WASHINGTON, D.C. 20549
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
RHINO PRODUCTIONS, INC.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
RHINO PRODUCITONS, INC.
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are subject to a number of risks and uncertainties. All statements that are not historical facts are forward-looking statements, including statements about our business strategy, the effect of Generally Accepted Accounting Principles ("GAAP") pronouncements, uncertainty regarding our future operating results and our profitability, anticipated sources of funds and all plans, objectives, expectations and intentions and the statements regarding future potential revenue, gross margins and our prospects for fiscal 2009.2010. These statements appear in a number of places and can be identified by the use of forward-looking terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "future," "intend," or "certain" or the negative of these terms or other variations or comparable terminology, or by discussions of strategy.
Rhino Productions, Inc. was incorporated in the state of Nevada on October 16, 2007. The Company has never declared bankruptcy, it has never been in receivership, and it has never been involved in any legal action or proceedings. Since becoming incorporated, Rhino has not made any significant purchase or sale of assets, nor has it been involved in any mergers, acquisitions or consolidations and the Company owns no subsidiaries. The fiscal year end is December 31st. The Company has not had revenues from operations since its inception and/or any interim period in the current fiscal year.
We are dependent on the services of Ya Kun Song, our sole officer and director, to obtain capital required to implement our business plan and for identifying, investigating, negotiating and integrating potential acquisition opportunities. The loss of the services of Ya Kun Song could have a substantial adverse effect on us.
The expansion of our business will be largely contingent on our ability to retain Ya Kun Song, our sole officer and director, upon whom we will rely to obtain capital required to implement our business plan and for identifying, investigating, negotiating and integrating potential acquisition candidates and to attract and retain highly qualified corporate and operations level management team. The loss of the services of Ya Kun Song could have a substantial adverse effect on us.
The time and cost of preparing a private company to become a public reporting company may preclude us from entering into a merger or acquisition with the most attractive private companies.
Rhino has
Target companies that fail to comply with SEC reporting requirements may delay or preclude acquisition. Sections 13 and 15(d) of the Exchange Act require reporting companies to provide certain information about significant acquisitions, including audited financial statements for the company acquired. The time and additional costs that may be incurred by some target entities to prepare these statements may significantly delay or essentially preclude consummation of an acquisition. Otherwise suitable acquisition prospects that do not conducted any product researchhave or are unable to obtain the required audited statements may be inappropriate for acquisition so long as the reporting requirements of the Exchange Act are applicable.
We may be subject to further government regulation which would adversely affect our operations.
Although we will be subject to the reporting requirements under the Exchange Act, management believes we will not be subject to regulation under the Investment Company Act of 1940, as amended (the "Investment Company Act"), since we will not be engaged in the business of investing or trading in securities. If we engage in business combinations which result in our holding passive investment interests in a number of entities, we could be subject to regulation under the Investment Company Act. If so, we would be required to register as an investment company and development since inception. There was no purchase or sale of any plantcould be expected to incur significant registration and or significant equipment.compliance costs. We have obtained no patents, trademarks licenses, or labor contracts. We currently are not awareformal determination from the SEC as to our status under the Investment Company Act and, consequently, violation of any governmental approval requiredthe Investment Company Act could subject us to conduct our business.material adverse consequences.
There is noAny potential acquisition or merger with a foreign company may subject us to additional risks.
If we enter into a business combination with a foreign concern, we will be subject to risks inherent in business operations outside of the United States. These risks include, for example, currency fluctuations, regulatory problems, punitive tariffs, unstable local tax policies, trade embargoes, risks related to shipment of raw materials and finished goods across national borders and cultural and language differences. Foreign economies may differ favorably or unfavorably from the United States economy in growth of gross national product, rate of inflation, market for our common stockdevelopment, rate of savings, and capital investment, resource self-sufficiency and balance of payments positions, and in other respects.
If we cannot provide any guarantee or assurance market will everfail to develop for the common stock in the future. If such a market is not developed shareholders wouldand maintain an effective system of internal controls, we may not be able to sell their sharesaccurately report our financial results or prevent fraud, as a result, current and likely lose their entire investment.
Other than Ronald Brigham (officer and director) there are no other employees. Currently Mr. Brigham is donating his time to the development of the Company. There is no employment agreement by and between us and Mr. Brigham.
Factors Affecting Future Operating Results
This Annual Report on Form 10-K contains forward-looking statements concerning our future programs, expenses, revenue, liquidity and cash needs as well as our plans and strategies. These forward-looking statements are based on current expectations and we assume no obligation to update this information, except as required by applicable laws and regulations. Numerous factors could cause actual results to differ significantly from the results described in these forward-looking statements, including the following risk factors.
Because our auditors have issued a going concern opinion, there is substantial uncertainty we will continue activities in which case youpotential shareholders could lose your investment.
Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoingconfidence in our financial reports, which could harm our business forand the next twelve months. As such we may have to cease activities and you could lose your investment.
We currently do not have adequate funds to cover the costs associated with maintaining our status as a Reporting Company.
The Company currently has approximately $3,458 of cash available. This amount will not be enough to pay the legal, accounting, and filing fees that is required to maintain our status as a reporting company, which is currently estimated at $15,000 for fiscal year 2009. If we can no longer be a reporting company our common stock would no longer be eligible for applying for quotationtrading price of our common stock on the Over-the-Counter Bulletin Board. This would result in there being no public market for an investor to trade our common stock and any investment made would be lost in its entirety.
Because of our inherent limitations, internal control over financial reporting may not prevent or detect misstatements on our financial statements.
During the auditing process for the 2008 annual report; the Company discovered inconsistencies within its quarterly reports for the first, second and third quarters of 2008. The Company believes this was due to the lack of internal control over the financial reporting for these periods.
Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because changes in conditions may occur or the degree of compliance with the policies or procedures may deteriorate.
We lack an operating history and have losses which we expect to continue into the future. As a result, we may have to suspend or cease activities, which would result in a complete loss of any investment made into the Company.stock.
We were incorporated on October 16, 2007 and we have not started our proposed business activities or realized any revenues. We have no operating history upon which an evaluation of our future success or failure can be made. As of December 31, 2008 our net loss since inception is $20,827. Based upon current plans, we expect to incur operating losses in future periods. As a result, we may not generate revenues in the future. Failure to generate revenues will causeEffective internal controls are necessary for us to suspend or cease activities.
If we are able to complete financing through the sale of additional shares of our common stock in the future, then shareholders will experience dilution.
The most likely source of future financing presently available to us is through the sale of shares of our common stock. Any sale of common stock will result in dilution of equity ownership to existing shareholders. This means that if we sell shares of our common stock, more shares will be outstandingprovide reliable financial reports and each existing shareholder will own a smaller percentage of the shares then outstanding. To raise additional capital we may have to issue additional shares, which may substantially dilute the interests of existing shareholders. Alternatively, we may have to borrow large sums, and assume debt obligations that require us to make substantial interest and capital payments.
We are subject to the requirements of section 404 of the Sarbanes-Oxley Act. If we are unable to timely comply with section 404 or if the costs related to compliance are significant, our profitability, stock price and results of operations and financial condition could be materially adversely affected.
We are required to comply with the provisions ofeffectively prevent fraud. Section 404 of the Sarbanes-Oxley Act of 2002 which requirerequires us to maintain an ongoing evaluationevaluate and integration of thereport on our internal controls of our business. We were required to documentover financial reporting. Compliance with Section 404 requires that we strengthen, assess and test our system of internal controls to provide the basis for our report. The process of strengthening our internal controls and certify that we are responsible for maintaining an adequate system of internal control procedures for the year ended December 31, 2008. In subsequent years, our independent registered public accounting firm will be required to opine on those internal controlscomplying with Section 404 is expensive and management’s assessment of those controls. In the process, we may identify areas requiring improvement,time consuming, and we may have to design enhanced processes and controls to address issues identified through this review.
We evaluated our existing controls for the year ended December 31, 2008. Our Chief Executive Officer and Chief Financial Officer identified material weaknesses in our internal control over financial reporting and determined that we did not maintain effective internal control over financial reporting as of December 31, 2008. The identified material weaknesses did not result in material audit adjustments to our 2008 financial statements; however, uncured material weaknesses could negatively impact our financial statements for subsequent years.
requires significant management attention. We cannot be certain that the measures we undertake will ensure that we will bemaintain adequate controls over our financial processes and reporting in the future. Furthermore, if we are able to successfully completerapidly grow our business, the procedures, certificationinternal controls that we will need will become more complex, and attestation requirements of Section 404significantly more resources will be required to ensure our internal controls remain effective. Failure to implement required controls, or thatdifficulties encountered in their implementation, could harm our auditors will not haveoperating results or cause us to reportfail to meet our reporting obligations. If we discover a material weakness in connectionour internal controls, the disclosure of that fact, even if the weakness is quickly remedied, could diminish investors' confidence in our financial statements and harm our stock price. In addition, non-compliance with Section 404 could subject us to a variety of administrative sanctions, including the suspension of trading, ineligibility for listing on the OTC Bulletin Board, and the inability of registered broker-dealers to make a market in our common stock, which would further reduce our stock price.
Since our principal stockholder beneficially owns a majority of our outstanding of common stock, and together with two other stockholders in the aggregate own beneficially over 90% of our outstanding shares, you will not have the ability to determine the outcome of matters requiring stockholder approval, including the acquisition of a target business.
Our principal stockholder, which is controlled by our sole officer and director, owns 52.50% of the outstanding shares of our common stock, and two other stockholders beneficially own in the aggregate an additional 38% of our outstanding shares of common stock. As a result, you will not have the ability to determine the outcome of matters requiring the approval of stockholders, including: (a) election of our board of directors; (b) removal of any of our directors; (c) amendments to our Articles of Incorporation or bylaws; (d) adoption of measures that could delay or prevent a change in control or impede a merger, takeover or other business combination involving us, or (e) other significant corporate transactions, including the acquisition of a target business.
Trading in our shares of common stock is limited, and will not improve unless we become profitable and secure more active market makers.
There is a limited trading market for our common stock. There can be no assurance that a regular trading market for our securities will continue to develop or that it will be sustained. The trading price of our securities could be subject to wide fluctuations, in response to announcements by us or others, developments affecting us, and other events or factors. In
addition, the stock market has experienced extreme price and volume fluctuations in recent years. These fluctuations have had a substantial effect on the market prices for many companies, often unrelated to the operating performance of such companies, and may adversely affect the market prices of the securities. Such risks could have an adverse affect on the stock's future liquidity.
Under our Articles of Incorporation, our Board of Directors has the authority, without stockholder approval, to issue preferred stock with terms that may not be beneficial to common stock holders and with the presentationability to adversely affect stockholder voting power and perpetuate the board's control over the Company.
Our Board of Directors by resolution may authorize the issuance of up to 5,000,000 shares of preferred stock in one or more series with such limitations and restrictions as it may determine, in its sole discretion, with no further authorization by security holders required for the issuance of such shares. The Board may determine the specific terms of the preferred stock, including: designations; preferences; conversions rights; cumulative, relative; participating; and optional or other rights, including: voting rights; qualifications; limitations; or restrictions of the preferred stock.
The issuance of preferred stock may adversely affect the voting power and other rights of the holders of common stock. Preferred stock may be issued quickly with terms calculated to discourage, make more difficult, delay or prevent a change in control of our financial statements.company or make removal of management more difficult. As a result, the Board of Directors' ability to issue preferred stock may discourage the potential hostile acquirer, possibly resulting in beneficial negotiations. Negotiating with an unfriendly acquirer may result in terms more favorable to us and our stockholders. Conversely, the issuance of preferred stock may adversely affect the market price of, and the voting and other rights of the holders of the common stock. We presently have no plans to issue any preferred stock.
We may, in the future, issue additional shares of common stock, which would reduce investors' percent of ownership and may dilute our share value.
Our Articles of Incorporation authorizes the issuance of 70 million shares of common stock. The future issuance of common stock may result in substantial dilution in the percentage of our common stock held by our then existing shareholders. We may value any common stock issued in the future on an arbitrary basis. The issuance of common stock for future services or acquisitions or other corporate actions may have the effect of diluting the value of the shares held by our investors, and might have an adverse effect on any trading market for our common stock.
Our common stock is subject to the "Penny Stock" Rules of the SEC and the trading market in our securities is limited, which makes transactions in our stock cumbersome and may reduce the value of an investment in our stock.
If we failThe Securities and Exchange Commission has adopted Rule 15g-9 which establishes the definition of a "penny stock," for the purposes relevant to complyus, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the requirements of Section 404rules require: (a) that a broker or if our auditor’s report such material weakness,dealer approve a person's account for transactions in penny stocks; and (b) the accuracybroker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and timelinessquantity of the filingpenny stock to be purchased.
In order to approve a person's account for transactions in penny stocks, the broker or dealer must: (a) obtain financial information and investment experience objectives of the person; and (b) make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.
The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the Commission relating to the penny stock market, which, in highlight form: (a) sets forth the basis on which the broker or dealer made the suitability determination; and (b) that the broker or dealer received a signed, written agreement from the investor prior to the transaction. Generally, brokers may be less willing to execute transactions in securities subject to the "penny stock" rules. This may make it more difficult for investors to dispose of our annual report mayCommon shares and cause a decline in the market value of our stock.
Disclosure also has to be materially adversely affectedmade about the risks of investing in penny stocks in both public offerings and could cause investorsin secondary trading and about the commissions payable to lose confidenceboth the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in our reported financialcases of fraud in penny stock transactions. Finally,
monthly statements have to be sent disclosing recent price information which could have a negative effectfor the penny stock held in the account and information on the trading pricelimited market in penny stocks.
Because we do not intend to pay any cash dividends on our common stock, our shareholders will not be able to receive a return on their shares unless they sell them.
We intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends on our common stock. In addition, a material weaknessstock in the effectiveness offoreseeable future. Unless we pay dividends, our internal controls over financial reporting could result in an increased chance of fraud and the loss of customers, reduce our abilityshareholders will not be able to obtain financing and require additional expendituresreceive a return on their shares unless they sell them. We cannot assure you that you will be able to comply with these requirements, each of which could have a material adverse effect on our business, results of operations and financial condition.sell shares when you desire to do so.
Further, we believe that the out-of-pocket costs, the diversion of management’s attention from running the day-to-day operations and operational changes caused by the need to comply with the requirements of Section 404 of the Sarbanes-Oxley Act could be significant. If the time and costs associated with such compliance exceed our current expectations, our results of operations could be adversely affected.
ITEM 1B | UNRESOLVED STAFF COMMENTS |
None
There are no pending legal proceedings to which we are a party or in which any of our directors, officers or affiliates, any owner of record or beneficially of more than 5% of any class of our voting securities, or security holder is a party adverse to us or has a material interest adverse to us. Our property is not the principal offices are located 16887 NW King Richard Court, Sherwood, Oregon 94140.subject of any pending legal proceedings.
ITEM 3 | LEGAL PROCEEDINGS. |
Rhino is not currently a party to any legal proceedings. Rhino’s agent for service of process in Nevada is: Ronald Brigham--16887 NW King Richard Court, Sherwood, Oregon 94140.
ITEM 4 | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. |
None
| MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. |
Market Information
Our common stock is not quoted on the OTC Bulletin Board under the symbol "RNPR.OB." However, given the limited number of record holders and the fact that we are a "shell company" (as defined in Rule 12b-2 under the Exchange Act), trading has been limited and quotations sporadic.
Record Holders
On March 25, 2010 we had 38 holders of record of our common stock.
Dividends
We have not declared or paid any exchange or any over the counter medium. There is no market forcash dividends on our common stock and there can be no guarantee that a market will ever developnor do we anticipate paying any in the foreseeable future. Furthermore, we expect to retain any future earnings to finance its operations and expansion. The payment of cash dividends in the future will be at the discretion of our Board of Directors and will depend upon our earnings levels, capital requirements, any restrictive loan covenants and other factors the Board considers relevant.
AsSales of December 31, 2008, 124,750 shares have been sold to the public for a cash consideration of $12,475 pursuant to our registered offering, deemed effective on March 14, 2008 by the SEC.Unregistered Securities
In October 2009, we issued 1,200,000 shares of common stock to a shareholder in satisfaction of advances of $21,885. The issuance was exempt from the registration requirements of the Securities Act under Section 4(2) thereof.
We did not declare or pay dividends during the Fiscal Year 2008 and do not anticipate declaring or paying dividends in fiscal year 2009.
Purchases of Our Equity Securities
We had noNeither we nor any of our affiliates purchased any equity compensation plan in 2008.securities from our stockholders during our fiscal quarter ended December 31, 2009.
Summary of Financial DataThis item does not apply to small reporting companies.
| | | As of December 31, 2008 | |
| | | | |
| Revenues | | $ | 0 | |
| | | | | |
| Operating Expenses | | $ | (20,827) | |
| | | | | |
| Earnings (Loss) | | $ | (20,827) | |
| | | | | |
| Total Assets | | $ | 3,458 | |
| | | | | |
| Liabilities | | $ | 5,460 | |
| | | | | |
| Shareholders’ Equity | | $ | 3,458 | |
The following discussion is intended to assist in the understandingof our financial condition and assessment of significant changes and trends related to the results of operations and financial condition of Rhino Productions, Inc. This discussion and analysis should be read in conjunction with ourthe financial statements and the related notes thereto included elsewhere in this Annual Report on Form 10-K10-K. The matters discussed herein contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act, and Section 27A of the Securities Act, which involve risks and uncertainties. All statements other than statements of historical information provided herein may be deemed to be forward-looking statements. Without limiting the foregoing, the words "believes", "anticipates", "plans", "expects" and similar expressions are intended to identify forward-looking statements. Factors that could cause actual results to differ materially from those reflected in the forward-looking statements include, but are not limited to, those discussed under the heading "Risk Factors " and elsewhere in this report and the risks discussed in our other filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis, judgment, belief or expectation only as of the date hereof.
Introduction
We were incorporated under Nevada law on October 12, 2007. Following our formation, our principal business objective was to provide cost effective, high quality coffee and wine products, accessories and related equipment for the fiscal year ended December 31, 2008.
Critical Accounting Policiesdiscriminating consumer, at convenient locations to the discerning gourmet, the general public and all levels of consumers eager to expand their interest in fine coffee and wine.
The preparation of our consolidated financial statements and notes thereto requires management to make estimates and assumptions that affect the amounts and disclosures reported within those financial statements. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, contingencies, litigation and income taxes. Management bases its estimates and judgments on historical experiences and on various other factors believed to be reasonable under the circumstances. Actual results under circumstances and conditions different than those assumed could result in differences from the estimated amounts in the financial statements. There have been no material changes to these policies during fiscal 2008.
We are a development stage company that has not generated any revenue from operations since inception. We are a “shell company” (as that term is defined in Rule 12b-2 under the Exchange Act).
Plan of Operations
We will attempt to acquire other assets or business operations that will maximize shareholder value. No specific assets or businesses have been definitively identified and there is no certainty that any such assets or business will be identified or any transactions will be consummated.
We expect that we will need to raise funds in order to effectuate our business plan. We will seek to establish or acquire businesses or assets with funds raised either via the issuance of shares or debt. There can be no assurance that additional capital will be available to us. We may seek to raise the required capital by other means. We may have to issue debt or equity or enter into a strategic arrangement with a third party. We currently have no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources. Since we have no such arrangements or plans currently in effect, our inability to raise funds will have a severe negative impact on our ability to remain a viable company. In pursuing the foregoing goals, we may seek to expand or change the composition of the Board or make changes to our current capital structure, including issuing additional shares or debt and adopting a stock option plan.
We have had no revenues from inception through December 31, 2009. We had a cumulative net loss from inception through December 31, 2008 of $(20,827), and a cumulative net loss from inception through December 31, 2009 of $(55,883). The significant increase in the cumulative net loss through December 31, 2009 as compared to December 31, 2008, was attributable to professional expenses of $34,714 in 2009, as compared to $14,560 in 2008. We do not expect to generate any revenues over the next twelve months. Our principal business objective for the next 12 months will be to seek, investigate and, if such investigation warrants, engage in a business combination with a private entity whose business presents an opportunity for our shareholders.
During the next 12 months we anticipate incurring costs related to filing of Exchange Act reports, and costs relating to consummating an acquisition. We believe we will be able to meet these costs through use of funds in our treasury and additional amounts, as necessary, to be loaned by or invested in us by our stockholder, management or other investors. We have no specific plans, understandings or agreements with respect to the raising of such funds, and we may seek to raise the required capital by the issuance of equity or debt securities or by other means. Since we have no such arrangements or plans currently in effect, our inability to raise funds for the consummation of an acquisition may have a severe negative impact on our ability to become a viable company.
Financial Condition
Our auditor's going concern opinion for prior years ended and the notation in the financial statements indicate that we do not have significant cash or other material assets and that we are relying on advances from stockholders, officers and directors to meet limited operating expenses. We do not have sufficient cash or other material assets nor do we have sufficient operations or an established source of revenue to cover our operational costs that would allow us to continue as a going concern.
Since we have had no operating history nor any revenues or earnings from operations, with no significant assets or financial resources, we will in all likelihood sustain operating expenses without corresponding revenues, at least until the consummation of a business combination. This may result in our incurring a net operating loss which will increase continuously until we can consummate a business combination with a profitable business opportunity and consummate such a business combination.
We are dependent upon our principal stockholder and officer to meet any de minimis costs that we may incur.
Liquidity and Capital Resources
As of December 31, 20082009, we had a stockholders’ deficit of $(2,688), as compared to $(2,002) as of December 31, 2008.
A stockholder of the Company has not identified any critical estimates that are used in the preparationadvanced funds totaling $19,125 and $2,760 during 2009 and 2008, respectively, for expenses of the financial statements.Company, in exchange for which he received 1,200,000 shares in October 2009.
The capital requirements relating to the acquisition of a operating business may be significant.
Liquidity
Management plans to rely on the proceeds from a debt or equity financing and Capital Resources. At the endsale of fiscal year 2008shares held by it to finance its ongoing operations. During 2010, we had $3,458 of cash on hand and available we had liabilities of $5,460. We must secureintend to continue to seek additional fundscapital in order to continuemeet our business. We cannot provide anycash flow and working capital. There is no assurance that we will be ablesuccessful in achieving any such financing or raise sufficient capital to raise additional proceeds or secure additional loans in the future to coverfund our expenses related to maintaining our reporting company status (estimated at $15,000 for fiscal year 2009). Furthermore, there is no guarantee we will receive the required financing to complete our business strategies; weoperations and further development. We cannot provide any assuranceassure you that future financing will be available to us on acceptable terms.commercially reasonable terms, if at all. If financing iswe are not availablesuccessful in sourcing significant additional capital in the near future, we will be required to significantly curtail or cease ongoing operations and consider alternatives that would have a material adverse affect on satisfactory terms,our business, results of operations and financial condition.
Off-Balance Sheet Arrangements
None.
Critical Accounting Policies and Estimates
We prepare our financial statements in accordance with accounting principles generally accepted in the United States, and make estimates and assumptions that affect our reported amounts of assets, liabilities, revenue and expenses. We base our estimates on historical experience and other assumptions that we believe are reasonable in the circumstances. Actual results may differ from these estimates.
The following critical accounting policies affect our more significant estimates and assumptions used in preparing our consolidated financial statements.
Our financial statements have been prepared on the going concern basis, which assumes the realization of assets and liquidation of liabilities in the normal course of operations. If we were not to continue as a going concern, we would likely not be able to realize on our assets at values comparable to the carrying value or the fair value estimates reflected in the balances set out in the preparation of our financial statements. There can be no assurances that we will be successful in generating additional cash from equity or other sources to be used for operations. Our financial statements do not include any adjustments to the recoverability of assets and classification of assets and liabilities that might be necessary should we be unable to continue developas a going concern.
Going Concern
The nature of our financial status makes us lack the characteristics of a going concern. This is because the company, due to its financial condition, may have to seek loans or expandthe sale of its securities to raise cash to meet its cash needs. We have no revenue and no cash. The level of current operations does not sustain our operations. Ifexpenses and we have no commitments for obtaining additional capital. These factors, among others, raise substantial doubt about its ability to continue as a going concern.
Recent Accounting Pronouncements
ASC 105, Generally Accepted Accounting Principles ("ASC 105") (formerly Statement of Financial Accounting Standards No. 168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles a replacement of FASB Statement No. 162) reorganized by topic existing accounting and reporting guidance issued by the Financial Accounting Standards Board ("FASB") into a single source of authoritative generally accepted accounting principles ("GAAP") to be applied by nongovernmental entities. All guidance contained in the Accounting Standards Codification ("ASC") carries an equal level of authority. Rules and interpretive releases of the Securities and Exchange Commission ("SEC") under authority of federal securities laws are unablealso sources of authoritative GAAP for SEC registrants. Accordingly, all other accounting literature will be deemed "non-authoritative". ASC 105 is effective on a prospective basis for financial statements issued for interim and annual periods ending after September 15, 2009. The Company has implemented the guidance included in ASC 105 as of July 1, 2009. The implementation of this guidance changed the Company's references to accomplish raising adequate funds then any it wouldGAAP authoritative guidance but did not impact the Company's financial position or results of operations.
ASC 855, Subsequent Events ("ASC 855") (formerly Statement of Financial Accounting Standards No. 165, Subsequent Events) includes guidance that was issued by the FASB in May 2009, and is consistent with current auditing standards in defining a subsequent event. Additionally, the guidance provides for disclosure regarding the existence and timing of a company's evaluation of its subsequent events. ASC 855 defines two types of subsequent events, "recognized" and "non-recognized". Recognized subsequent events provide additional evidence about conditions that existed at the date of the balance sheet and are required to be likelyreflected in the financial statements. Non-recognized subsequent events provide evidence about conditions that any investment made intodid not exist at the date of the balance sheet but arose after that date and, therefore; are not required to be reflected in the financial statements. However, certain non-recognized subsequent events may require disclosure to prevent the financial statements from being misleading. This guidance was effective prospectively for interim or annual financial periods ending after June 15, 2009. The Company would be lostimplemented the guidance included in its entirety.ASC 855 as of April 1, 2009. The effect of implementing this guidance was not material to the Company's financial position or results of operations.
In August 2009, the FASB issued Accounting Standards Update No. 2009-05, Results“Measuring Liabilities at Fair Value,” (“ASU 2009-05”). ASU 2009-05 provides guidance on measuring the fair value of Operationsliabilities and is effective for the first interim or annual reporting period beginning after its issuance. The Company’s adoption of ASU 2009-05 did not have an effect on its disclosure of the fair value of its liabilities.
In September 2009, the FASB issued ASC Update No. 2009-12, Fair Value Measurements and Disclosures (Topic 820): Investments in Certain Entities that Calculate Net Asset Value per Share (or Its Equivalent) ("ASC Update No. 2009-12"). WeThis update sets forth guidance on using the net asset value per share provided by an investee to estimate the fair value of an alternative investment. Specifically, the update permits a reporting entity to measure the fair value of this type of investment on the basis of the net asset value per share of the investment (or its equivalent) if all or substantially all of the underlying investments used in the calculation of the net asset value is consistent with ASC 820. The update also requires additional disclosures by each major category of investment, including, but not limited to, fair value of underlying investments in the major category, significant investment strategies, redemption restrictions, and unfunded commitments related to investments in the major category. The amendments in this update are effective for interim and annual periods ending after December 15, 2009 with early application permitted. The Company does not expect that the implementation of ASC Update No. 2009-12 will have a material effect on its financial position or results of operations.
In June 2009, FASB issued Statement of Financial Accounting Standards No. 167, Amendments to FASB Interpretation No. 46(R) ("Statement No. 167"). Statement No. 167 amends FASB Interpretation No. 46R, Consolidation of Variable Interest Entities an interpretation of ARB No. 51 ("FIN 46R") to require an analysis to determine whether a company has a controlling financial interest in a variable interest entity. This analysis identifies the primary beneficiary of a variable interest entity as the enterprise that has a) the power to direct the activities of a variable interest entity that most significantly impact the entity's economic performance and b) the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. The statement requires an ongoing assessment of whether a company is the primary beneficiary of a variable interest entity when the holders of the entity, as a group, lose power, through voting or similar rights, to direct the actions that most significantly affect the entity's economic performance. This statement also enhances disclosures about a company's involvement in variable interest entities. Statement No. 167 is effective as of the beginning of the first annual reporting period that begins after November 15, 2009. Although Statement No. 167 has not begun operations and webeen incorporated into the Codification, in accordance with ASC 105, the standard shall remain authoritative until it is integrated. The Company does not expect the adoption of Statement No. 167 to have not generated any revenues. Since incorporation we have incurred a lossmaterial impact on its financial position or results of $20,827.operations.
Off-Balance Sheet Arrangements.Index None
In June 2009, the FASB issued Statement of Financial Accounting Standards No. 166, Contractual Obligations.Accounting for Transfers of Financial Assets an amendment of FASB Statement No. 140 None("Statement No. 166"). Statement No. 166 revises FASB Statement of Financial Accounting Standards No. 140, Accounting for Transfers and Extinguishment of Liabilities a replacement of FASB Statement 125 ("Statement No. 140") and requires additional disclosures about transfers of financial assets, including securitization transactions, and any continuing exposure to the risks related to transferred financial assets. It also eliminates the concept of a "qualifying special-purpose entity", changes the requirements for derecognizing financial assets, and enhances disclosure requirements. Statement No. 166 is effective prospectively, for annual periods beginning after November 15, 2009, and interim and annual periods thereafter. Although Statement No. 166 has not been incorporated into the Codification, in accordance with ASC 105, the standard shall remain authoritative until it is integrated. The Company does not expect the adoption of Statement No. 166 will have a material impact on its financial position or results of operations.
In October 2009, the FASB issued changes to revenue recognition for multiple-deliverable arrangements. These changes require separation of consideration received in such arrangements by establishing a selling price hierarchy (not the same as fair value) for determining the selling price of a deliverable, which will be based on available information in the following order: vendor-specific objective evidence, third-party evidence, or estimated selling price; eliminate the residual method of allocation and require that the consideration be allocated at the inception of the arrangement to all deliverables using the relative selling price method, which allocates any discount in the arrangement to each deliverable on the basis of each deliverable’s selling price; require that a vendor determine its best estimate of selling price in a manner that is consistent with that used to determine the price to sell the deliverable on a standalone basis; and expand the disclosures related to multiple-deliverable revenue arrangements. These changes become effective on January 1, 2011. The Company has determined that the adoption of these changes will not have an impact on the consolidated financial statements, as the Company does not currently have any such arrangements with its customers.
| QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. |
We doThis item does not currently hold any market risk sensitive instruments entered into for hedging transaction risks relatedapply to foreign currencies. In addition, we have not entered into any transactions with derivative financial instruments for trading purposes.small reporting companies.
Our financial statements appear beginning on page F-1, immediately following the signature page of this report.
None
Disclosure Controls and Procedures
Management of Rhino Productions, Inc. is responsible for maintaining disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. In addition, the disclosure controls and procedures must ensure that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required financial and other required disclosures.
At the end of the period covered by this report, an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13(a)-15(e) and 15(d)-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)) was carried out under the supervision and with the participation of our PrincipalChief Executive Officer Principaland Chief Financial and Accounting Officer, Ronald Brigham.Ya Kun Song. Based on hisher evaluation of our disclosure controls and procedures, heshe concluded that during the period covered by this report, such disclosure controls and procedures were not effective to detect the inappropriate application of US GAAP standards.effective. This was due to our status as a shell company and our limited resources, including the absence of a financial staff with accounting and financial expertise and deficiencies that existed in the design or operation of our internal control over financial reporting that adversely affected our disclosure controls and that may be considered to be “material weaknesses.”
Rhino Productions, Inc. will continue to create and refine a structure in which critical accounting policies and estimates are identified, and together with other complex areas, are subject to multiple reviews by accounting personnel. In addition, Rhino Productions will enhance and test our year-end financial close process. Additionally, Rhino Production’s audit committee will increase its review of our disclosure controls and procedures. Finally, weWe plan to designateddesignate individuals responsible for identifying reportable developments. We believe these actions willdevelopments and to implement procedures designed to remediate the material weakness by focusing additional attention and resources in our internal accounting functions. However, the material weakness will not be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.
Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.
Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions; (ii) provide reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; (iii) provide reasonable assurance that receipts and expenditures of company assets are made in accordance with management authorization; and (iv) provide reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because changes in conditions may occur or the degree of compliance with the policies or procedures may deteriorate.
DuringOur management, which assumed control of our company in December 2009 following the auditing process for the 2008 annual report; the Company discovered inconsistencies within its quarterly reports for the first, second and third quartersacquisition of 2008. The Company believes this was due to the lack of internal control over the financial reporting for these periods.
Managementa controlling interest by Vast Glory Holdings Limited, assessed the effectiveness of our internal control over financial reporting as of December 31, 2008.2009. This assessment isevaluation was based on the criteria for effective internal control described in Internal Control — Integrated Framework issuedset forth by the Committee of Sponsoring Organizations of the Treadway Commission.Commission, or COSO, Internal Control-Integrated Framework. Based on itsupon such assessment, managementour Chief Executive Officer and Chief Financial Officer, Ya Kun Song, concluded that our internal controlcontrols over financial reporting were not effective as of December 31, 2008 was2009. In particular, our controls over financial reporting were not effective in the specific areas described in the “Disclosure“Evaluation of Disclosure Controls and Procedures” section above and as specifically described in the paragraphs below.
As of December 31, 2008 the Principal2009 our Chief Executive Officer/PrincipalChief Financial Officer identified the following specific material weaknesses in the Company’s internal controls over its financial reporting processes:
• Policies and Procedures for the Financial Close and Reporting Process — Currently there are no policies or procedures that clearly define the roles in the financial close and reporting process. The various roles and responsibilities related to this process should be defined, documented, updated and communicated. Failure to haveNot having such policies and procedures in place amounts to a material weakness toin the Company’s internal controls over its financial reporting processes.
• Representative with Financial Expertise — For the year endingended December 31, 2008,2009, the Company did not have a representative with the requisite knowledge and expertise to review the financial statements and disclosures at a sufficient level to monitor the financial statements and disclosures of the Company. Our chief executive officer also serves as our chief financial officer. All of our financial reporting is carried out by one individual, and we do not have an audit committee. Our board of directors consists of one individual, who serves as our chief executive officer and chief financial officer. This lack of accounting staff results in a lack of segregation of duties and accounting technical expertise necessary for an effective system of internal control. Failure to have a representative with such knowledge and expertise amounts to a material weakness to the Company’s internal controls over its financial reporting processes.
• Adequacy of Accounting Systems at Meeting Company Needs — The accounting system in place at the time of the assessment lacks the ability to provide high quality financial statements from within the system, and there were no procedures in place or built into the system to ensure that all relevant information is secure, identified, captured, processed, and reported within the accounting system.
Failure to have an adequate accounting system with procedures to ensure the information is secure and accurately recorded and reported amounts to a material weakness to the Company’s internal controls over its financial reporting processes.
• Segregation of Duties — Management has identified a significant general lack of definition and segregation of duties throughout the financial reporting processes.processes due to limiting staffing. Due to the pervasive nature of this issue, the lack of adequate definition and segregation of duties amounts to a material weakness to the Company’s internal controls over its financial reporting processes.
In light of the foregoing, once we have the adequate funds, management plans to develop the following additional procedures to help address these material weaknesses:
• | · | Rhino Productions will create and refine a structure in which critical accounting policies and estimates are identified and, together with other complex areas, are subject to multiple reviews by accounting personnel. In addition, we plan to enhance and test our month-end and year-end financial close process. Additionally, our audit committee will increase its review of our disclosure controls and procedures. We also intend to develop and implement policies and procedures for the financial close and reporting process, such as identifying the roles, responsibilities, methodologies, and review/approval process. We also intend to develop, implement and document policies and procedures for the financial close and reporting process, such as identifying the roles, responsibilities, methodologies, and review/approval process. |
| · | As soon as our finances allow, Rhino Productions will hire a Chief Financial Officer who will be sufficiently versed in public company accounting to implement appropriate procedures for timely and accurate disclosures. |
We believe these actions will remediate the material weaknesses by focusing additional attention and resources in our internal accounting functions. However, the material weaknesses will not be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.
This report shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
Changes in Internal Controls
There have been no changes in our internal control over financial reporting that occurred during our fiscal quarter ended December 31, 20082009 that have materially affected, or are reasonable likely to materially affect, our internal control over financial reporting.
ITEM 9B | OTHER INFORMATION. |
None
PART III
| ITEM 10 | DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. |
Directors:
| Name of Director | Age |
| Ronald G. Brigham | 57 |
Executive Officers:
| Name of Officer | Age | Office |
| Ronald G. Brigham | 57 | President, Chief Financial Officer, Secretary and Treasurer |
The term ofAll directors hold office for each director is one year, or until the next annual meeting of stockholders or until their successors have been elected and qualified, or their earlier death, resignation or removal. All officers are appointed annually by the shareholders.board of directors and, subject to any existing employment agreement, serve at the discretion of the board. Currently, directors receive no compensation.
Biographical InformationWe do not have audit, nominating or compensation committees. We have only one director who also is our President, and therefore is not "independent" within the meaning of Rule 10A-3 under the Exchange Act. We intend to initiate a search of suitable candidates to expand the size of, and include "independent" individuals on, our Board and adopt an ethics policy. At this time, given our limited activities and since our common stock is quoted on the OTC Bulletin Board, the Board has no plans or need to establish an audit committee with a financial expert or a compensation committee to determine guidelines for determining the compensation of its executive officers or directors, who currently serve without compensation. For similar reasons, we have not adopted a written policy for considering recommendations from shareholders for candidates to serve as directors or with respect to communications from shareholders. We are seeking independent board members. We have not yet retained independent board members to form an audit committee.
Set forth belowYa Kun Song, our sole director, does not satisfy the criteria of an "Audit Committee Financial Expert."
Conflicts of Interest
Ya Kun Song, our sole director and officer, is associated with other firms involved in a brief descriptionrange of the background and business experienceactivities. Consequently, there are potential inherent conflicts of our executiveinterest in her acting as an officer and director for the past five yearsof our company. Insofar as Ya Kun Song is engaged in other business activities, we anticipate that she will devote only a minor amount of time to our affairs.
Our officers and directors are, so long as they are officers or directors of our company, subject to the restriction that all opportunities contemplated by our plan of operations which come to their attention, either in the performance of their duties or in any other manner, will be considered opportunities of, and be made available us and the companies that they are affiliated with on an equal basis. A breach of this requirement will be a breach of the fiduciary duties of the officer or director.
We have not adopted any other conflict of interest policy with respect to such transactions.
Compensation of Directors
During the fiscal year ended December 31, 2009, we did not pay or accrue for any individual serving as a member of our Board of Directors, , age 57 .and our directors did not earn, any fees for serving as a member of our Board of Directors. The following table sets forth certain information regarding the compensation paid to our directors during the fiscal year ended December 31, 2009.
Mr. Ronald G. Brigham graduated with a B.S. in Management from the University of Oregon in 1976. Since then, he has been a Director of Operations for several companies. From 1981 through 1994, Mr. Brigham was in charge of operations for a multiple-unit McDonald's franchisee in Eugene, Oregon. During his tenure in Eugene, Mr. Brigham was on the Lane Community College Food Advisory Board which helped shape educational opportunities for students in the restaurant industry. From 1995 through 2000, he honed operations at two coffee companies, where he significantly reduced operating expenses and grew revenue. From 2000 through 2005, Ronald Brigham directed operations at Pizza Schmizza and KnowledgePoints, Inc., where he ran company units and also consulted franchise owners. From 2005 to current, Mr. Brigham, has been District Manager for SmarteCarte, Inc. and is in charge of multiple locations throughout the Oregon Region.DIRECTOR COMPENSATION
Significant Employees. We do not employ any non-officers who are expected to make a significant contribution to its business.
14Name (a) | | Fees Earned or Paid in Cash ($) (b) | | Stock Awards ($) (c) | | Option Awards ($) (d) | | Non-Equity Incentive Plan Compensation ($) (e) | | Non-Qualified Deferred Compensation Earnings ($) (f) | | All Other Compensation ($) (g) | | Total ($) (j) |
| | | | | | | | | | | | | | |
| Ya Kun Song (1) | | None | | None | | None | | None | | None | | None | | None |
| | | | | | | | | | | | | | |
| Ronald G. Brigham (2) | | None | | None | | None | | None | | None | | None | | None |
____ | (1) | Ya Kun Song has been our sole director since December 9, 2009. |
| (2) | Ronald G. Brigham served as our sole director until December 9, 2009. |
Corporate Governance
Nominating Committee.We do not have not established a Nominating Committee because of our limited operations; and because weaudit, nominating or compensation committees. We have only one director who also is our President, and officer,therefore is not "independent" within the meaning of Rule 10A-3 under the Exchange Act. We intend to initiate a search of suitable candidates to expand the size of, and include "independent" individuals on, our Board and adopt an ethics policy. At this time, given our limited activities and since our common stock is quoted on the OTC Bulletin Board, the Board has no plans or need to establish an audit committee with a financial expert or a compensation committee to determine guidelines for determining the compensation of its executive officers or directors, who currently serve without compensation. For similar reasons, we have not adopted a written policy for considering recommendations from shareholders for candidates to serve as directors or with respect to communications from shareholders.
Ya Kun Song,, our sole director, does not satisfy the criteria of an "Audit Committee Financial Expert."
Compliance with Section 16(a) of the Exchange Act
Section 16 of the Securities Exchange Act requires our directors and executive officers and persons who own more than 10% of a registered class of our equity securities to file various reports with the SEC concerning their holdings of, and transactions in, our securities. Copies of these filings must be furnished to us.
Based on a review of the copies of such forms furnished to us and written representations from our executive officers and directors, we believe that we are able to effectively manageduring 2009 all of our officers, directors and greater than 10% stockholders complied with all applicable Section 16(a) filing requirements, except that the issues normally consideredForms 3 filed by a Nominating Committee.Ya Kun Song, Vast Glory Holdings Limited, Sage Explorer Holding Limited and Rui Mai were filed nine days late and the Form 3 filed by Chun Ying Cui was filed 11 days late.
Audit Committee. We have has not established an Audit Committee because of our limited operations; and because we have only one director and officer, we believe that we are able to effectively manage the issues normally considered by a Audit Committee.
Code of Ethics. The Company’s Board of Directors has approved a Code of Ethics for management relating to financial disclosures and filings related to future reporting requirements. A copy of the Code of Ethics will be made available to you by contacting the Company at 16887 NW King Arthur Court, Sherwood, Oregon 97140.
Summary Compensation Table
| Name and principal position | | Fiscal Year | | Salary | | Bonus | | Other annual compensation | | Restricted stock award(s) | | Securities underlying options/ SARs | | LTIP payouts | | All other compensation |
Ronald G. Brigham Director/ Officer | | 2007 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
| | | 2008 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
ThereSince inception, we have not paid or accrued any compensation for our chief executive officer or any other executive officer and we have not entered into an employment or consulting agreement with any of our directors or executive officers. We have not granted any equity-based compensation, awards or stock options to our chief executive officer or any other executive officer. We do not have any retirement, pension, profit sharing or stock option plans or insurance or medical reimbursement plans covering our officers and directors. No value has been no cash payment paidassigned to any of the executive officer for services rendered in all capacities to us for the period ended December 31, 2008. There has beenperformed by our officers (employees) and no compensation will be awarded to, earned by, or paid to thethese officers.
We have not granted any equity-based compensation, awards or stock options to our chief executive officer byor any personother executive officer.
Summary Compensation Table
The following table sets forth information concerning the compensation paid or earned for the periods indicated for services rendered to our company in all capacities to us forby, the fiscal period ended December 31, 2008. No compensation is anticipated within the next six months to any officer or director of the Company.
Stock Option Grants
We did not grant any stock options to theindividuals who served as our chief executive officer during the most recent fiscal periodyear ended December 31, 2008. We have also not2009.
SUMMARY COMPENSATION TABLE
Name and principal position (a) | | Year (b) | | Salary (c) | | Bonus ($) (d) | | Stock Awards ($) (e) | | Option Awards ($) (f) | | Non-Equity Incentive Plan Compensation ($) (g) | | Nonqualified Deferred Compensation Earnings ($) (h) | | All Other Compensation ($) (i) | | Total (j) |
| Ya Kun Song(1) | | 2009 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
| | | | | | | | | | | | | | | | | | | |
| Ronald G. Brigham(2) | | 2009 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
| | | | | | | | | | | | | | | | | | | |
| | | 2008 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
_____
| (1) | Ya Kun Song has been our President, Chief Executive and Financial Officer and a Director since December 9, 2009. |
| (2) | Ronald G. Brigham was our chief executive officer and sole director until December 9, 2009. |
Stock Options
Neither Ya Kun Song nor Ronald G. Brigham was granted any stock options or received any other equity award during 2009 or hold any outstanding options to the executive officerpurchase shares of the Company.
our common stock as of December 31, 2009.
Change in Control.
On December 9, 2009, Vast Glory Holdings Limited ("Purchaser") purchased from Ronald G. Brigham 2,000,000 shares of the outstanding common stock of the Company, for $132,000 (the "Stock Transaction"). The purchased shares constituted 52.5% of the 3,809,600 issued and outstanding shares of the Company's common stock, resulting in a change in the controlling interest of the Company.
Prior to the Stock Transaction, Ronald Brigham held an aggregate of 2,150,000 shares of the Company's common stock, representing collectively approximately 56.4% of the Company's 3,809,600 issued and outstanding shares of common stock.
The source of the funds with which Purchaser purchased such shares was working capital.
Security Ownership.
The following table providessets forth, as of March 15, 2010, the names and addressesnumber of shares of our common stock beneficially owned by (i) each person or entity known to Rhino Productionsus to ownbe the beneficial owner of more than 5% of the outstanding common stock asstock; (ii)each officer and director of December 31, 2008,our company, and by the Officers(iii) all officers and Directors, individually anddirectors as a group. Information relating to beneficial ownership of common stock by our principal stockholders and management is based upon information furnished by each person using "beneficial ownership" concepts under the rules of the Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Each beneficial owner's percentage ownership is determined by assuming that options or warrants that are held by such person (but not those held by any other person) and which are exercisable within 60 days from the date of this report have been exercised. Except as otherwise indicated, all shares are owned directly.noted below, each person has sole voting and investment power. As of March 15, 2010, we had outstanding 3,809,600. The address of each of the persons listed below is Number 01 Commercial Street, Kuntai International Center, Chaowai Road , Chaoyang District, Beijing, People’s Republic of China 100020.
Name and address of beneficial owner | | Amount and Nature of beneficial ownership | | Percent of class* |
| | | | | |
| Owners of More than 5%: | | | | |
| | | | | |
| Vast Glory Holdings Limited | | 2,000,000 | | 52.50% |
| Sage Explorer Holding Limited | | 1,000,000 | | 26.25% |
| Rui Mai (1) | | 1,000,000 | | 26.25% |
| Chun Ying Cui | | | | 11.81% |
| | | | | |
Directors and officers: | | | | |
| Ya Kun Song (2) | | 2,000,000 | | 52.50% |
| All directors and officers as a group | | 2,000,000 | | 52.50% |
_____
| (1) | Rui Mai is the president and sole shareholder of Sage Explorer Holding Limited and has sole voting and dispositive power with respective to the shares owned by Sage Explorer Holding Limited. |
| (2) | Ya Kun Song is the president and sole shareholder of Vast Glory Holdings Limited and has sole voting and dispositive power with respective to the shares owned by Vast Glory Holdings Limited. |
Securities Authorized for Issuance under Equity Compensation Plans
The following table sets forth information about the common stock available for issuance under compensatory plans and arrangements as of December 31, 2009.
Title of class | | Name and address
of beneficial owner
| | Amount of
beneficial ownership
| | Percent(c) |
| | | | | | Number of class*securities |
| | (a) | | | | remaining available |
| | Number of | | (b) | | for future issuance |
| | securities to be | | Weighted-average | | under equity |
| | issued upon | | exercise price of | | compensation |
| | exercise of | | outstanding options | | plans (excluding |
| | outstanding | | under equity | | securities reflected in |
| Plan Category | | options | | compensation plans | | column (a)) |
| | | | | | | |
Common Stock
Equity compensation | | Ronald G. Brigham
16887 NW King Richard Court
Sherwood, Oregon 97140
| | 2,150,000, shares
| | 86.5%
|
| plan approved by | | | | | | |
| security holders | | None | | -- | | None |
| | | | | | |
| Equity compensation | | | | | | |
| plans not approved by | | | | | |
| security holders | | None | | -- | | None |
| | | | | | |
| Total | | None | | -- | | None |
*The percent of class is based on 2,474,750 shares of common stock issued and outstanding as of December 31, 2008
During Fiscal Year 2008, there were no materialThere have not been any transactions between the Company and any Officer, Director or related party has not,required to be reported under this item since the date of incorporation, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:
-The sole Officer and Director;
-Any person proposed as a nominee for election as a director;
-Any person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to the outstanding shares of common stock;
-Any relative or spouse of any of the foregoing persons who have the same house as such person.January 1, 2008.
Any future transactions between us and our Officers, Directors, and Affiliates will be on terms no less favorable to us than can be obtained from unaffiliated third parties. Such transactions with such persons will be subject to approval of our Board of Directors.Director Independence
Ya Kun Song , our President, Chief Executive and Financial Officer, is our sole director, and therefore is not "independent", as that term is defined by Rule 10A-3 under the Exchange Act.
AsThe following is a summary of the fees billed to us by Kyle L Tingle, CPA, LLC for professional services rendered for the fiscal years ended December 31, 2008 and 2009, respectively:
| | | Fiscal year ended December 31, | |
| | | 2008 | | | 2009 | |
| | | | | | | |
| Audit Fees | | $ | 2,250 | | | $ | 15,025 | |
| Audit Related Fees | | $ | 0 | | | $ | 0 | |
| Tax Fees | | $ | 0 | | | $ | 0 | |
| All Other Fees | | $ | 0 | | | $ | 0 | |
Audit Fees. Consists of fees billed for professional services rendered for the Company has incurred auditing expensesaudit of approximately $6,000 which includes bookkeepingour consolidated financial statements and auditing services. There were noreview of interim consolidated financial statements included in quarterly reports and services that are normally provided in connection with statutory and regulatory filings or engagements.
Audit Related Fees. Consists of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under "Audit
Fees".
Tax Fees. Consists of fees billed for professional services for tax compliance, tax advice and tax planning. These services include preparation of federal and state income tax returns.
All Other Fees. Consists of fees for product and services other than the services reported above.
Board of Directors' Pre-Approval Policies
Our Board of Directors' policy is to pre-approve all audit and permissible non-audit services provided by the independent auditors. These services may include audit services, audit related services, tax services, and other services. Pre-approval is generally provided for up to one year, and any pre-approval is detailed as to the particular service or taxcategory of services and is generally subject to a specific budget. The independent auditors and management are required to periodically report to the Board of Directors regarding the extent of services provided by the independent auditors in accordance with this pre-approval and the fees incurred.for the services performed to date. The Board of Directors may also pre-approve particular services on a case-by-case basis.
Our Board of Directors has reviewed and discussed with Kyle L Tingle, CPA, LLC our audited financial statements contained in our Annual Report on Form 10-K for the 2009 fiscal year. The Board of Directors also has discussed with Kyle L Tingle , CPA, LLC the matters required to be discussed pursuant to SAS No. 61 (Codification of Statements on Auditing Standards, AU Section 380), which includes, among other items, matters related to the conduct of the audit of our financial statements.
Our Board of Directors has received and reviewed the written disclosures and the letter from Kyle L Tingle , CPA, LLC required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees), and has discussed with Kyle L Tingle its independence from our company.
Our Board of Directors has considered whether the provision of services other than audit services is compatible with maintaining auditor independence. Based on the review and discussions referred to above, the Board of Directors determined that the audited financial statements be included in our Annual Report on Form 10-K for our 2009 fiscal year for filing with the SEC.
| (a) | The following documents have been filed as a part of this Annual Report on Form 10-K. |
| 1. | Financial Statements Period Ended 12/31/2008 2009 |
| | Page | |
| Report of Independent Registered Public Accounting Firm | F-3 | |
| Balance Sheets | F-4 | |
| Statements of Operations | F-5 | |
| Statements of Stockholders' Equity | F-6 | |
| Statements of Cash Flows | F-7 | |
| Notes to Financial Statements | F-8-14 |
Restated Quarterly Statement for the period ended September 30, 2008F-8-12 | F-15 |
Restated Quarterly Statement for the period ended June 30, 2008 | F-26 |
Restated Quarterly Statement for the period ended March 31, 2008 | F-37 |
| 2. | Financial Statement Schedules. |
All schedules are omitted because they are not applicable or not required or because the required information is included in the Financial Statements or the Notes thereto.
The following exhibits are filed as part of, or incorporated by reference into, this Annual Report:
EXHIBIT
| 3.1 | Articles of Incorporation are incorporated herein by reference to Exhibit 3.1 of the Registrant’s Registration Statement on Form SB-2,S-1/A (Amendment No. 1), filed and declared effective on February 1,March 14, 2008. |
| 3.2 | By-Laws are incorporated herein by reference to Exhibit 3.2 of the Registrant’s Registration Statement on Form SB-2,S-1/A (Amendment No. 1), filed and declared effective on February 1,March 14, 2008. |
| |
| |
23.1 | Consent of Accountant |
| 31.1 | 8650 SECTION 302 CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT TO RULE 13a-14 or RULE 15d-14 of SECURITIES EXCHANGE ACT OF 1934. |
| 32.1 | 4700 CERTIFICATION PURSUANT TO 18SECTION 906 of SARBANES-OXLEY ACT OF 2002 (18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION1350). |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | RHINO PRODUCTIONS, INC. | |
| | | |
| By: | /s/ Ronald G. BrighamYa Kun Song | |
| | | Ronald G. Brigham |
| | |
| | Chief Executive Officer |
| | Chief Financial Officer |
(Principal Executive and Financial Officer) | | Chief Accounting Officer |
| | Secretary, Director |
| | | |
| | |
In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on May 3, 2010.
| Signature | Title |
| |
| President, Chief Executive Officer, Chief Financial |
| /s/ Ya Kun Song | Officer, and a Director (Principal Executive and |
| Ya Kun Song | Financial Officer) |
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Financial Statements
December 31, 2009 and 2008
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Financial Statements
December 31, 20082009 and 2007
2008
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Financial Statements
December 31, 2008 and 2007
TABLE OF CONTENTS
| | Page(s) |
| Report of Independent Registered Accounting Firm | F-3 |
| | |
Balance Sheets as of December 31, 20082009 and 20072008 | F-4 |
| | |
Statements of Operations for the years ended December 31, 20082009 and 20072008 and the period of October 16, 2007 (Inception)(inception) to December 31, 20082009 | F-5 |
| | |
Statement of Changes in Stockholders’Stockholders' Equity (Deficit) cumulative from October 16, 2007 (inception) to December 31, 20082009 | F-6 |
| | |
Statements of Cash Flows for the years ended December 31, 20082009 and 20072008 and the period of October 16, 2007 (Inception)(inception) to December 31, 20082009 | F-7 |
| | |
Notes to the Financial Statements | F-8-14F-8 - F-12 |
Report of Independent Registered Public Accounting Firm
To the Board of Directors
Rhino Productions, Inc.
Las Vegas, Nevada
We have audited the accompanying balance sheets of Rhino Productions, Inc. (A Development Stage Enterprise) as of December 31, 20082009 and 20072008 the related statements of operations, stockholders’ deficit, and cash flows for the years then ended and the period October 16, 2007 (inception) through December 31, 2008.2009. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, 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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Rhino Productions, Inc. (A Development Stage Enterprise) as of December 31, 20082009 and 20072008 and the results of its operations and cash flows for the years then ended and the period October 16, 2007 (inception) through December 31, 2008,2009, in conformity with U.S. generally accepted accounting principles.
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 limited operations and has no established source of revenue. This raises substantial doubt about its ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Kyle L. Tingle, CPA, LLC
Kyle L. Tingle, CPA, LLC
April 13, 200921, 2010
Las Vegas, Nevada
| RHINO PRODUCTIONS, INC. |
| (A Development Stage Enterprise) |
| Balance Sheets |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Balance Sheets | |
| | | | | | | |
| | December 31, | |
| | 2008 | | 2007 | |
| ASSETS | |
| | | | | | | |
| Current assets | | | | | | |
| Cash | | $ | 3,458 | | | $ | 850 | |
| Total current assets | | | 3,458 | | | | 850 | |
| | | | | | | | | |
| Total assets | | $ | 3,458 | | | $ | 850 | |
| | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY | |
| | | | | | | | | |
| Current liabilities | | | | | | | | |
| Accounts payable | | $ | 2,700 | | | $ | 300 | |
| Loan from shareholder | | | 3,760 | | | | - | |
| Total current liabilities | | | 6,460 | | | | 300 | |
| | | | | | | | | |
| Stockholders' (deficit) equity | | | | | | | | |
| Preferred stock, $0.001 par value; 5,000,000 shares authorized, no shares issued or outstanding | | | - | | | | - | |
| Common stock, $0.001 par value; 70,000,000 shares authorized, 2,474,750 and 2,350,000 shares issued and outstanding at December 31, 2008 and 2007 | | | 2,475 | | | | 2,350 | |
| Additional paid in capital | | | 15,350 | | | | 3,000 | |
| Deficit accumulated during the development stage | | | (20,827 | ) | | | (4,800 | ) |
| Total stockholders' (deficit) equity | | | (3,002 | ) | | | 550 | |
| | | | | | | | | |
| Total liabilities and stockholders' (deficit) equity | | $ | 3,458 | | | $ | 850 | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
| | | December 31, |
| | | 2009 | | 2008 |
| ASSETS |
| Current assets | | | | | |
| | Cash | $ | 1 | | $ | 3,458 |
| Total current assets | | 1 | | | 3,458 |
| | | | | | | |
| Total assets | $ | 1 | | $ | 3,458 |
| | | | | | | |
| LIABILITIES AND STOCKHOLDERS' DEFICIT |
| | | | | | | |
| Current liabilities | | | | | |
| | Accounts payable | $ | 2,689 | | $ | 2,700 |
| | Shareholder loan | | - | | | 2,760 |
| Total current liabilities | | 2,689 | | | 5,460 |
| | | | | | | |
| Stockholders' Deficit | | | | | |
| | Subscription receivable | | - | | | (200) |
| | Preferred stock, $0.001 par value; 5,000,000 shares authorized, no shares issued or outstanding | - | | | - |
| | Common stock, $0.001 par value; 70,000,000 shares authorized, 3,809,600 and 2,486,750 shares issued and outstanding at December 31, 2009 and 2008 | 3,810 | | | 2,487 |
| | Additional paid in capital | | 49,385 | | | 16,538 |
| | Deficit accumulated during the development stage | | (55,883) | | | (20,827) |
| Total stockholders' deficit | | (2,688) | | | (2,002) |
| | | | | | | |
| Total liabilities and stockholders' deficit | $ | 1 | | $ | 3,458 |
| | | | | | | |
| See accompanying notes to financial statements. |
| RHINO PRODUCTIONS, INC. |
| (A Development Stage Enterprise) |
| Statements of Operations |
| | | | | | | | | For the period from October 16, 2007 (inception) to December 31, 2009 |
| | | | | | | | |
| | | Year ended December 31, | |
| | | 2009 | | 2008 | |
| | | | | | | | | | |
| Revenue | $ | - | | $ | - | | $ | - |
| | | | | | | | | | |
| Expenses | | | | | | | | |
| | General and administrative | | 342 | | | 1,467 | | | 2,109 |
| | Professional fees | | 34,714 | | | 14,560 | | | 53,774 |
| Total expenses | | 35,056 | | | 16,027 | | | 55,883 |
| | | | | | | | | | |
| Net loss | $ | (35,056) | | $ | (16,027) | | $ | (55,883) |
| | | | | | | | | | |
| Basic and diluted loss per common share | $ | (0.01) | | $ | (0.01) | | | |
| | | | | | | | | | |
| Weighted average shares outstanding | | 2,671,629 | | | 2,391,868 | | | |
| | | | | | | | | | |
| See accompanying notes to financial statements. |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Operations | |
| | |
| | | | | | | | For the period from October 16, 2007 (inception) to December 31, 2008 | |
| | | | | | | |
| | Year ended December 31, | |
| | 2008 | | 2007 | |
| | | | | | | | | | |
| Revenue | | $ | - | | | $ | - | | | $ | - | |
| | | | | | | | | | | | | |
| Expenses | | | | | | | | | | | | |
| General and administrative | | | 167 | | | | 300 | | | | 467 | |
| Travel | | | 1,300 | | | | - | | | | 1,300 | |
| Professional fees | | | 14,560 | | | | 4,500 | | | | 19,060 | |
| Total expenses | | | 16,027 | | | | 4,800 | | | | 20,827 | |
| | | | | | | | | | | | | |
| Net loss | | $ | (16,027 | ) | | $ | (4,800 | ) | | $ | (20,827 | ) |
| | | | | | | | | | | | | |
| Basic and diluted loss per common share | | $ | (0.01 | ) | | $ | (0.00 | ) | | | | |
| | | | | | | | | | | | | |
| Weighted average shares outstanding | | | 2,390,447 | | | | 2,350,000 | | | | | |
| | | | | | | | | | | | | |
| See accompanying notes to financial statements | |
| RHINO PRODUCTIONS, INC |
| (A Development Stage Enterprise) |
| Statement of Changes in Stockholders' Equity (Deficit) |
| For the Period of October 16, 2007 (Inception) to December 31, 2009 |
| RHINO PRODUCTIONS, INC. | | |
| (A Development Stage Company) | | |
| Statement of Changes in Stockholders' Equity (Deficit) | | |
| For the Period of October 16, 2007 (Inception) to December 31, 2008 | | |
| | | | | | | | | | | | | | | | | |
| | | Common Stock | | Additional Paid-In Capital | | Accumulated Deficit | | Total | | | Common Stock | | | Additional Paid-In | | | Subscriptions | | | Accumulated | | | | |
| | | Shares | | Amount | | | Shares | | | Amount | | | Capital | | | receivable | | | Deficit | | | Total | |
| Balance, October 16, 2007 (Inception) | | | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | |
| Issuance of common stock for cash and services | | | 2,350,000 | | | | 2,350 | | | | 3,000 | | | | - | | | | 5,350 | | |
| Issuance of common stock for cash | | | | 2,350,000 | | | | 2,350 | | | | 3,000 | | | | - | | | | - | | | | 5,350 | |
| Net loss, December 31, 2007 | | | - | | | | - | | | | - | | | | (4,800 | ) | | | (4,800 | ) | | | - | | | | - | | | | - | | | | - | | | | (4,800 | ) | | | (4,800 | ) |
| Balance, December 31, 2007 | | | 2,350,000 | | | | 2,350 | | | | 3,000 | | | | (4,800 | ) | | | 550 | | | | 2,350,000 | | | | 2,350 | | | | 3,000 | | | | - | | | | (4,800 | ) | | | 550 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Sale of common stock for cash | | | 124,750 | | | | 125 | | | | 12,350 | | | | - | | | | 12,475 | | | | 134,750 | | | | 135 | | | | 13,340 | | | | - | | | | - | | | | 13,475 | |
| Issuance of common stock for subscription receivable | | | | 2,000 | | | | 2 | | | | 198 | | | | (200 | ) | | | - | | | | - | |
| Net loss, December 31, 2008 | | | - | | | | - | | | | - | | | | (16,027 | ) | | | (16,027 | ) | | | - | | | | - | | | | - | | | | | | | | (16,027 | ) | | | (16,027 | ) |
| Balance, December 31, 2008 | | | 2,474,750 | | | $ | 2,475 | | | $ | 15,350 | | | $ | (20,827 | ) | | $ | (3,002 | ) | | | 2,486,750 | | | | 2,487 | | | | 16,538 | | | | (200 | ) | | | (20,827 | ) | | | (2,002 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| See accompanying notes to financial statements | | |
| Collection of subscription receivable | | | | - | | | | - | | | | - | | | | 200 | | | | - | | | | 200 | |
| Sale of common stock for cash | | | | 2,850 | | | | 3 | | | | 282 | | | | - | | | | - | | | | 285 | |
| Issuance of common stock for services | | | | 120,000 | | | | 120 | | | | 11,880 | | | | - | | | | - | | | | 12,000 | |
| Shareholder’s loan | | | | 1,200,000 | | | | 1,200 | | | | 20,685 | | | | - | | | | - | | | | 21,885 | |
| Net loss, December 31, 2009 | | | | - | | | | - | | | | - | | | | - | | | | (35,056 | ) | | | (35,056 | ) |
| Balance, December 31, 2009 | | | | 3,809,600 | | | $ | 3,810 | | | $ | 49,385 | | | $ | - | | | $ | (55,883 | ) | | $ | (2,688 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| See accompanying notes to financial statements. | | See accompanying notes to financial statements. | |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Cash Flows | |
| | | | | | | | | For the period of October 16, 2007 (inception) to December 31, 2008 | |
| | | | | | | |
| | | | | | | |
| | Year ended December 31, | |
| | 2008 | | | 2007 | |
| Cash flows from operating activities | | | | | | | |
| Net loss | | $ | (16,027 | ) | | $ | (4,800 | ) | | $ | (20,827 | ) |
| Changes in operating assets and liabilities | | | | | | | | | |
| Accounts payable | | | 2,400 | | | | 300 | | | | 2,700 | |
| Net cash used in operating activities | | | (13,627 | ) | | | (4,500 | ) | | | (18,127 | ) |
| | | | | | | | | | | | | |
| Net cash used in investing activities | | | - | | | | - | | | | - | |
| | | | | | | | | | | | | |
| Cash flows from financing activities | | | | | | | | | |
| Loan from shareholder | | | 3,760 | | | | - | | | | 3,760 | |
| Proceeds from sale of stock | | | 12,475 | | | | 5,350 | | | | 17,825 | |
| Net cash provided by financing activities | | | 16,235 | | | | 5,350 | | | | 21,585 | |
| | | | | | | | | | | | | |
| Net increase in cash | | | 2,608 | | | | 850 | | | | 3,458 | |
| | | | | | | | | | | | | |
| Cash at beginning of period | | | 850 | | | | - | | | | - | |
| | | | | | | | | | | | | |
| Cash at end of period | | $ | 3,458 | | | $ | 850 | | | $ | 3,458 | |
| | | | | | | | | | | | | |
| Supplemental Cash Flow Information: | | | | | | | | | |
| Cash paid for interest | | $ | - | | | $ | - | | | $ | - | |
| Cash paid for income taxes | | $ | - | | | $ | - | | | $ | - | |
| | | | | | | | | | | | | |
| See accompanying notes to financial statements | |
|
| (A Development Stage Enterprise) |
| Statements of Cash Flows |
| | | | | | | | | | For the period of October 16, 2007 (inception) to December 31, 2009 |
| | | | | | | | | |
| | | | | | | | | |
| | | | Year ended December 31, | |
| | | | 2009 | | 2008 | |
| Cash flows from operating activities | | | | | | |
| | Net loss | $ | (35,056) | | $ | (16,027) | | $ | (55,883) |
| | Adjustments to reconcile net loss to net cash used in operating activities: | | | |
| | | Common stock issued for services | 12,000 | | | - | | | 12,000 |
| | Changes in operating assets and liabilities: | | | | | | |
| | | Accounts payable | | (11) | | | 2,400 | | | 2,689 |
| Net cash used in operating activities | (23,067) | | | (13,627) | | | (41,194) |
| | | | | | | | | | | |
| Net cash used in investing activities | | - | | | - | | | - |
| | | | | | | | | | | |
| Cash flows from financing activities | | | | | | |
| | | Proceeds from shareholder loan | 19,125 | | | 2,760 | | | 21,885 |
| | | Collection of subscription receivable | 200 | | | - | | | - |
| | | Proceeds from sale of stock | | 285 | | | 13,475 | | | 19,310 |
| Net cash provided by financing activities | 19,610 | | | 16,235 | | | 41,195 |
| | | | | | | | | | | |
| | | Net (decrease) increase in cash | (3,457) | | | 2,608 | | | 1 |
| | | | | | | | | | | |
| | | Cash at beginning of period | | 3,458 | | | 850 | | | - |
| | | | | | | | | | | |
| | | Cash at end of period | $ | 1 | | $ | 3,458 | | $ | 1 |
| | | | | | | | | | | |
| Supplemental disclosure of non-cash investing and financing activities: | | |
| | Conversion of shareholder loan for 1,200,000 common shares | $ | 21,885 | | $ | - | | $ | 21,885 |
| | Common stock issued for professional services | $ | 12,000 | | $ | - | | $ | 12,000 |
| | | | | | | | | | | |
| Supplemental Cash Flow Information: | | | | | | |
| | Cash paid for interest | $ | - | | $ | - | | $ | - |
| | Cash paid for income taxes | $ | - | | $ | - | | $ | - |
| | | | | | | | | | | |
| See accompanying notes to financial statements. |
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Financial Statements
December 31, 20082009 and 2007
2008
Note 1 – Nature of Business
Rhino Productions, Inc. (“Company”) was organized October 16, 2007 under the laws of the State of Nevada for purpose of providing cost effective, high quality coffee and wine products, accessories and related equipment. The Company currently has no operations or realized revenues from its planned principle business purpose and, in accordance with Statement of Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by DevelopmentFASB ASC 915 “Development Stage Enterprises,Entities,” is considered a Development Stage Enterprise.
Note 2 – Significant Accounting Policies
Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash
For the Statements of Cash Flows, all highly liquid investments with maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of December 31, 20082009 or 2008.
Income taxes
The Company accounts for income taxes under FASB ASC 740 "Income Taxes." Under the asset and 2007.liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.
Share Based Expenses
FASB ASC 718 "Compensation - Stock Compensation" prescribes accounting and reporting standards for all stock-based payments awarded to employees, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights, and may be classified as either equity or liabilities. The Company determines if a present obligation to settle the share-based payment transaction in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices or stated policies. If a present obligation exists, the transaction should be recognized as a liability; otherwise, the transaction should be recognized as equity. The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50 "Equity - Based Payments to Non-Employees." Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Financial Statements
December 31, 20082009 and 2007
2008
Note 2 – Significant Accounting Policies (continued)
Income taxes
Income taxes are provided for using the liability method of accounting in accordance with SFAS No. 109 “Accounting for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109.” A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment.
Share Based Expenses
In December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 123R “Share Based Payment.”This statement is a revision to SFAS 123 and supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”This statement requires a public entity to expense the cost of employee services received in exchange for an award of equity instruments. This statement also provides guidance on valuing and expensing these awards, as well as disclosure requirements of these equity arrangements. The Company adopted SFAS No. 123R upon creation of the company and expenses share based costs in the period incurred.
Going concernConcern
The Company’sCompany's financial statements are prepared in accordance withusing accounting principles generally accepted accounting principlesin the United States of America applicable to a going concern. Thisconcern which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, theThe Company doeshas not have cash nor material assets, nor does it have operations or ayet established an ongoing source of revenuerevenues sufficient to cover its operationoperating costs and allow it to continue as a going concern. The Company is currently attempting to raise capital in order to initiate its business plan which will, if successful, mitigate these factors which raise substantial doubt aboutability of the Company’s abilityCompany to continue as a going concern. Theconcern is dependent on the Company’s obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.
In order to continue as a going concern, the Company will be dependent upon the raising of thisneed, among other things, additional capital through placement of our common stock in orderresources. Management's plans to implementobtain such resources for the Company include (1) obtaining capital from management and significant stockholders sufficient to meet its business plan, or mergeminimal operating expenses, and (2) seeking out and completing a merger with an existing operating company. There can be no assuranceHowever, management cannot provide any assurances that the Company will be successful in either situation in orderaccomplishing any of its plans.
The ability of the Company to continue as a going concern.concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The officersaccompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Recently Implemented Standards
ASC 105, Generally Accepted Accounting Principles ("ASC 105") (formerly Statement of Financial Accounting Standards No. 168, The FASB Accounting Standards Codification and directors have committedthe Hierarchy of Generally Accepted Accounting Principles a replacement of FASB Statement No. 162) reorganized by topic existing accounting and reporting guidance issued by the Financial Accounting Standards Board ("FASB") into a single source of authoritative generally accepted accounting principles ("GAAP") to advancing certain operating costsbe applied by nongovernmental entities. All guidance contained in the Accounting Standards Codification ("ASC") carries an equal level of authority. Rules and interpretive releases of the Company.Securities and Exchange Commission ("SEC") under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. Accordingly, all other accounting literature will be deemed "non-authoritative". ASC 105 is effective on a prospective basis for financial statements issued for interim and annual periods ending after September 15, 2009. The Company has implemented the guidance included in ASC 105 as of July 1, 2009. The implementation of this guidance changed the Company's references to GAAP authoritative guidance but did not impact the Company's financial position or results of operations.
ASC 855, Subsequent Events ("ASC 855") (formerly Statement of Financial Accounting Standards No. 165, Subsequent Events) includes guidance that was issued by the FASB in May 2009, and is consistent with current auditing standards in defining a subsequent event. Additionally, the guidance provides for disclosure regarding the existence and timing of a company's evaluation of its subsequent events. ASC 855 defines two types of subsequent events, "recognized" and "non-recognized". Recognized subsequent events provide additional evidence about conditions that existed at the date of the balance sheet and are required to be reflected in the financial statements. Non-recognized subsequent events provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date and, therefore; are not required to be reflected in the financial statements. However, certain non-recognized subsequent events may require disclosure to prevent the financial statements from being misleading. This guidance was effective prospectively for interim or annual financial periods ending after June 15, 2009. The Company implemented the guidance included in ASC 855 as of April 1, 2009. The effect of implementing this guidance was not material to the Company's financial position or results of operations.
In August 2009, the FASB issued Accounting Standards Update No. 2009-05, “Measuring Liabilities at Fair Value,” (“ASU 2009-05”). ASU 2009-05 provides guidance on measuring the fair value of liabilities and is effective for the first interim or annual reporting period beginning after its issuance. The Company’s adoption of ASU 2009-05 did not have an effect on its disclosure of the fair value of its liabilities.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Financial Statements
December 31, 20082009 and 2007
2008
Note 2 – Significant Accounting Policies (continued)
Recent Accounting PronouncementsRecently Implemented Standards (continued)
In May 2008,September 2009, the FASB issued Financial Accounting StandardsASC Update No. 163,2009-12, “Accounting for Financial Guarantee Insurance Contracts -Fair Value Measurements and Disclosures (Topic 820): Investments in Certain Entities that Calculate Net Asset Value per Share (or Its Equivalent) ("ASC Update No. 2009-12"). This update sets forth guidance on using the net asset value per share provided by an interpretationinvestee to estimate the fair value of FASB Statement No. 60.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises under FASB Statement No. 60, Accounting and Reporting by Insurance Enterprises. That diversity results in inconsistenciesan alternative investment. Specifically, the update permits a reporting entity to measure the fair value of this type of investment on the basis of the net asset value per share of the investment (or its equivalent) if all or substantially all of the underlying investments used in the recognition and measurement of claim liabilities because of differing views about when a loss has been incurred under FASB Statement No. 5, Accounting for Contingencies.
This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirementscalculation of the Statement will improvenet asset value is consistent with ASC 820. The update also requires additional disclosures by each major category of investment, including, but not limited to, fair value of underlying investments in the quality of information providedmajor category, significant investment strategies, redemption restrictions, and unfunded commitments related to users of financial statements. This Statement isinvestments in the major category. The amendments in this update are effective for financial statements issued for fiscal years beginninginterim and annual periods ending after December 15, 2008, and all interim periods within those fiscal years.
In May 2008, FASB issued Financial Accounting Standards2009 with early application permitted. The implementation of ASC Update No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). This Statement is effective 60 days following the SEC's approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles. This pronouncement has no2009-12 did not have a material effect on thisthe Company’s financial reporting at this time.position or results of operations.
In MarchJune 2009, the FASB issued Statement of 2008 the Financial Accounting Standards Board (FASB) issued SFAS No. 161, “166, Disclosures about Derivative Instruments and Hedging Activities—Accounting for Transfers of Financial Assets an amendment of FASB Statement No. 133140, “ ("Statement No. 166"). Statement No. 166 revises FASB Statement of Financial Accounting Standards No. 140, Accounting for DerivativesTransfers and Hedging ActivitiesExtinguishment of Liabilities a replacement of FASB Statement 125.” SFAS No. 161 has the same scope as ("Statement No. 133 but140") and requires enhancedadditional disclosures about (a) howtransfers of financial assets, including securitization transactions, and why an entity uses derivative instruments, (b) how derivative instrumentsany continuing exposure to the risks related to transferred financial assets. It also eliminates the concept of a "qualifying special-purpose entity", changes the requirements for derecognizing financial assets, and related hedged items are accounted for underenhances disclosure requirements. Statement No. 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161166 is effective prospectively, for financial statements issued for fiscal yearsinterim and interimannual periods beginning after November 15, 2008,2009r. Although Statement No. 166 has not been incorporated into the Codification, in accordance with early application encouraged.ASC 105, the standard shall remain authoritative until it is integrated. The Company does not expect the adoption of Statement No. 166 will have a material impact on its financial position or results of operations.
In June 2009, FASB issued Statement of Financial Accounting Standards No. 167, Amendments to FASB Interpretation No. 46(R) ("Statement No. 167"). Statement No. 167 amends FASB Interpretation No. 46R, Consolidation of Variable Interest Entities an interpretation of ARB No. 51 ("FIN 46R") to require an analysis to determine whether a company has a controlling financial interest in a variable interest entity. This analysis identifies the primary beneficiary of a variable interest entity as the enterprise that has a) the power to direct the activities of a variable interest entity that most significantly impact the entity's economic performance and b) the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. The statement encourages, butrequires an ongoing assessment of whether a company is the primary beneficiary of a variable interest entity when the holders of the entity, as a group, lose power, through voting or similar rights, to direct the actions that most significantly affect the entity's economic performance. This statement also enhances disclosures about a company's involvement in variable interest entities. Statement No. 167 is effective as of the beginning of the first annual reporting period that begins after November 15, 2009. Although Statement No. 167 has not been incorporated into the Codification, in accordance with ASC 105, the standard shall remain authoritative until it is integrated. The Company does not expect the adoption of Statement No. 167 to have a material impact on its financial position or results of operations
In October 2009, the FASB issued changes to revenue recognition for multiple-deliverable arrangements. These changes require comparative disclosuresseparation of consideration received in such arrangements by establishing a selling price hierarchy (not the same as fair value) for earlier periodsdetermining the selling price of a deliverable, which will be based on available information in the following order: vendor-specific objective evidence, third-party evidence, or estimated selling price; eliminate the residual method of allocation and require that the consideration be allocated at initial adoption. SFAS No. 161 has no effectthe inception of the arrangement to all deliverables using the relative selling price method, which allocates any discount in the arrangement to each deliverable on the Company’sbasis of each deliverable’s selling price; require that a vendor determine its best estimate of selling price in a manner that is consistent with that used to determine the price to sell the deliverable on a standalone basis; and expand the disclosures related to multiple-deliverable revenue arrangements. These changes become effective on January 1, 2011. The Company has determined that the adoption of these changes will not have an impact on the consolidated financial position, statements, of operations, or cash flows at this time.as the Company does not currently have any such arrangements with its customers.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Financial Statements
December 31, 20082009 and 2007
Note 2 – Significant Accounting Policies (continued)
Recent Accounting Pronouncements (continued)
In December, 2007, the FASB issued SFAS No. 160, “Non-controlling interests in Consolidated Financial Statements, an amendment of ARB No. 51.” SFAS No. 160 applies to “for-profit” entities that prepare consolidated financial statements where there is an outstanding non-controlling interest in a subsidiary. The Statement requires that the non-controlling interest be reported in the equity section of the consolidated balance sheet but identified separately from the parent. The amount of consolidated net income attributed to the non-controlling interest is required to be presented, clearly labeled for the parent and the non-controlling entity, on the face of the consolidated statement of income. When a subsidiary is de-consolidated, any retained non-controlling interest is to be measured at fair value. Gain or loss on de-consolidation is recognized rather than carried as the value of the retained investment. The Statement is effective for fiscal years and interim periods beginning on or after December 15, 2008. It cannot be adopted earlier but, once adopted, is to be applied retroactively. This pronouncement has no effect on this Company’s financial reporting at this time.2008
In December 2007, the FASB issued SFAS No.141 (revised 2007), “Business Combinations” (“SFAS 141(R)”) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements” (“SFAS 160”). These standards aim to improve, simplify, and converge internationally the accounting for business combinations and the reporting of noncontrolling interests in consolidated financial statements. The provisions of SFAS 141 (R) and SFAS 160 are effective for the fiscal year beginning April 1, 2009. The adoption of SFAS 141(R) and SFAS 160 has not impacted the Company’s financial statements.
None of the above new pronouncements has current application to the Company, but may be applicable to the Company’s future financial reporting.
Note 3 – Stockholders’ Equity (Deficit)
Preferred stock
The authorized preferred stock of the Company consists of 5,000,000 shares with a par value of $0.001. The Company has no preferred stock issued or outstanding.
Common stock
The authorized common stock of the Company consists of 70,000,000 shares with par value of $0.001. On October 23, 2007, the Company authorized the issuance of 2,350,000 shares of its $0.001 par value common stock in consideration of $5,350 in cash.
On February 2, During the year ended December 31, 2008, the Company filed with the Securities and Exchange Commission a Form SB-2 Registration Statement for the registration of 750,000issued 134,750 shares of $0.001 par valueits common stock to be offered at $0.10 per share. It was deemed effective on March 14, 2008. Asfor $13,475 of cash. Also during the year ended December 31, 2008, 124,750the Company issued 2,000 shares have been sold to the publicof common stock for a cash consideration of $12,475.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to$200 subscription receivable which was collected in January 2009. During the Financial Statements
year ended December 31, 20082009, the Company issued 2,850 shares of common stock for $285 in cash and 2007
Note 3 – Stockholders’ Equity (continued)
Preferred120,000 shares of common stock
The authorized preferred stock for $12,000 of professional services. In conjunction with a change in control of the Company, consiststhe former officer received 1,200,000 shares of 5,000,000common stock in lieu of $21,885 in officer loans advanced to the Company. The total common shares with a par value of $0.001. The Company has no preferred stock issued or outstanding.and outstanding at December 31, 2009 and 2008 were 3,809,600 and 2,486,750, respectively.
Net loss per common share
Net loss per share is calculated in accordance with SFAS No. 128,FASB ASC 260, “Earnings Per Share.” The weighted-average number of common shares outstanding during each period is used to compute basic loss per share. Diluted loss per share is computed using the weighted averaged number of shares and dilutive potential common shares outstanding. Dilutive potential common shares are additional common shares assumed to be exercised.
Basic net loss per common share is based on the weighted average number of shares of common stock outstanding during 20082009 or 20072008 and since inception. As of December 31, 20082009 and 20072008 and since inception, the Company had no dilutive potential common shares.
Note 4 – Income Taxes
We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax and FASB Interpretation No. 48 - Accounting for Uncertainty in Income Taxes an interpretation of FASB Statement No.109”, whenWhen it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit. We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry-forwards,carryforwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry-forwardcarryforward period.
The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements for the yearstwelve-months ended December 31, 2009 and 2008, or 2007,during the prior three years applicable under FIN 48. As a result of the adoption of FIN 48, weFASB ASC 740. We did not recognize any adjustment to the liability for uncertain tax position and therefore did not record any adjustment to the beginning balance of accumulated deficit on the consolidated balance sheet. All tax returns have been appropriately filed by the Company.
| Income tax provision at the federal statutory rate | | | 35 | % |
| Effect on operating losses | | | (35 | %) |
| | | - | |
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Financial Statements
December 31, 20082009 and 2007
2008
Note 4 – Income Taxes (continued)
The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The sources and tax effects of the differences for the periods presented are as follows:
Income tax provision at the
| |
Federal statutory rate | 35% |
Effect of operating losses | -35% |
| 0% |
Net deferred tax assets consist of the following:
| | | 2008 | | | 2007 | |
| Net operating loss carry forward | | $ | 5,609 | | | $ | 1,680 | |
| Valuation allowance | | | (5,609 | ) | | | (1,680 | ) |
| Net deferred tax asset | | $ | - | | | $ | - | |
| | | | 2009 | | | | 2008 | |
| Net operating loss carry forward | | $ | 19,559 | | | $ | 5,609 | |
| Valuation allowance | | | (19,559 | ) | | | (5,609 | ) |
| Net deferred tax asset | | $ | - | | | $ | - | |
A reconciliation of income taxes computed at the statutory rate t the income tax amount recorded is as follows:
| | | 2008 | | | 2007 | | | From Inception | |
| Net operating loss carry forward | | $ | 5,609 | | | $ | 1,680 | | | $ | 7,289 | |
| Valuation allowance | | | (5,609 | ) | | | (1,680 | ) | | | (7,289 | ) |
| Net deferred tax asset | | $ | - | | | $ | - | | | $ | - | |
| | | | 2009 | | | | 2008 | | | | Since Inception | |
| Tax at statutory rate (35%) | | $ | 12,270 | | | $ | 5,609 | | | $ | 19,559 | |
| Increase in valuation allowance | | | (12,270 | ) | | | (5,609 | ) | | | (19,559 | ) |
| Net deferred tax asset | | $ | - | | | $ | - | | | $ | - | |
The Company did not pay any income taxes during the years ended December 31, 20082009 or 2007.2008.
The net federal operating loss carry forward will expire infrom 2027 and 2028.through 2029. This carry forward may be limited upon the consummation of a business combination under IRC Section 381.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Financial Statements
December 31, 2008 and 2007
Note 5 – Related Party Transactions
The Company neither owns nor leases any real or personal property. An officer or resident agent of the corporation provides office services without charge. Such costs are immaterial to the financial statements and accordingly, have not been reflected therein. The officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interest. The Company has not formulated a policy for the resolution of such conflicts.
The officer of the Company has advanced $3,760 for organizational expenses and professional fees as of December 31, 2008. The loan is due on demand and as such is included in current liabilities as of December 31, 2008. Interest has not been imputed as such costs would be immaterial to the financial statements as a whole.
Note 6 – Warrants and Options
There are no warrants or options outstanding to acquire any additional shares of common stock of the Company.
Note 7 – Subsequent Events
No events have occurred subsequent to the balance sheet date that would require disclosure herein.
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Unaudited Financial Statements
September 30, 2008
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Unaudited Financial Statements
September 30, 2008
TABLE OF CONTENTS
| | Page(s) |
Balance Sheets as of September 30, 2008 and December 31, 2007 | F-17 |
| | |
Statements of Operations for the three and nine months ended September 30, 2008 | |
| and the period of October 16, 2007 (Inception) to September 30, 2008 | F-18 |
| | |
Statements of Cash Flows for the nine months ended September 30, 2008 and the period of | |
| October 16, 2007 (Inception) to September 30, 2008 | F-19 |
| | |
Notes to the Unaudited Financial Statements | F-20-25 |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Balance Sheets | |
| (Unaudited) | |
| | | | | | |
| | September 30, 2008 | | December 31, 2007 | |
| |
| |
| | | | | | | |
| ASSETS | |
| | | | | | | |
| Current assets | | | | | | |
| Cash | | $ | 935 | | | $ | 850 | |
| Total current assets | | | 935 | | | | 850 | |
| | | | | | | | | |
| Total assets | | $ | 935 | | | $ | 850 | |
| | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY | |
| | | | | | | | | |
| Current liabilities | | | | | | | | |
| Accounts payable | | $ | 2,250 | | | $ | 300 | |
| Loan from shareholder | | | 2,760 | | | | - | |
| Total current liabilities | | | 5,010 | | | | 300 | |
| | | | | | | | | |
| Stockholders' (Deficit) Equity | | | | | | | | |
| Preferred stock, $.001 par value; 5,000,000 shares authorized, no shares issued or outstanding | | | - | | | | - | |
| Common stock, $.001 par value; 70,000,000 shares authorized, 2,415,250 and 2,350,000 shares issued and outstanding at September 30, 2008 and December 31, 2007 | | | 2,415 | | | | 2,350 | |
| Additional paid in capital | | | 9,460 | | | | 3,000 | |
| Deficit accumulated during the development stage | | | (15,950 | ) | | | (4,800 | ) |
| Total stockholders' (deficit) equity | | | (4,075 | ) | | | 550 | |
| | | | | | | | | |
| Total liabilities and stockholders' (deficit) equity | | $ | 935 | | | $ | 850 | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Operations | |
| (Unaudited) | |
| | | | | | | | For the period from October 16, 2007 (inception) to September 30, 2008 | |
| | | | | | | |
| | Three months ended September 30, 2008 | | Nine months ended September 30, 2008 | |
| |
| | | | | | | | | | |
| Revenue | | $ | - | | | $ | - | | | $ | - | |
| | | | | | | | | | | | | |
| Expenses | | | | | | | | | | | | |
| General and administrative | | | 100 | | | | 140 | | | | 440 | |
| Travel | | | 500 | | | | 1,300 | | | | 1,300 | |
| Professional fees | | | 5,000 | | | | 9,710 | | | | 14,210 | |
| Total expenses | | | 5,600 | | | | 11,150 | | | | 15,950 | |
| | | | | | | | | | | | | |
| Net loss | | $ | (5,600 | ) | | $ | (11,150 | ) | | $ | (15,950 | ) |
| | | | | | | | | | | | | |
| Basic and diluted loss per common share | | $ | (0.00 | ) | | $ | (0.00 | ) | | | | |
| | | | | | | | | | | | | |
| Weighted average shares outstanding | | | 2,413,147 | | | | 2,375,071 | | | | | |
| | | | | | | | | | | | | |
| See accompanying notes to financial statements | |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Cash Flows | |
| (Unaudited) | |
| | | | | | For the period of October 16, 2007 (inception) to September 30, 2008 | |
| | | | |
| | | | |
| | Nine months ended September 30, 2008 | |
| |
| Cash flows from operating activities | | | | |
| Net loss | | $ | (11,150 | ) | | $ | (15,950 | ) |
| Changes in operating assets and liabilities | | | | | |
| Accounts payable | | | 1,950 | | | | 2,250 | |
| Net cash used in operating activities | | | (9,200 | ) | | | (13,700 | ) |
| | | | | | | | | |
| Net cash used in investing activities | | | - | | | | - | |
| | | | | | | | | |
| Cash flows from financing activities | | | | | |
| Loan from shareholder | | | 2,760 | | | | 2,760 | |
| Proceeds from sale of stock | | | 6,525 | | | | 11,875 | |
| Net cash provided by financing activities | | | 9,285 | | | | 14,635 | |
| | | | | | | | | |
| Net increase in cash | | | 85 | | | | 935 | |
| | | | | | | | | |
| Cash at beginning of period | | | 850 | | | | - | |
| | | | | | | | | |
| Cash at end of period | | $ | 935 | | | $ | 935 | |
| | | | | | | | | |
| Supplemental Cash Flow Information: | | | | | |
| Cash paid for interest | | $ | - | | | $ | - | |
| Cash paid for income taxes | | $ | - | | | $ | - | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
September 30, 2008
Note 1 – Nature of Business
The unaudited financial statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such SEC rules and regulations; nevertheless, the Company believes that the disclosures are adequate to make the information presented not misleading. These financial statements and the notes attached hereto should be read in conjunction with the financial statements and notes included in the Company’s Form S-1, which was filed with the SEC on February 29, 2008 and was deemed effective by the Securities and Exchange Commission on March 14, 2008. In the opinion of the Company, all adjustments, including normal recurring adjustments necessary to present fairly the financial position of Rhino Productions, Inc., as of September 30, 2008 and the results of its operations and cash flows for the three and nine month periods then ended, have been included. The results of operations for the interim period are not necessarily indicative of the results for the full year.
Rhino Productions, Inc. (“Company”) was organized October 16, 2007 under the laws of the State of Nevada for purpose of providing cost effective, high quality coffee and wine products, accessories and related equipment. The Company currently has no operations or realized revenues from its planned principle business purpose and, in accordance with Statement of Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by Development Stage Enterprises,” is considered a Development Stage Enterprise.
Note 2 – Significant Accounting Policies
Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash
For the Statements of Cash Flows, all highly liquid investments with maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of September 30, 2008 and December 31, 2007.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
September 30, 2008
Note 2 – Significant Accounting Policies (continued)
Income taxes
Income taxes are provided for using the liability method of accounting in accordance with SFAS No. 109 “Accounting for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109.” A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment.
Share Based Expenses
In December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 123R “Share Based Payment.”This statement is a revision to SFAS 123 and supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”This statement requires a public entity to expense the cost of employee services received in exchange for an award of equity instruments. This statement also provides guidance on valuing and expensing these awards, as well as disclosure requirements of these equity arrangements. The Company adopted SFAS No. 123R upon creation of the company and expenses share based costs in the period incurred.
Going concern
The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company does not have cash nor material assets, nor does it have operations or a source of revenue sufficient to cover its operation costs and allow it to continue as a going concern. The Company is currently attempting to raise capital in order to initiate its business plan which will, if successful, mitigate these factors which raise substantial doubt about the Company’s ability to continue as a going concern. The Company will be dependent upon the raising of this additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern. The officers and directors have committed to advancing certain operating costs of the Company.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
September 30, 2008
Note 2 – Significant Accounting Policies (continued)
Recent Accounting Pronouncements
In May 2008, FASB issued Financial Accounting Standards No. 163, “Accounting for Financial Guarantee Insurance Contracts - an interpretation of FASB Statement No. 60.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises under FASB Statement No. 60, Accounting and Reporting by Insurance Enterprises. That diversity results in inconsistencies in the recognition and measurement of claim liabilities because of differing views about when a loss has been incurred under FASB Statement No. 5, Accounting for Contingencies.
This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements. This Statement is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years.
In May 2008, FASB issued Financial Accounting Standards No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). This Statement is effective 60 days following the SEC's approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles. This pronouncement has no effect on this Company’s financial reporting at this time.
In March of 2008 the Financial Accounting Standards Board (FASB) issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133, “Accounting for Derivatives and Hedging Activities.” SFAS No. 161 has the same scope as Statement No. 133 but requires enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement No. 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption. SFAS No. 161 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
September 30, 2008
Note 2 – Significant Accounting Policies (continued)
Recent Accounting Pronouncements (continued)
In December, 2007, the FASB issued SFAS No. 160, “Non-controlling interests in Consolidated Financial Statements, an amendment of ARB No. 51.” SFAS No. 160 applies to “for-profit” entities that prepare consolidated financial statements where there is an outstanding non-controlling interest in a subsidiary. The Statement requires that the non-controlling interest be reported in the equity section of the consolidated balance sheet but identified separately from the parent. The amount of consolidated net income attributed to the non-controlling interest is required to be presented, clearly labeled for the parent and the non-controlling entity, on the face of the consolidated statement of income. When a subsidiary is de-consolidated, any retained non-controlling interest is to be measured at fair value. Gain or loss on de-consolidation is recognized rather than carried as the value of the retained investment. The Statement is effective for fiscal years and interim periods beginning on or after December 15, 2008. It cannot be adopted earlier but, once adopted, is to be applied retroactively. This pronouncement has no effect on this Company’s financial reporting at this time.
In December 2007, the FASB issued SFAS No.141 (revised 2007), “Business Combinations” (“SFAS 141(R)”) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements” (“SFAS 160”). These standards aim to improve, simplify, and converge internationally the accounting for business combinations and the reporting of noncontrolling interests in consolidated financial statements. The provisions of SFAS 141 (R) and SFAS 160 are effective for the fiscal year beginning April 1, 2009. The adoption of SFAS 141(R) and SFAS 160 has not impacted the Company’s financial statements.
None of the above new pronouncements has current application to the Company, but may be applicable to the Company’s future financial reporting.
Note 3 – Stockholders’ Equity
Common stock
The authorized common stock of the Company consists of 70,000,000 shares with par value of $0.001. On October 23, 2007, the Company authorized the issuance of 2,350,000 shares of its $.001 par value common stock in consideration of $5,350 in cash.
On February 2, 2008, the Company filed with the Securities and Exchange Commission a Form SB-2 Registration Statement for the registration of 750,000 shares of $0.001 par value common stock to be offered at $0.10 per share. It was deemed effective on March 14, 2008. As of September 30, 2008, 65,250 shares have been sold to the public for a total cash consideration of $6,525.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
September 30, 2008
Note 3 – Stockholders’ Equity (continued)
Preferred stock
The authorized preferred stock of the Company consists of 5,000,000 shares with a par value of $0.001. The Company has no preferred stock issued or outstanding.
Net loss per common share
Net loss per share is calculated in accordance with SFAS No. 128, “Earnings Per Share.” The weighted-average number of common shares outstanding during each period is used to compute basic loss per share. Diluted loss per share is computed using the weighted averaged number of shares and dilutive potential common shares outstanding. Dilutive potential common shares are additional common shares assumed to be exercised.
Basic net loss per common share is based on the weighted average number of shares of common stock outstanding during 2007 and since inception. As of September 30, 2008 and since inception, the Company had no dilutive potential common shares.
Note 4 – Income Taxes
We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax and FASB Interpretation No. 48 - Accounting for Uncertainty in Income Taxes an interpretation of FASB Statement No.109”, when it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit. We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry-forwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry-forward period.
The Company did not pay any income taxes during the nine months ended September 30, 2008.
The net federal operating loss carry forward will expire in 2027. This carry forward may be limited upon the consummation of a business combination under IRC Section 381.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
September 30, 2008
Note 5 – Related Party Transactions
The Company neither owns nor leases any real or personal property. An officer or resident agent of the corporation provides office services without charge. Such costs are immaterial to the financial statements and accordingly, have not been reflected therein. The officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interest. The Company has not formulated a policy for the resolution of such conflicts.
The officer of the Company has advanced $2,760 for organizational expenses and professional fees as of September 30, 2008. The loan is due on demand and as such is included in current liabilities as of September 30, 2008. Interest has not been imputed as such costs would be immaterial to the financial statements as a whole.
Note 6 – Warrants and Options
There are no warrants or options outstanding to acquire any additional shares of common stock of the Company.
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Unaudited Financial Statements
June 30, 2008
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Unaudited Financial Statements
June 30, 2008
TABLE OF CONTENTS
| | Page(s) |
Balance Sheets as of June 30, 2008 and December 31, 2007 | F-28 |
| | |
Statements of Operations for the three and six months ended June 30, 2008 | |
| and the period of October 16, 2007 (Inception) to June 30, 2008 | F-29 |
| | |
Statements of Cash Flows for the six months ended June 30, 2008 and the period of | |
| October 16, 2007 (Inception) to June 30, 2008 | F-30 |
| | |
Notes to the Unaudited Financial Statements | F-31-36 |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Balance Sheets | |
| (Unaudited) | |
| | | | | | |
| | June 30, 2008 | | December 31, 2007 | |
| |
| |
| | | | | | | |
| ASSETS | |
| | | | | | | |
| Current assets | | | | | | |
| Cash | | $ | 5,310 | | | $ | 850 | |
| Total current assets | | | 5,310 | | | | 850 | |
| | | | | | | | | |
| Total assets | | $ | 5,310 | | | $ | 850 | |
| | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS' EQUITY | |
| | | | | | | | | |
| Current liabilities | | | | | | | | |
| Accounts payable | | $ | 2,250 | | | $ | 300 | |
| Loan from shareholder | | | 2,760 | | | | - | |
| Total current liabilities | | | 5,010 | | | | 300 | |
| | | | | | | | | |
| Stockholders' Equity | | | | | | | | |
| Preferred stock, $.001 par value; 5,000,000 shares authorized, no shares issued or outstanding | | | - | | | | - | |
| Common stock, $.001 par value; 70,000,000 shares authorized, 2,403,000 and 2,350,000 shares issued and outstanding at June 30, 2008 and December 31, 2007 | | | 2,403 | | | | 2,350 | |
| Additional paid in capital | | | 8,247 | | | | 3,000 | |
| Deficit accumulated during the development stage | | | (10,350 | ) | | | (4,800 | ) |
| Total stockholders' equity | | | 300 | | | | 550 | |
| | | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 5,310 | | | $ | 850 | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Operations | |
| (Unaudited) | |
| | | | | | | | For the period from October 16, 2007 (inception) to June 30, 2008 | |
| | | | | | | |
| | Three months ended June 30, 2008 | | Six months ended June 30, 2008 | |
| |
| | | | | | | | | | |
| Revenue | | $ | - | | | $ | - | | | $ | - | |
| | | | | | | | | | | | | |
| Expenses | | | | | | | | | | | | |
| General and administrative | | | 30 | | | | 40 | | | | 340 | |
| Travel | | | - | | | | 800 | | | | 800 | |
| Professional fees | | | - | | | | 4,710 | | | | 9,210 | |
| Total expenses | | | 30 | | | | 5,550 | | | | 10,350 | |
| | | | | | | | | | | | | |
| Net loss | | $ | (30 | ) | | $ | (5,550 | ) | | $ | (10,350 | ) |
| | | | | | | | | | | | | |
| Basic and diluted loss per common share | | $ | (0.00 | ) | | $ | (0.00 | ) | | | | |
| | | | | | | | | | | | | |
| Weighted average shares outstanding | | | 2,361,648 | | | | 2,355,824 | | | | | |
| | | | | | | | | | | | | |
| See accompanying notes to financial statements | |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Cash Flows | |
| (Unaudited) | |
| | | | | | For the period of October 16, 2007 (inception) to June 30, 2008 | |
| | | | |
| | | | |
| | Six months ended June 30, 2008 | |
| |
| Cash flows from operating activities | | | | |
| Net loss | | $ | (5,550 | ) | | $ | (10,350 | ) |
| Changes in operating assets and liabilities | | | | | |
| Accounts payable | | | 1,950 | | | | 2,250 | |
| Net cash used in operating activities | | | (3,600 | ) | | | (8,100 | ) |
| | | | | | | | | |
| Net cash used in investing activities | | | - | | | | - | |
| | | | | | | | | |
| Cash flows from financing activities | | | | | |
| Loan from shareholder | | | 2,760 | | | | 2,760 | |
| Proceeds from sale of stock | | | 5,300 | | | | 10,650 | |
| Net cash provided by financing activities | | | 8,060 | | | | 13,410 | |
| | | | | | | | | |
| Net increase in cash | | | 4,460 | | | | 5,310 | |
| | | | | | | | | |
| Cash at beginning of period | | | 850 | | | | - | |
| | | | | | | | | |
| Cash at end of period | | $ | 5,310 | | | $ | 5,310 | |
| | | | | | | | | |
| Supplemental Cash Flow Information: | | | | | |
| Cash paid for interest | | $ | - | | | $ | - | |
| Cash paid for income taxes | | $ | - | | | $ | - | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
June 30, 2008
Note 1 – Nature of Business
The unaudited financial statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such SEC rules and regulations; nevertheless, the Company believes that the disclosures are adequate to make the information presented not misleading. These financial statements and the notes attached hereto should be read in conjunction with the financial statements and notes included in the Company’s Form S-1, which was filed with the SEC on February 29, 2008 and was deemed effective by the Securities and Exchange Commission on March 14, 2008. In the opinion of the Company, all adjustments, including normal recurring adjustments necessary to present fairly the financial position of Rhino Productions, Inc., as of June 30, 2008 and the results of its operations and cash flows for the three and six month periods then ended, have been included. The results of operations for the interim period are not necessarily indicative of the results for the full year.
Rhino Productions, Inc. (“Company”) was organized October 16, 2007 under the laws of the State of Nevada for purpose of providing cost effective, high quality coffee and wine products, accessories and related equipment. The Company currently has no operations or realized revenues from its planned principle business purpose and, in accordance with Statement of Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by Development Stage Enterprises,” is considered a Development Stage Enterprise.
Note 2 – Significant Accounting Policies
Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash
For the Statements of Cash Flows, all highly liquid investments with maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of June 30, 2008 and December 31, 2007.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
June 30, 2008
Note 2 – Significant Accounting Policies (continued)
Income taxes
Income taxes are provided for using the liability method of accounting in accordance with SFAS No. 109 “Accounting for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109.” A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment.
Share Based Expenses
In December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 123R “Share Based Payment.”This statement is a revision to SFAS 123 and supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”This statement requires a public entity to expense the cost of employee services received in exchange for an award of equity instruments. This statement also provides guidance on valuing and expensing these awards, as well as disclosure requirements of these equity arrangements. The Company adopted SFAS No. 123R upon creation of the company and expenses share based costs in the period incurred.
Going concern
The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company does not have cash nor material assets, nor does it have operations or a source of revenue sufficient to cover its operation costs and allow it to continue as a going concern. The Company is currently attempting to raise capital in order to initiate its business plan which will, if successful, mitigate these factors which raise substantial doubt about the Company’s ability to continue as a going concern. The Company will be dependent upon the raising of this additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern. The officers and directors have committed to advancing certain operating costs of the Company.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
June 30, 2008
Note 2 – Significant Accounting Policies (continued)
Recent Accounting Pronouncements
In May 2008, FASB issued Financial Accounting Standards No. 163, “Accounting for Financial Guarantee Insurance Contracts - an interpretation of FASB Statement No. 60.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises under FASB Statement No. 60, Accounting and Reporting by Insurance Enterprises. That diversity results in inconsistencies in the recognition and measurement of claim liabilities because of differing views about when a loss has been incurred under FASB Statement No. 5, Accounting for Contingencies.
This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements. This Statement is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years.
In May 2008, FASB issued Financial Accounting Standards No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). This Statement is effective 60 days following the SEC's approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles. This pronouncement has no effect on this Company’s financial reporting at this time.
In March of 2008 the Financial Accounting Standards Board (FASB) issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133, “Accounting for Derivatives and Hedging Activities.” SFAS No. 161 has the same scope as Statement No. 133 but requires enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement No. 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption. SFAS No. 161 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
June 30, 2008
Note 2 – Significant Accounting Policies (continued)
Recent Accounting Pronouncements (continued)
In December, 2007, the FASB issued SFAS No. 160, “Non-controlling interests in Consolidated Financial Statements, an amendment of ARB No. 51.” SFAS No. 160 applies to “for-profit” entities that prepare consolidated financial statements where there is an outstanding non-controlling interest in a subsidiary. The Statement requires that the non-controlling interest be reported in the equity section of the consolidated balance sheet but identified separately from the parent. The amount of consolidated net income attributed to the non-controlling interest is required to be presented, clearly labeled for the parent and the non-controlling entity, on the face of the consolidated statement of income. When a subsidiary is de-consolidated, any retained non-controlling interest is to be measured at fair value. Gain or loss on de-consolidation is recognized rather than carried as the value of the retained investment. The Statement is effective for fiscal years and interim periods beginning on or after December 15, 2008. It cannot be adopted earlier but, once adopted, is to be applied retroactively. This pronouncement has no effect on this Company’s financial reporting at this time.
In December 2007, the FASB issued SFAS No.141 (revised 2007), “Business Combinations” (“SFAS 141(R)”) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements” (“SFAS 160”). These standards aim to improve, simplify, and converge internationally the accounting for business combinations and the reporting of noncontrolling interests in consolidated financial statements. The provisions of SFAS 141 (R) and SFAS 160 are effective for the fiscal year beginning April 1, 2009. The adoption of SFAS 141(R) and SFAS 160 has not impacted the Company’s financial statements.
None of the above new pronouncements has current application to the Company, but may be applicable to the Company’s future financial reporting.
Note 3 – Stockholders’ Equity
Common stock
The authorized common stock of the Company consists of 70,000,000 shares with par value of $0.001. On October 23, 2007, the Company authorized the issuance of 2,350,000 shares of its $0.001 par value common stock in consideration of $5,350 in cash.
On February 2, 2008, the Company filed with the Securities and Exchange Commission a Form SB-2 Registration Statement for the registration of 750,000 shares of $0.001 par value common stock to be offered at $0.10 per share. It was deemed effective on March 14, 2008. As of June 30, 2008, 53,000 shares have been sold to the public for a total cash consideration of $5,300.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
June 30, 2008
Note 3 – Stockholders’ Equity (continued)
Preferred stock
The authorized preferred stock of the Company consists of 5,000,000 shares with a par value of $0.001. The Company has no preferred stock issued or outstanding.
Net loss per common share
Net loss per share is calculated in accordance with SFAS No. 128, “Earnings Per Share.” The weighted-average number of common shares outstanding during each period is used to compute basic loss per share. Diluted loss per share is computed using the weighted averaged number of shares and dilutive potential common shares outstanding. Dilutive potential common shares are additional common shares assumed to be exercised.
Basic net loss per common share is based on the weighted average number of shares of common stock outstanding during 2008 and 2007 and since inception. As of June 30, 2008 and since inception, the Company had no dilutive potential common shares.
Note 4 – Income Taxes
We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax and FASB Interpretation No. 48 - Accounting for Uncertainty in Income Taxes an interpretation of FASB Statement No.109”, when it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit. We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry-forwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry-forward period.
The Company did not pay any income taxes during the six months ended June 30, 2008.
The net federal operating loss carry forward will expire in 2027. This carry forward may be limited upon the consummation of a business combination under IRC Section 381.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
June 30, 2008
Note 5 – Related Party Transactions
The Company neither owns nor leases any real or personal property. An officer or resident agent of the corporation provides office services without charge. Such costs are immaterial to the financial statements and accordingly, have not been reflected therein. The officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interest. The Company has not formulated a policy for the resolution of such conflicts.
The officerCompany has received loans from a shareholder totaling $21,885 since inception. Of this amount, $19,125 and $2,760 was received during the years ended December 31, 2009 and 2008, respectively. The shareholder received 1,200,000 shares of common stock in satisfaction of the Company has advanced $2,760 for organizational expenses and professional fees as of June 30, 2008.officer loans. The loan is due on demand and as such is included in current liabilities as of June 30, 2008. Interestbore a 0% interest rate during the period it was due. Imputed interest has not been imputed as such costs wouldconsidered but was determined to be immaterial to the financial statements as a whole.statements.
Note 6 – Warrants and Options
There are no warrants or options outstanding to acquire any additional shares of common stock of the Company.
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Unaudited Financial Statements
March 31, 2008
RHINO PRODUCTIONS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Unaudited Financial Statements
March 31, 2008
TABLE OF CONTENTS
| | Page(s) |
Balance Sheets as of March 31, 2008 and December 31, 2007 | F-39 |
| | |
Statements of Operations for the three months ended March 31, 2008 | |
| and the period of October 16, 2007 (Inception) to March 31, 2008 | F-40 |
| | |
Statements of Cash Flows for the three months ended March 31, 2008 | |
| and the period of October 16, 2007 (Inception) to March 31, 2008 | F-41 |
| | |
Notes to the Unaudited Financial Statements | F-42-47 |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Balance Sheets | |
| (Unaudited) | |
| | | | | | |
| | March 31, 2008 | | December 31, 2007 | |
| |
| |
| | | | | | | |
| ASSETS | |
| | | | | | | |
| Current assets | | | | | | |
| Cash | | $ | - | | | $ | 850 | |
| | | | | | | | | |
| Total current assets | | | - | | | | 850 | |
| | | | | | | | | |
| Total assets | | $ | - | | | $ | 850 | |
| | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY | |
| | | | | | | | | |
| Current liabilities | | | | | | | | |
| Bank overdraft | | $ | 16 | | | $ | - | |
| Accounts payable | | | 2,250 | | | | 300 | |
| Loan from shareholder | | | 2,704 | | | | - | |
| | | | | | | | | |
| Total current liabilities | | | 4,970 | | | | 300 | |
| | | | | | | | | |
| Stockholders' (deficit) equity | | | | | | | | |
| Preferred stock, $.001 par value; 5,000,000 shares authorized, no shares issued or outstanding | | | - | | | | - | |
| Common stock, $.001 par value; 70,000,000 shares authorized, 2,350,000 shares issued and outstanding at March 31, 2008 and December 31, 2007 | | | 2,350 | | | | 2,350 | |
| Additional paid in capital | | | 3,000 | | | | 3,000 | |
| Deficit accumulated during the development stage | | | (10,320 | ) | | | (4,800 | ) |
| Total stockholders' (deficit) equity | | | (4,970 | ) | | | 550 | |
| | | | | | | | | |
| Total liabilities and stockholders' (deficit) equity | | $ | - | | | $ | 850 | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Operations | |
| (Unaudited) | |
| | | | | For the period from October 16, 2007 (inception) to March 31, 2008 | |
| | | | |
| | Three months ended March 31, 2008 | |
| |
| | | | | | | |
| Revenue | | $ | - | | | $ | - | |
| | | | | | | | | |
| Expenses | | | | | | | | |
| General and administrative | | | 10 | | | | 310 | |
| Travel | | | 800 | | | | 800 | |
| Professional fees | | | 4,710 | | | | 9,210 | |
| Total expenses | | | 5,520 | | | | 10,320 | |
| | | | | | | | | |
| Net loss | | $ | (5,520 | ) | | $ | (10,320 | ) |
| | | | | | | | | |
| Basic and diluted loss per common share | | $ | (0.00 | ) | | | | |
| | | | | | | | | |
| Weighted average shares outstanding | | | 2,350,000 | | | | | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
| RHINO PRODUCTIONS, INC. | |
| (A Development Stage Enterprise) | |
| Statements of Cash Flows | |
| | |
| | | | | | For the period of October 16, 2007 (inception) to March 31, 2008 | |
| | | | |
| | | | |
| | Three months ended March 31, 2008 | |
| |
| Cash flows from operating activities | | | | |
| Net loss | | $ | (5,520 | ) | | $ | (10,320 | ) |
| Changes in operating assets and liabilities: | | | | | |
| Accounts payable | | | 1,950 | | | | 2,250 | |
| Net cash used in operating activities | | | (3,570 | ) | | | (8,070 | ) |
| | | | | | | | | |
| Net cash used in investing activities | | | - | | | | - | |
| | | | | | | | | |
| Cash flows from financing activities | | | | | |
| Bank overdraft | | | 16 | | | | 16 | |
| Loan from shareholder | | | 2,704 | | | | 2,704 | |
| Proceeds from sale of stock | | | - | | | | 5,350 | |
| Net cash provided by financing activities | | | 2,720 | | | | 8,070 | |
| | | | | | | | | |
| Net decrease in cash | | | (850 | ) | | | - | |
| | | | | | | | | |
| Cash at beginning of period | | | 850 | | | | - | |
| | | | | | | | | |
| Cash at end of period | | $ | - | | | $ | - | |
| | | | | | | | | |
| Supplemental Cash Flow Information: | | | | | |
| Cash paid for interest | | $ | - | | | $ | - | |
| Cash paid for income taxes | | $ | - | | | $ | - | |
| | | | | | | | | |
| See accompanying notes to financial statements | |
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
March 31, 2008
Note 1 – Nature of Business
The unaudited financial statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such SEC rules and regulations; nevertheless, the Company believes that the disclosures are adequate to make the information presented not misleading. These financial statements and the notes attached hereto should be read in conjunction with the financial statements and notes included in the Company’s Form S-1, which was filed with the SEC on February 29, 2008 and was deemed effective by the Securities and Exchange Commission on March 14, 2008. In the opinion of the Company, all adjustments, including normal recurring adjustments necessary to present fairly the financial position of Rhino Productions, Inc., as of March 31, 2008 and the results of its operations and cash flows for the three month periods then ended, have been included. The results of operations for the interim period are not necessarily indicative of the results for the full year.
Rhino Productions, Inc. (“Company”) was organized October 16, 2007 under the laws of the State of Nevada for purpose of providing cost effective, high quality coffee and wine products, accessories and related equipment. The Company currently has no operations or realized revenues from its planned principle business purpose and, in accordance with Statement of Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by Development Stage Enterprises,” is considered a Development Stage Enterprise.
Note 27 – Significant Accounting Policies
Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash
For the Statements of Cash Flows, all highly liquid investments with maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of March 31, 2008 and December 31, 2007.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
March 31, 2008
Note 2 – Significant Accounting Policies (continued)
Income taxes
Income taxes are provided for using the liability method of accounting in accordance with SFAS No. 109 “Accounting for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109.” A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment.
Share Based Expenses
In December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 123R “Share Based Payment.”This statement is a revision to SFAS 123 and supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”This statement requires a public entity to expense the cost of employee services received in exchange for an award of equity instruments. This statement also provides guidance on valuing and expensing these awards, as well as disclosure requirements of these equity arrangements. The Company adopted SFAS No. 123R upon creation of the company and expenses share based costs in the period incurred.
Going concern
The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company does not have cash nor material assets, nor does it have operations or a source of revenue sufficient to cover its operation costs and allow it to continue as a going concern. The Company is currently attempting to raise capital in order to initiate its business plan which will, if successful, mitigate these factors which raise substantial doubt about the Company’s ability to continue as a going concern. The Company will be dependent upon the raising of this additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern. The officers and directors have committed to advancing certain operating costs of the Company.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
March 31, 2008
Note 2 – Significant Accounting Policies (continued)
Recent Accounting Pronouncements
In May 2008, FASB issued Financial Accounting Standards No. 163, “Accounting for Financial Guarantee Insurance Contracts - an interpretation of FASB Statement No. 60.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises under FASB Statement No. 60, Accounting and Reporting by Insurance Enterprises. That diversity results in inconsistencies in the recognition and measurement of claim liabilities because of differing views about when a loss has been incurred under FASB Statement No. 5, Accounting for Contingencies.
This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements. This Statement is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years.
In May 2008, FASB issued Financial Accounting Standards No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). This Statement is effective 60 days following the SEC's approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles. This pronouncement has no effect on this Company’s financial reporting at this time.
In March of 2008 the Financial Accounting Standards Board (FASB) issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133, “Accounting for Derivatives and Hedging Activities.” SFAS No. 161 has the same scope as Statement No. 133 but requires enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement No. 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption. SFAS No. 161 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
March 31, 2008
Note 2 – Significant Accounting Policies (continued)
Recent Accounting Pronouncements (continued)
In December, 2007, the FASB issued SFAS No. 160, “Non-controlling interests in Consolidated Financial Statements, an amendment of ARB No. 51.” SFAS No. 160 applies to “for-profit” entities that prepare consolidated financial statements where there is an outstanding non-controlling interest in a subsidiary. The Statement requires that the non-controlling interest be reported in the equity section of the consolidated balance sheet but identified separately from the parent. The amount of consolidated net income attributed to the non-controlling interest is required to be presented, clearly labeled for the parent and the non-controlling entity, on the face of the consolidated statement of income. When a subsidiary is de-consolidated, any retained non-controlling interest is to be measured at fair value. Gain or loss on de-consolidation is recognized rather than carried as the value of the retained investment. The Statement is effective for fiscal years and interim periods beginning on or after December 15, 2008. It cannot be adopted earlier but, once adopted, is to be applied retroactively. This pronouncement has no effect on this Company’s financial reporting at this time.
In December 2007, the FASB issued SFAS No.141 (revised 2007), “Business Combinations” (“SFAS 141(R)”) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements” (“SFAS 160”). These standards aim to improve, simplify, and converge internationally the accounting for business combinations and the reporting of noncontrolling interests in consolidated financial statements. The provisions of SFAS 141 (R) and SFAS 160 are effective for the fiscal year beginning April 1, 2009. The adoption of SFAS 141(R) and SFAS 160 has not impacted the Company’s financial statements.
None of the above new pronouncements has current application to the Company, but may be applicable to the Company’s future financial reporting.
Note 3 – Stockholders’ Equity
Common stock
The authorized common stock of the Company consists of 70,000,000 shares with par value of $0.001. On October 23, 2007, the Company authorized the issuance of 2,350,000 shares of its $0.001 par value common stock in consideration of $5,350 in cash.
On February 2, 2008, the Company filed with the Securities and Exchange Commission a Form SB-2 Registration Statement for the registration of 750,000 shares of $0.001 par value common stock to be offered at $0.10 per share. It was deemed effective on March 14, 2008. As of March 31, 2008, no shares have been sold to the public.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
March 31, 2008
Note 3 – Stockholders’ Equity (continued)
Preferred stock
The authorized preferred stock of the Company consists of 5,000,000 shares with a par value of $0.001. The Company has no preferred stock issued or outstanding.
Net loss per common share
Net loss per share is calculated in accordance with SFAS No. 128, “Earnings Per Share.” The weighted-average number of common shares outstanding during each period is used to compute basic loss per share. Diluted loss per share is computed using the weighted averaged number of shares and dilutive potential common shares outstanding. Dilutive potential common shares are additional common shares assumed to be exercised.
Basic net loss per common share is based on the weighted average number of shares of common stock outstanding during 2008 or 2007 and since inception. As of March 31, 2008, December 31, 2007 and since inception, the Company had no dilutive potential common shares.
Note 4 – Income Taxes
We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax and FASB Interpretation No. 48 - Accounting for Uncertainty in Income Taxes an interpretation of FASB Statement No.109”, when it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit. We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry-forwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry-forward period.
The Company did not pay any income taxes during the three months ended March 31, 2008.
The net federal operating loss carry forward will expire in 2027. This carry forward may be limited upon the consummation of a business combination under IRC Section 381.
RHINO PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to the Unaudited Financial Statements
March 31, 2008
Note 5 – Related Party TransactionsSubsequent Events
The Company neither owns nor leases any real or personal property. An officer or resident agent of the corporation provides office services without charge. Such costs are immaterial to the financial statementshas evaluated subsequent events through April 21, 2010 and accordingly, have not been reflected therein. The officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interest. The Company has not formulated a policy for the resolution of such conflicts.
The officer of the Company has advanced $2,704 for organizational expenses and professional fees as of March 31, 2008. The loan is due on demand and as such is included in current liabilities as of March 31, 2008. Interest has not been imputed as such costs would be immaterial to the financial statements as a whole.
Note 6 – Warrants and Options
Theredetermined there are no warrants or options outstandingevents to acquire any additional shares of common stock of the Company.disclose.