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[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||||||||||||||||||
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[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||||||||||||||||||
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| Commission file number: | 333-182566 |
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| Line Up Advertisement, Inc. |
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| Nevada |
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| 32-0378469 |
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Makati City, Philippines |
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| (702) 478-2122 |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. | ||||||||||||||||||||||||
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Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes[ ] No [ ] | ||||||||||||||||||||||||
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. | ||||||||||||||||||||||||
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Non-accelerated filer [ ] (Do not check if a smaller reporting company) | Smaller reporting company [X] | |||||||||||||||||||||||
Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). | ||||||||||||||||||||||||
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LINE UP ADVERTISEMENT, INC.
QUARTERLY REPORT
TABLE OF CONTENTS
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9 ITEM 2. MANAGEMENT`S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions. Summary Information On April 17, 2012, Mr. Vagner Gomes Tome, president and sole director, incorporated the Company in the State of Nevada and established a fiscal year end of April 30th. On May 23, 2013 the Company accepted the resignation of Vagner Gomes Tome as the sole director and officer of the Company and accepted the appointment of Joelyn Alcantara to serve in his stead. The objective of this corporation remains to introduce advertisement in nightclub line-ups. We are a development-stage Company that intends to provide TVs streaming advertisements for the customers lining up on the outside of the nightclubs. The idea is to showcase pictures of that particular club scene, special events, deals on drink specials and advertisements from local businesses and other companies. We plan on providing the TV at no cost to the club and generate revenue through the sale of advertisements from local restaurants, cigarette companies, alcohol companies, clothing companies, ads for sports and entertainment events, etc. As of the date of this prospectus, we have not yet contacted any possible client. Furthermore, we have not yet developed our systems and services. The Company has not yet implemented its business model and to date has generated no revenues. Results of Operations As of October 31, 2013 we had $4,397 in cash, with liabilities of $28,766, as compared to $395 in cash and $10,762 in liabilities at April 30, 2013. At April 30, 2013, Mr. Vagner Gomes Tome was owed $1,163 and at October 31, 2013 he was owed $6,163. At April 30, 2013 Joelyn Alcantara was owed $0, and at October 31, 2013 she was owed $10,754 The funds provided to the Company by the former President and current President have no interest and no fixed repayment date. The Company incurred expenses in the amount of $5,452 and $14,002 during the three and six month period ending October 31, 2013 and $5,250 and $5,615 during the three and six month period ending October 31, 2012. The total expenses accumulated since inception is $37,069. Our current cash holdings will not satisfy our liquidity requirements and we will require additional financing to pursue our planned business activities. We have registered 5,000,000 of or our common stock for sale to the public. Our registration statement became effective on August 29, 2012 and we are in the process of seeking equity financing to fund our operations over the next months. We have issued 260,000 shares in September 2012, totaling $5,200. Our officer and director has committed to advancing funds (up to $15,000) for the next twelve months to cover expenses to maintain the reporting status current with the SEC. Ms. 10 Joelyn Alcantara is willing to lend the full amount of these funds to the Company as the expenses are incurred, if necessary or if no other proceeds are obtained by the Company, regardless of the amount raised through this offering. However, there is no contract in place or written agreement with Ms. Alcantara and the funds expressed in the above president’s
Management believes that if subsequent private placements are successful, we will generate sales revenue within the following twelve months thereof. However, additional equity financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements. We are exclusively dependent upon the success of the anticipated offering described herein. Therefore, the failure thereof would result in need to seek capital from other resources such as debt financing, which may not even be available to the Company. However, if such financing were available, because we are a development stage Company with no operations to date, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing. If the Company cannot raise additional proceeds via a private placement of its common stock or secure debt financing, it would be required to cease business operations. As a result, investors would lose all of their investment. Plan of Operation Our net proceeds (Gross proceeds less Expenses related to this offering, estimated at a fixed cost of $7,636 and Expenses to maintain our reporting status for 12 months after effective date, estimated at a fixed cost of $14,400) are planned to be invested in the following order of importance and the objective of each step:
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Estimated time frame for completion of each step of our Plan of Operations.
Market research
We plan to have a detailed ‘map’ of night clubs locations and possible local businesses that could benefit from our services. We expect to understand the demographic of the clubs and we also plan to interview patrons who attend and frequent the club, to have an idea of how long they believe they usually stand in line and the usual time frame that people stand outside on particular evenings of
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operation. Gathering this information is essential to the Company so we can make the proper decisions and outline the best strategies for our Business. The Company’s president will be responsible to conduct the Market Research and/or hire an independent Company to perform this task if finances allow.
We expect to spend between $550 and $25,000 in our Market Research, depending on the funds from the sale of the offered shares herein.
-Equipment purchase
The company estimates that the cost for each outdoor weather proof TV case will range from $1,000 to $6,000; depending on the manufacturer and TV size.
TV’s are widely available and they range in price, depending on the brand and size, from $500 to $3,000.
The Company’s president will be responsible for the equipment purchase.
The Company expects to invest between $1,000 and $32,000 for purchase of equipment, depending on the funds from the sale of the offered shares herein.
-Tests and website development
After we acquire the initial necessary equipment, we plan on running tests simulating actual situations, such as visibility of the TV in different positions, finding the best possible placement for the TV. We may also consider weather conditions, lighting among other factors that may arise.
After we have successfully tested our systems, we intend to finalize our website (www.lineupad.com), currently under construction, including a detailed explanation of our systems with pictures and videos.
We plan on hiring third party technicians and/or engineers to help with the tests and a third party web developer to finalize our website. The president will be responsible to hire the third party personnel and she will oversee all the development. The president may be responsible to run all the tests, depending on the funds available to the Company.
We intend to allocate between $504 and $6,500 for our tests and website costs, depending on the funds from the sale of the offered shares herein.
-Secure contracts with nightclub owners
After we decide on a pre-set system and standards for our services and products, we believe that we will have a better understanding of the functionality of our business. At that time, we may be able to present our idea in a more organized manner, and instruct how it will work. These factors would give us a better chance to secure contracts with club owners and managers.
The Company’s president will deal with all negotiations and she may decide to hire sub-contracted sales personnel, if finances allow.
We expect to allocate $450 and $6,000 to cover costs related to securing contracts with nightclub owners, depending on the funds from the sale of the offered shares herein.
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-Search for local businesses for initial advertisement
After securing our initial club contract and setting our first TV(s) up, we plan on finding advertisements from local businesses, such as after hour stores, late night eateries, taxi companies, etc. We estimate that a video to be used for our TV’s can be produced and edited in no more than 7 days.
We believe that our cost to produce the video advertisements will be very low, because we could use existing material from the advertising client’s website or simply use pictures and or videos to be provided by the client (nowadays, digital pictures and videos are very accessible).
The Company’s president will deal with all the negotiations and she may decide to hire sub-contracted sales personnel, if finances allow. Mr. Tome will be responsible for editing the videos.
We plan on investing between $400 and $7,300 to search for local businesses for initial advertisement, depending on the funds from the sale of the offered shares herein.
-Office supplies, Stationery, Telephones, Internet
We intend to allocate between $60 and $1,164 to cover these costs, at the president’s discretion, depending on the funds from the sale of the offered shares herein.
We do not currently have any employees and management does not plan to hire employees at this time. We do not expect the purchase or sale of any significant equipment and has no current material commitments.
Off-balance sheet arrangements
The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect or change on the Company’s financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the Company is a party, under which the Company has (i) any obligation arising under a guarantee contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Not required.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
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Based upon an evaluation of the effectiveness of disclosure controls and procedures, our principal executive and financial officer has concluded that as of the end of the period covered by this Quarterly Report on Form 10-Q our disclosure controls and procedures (as
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defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act) were not effective.
The material weaknesses in our disclosure control procedures are as follows:
1. Lack of formal policies and procedures necessary to adequately review significant accounting transactions. The Company utilizes a third party independent contractor for the preparation of its financial statements. Although the financial statements and footnotes are reviewed by our management, we do not have a formal policy to review significant accounting transactions and the accounting treatment of such transactions. The third party independent contractor is not involved in the day to day operations of the Company and may not be provided information from management on a timely basis to allow for adequate reporting/consideration of certain transactions.
2. Audit Committee and Financial Expert. The Company does not have a formal audit committee with a financial expert, and thus the Company lacks the board oversight role within the financial reporting process.
We intend to initiate measures to remediate the identified material weaknesses including, but not necessarily limited to, the following:
• | Establishing a formal review process of significant accounting transactions that includes participation of the Chief Executive Officer, the Chief Financial Officer and the Company’s corporate legal counsel. |
• | Form an Audit Committee that will establish policies and procedures that will provide the Board of Directors a formal review process that will among other things, assure that management controls and procedures are in place and being maintained consistently. |
Establishing a formal review process of significant accounting transactions that includes participation of the Chief Executive Officer, the Chief Financial Officer and the Company’s corporate legal counsel.
Form an Audit Committee that will establish policies and procedures that will provide the Board of Directors a formal review process that will among other things, assure that management controls and procedures are in place and being maintained consistently.
Changes in Internal Controls over Financial Reporting
There have not been any changes in the Company's internal control over financial reporting during the quarter ended JanuaryOctober 31, 2013 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated.
No director, officer, or affiliate of the issuer and no owner of record or beneficiary of more than 5% of the securities of the issuer, or any security holder is a party adverse to the small business issuer or has a material interest adverse to the small business issuer.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None
Item 4.(Removed (Removed and Reserved)
Item 5. Other Information
None
Item 6. Exhibits
Exhibit No. | Document Description |
3.1 | Articles of Incorporation [1] |
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3.2 | By-Laws [1] |
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31.1 | Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer |
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31.2 | Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer * |
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32.1 | Section 1350 Certification of Chief Executive Officer |
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32.2 | Section 1350 Certification of Chief Financial Officer ** |
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101.INS | XBRL Instance Document |
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101.SCH | XBRL Taxonomy Extension Schema Document |
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101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
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101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
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101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
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101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
[1] Incorporated by reference from the Company’sCompany’s filing with the Commission on July 06, 2012.
* Included in Exhibit 31.1
** Included in Exhibit 32.1
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SIGNATURES
Pursuant to the requirements of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Line Up Advertisement, Inc.
/s/ Vagner Gomes TomeJoelyn Alcantara
Vagner Gomes TomeJoelyn Alcantara
President and Director,
Principal Executive Officer,
Principal Financial Officer,
Principal Accounting Officer
Dated: March 01,December 12, 2013
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