8,451    (1,086)
  Increase in other liabilities   —      —   
  Decrease in accounts payable and accrued liabilities   2,423    2,322 
  Increase in deposits   (24,739)   (104,967)
Net cash used in operating activities   (166,767)   (345,737)
  Cash flows from investing activities:          
  Construction in progress   (1,783)   774 
  Purchase of property and equipment   (21,763)   (13,384)
Net cash used in investing activities   (23,546)   (12,610)
           
Cash flows from financing activities:          
  Repayment to related party debt   —      (6,550)
  Proceeds from sales of common stock   4,000    —   
  Proceed from preferred stock issued   —      50 
  Net proceeds from Director loans   258,819    305,270 
  Net proceeds (payments) from loans   (10,657)   (12,106)
Net cash provided by financing activities   252,162    286,664 
           
Effects of currency translation on cash   (62,796)   13,964 
           

Net increase in cash, cash equivalents, and restricted cash including exchange rate effect

   (947)    (57,719) 

Cash, cash equivalents, and restricted cash at beginning of year

   2,216    59,935 

Cash, cash equivalents, and restricted cash at end of year

  $1,269   $2,216 
           
Supplemental disclosures:          
  Cash paid for interest  $—     $—   
  Cash paid for taxes  $—     $—   
           
Non-cash transactions:          
  Shares issued under merger plan with Abina   —      —   
  Debt forgiveness  $990    —   
           
The accompanying notes are an integral part of these audited consolidated financial statements
 F-5 
 

ANDES 7, INC. and Subsidiary

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2019

(UNAUDITED)

 

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

ANDES 7 Inc. (the “Company”) was incorporated in the State of Delaware on July 27, 2015. ANDES 7 Inc. was formed as a vehicle to pursue a business combination with an operating company that would have perceived benefits of becoming a publicly traded corporation.

 

On February 12, 2016, the Company entered into a Subscription Agreements with three subscribers for the issuance of its restricted common stock – AbinaAsean, Co. Ltd., an entity organized under the laws of the Republic of Seychelles (8,000,000 shares), Toh Kean Ban (1,000,000 shares) and Dr. Ir. H.M. ItocTochija (1,000,000 shares). Each of the Subscription Agreements were the result of privately negotiated transactions without the use of public dissemination of promotional or sales materials. Each of the buyers represented they were “accredited investors,” and as such could bear the risk of such investment for an indefinite period of time and to afford a complete loss thereof.

 

On July 2, 2018, the Company entered into an Agreement and Plan of Merger between the Company, ANDES 7 Acquisition Corp, (“Merger Sub”) a Delaware corporation and Abina Co. Ltd. (the “Abina”). Abina is a corporation organized under the Kingdom of Thailand and has operated under the name “Abina Co. Ltd.” since August 3, 2015 and has since then operated a diverse business involved in investments in hotels, resorts, and commercial property. The Agreement and Plan of Merger provided for the acquisition by the Company of all the outstanding shares of Abina through a reverse merger of merger sub into Abina, the surviving corporation. The financial statements have been prepared to retroactively present the reverse merger.

 

NOTE 2 - GOING CONCERN

 

The accompanying audited financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company’s ability to raise additional capital through debt and/or equity financing is unknown. The obtainment of additional financing and the successful development of the Company’s contemplated plan of operations are necessary for the Company to continue. The ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern. However; management believes that the Company will generate sufficient cash flows to fund its operations and to meet its obligations on a timely basis for the next twelve months. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

 

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

 

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. These estimates and judgments are based on historical information, information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could differ from those estimates.

  

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Andes 7 Acquisition Corp and Abina Co, Ltd. All financial information has been prepared in conformity with accounting principles generally accepted in the United States of America. All significant intercompany transactions and balances have been eliminated.

 

 F-6 
 

Translation Adjustment

For the periods ended December 31, 2019 and 2018, the accounts of the Company were maintained, and its financial statements were expressed, in BAHT.  Such financial statements were translated into USD in accordance with the Foreign Currency Matters Topic of the Codification (ASC 830), with the BAHT as the functional currency.  According to the Codification, all assets and liabilities were translated at the current exchange rate at respective balance sheets dates, stockholders’ equity are translated at the historical rates and income statement items are translated at the average exchange rate for the period. The resulting translation adjustments are reported under other comprehensive income in accordance with the Comprehensive Income Topic of the Codification (ASC 220), as a component of members’ capital.  Transaction gains and losses are reflected in the income statement.

 

Comprehensive Income/(Loss)

The Company uses SFAS 130 “Reporting Comprehensive Income” (ASC Topic 220).  Comprehensive income is comprised of net income and all changes to the statements of stockholders’ equity, except those due to investments by stockholders, changes in paid-in capital and distributions to stockholders. Comprehensive loss for the period ended December 31, 2019 and 2018 is included in the statement of operations as a foreign currency translation adjustment.

 

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and cash in time deposits, certificates of deposit and all highly liquid instruments with original maturities of three months or less.

 

Revenue recognition

Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

 

The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company's performance obligations are transferred to customers at a point in time, typically upon delivery.

 

Inventories

Inventories are valued at the lower of cost or market utilizing the first-in first-out (FIFO) method. Management compares the cost of inventories with the market value and allowance is made for writing down their inventories to market value, if lower.

 

 F-7 
 

Fair value of financial instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements.  To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels.  The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

 

Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3: Pricing inputs that are generally observable inputs and not corroborated by market data.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accounts payable approximate their fair value because of the short maturity of those instruments.  

 

The Company does not have any assets or liabilities measured at fair value on a recurring basis. The Company’s property and equipment is subject to measurement on a non-recurring basis. No fair value adjustments are included in the financial statements.

 

Income taxes

The Company follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary 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 the Statements of Income in the period that includes the enactment date.

 

The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (“Section 740-10-25”) with regards to uncertainty in income taxes.  Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements.  Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.  The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures.  The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25.

  

Adoption of New Accounting Standards

In March 2016, the FASB issued ASU 2016-02, Leases (“ASU 2016-02”), which provides guidance for accounting for leases. ASU 2016-02 requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on effective interest rate method or a straight-line basis over the term of the lease. Accounting for lessors remains largely unchanged from current GAAP. ASU 2016-02 was effective for the Company’s fiscal year beginning after December 15, 2018 and subsequent interim periods. The Company has evaluated the adoption of ASU 2016-02 which was not applicable due to the Company having no leases.

The Company continually assesses any new accounting pronouncements to determine their applicability to the Company. Where it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and assures that there are proper controls in place to ascertain that the Company’s financials properly reflect the change.

 F-8 
 

NOTE 4 – INVENTORY

 

As of December 31, 2019 and December 31, 2018, inventory reserves were $75,431 and $0, respectively.

  

    December 31, 2019   December 31, 2018
Inventory, gross   $ 83,812     $ 81,279  
Inventory reserve     (75,431 )     —    
Inventory, net     8,381       81,279  
                 

 

NOTE 5 – DEPOSIT - LAND CONTRACT

 

In 2016 Abina entered into an agreement to purchase land in Chiang Rai, Thailand for 200 million Baht. The Company has paid a $195,043 deposit (5.8 million Baht) as of December 31, 2019 and the balance of 194.2 million Baht is due on per the terms of an extension given in an amended agreement. The Company plans on developing the land as a tourist destination and is currently in the process of building a café on the property.

 

NOTE 6 – CONSTRUCTION IN PROGRESS

  

In 2016 the Company incurred $79,744 of construction related costs of which approximately $68,000 was for the building of the café and the remaining balance of almost $12,000 primarily consisted of land and site development costs. As of December 31, 2019, the balance in the construction in progress account has increased to $22,429.

 

NOTE 7 – PROPERTY AND EQUIPMENT

 

The Company’s property and equipment primarily consists of office furniture and equipment and it is being depreciated using the straight-line method over a period of five years.

 

  

December 31,

2019

 

December 31,

2018

Office Equipment  $66,824   $59,819 
Accounting Software   832    766 
Flag Costs   32,799    30,192 
Vehicles   93,167    85,761 
Buildings and land costs   153,718    141,499 
Total property & equipment   347,340    318,037 
Less accumulated depreciation   (109,947)   (72,724)
Property & equipment, net  $237,393   $245,313 

 

Depreciation expense for the year ended December 31, 2019 and 2018 totaled $29,683 and $20,776 respectively.

 

NOTE 8 – LOANS PAYABLE

 

The Company has entered into two financing agreements for its vehicles used in the business. The following is a summary of these loans payable as of December 31, 2019: 

Loan  Issue Date  Maturity Date  Interest Rate  Beginning Balance  Payments  Balance 12/31/18  Payments  Balance
12/31/19
Siam Commercial Bank #1  7/14/2016  7/14/2020   5.029%  $29,846    (7,442)   14,438    (7,087)   7,351 
Siam Commercial Bank #2  11/29/2016  11/29/2020   8.98%   15,801    (2,165)   9,496    (3,570)   5,926 

 

NOTE 9 – PREFERRED STOCK

 

The Company is authorized to issue 5,000,000 shares of $0.0001 par value preferred stock.

 

On March 25, 2018, the Company with the authorization of the board of directors and the majority shareholder adopted a resolution to create 500,000 shares of Series A preferred stock. The Company then filed an amendment to its certificate of incorporation with the State of Delaware on May 10, 2018 to create a certificate of designation for 500,000 shares of Series A preferred stock with each share convertible into 1,000 shares of common stock and with voting rights of 1,000 votes for each share of Series A preferred stock.

 F-9 
 

On May 10, 2018, Manichan Khor, the wife of Andrew Khor Poh Kiang, the President, CEO and Chairman entered into a stock purchase agreement to purchase 500,000 shares of Series A preferred stock at par value for total proceeds of $50.

  

NOTE 10 – COMMON STOCK

 

The Company is authorized to issue 1,000,000,000 shares of $0.0001 par value common stock.

 

During the year December 31, 2018, as part of the Agreement and Plan of Merger with Abina Co. Ltd., the Company issued 111,000,000 shares of its common stock. In addition, Andrew Khor Poh Kiang cancelled 1,000,000 shares of his common stock.

During the year ended December 31, 2019, the Company issued 5,000 shares of its common stock for cash totaling $4,000.

NOTE 11 – RELATED PARTY TRANSACTIONS

During the year ended December 31, 2016, directors of Abina had loaned the Company a total of $655,565. The funds were used to pay for general operating expenses. All loans are unsecured, non-interest bearing and due on demand. As of December 31, 2019, the balance due was $1,495,538.

Since 2016, a related party had advanced the Company funds to pay for general operating expenses. The funds were unsecured, non-interest bearing and due on demand. During the three months ended June 30, 2019, Mr. Richard Chiang forgave the $990 due to him in connection with the 9,900,000 shares redeemed earlier and recorded $990 as debt forgiveness. As of December 31, 2019 and 2018, due to related party balance due was $42,730 and $43,720, respectively.

 

NOTE 12 – COMMITMENT 

In April 2017 Abina entered into a two-year lease for its office facility in Chiang Rai, Thailand which can be further renewed for two years starting April 1, 2019 and it expires on March 31, 2021. The monthly rent obligation is approximately $963 (Thai baht was converted to USD based on average exchange rate). Minimum required rental payments for 2018 and 2019 are approximately $11,556 and $2,889, respectively.

NOTE 13 – INCOME TAXES

The Company operates in Thailand and has no activities in the United States. Pursuant to the income tax laws of Thailand, the statutory income tax rate is 15% for taxable income of approximately $85,000 or less and 20% for taxable income in excess of $85,000. The Company utilizes a 20% income tax rate for purposes of estimating its tax valuation allowance.

 F-10 
 

The provision for Federal income tax consists of the following for the year ended December 31, 2019 and 2018:

   December 31, 2019  December 31, 2018
Federal income tax benefit attributable to:          
Current Operations  $53,781   $54,133 
Less: valuation allowance   (53,781)   (54,133)
Net provision for Federal income taxes  $—     $—   

 
Net deferred tax assets consist of the following components as of December 31, 2019 and 2018:

   December 31, 2019  December 31, 2018
Unused tax loss brought forward  $(891,669)  $(633,895)
Loss for the year   (256,101)   (257,774)
Expenses not deductible for tax   —      —   
Total net operating loss carry forwards  $(1,147,770)  $(891,669)
Effective tax rate   21%   21%
Unrecognized deferred tax asset carried forward  $241,032   $187,250 
Less: valuation allowances   (241,032)   (187,250)
Deferred income tax benefit, net of valuation allowance  $—     $—   

 
The Company has not recognized a deferred tax asset in these financial statements as it is not more-likely-than-not that the future taxable profit against which loss can be utilized will be realized.  Accordingly, a 100% valuation allowance has been made. 

The expected tax expense (benefit) based on the U.S. federal statutory rate is reconciled with actual tax expense (benefit) as follows:

 

   For the year ended
   December 31, 2019
Statutory Federal Income Tax Rate   21%
Nontaxable permanent differences   —   
Change in valuation allowance   (21)%
Income tax provision   —   

  

Uncertain Tax Positions

Interest associated with unrecognized tax benefits are classified as income tax and penalties in general and administrative expenses in the statement of operations.  For the period ended December 31, 2019 and 2018, the Company had no related interest and penalties expenses. Currently, the Company is not undergoing examination by major tax jurisdictions, but the tax authority in Thailand has the right to examine the Company’s 2019 and 2018 income tax return.

 F-11 
 

NOTE 14 – ACCUMULATED OTHER COMPREHENSIVE LOSS

 

The balance of related after-tax components comprising accumulated other comprehensive income included in stockholders’ equity were as follows:

 

   December 31,
2019
  December 31, 2018
Accumulated other comprehensive loss, beginning of period  $(37,012)  $(50,976)
Change in cumulative translation adjustment   (62,796)   13,964 
Accumulated other comprehensive loss  $(99,808)  $(37,012)

  

NOTE 15 – SUBSEQUENT EVENTS

Subsequent to the year ended December 31, 2019, the Company issued 35,000 shares of its common stock for cash totaling $28,000.

 

 

 

 

 

 F-12 
 

ITEM 9. CHANGES IN DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

 

On December 7, 2018, the Company dismissed its auditor, De Leon & Company, P.A. There were no disagreements or any matter of accounting principles or practices, financial statement disclosure, or procedure that led to its dismissal. On the same day, the Company engaged BF Borgers CPA PC as its new independent principal accountant.

 

There are not and have not been any disagreements between the Company and its accountants on any matter of accounting principles, practices or financial statement disclosure.

 

ITEM 9A. CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures 

 

As required by Rule 13a-15 under the Securities Exchange Act of 1934, we have carried out an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this annual report, December 31, 2019. This evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer.

 

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 periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our company’s reports filed under the Securities Exchange Act of 1934 is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

 

Based upon that evaluation, including our Chief Executive Officer and Chief Financial Officer, we have concluded that our disclosure controls and procedures were ineffective as of the end of the period covered by this report due to a material weakness in our internal control over financial reporting, which is described below.

 

Management’s Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934). Management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013). As a result of this assessment, management concluded that, as of December 31, 2019, our internal control over financial reporting was not effective. Our management identified the following material weaknesses in our internal control over financial reporting, which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.

 

We plan to take steps to enhance and improve the design of our internal control over financial reporting. During the period covered by this quarterly report on Form 10-K, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we hope to implement the following changes during our fiscal year ending December 31, 2020: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out in (i) and (ii) are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

  

 16 
 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting during the year ended December 31, 2019 have materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

 

ITEM 9B. OTHER INFORMATION.

 

Not applicable.

   

PART III

 

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

A. Identification of Directors and Officers.


The current officers and directors will serve for one year or until their respective successors are elected and qualified. Neither the Company, its property, nor any of its directors or officers is a party to any pending legal proceeding, nor have they been subject to a bankruptcy petition filed against them.  None of its officers or directors have been convicted in, nor is subject to, any criminal proceeding.

 

The names and ages of the directors and executive officers of the Company and their positions with the Company are as follows:

 

Name   Age   Position
Executive Officers          
Andrew Khor Poh Kiang     53      President, Chief Executive Officer, Chairman
Lee Kok Keing     58      Chief Financial Officer
Choon Moh Khor     61      Chief Operations Officer
Jannie Gui Honey       50      Secretary
Dr. Ng Mooi Eng     52      Treasurer

 

Officers and Directors

 

Andrew Khor Poh Kiang –President, Chief Executive Officer and Chairman: From 2000 to 2002, Mr. Khor was the assistant to Consul General Mr. Wan Jaafar Wan Noor from the Ministry of Foreign Affairs, Malaysia in Thailand. From 2002 to 2006, Mr. Khor was managing SAG Group Company Limited in Thailand, a mining company he controlled that supplied iron ore to China. From 2006 to present, Mr. Khor has been involved in the High Technology area through " The Super Conductivity Maglev System " of Japan Flagship Group " or known as FSG, as its South East Asia Representative, dealing with local governments in South East Asia for the " HIGH SPEED SURFACE TRAIN  " and also appointed by STAR CRUISES, Berjaya Group and TanjungRhu Resorts as human resources trainer in hospitality and residential property development. Mr. Khor is the President of AbinaAsean Co., Ltd. Mr. Khor holds a Masters of Business Administration from ICS Singapore. 

 

Lee Kok Keing --Chief Financial Officer: Mr. Lee began his career in banking and finance with RHB Bank Berhad from 1979 to 2006, he held various positions and served as branch manager for a few years. From 2006 to 2015, he joined RHB Investment Bank Berhad (formerly OSK Investment Bank) and served in several executive positions as head of branch.

 

Choon Moh Khor --Chief Operations Officer: Mr. Khor began his career as a machine operator for a plastics company in 1978 and has 40 years experience in customer network operations, marketing, brand building, and general management. Over the course of his experience, he has worked in various positions for companies such as Toyo Ink Sdn. Bhd., Kwong Lee Hang Sdn. Bhd, PEC Engineering Sdn. Bhd, British-American Insurance, Automobile Rust Hunter Sdn. Bhd, Pearl Jojoba Sdn. Bhd, Cyber-Trend Marketing Sdn. Bhd,and Yzon Distribution & Marketing Sdn. Bhd.

 17 
 

Jannie Gui Honey --Secretary: Ms. Gui was employed by NBE Construction Sdn Bhd for 27 years as an Accounts Clerk; she worked as Sales Manager for Vanhoden Sdn Bhd from 2005 to 2010 and as its Operating Manager from 2010 to 2014. Most recently, she has held the position of Secretary for Abina Company Limited from 2015 to present.

 

Dr. Ng Mooi Eng—Treasurer: Dr. Ng has 25 years experience in business managing branding and franchising of women's wear apparel for V-Up Advance Sdn Bhd. Dr. Eng holds a master’s and doctorate in business administration from Ansted University.

 

B. Significant Employees.

 

As of the date hereof, the Company has no significant employees.

 

C. Family Relationships.

 

There are no family relationships among directors, executive officers, or persons nominated or chosen by the issuer to become directors or executive officers. Our largest shareholder Manichan Khor and shareholder of our Series A Preferred stock is the wife of our President, Chief Executive Officer and Chairman, Andrew Khor Poh Kiang, she is not a director and holds no executive positions at the Company.

 

D. Involvement in Certain Legal Proceedings.

 

There have been no events under any bankruptcy act, no criminal proceedings and no judgments, injunctions, orders or decrees material to the evaluation of the ability and integrity of any director, executive officer, promoter or control person of Registrant during the past five years.

  

Nominating Committee

 

We have not adopted any procedures by which security holders may recommend nominees to our Board of Directors. 

 

Audit Committee

 

The Board of Directors acts as the audit committee. The Company does not have a qualified financial expert at this time because it has not been able to hire a qualified candidate. Further, the Company believes that it has inadequate financial resources at this time to hire such an expert. The Company intends to continue to search for a qualified individual for hire.

 

ITEM 11.   EXECUTIVE COMPENSATION.

 

Our President and Chief Executive Officer and Chief Financial Officer have not taken compensation for their services. Any compensation arrangement for our officers and directors will be approved and ratified by our Board of Directors. It is not anticipated at this date that our officers and directors will be compensated for serving in their positions.

 

The Company has no stock option, retirement, pension, or profit sharing programs for the benefit of directors, officers or other employees, but our officers and directors may recommend adoption of one or more such programs in the future.

 

We have no employment agreements with our officers, although we may enter into such agreements following our receipt of additional capital.

 

The Company does not have a standing compensation committee, audit committee, nomination committee, or committees performing similar functions.  We anticipate that we will form such committees of the Board of Directors once we have a full Board of Directors.

 

 18 
 

The following table summarizes the compensation paid to our President and Chief Executive Officer and Chief Financial Officer, (collectively, the “Named Executive Officers”) during or with respect to the fiscal year ended December 31, 2019 and December 31, 2018.

 

Summary Compensation Table

 

Name and principal position   Year    Salary    Bonus    

Non-Equity

Incentive Plan (1)

    

All other

compensation (2)

    Total 
Andrew Khor Poh Kiang (1)   2019    —      —      —      —      —   
President, CEO and Chairman   2018    —      —      —      —      —   
Lee KokKeing (2)   2019    —      —      —      —      —   
CFO   2018    —      —      —      —      —   

   

(1) Mr. Khor became our President and Chief Executive Officer on February 12, 2016, in connection with the change in control of our company from our former control shareholder. Mr. Khor did not receive any compensation with respect to the years ended December 31, 2019 and December 31, 2018. Mr. Khor is not currently being paid an annual salary for serving as our President, Chief Executive Officer and Chairman. He will be eligible for additional bonus compensation, to be determined by the Board of Directors.

 

(2) Mr. Lee became our Chief Financial Officer and Secretary on February 12, 2016. Mr. Lee is not currently being paid an annual salary for serving as Chief Financial Officer. He will be eligible for additional bonus compensation, to be determined by the Board of Directors.

 

Director Compensation

 

We currently have one director, our President, Chief Executive Officer and Chairman, Andrew Khor Poh Kiang. We not currently pay any cash fees to our directors, nor do we pay directors’ expenses in attending board meetings.

 

Employment Agreements

 

The Company is not a party to any employment agreements.

 

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

 

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

As of August 19, 2020, there were 120,140,000 shares of common stock issued and outstanding.  The following table sets forth certain information regarding the beneficial ownership of the outstanding shares as of the date of this Report, (i) each of our executive officers and directors; and (ii) all of our executive officers and directors as a group.

Except as otherwise indicated, each such person has investment and voting power with respect to such shares, subject to community property laws where applicable.   The address of all individuals for whom an address is not otherwise indicated is 333, Village 6, AmphurWiang Chiang, Chiang Rai, Thailand 57150.

Name and Address of Beneficial Owner Title of Class

Amount and Nature of

Beneficial Ownership

Percent of Class(1)
Andrew Khor Poh Kiang Common Stock 54,390,000     45%
All Directors and Officers as a group, 1 person          
ManichanKhor(3) Common Stock 55,500,000   46%
TantidaSae-Tang Common Stock 1,110,000   *
AbinaAsean, Co. Ltd. (Republic of Seychelles) Common Stock 8,000,000   7%
Dr. Ir. HM ItocTochija Common Stock 1,000,000   *
Tech Associates, Inc.(2) Common Stock 100,000   *
Manichan Khor Series A Preferred 500,000   100%

 *Denotes less than 5%.

 

 19 
 

(1) The above table is based upon information derived from our stock records. Unless otherwise indicated in the footnotes to this table and subject to community property laws where applicable. Unless otherwise indicated, beneficial ownership is determined in accordance with the Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended, and includes voting or investment power with respect to the shares beneficially owned. Applicable percentages are based upon 120,140,000 shares of common stock outstanding as of August 19, 2020.

(2) The address for Tech Associates Inc. is 650 California Street, 7th Floor, San Francisco, CA 94108.

(3) Manichan Khor is the wife of our President, CEO and Chairman, Andrew Khor Poh Kiang, and both share mutual beneficial ownership of their shares.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

 

Except as otherwise indicated herein, there have been no related party transactions, or any other transactions or relationships required to be disclosed pursuant to Item 404 of Regulation S-K.

 

Director Independence

 

None.

 

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

 

The following is a summary of the fees billed to us by BF Borgers CPA PC and De Leon & Co, P.A. for professional services rendered during the years ended December 31, 2019 and 2018:

 

Service   2019    2018 
Audit Fees  $     $   
Audit-Related Fees   20,000      50,400   
Tax Fees   —      —   
All Other Fees   —      —   
Total  $20,000     $50,400   

 

  1) Audit Fees consist of fees billed for professional services rendered for the audit of our annual financial statements and review of the interim financial statements included in quarterly reports and services that are normally provided by our accountants in connection with statutory and regulatory filings or engagements.

 

  2) Audit-Related Fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit Fees.” This category includes fees related to due diligence services pertaining to potential business acquisitions/disposition; and consultation regarding accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standard or interpretation by the SEC, FASB or other regulatory or standard-setting bodies as well as general assistance with implementation of the requirements of SEC rules or listing standards promulgated pursuant to the Sarbanes-Oxley Act of 2002.

 

 20 
 

  3) Tax Fees consist of fees billed for professional services rendered for tax compliance, tax advice and tax planning. These services include assistance regarding federal, state and local tax compliance, planning and advice.

 

  4) All Other Fees consist of fees for products and services other than the services reported above.

 

Our Board of Directors is responsible for approving all Audit, Audit-Related, Tax and Other Services. The Board of Directors pre-approves all auditing services and permitted non-audit services, including all fees and terms to be performed for us by our independent registered public accounting firm at the beginning of the fiscal year. Non-audit services are reviewed and pre-approved by project at the beginning of the fiscal year. Any additional non-audit services contemplated by the Company after the beginning of the fiscal year are submitted to the Board of Directors for pre-approval prior to engaging the independent auditor for such services.

 

Audit Fees

 

The aggregate fees incurred during the years ended December 31, 2019 and 2018 for professional services rendered by the independent registered public accounting firm for the audit of the Company's annual financial statements and review of financial statements included in the Company's Form 10-K and Form 10-Q reports and services normally provided in connection with statutory and regulatory filings or engagements were $20,000 and $50,400, respectively.

 

Audit Related Fees

None.

Tax Fees

 

There were no fees billed by De Leon & Co, P.A.or BF Borgers CPA PC for professional services for tax compliance, tax advice, and tax planning for the fiscal years ended December 31, 2019 and 2018.

 

All Other Fees

 

There were no fees billed by De Leon & Co, P.A. or BF Borgers CPA PC for other products and services for the fiscal years ended December 31, 2019 and 2018.

 

 

Audit Committee’s Pre-Approval Process

 

The Board of Directors acts as the audit committee of the Company, and accordingly, all services are approved by all the members of the Board of Directors.

 

 21 
 

 PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

 

 

(a) Exhibits:

 

Exhibit Exhibit Description Filed herewith Form Period ending Exhibit Filing date

3.1

Certificate of Incorporation

 10

 3.1

 08/07/15

3.2 By-Laws   10   3.2 08/07/15
3.3 Certificate of Amendment to Certificate of Incorporation, dated February 25, 2016   8-K   3.3 03/04/16
4.1 Specimen Stock Certificate 10   4.1 08/07/15
10.1 Land Purchase Extension to December 15, 2020 X        
10.2 Café Land Extension Due December 20, 2020 X        
21.1 Subsidiaries X        
99.1 Consent in Lieu of Shareholder Meeting, dated, February 12, 2016   8-K   99.1 02/16/16
99.2 Resolutions of the Board of Directors, dated, February 12, 2016   8-K   99.2 02/16/16
99.3 Resolutions of the Board of Directors, dated, February 12, 2016   8-K   99.3 02/16/16
99.4 Stock Subscription Agreement, Abina Asean Co. Ltd.   8-K   99.4 02/16/16
99.5 Stock Subscription Agreement, Toh Kean Ban   8-K 99.5 02/16/16
99.6 Stock Subscription Agreement, Dr. Ir. H.M Itoc Tochija   8-K   99.6 02/16/16
31 Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X      
32 Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X      
101.INS XBRL Instance Document X        
101.SCH XBRL Taxonomy Extension Schema Document X        
101.CAL XBRL Taxonomy Extension CalculationLinkbase Document X        
101.LAB XBRL Taxonomy Extension Label LinkbaseDocument X        
101.PRE XBRL Taxonomy Extension Presentation LinkbaseDocument X        
101.DEF XBRL Taxonomy Extension Definition Linkbase Definition X        

 

ITEM 16. FORM 10-K SUMMARY

 

None.

 

 22 
 

SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

ANDES 7 INC.

 

Dated: September 14, 2020

     
  By: /s/ Andrew Khor Poh Kiang
   

Andrew Khor Poh Kiang

President, Chief Executive Officer, Chairman of the Board of Directors

     
  By: /s/ Lee KokKeing
   

Lee KokKeing

Chief Financial Officer

 

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

 Name   Title   Date  
           
By: /s/ Andrew Khor Poh Kiang    Chief Executive Officer (Principal Executive Officer) and Chairman of the Board of Directors   September 14, 2020  

 

 

 

 

 

 

 

 23