UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended: November 30, 2017February 28, 2021
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from ___________ to____________
Commission File Number: 333-213009
GEANTCANNABIS SUISSE CORP.
(Exact name of registrant as specified in its charter)
Nevada (State or Other Jurisdiction of Incorporation or Organization) | 2600 (Primary Standard Industrial Classification Code Number) | 38-3993849 I.R.S. Employer Identification Number | |
Kiranthidiya road 114, Beruwala, Sri Lanka, 12070
Lerzenstrasse 12, 8953 Dietikon, Switzerland
Phone: +15022082098
E-mailPhone: +17027510467:
E-mail: office@geantcorp.commanage@cannabissuissecorp.com
(Address, including zip code, and telephone number,
Including area code, of registrant’sregistrant’s principal executive offices)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock | CSUI | OTC Markets |
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 past 12 months, and (2) has been subject to such filing requirements for the past 90 days.
Yes [X]⌧ No [ ]☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☐ 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. See the definitions of “large“large accelerated filer,” “accelerated filer”“accelerated filer”, “emerging“emerging growth company” company”and “smaller“smaller reporting company”company” in Rule 12b-2 of the Exchange Act:Act. (Check one):
Large accelerated filer |
| Accelerated filer |
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Non-accelerated filer |
| Smaller reporting company |
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Emerging growth company |
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [ ]☐ No [X]⌧
As of December 28, 2017April 19, 2021, there were 2,855,00034,500,000 shares outstanding of the registrant’sregistrant’s common stock.
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PART I | FINANCIAL INFORMATION: | ||
Item 1. | Financial Statements |
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Consolidated Balance Sheets as of |
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Consolidated Statements of Operations and Comprehensive Loss (unaudited) for the three and |
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Consolidated Statements of Cash Flows (unaudited) for the nine months ended February 28, 2021 and 2020 | 8 | ||
Notes to the Consolidated Financial Statements (unaudited) | 9 | ||
Item 2. |
Results of Operations |
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Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
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Item 4. | Controls and Procedures |
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PART II | OTHER INFORMATION: | ||
Item 1. | Legal Proceedings |
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Item 1A | Risk Factors |
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Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
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Item 3. | Defaults Upon Senior Securities |
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Item 4. | Mine Safety Disclosure |
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Item 5. | Other Information |
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Item 6. | Exhibits |
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| Signatures | ||
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23
PART I – FINANCIAL INFORMATION
Item 1. Financial statements
The accompanying interim condensedconsolidated financial statements of GeantCannabis Suisse Corp. (the “Company”), have been prepared without audit 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 United States generally accepted principles have been condensed or omitted pursuant to such rules and regulations.
The accompanying interim condensed financial statements of Geant Corp. (the “Company”“Company”) should be read in conjunction with the 10-K that was filed with the United States Securities and Exchange Commission (the “SEC”“SEC”) on August 18, 2017.. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”(“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 108 of Regulation S-X. Accordingly, since they are interim statements, the accompanying consolidated financial statements do not include all the information and notes required by GAAP for complete financial statement presentation. In the opinion of management, the interim financial statements reflect all adjustments (consisting of normal, recurring adjustments) that are necessary for a fair presentation of the financial position, results of operations, and cash flows for the interim periods presented. Interim results are not necessarily indicative of results for a full year.
In the opinion of management, the consolidated financial statements contain all material adjustments, consisting only of normal adjustments considered necessary to present fairly the financial condition, results of operations, and cash flows of the Company for the interim periods presented.
3
GEANT CORP.
BALANCE SHEETS
ASSETS |
| November 30, 2017 (Unaudited) | May 31, 2017 (Audited) | ||||
Current Assets |
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Cash and cash equivalents Inventory | $ | 6,339 6,693 | 6,187 8,996 | ||||
Prepaid expenses |
| 103 | 823 | ||||
Total Current Assets | $ | 13,135 | 16,006 | ||||
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Fixed Assets |
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Equipment, net |
| 18,737 | 22,184 | ||||
Total Fixed Assets | $ | 18,737 | 22,184 | ||||
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Total Assets | $ | 31,872 | 38,190 | ||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Liabilities |
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Current Liabilities |
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Related-party loan |
| 29,100 | 29,100 | ||||
Total Current Liabilities | $ | 29,100 | 29,100 | ||||
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Total Liabilities | $ | 29,100 | 29,100 | ||||
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Commitments & Contingencies |
| - | - | ||||
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Stockholder’s Equity |
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Common stock, par value $0.001; 75,000,000 shares authorized, 2,855,000 and 2,855,000 shares issued and outstanding as of November 30, 2017 and May 31, 2017 respectively |
| 2,855 | 2,855 | ||||
Additional paid in capital |
| 33,340 | 33,340 | ||||
Accumulated deficit |
| (33,423 | ) | (27,105 | ) | ||
Total Stockholder’s Equity | $ | 2,772 | 9,090 | ||||
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Total Liabilities and Stockholder’s Equity | $ | 31,872 | 38,190 |
4
CANNABIS SUISSE CORP.
CONSOLIDATED BALANCE SHEETS
February 28, 2021 (unaudited) | May 31, 2020 | ||||||||||
ASSETS | |||||||||||
Current Assets | |||||||||||
Cash and Cash Equivalents | $ | - | $ | 5 | |||||||
Accounts Receivable, net | - | 76,848 | |||||||||
Related Party Receivable | - | 10,040 | |||||||||
Inventory, net | 53,091 | 58,061 | |||||||||
Prepaid Expenses | 450 | - | |||||||||
Prepaid Taxes | - | 12,069 | |||||||||
Total Current Assets | 53,451 | 157,023 | |||||||||
Property and Equipment, net | 5,030 | 85,039 | |||||||||
Other Assets | |||||||||||
VAT Tax Receivable | - | 1,810 | |||||||||
Operating lease right of use asset | - | 139,653 | |||||||||
Total Other Assets | - | 141,463 | |||||||||
TOTAL ASSETS | $ | 58,571 | $ | 383,525 | |||||||
LIABILITIES & STOCKHOLDERS’ DEFICIT | |||||||||||
Liabilities | |||||||||||
Current Liabilities | |||||||||||
Accounts Payable | $ | 51,357 | $ | 108,973 | |||||||
Accrued Expenses | - | 18,478 | |||||||||
Accrued Wages | 101,000 | 38,625 | |||||||||
Advances From Related Parties | 49,327 | 415,470 | |||||||||
Bank Indebtedness (Note 8) | - | 45,212 | |||||||||
Convertible Notes Payable | 40,000 | - | |||||||||
Derivative Liability (Note 7) | 22,150 | - | |||||||||
Lease Liabilities - Short-term | - | 70,859 | |||||||||
Total Current Liabilities | 263,834 | 697,617 | |||||||||
Non-Current Liabilities | |||||||||||
Long Term Loan | - | 3,622 | |||||||||
Lease Liabilities - Long-term | - | 68,794 | |||||||||
Total Non-Current Liabilities | - | 72,416 | |||||||||
Total Liabilities | 263,834 | 770,033 | |||||||||
Commitments and Contingencies (Note 5) | |||||||||||
Stockholders’ Deficit | |||||||||||
Common stock, par value $0.001; 250,000,000 shares authorized, 34,500,000 shares issued and outstanding | 34,500 | 34,500 | |||||||||
Additional Paid-In-Capital | 562,860 | 51,695 | |||||||||
Accumulated other comprehensive loss | - | (17,221) | |||||||||
Accumulated Deficit | (802,623) | (455,482) | |||||||||
Total Stockholders’ Deficit | (205,263) | (386,508) | |||||||||
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT | $ | 58,571 | $ | 383,525 | |||||||
The accompanying notes are an integral part of these statements.
4
5
GEANT
CANNABIS SUISSE CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)
For the three months ended February 28, 2021 | For the three months ended February 29, 2020 | For the nine months ended February 28, 2021 | For the nine months ended February 29, 2020 | |||||
REVENUES |
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Sales of goods from principal activity | $ | - | $ | 57,531 | $ | 36,945 | $ | 163,973 |
Sales of goods from secondary activity | - | - | 13,905 | - | ||||
Total Revenues | - | 57,531 | 50,850 | 163,973 | ||||
Cost of goods sold | - | 72,588 | 102,648 | 273,143 | ||||
Gross (Loss) Profit | - | (15,057) | (51,798) | (109,170) | ||||
OPERATING EXPENSES | ||||||||
Professional fees | 4,405 | 29,880 | 34,566 | 76,235 | ||||
Depreciation | 679 | 4,161 | 9,003 | 12,484 | ||||
General and administrative expenses | 53,410 | 16,104 | 221,146 | 139,267 | ||||
TOTAL OPERATING EXPENSES | 58,494 | 50,145 | 264,715 | 227,986 | ||||
OPERATING LOSS | (58,494) | (65,202) | (316,513) | (337,156) | ||||
Interest expense, net | (33,131) | - | (33,131) | - | ||||
Change in fair value of derivative liability | 10,981 | - | 10,981 | - | ||||
LOSS BEFORE INCOME TAXES | (80,644) | (65,202) | (338,663) | (337,156) | ||||
PROVISION FOR INCOME TAXES | - | - | - | - | ||||
NET LOSS | $ | (80,644) | $ | (65,202) | $ | (338,663) | $ | (337,156) |
Other comprehensive (loss) income: | ||||||||
Foreign currency translation adjustment | - | (9,273) | (8,478) | (9,273) | ||||
COMPREHENSIVE LOSS | $ | (80,644) | $ | (74,475) | $ | (347,141) | $ | (346,429) |
NET LOSS PER SHARE: BASIC AND DILUTED | $ | (0.00) | $ | (0.00) | $ | (0.00) | $ | (0.00) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED | 34,500,000 | 34,500,000 | 34,500,000 | 34,500,000 |
The accompanying notes are an integral part of these statements.
6
CANNABIS SUISSE CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (UNAUDITED)
(UNAUDITED)
Common Stock | Additional Paid-In-Capital | Accumulated other comprehensive loss | Accumulated Deficit | Total Stockholders’ Equity (Deficit) | ||
Shares | Amount | |||||
Balance, May 31, 2019 | 34,500,000 | $ 34,500 | $ 51,695 | $ - | $ (66,254) | $ 19,941 |
Net loss | - | - | - | - | (128,290) | (128,290) |
Balance, August 31, 2019 | 34,500,000 | 34,500 | 51,695 | - | (194,544) | (108,349) |
Net loss | - | - | - | - | (143,666) | (143,666) |
Balance, November 30, 2019 | 34,500,000 | 34,500 | 51,695 | - | (338,210) | (252,015) |
Foreign currency translation adjustment | - | - | - | (9,273) | - | (9,273) |
Net loss | - | - | - | - | (65,202) | (65,202) |
Balance, February 29, 2020 | 34,500,000 | $ 34,500 | $ 51,695 | $ (9,273) | $ (403,412) | $ (326,490) |
Balance, May 31, 2020 | 34,500,000 | $ 34,500 | $ 51,695 | $ (17,221) | $ (455,482) | $ (386,508) |
Foreign currency translation adjustment | - | - | - | (157) | - | (157) |
Net loss | - | - | - | - | (164,504) | (164,504) |
Balance, August 31, 2020 | 34,500,000 | 34,500 | 51,695 | (17,378) | (619,986) | (551,169) |
Disposal of Subsidiary | - | - | 511,165 | 17,378 | - | 528,543 |
Net loss | - | - | - | - | (101,993) | (101,993) |
Balance, November 30, 2020 | 34,500,000 | 34,500 | 562,860 | - | (721,979) | (124,619) |
Net loss | - | - | - | - | (80,644) | (80,644) |
Balance, February 28, 2021 | 34,500,000 | $ 34,500 | $ 562,860 | $ - | $ (802,623) | $ (205,263) |
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| For the three months ended November 30, 2017 | For the three months ended November 30, 2016 | For the six months ended November 30, 2017 | For the six months ended November 30, 2016 | ||||||||||
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REVENUES | $ | 6,500 | 3,800 | 6,500 | 5,100 | ||||||||||
Cost of Goods Sold |
| 2,303 | 1,011 | 2,303 | 1,485 | ||||||||||
Gross Profit |
| 4,197 | 2,789 | 4,197 | 3,615 | ||||||||||
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OPERATING EXPENSES |
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General and Administrative Expenses |
| 407 | 221 | 767 | 7,661 | ||||||||||
Professional fees |
| 2,300 | - | 6,300 | - | ||||||||||
Depreciation |
| 1,724 | - | 3,448 | - | ||||||||||
TOTAL OPERATING EXPENSES |
| (4,431 | ) | (221 | ) | (10,515 | ) | (7,661 | ) | ||||||
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NET INCOME (LOSS) FROM OPERATIONS |
| (234 | ) | 2,568 | (6,318 | ) | (4,046 | ) | |||||||
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PROVISION FOR INCOME TAXES |
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NET INCOME (LOSS) | $ | (234 | ) | 2,568 | (6,318 | ) | (4,046 | ) | |||||||
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NET LOSS PER SHARE: BASIC AND DILUTED | $ | (0.00 | ) | 0.00 | (0.00 | ) | (0.00 | ) | |||||||
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WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED |
| 2,855,000 | 2,008,543 | 2,855,000 | 2,004,255 | ||||||||||
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The accompanying notes are an integral part of these statements.
5
GEANT CORP.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
| For the six months ended November 30, 2017 | For the six months ended November 30, 2016 | |||||
CASH FLOWS FROM OPERATING ACTIVITIES |
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Net loss for the period | $ | (6,318 | ) | $ | (4,046 | ) | |
Adjustments to reconcile net loss to net cash (used in) operating activities: |
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Depreciation | 3,448 | 195 | |||||
Decrease/Increase in Inventory | 2,303 | (745 | ) | ||||
Decrease/Increase in Prepaid expenses | 720 | (1,423 | ) | ||||
Decrease in Accounts Payable | - | (280 | ) | ||||
CASH FLOWS USED IN OPERATING ACTIVITIES | 153 | (6,299 | ) | ||||
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CASH FLOWS FROM FINANCING ACTIVITIES |
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Proceeds from sale of common stock | - | 9,530 | |||||
Loans | - | 6,000 | |||||
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES | - | 15,530 | |||||
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NET INCREASE IN CASH | 153 | 9,231 | |||||
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Cash, beginning of period | 6,186 | 1,065 | |||||
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Cash, end of period | $ | 6,339 | $ | 10,296 | |||
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SUPPLEMENTAL CASH FLOW INFORMATION: |
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Interest paid | $ | - | $ | - | |||
Income taxes paid | $ | - | $ | - |
7
CANNABIS SUISSE CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
For the nine months ended February 28, 2021 | For the nine months ended February 29, 2020 | ||||||||
OPERATING ACTIVITIES | |||||||||
Net loss | $ | (347,141) | $ | (337,156) | |||||
Adjustments to reconcile net loss | |||||||||
to net cash provided by operations: | |||||||||
Depreciation | 9,003 | 12,484 | |||||||
Provision for Doubtful Accounts | 78,827 | - | |||||||
Amortization Expense | 12,772 | - | |||||||
Change in Fair Value of Derivative Liability | 22,150 | - | |||||||
Changes in assets and liabilities: | |||||||||
Accounts Receivable | (1,979) | (55,009) | |||||||
Related Party Receivables | 8,422 | - | |||||||
Inventory | (24,932) | 57,835 | |||||||
VAT Tax Receivable | 9,563 | 368 | |||||||
Prepaid Expenses | (450) | 10,467 | |||||||
Accounts Payable | 81,457 | 50,251 | |||||||
Accrued Expenses | - | 19,495 | |||||||
Accrued Wages | 62,375 | - | |||||||
Net cash used in Operating Activities | (89,933) | (241,265) | |||||||
FINANCING ACTIVITIES | |||||||||
Advances From Related Parties | 28,913 | 176,894 | |||||||
Bank Indebtedness | 21,015 | - | |||||||
Convertible Notes Payable | 40,000 | - | |||||||
Net cash provided by Financing Activities | 89,928 | 176,894 | |||||||
Effect of exchange rate on cash | - | (11,955) | |||||||
Net cash increase (decrease) for period | (5) | (76,326) | |||||||
Cash at beginning of period | 5 | 84,181 | |||||||
Cash at end of period | $ | - | $ | 7,855 | |||||
SUPPLEMENTAL | |||||||||
Cash paid for taxes | $ | - | $ | - | |||||
Cash paid for interest | $ | - | $ | - | |||||
Supplemental disclosures of cash flow information on the cash flow | |||||||||
Operating lease right to use asset exchanged for operating lease liability | $ | - | $ | 195,394 | |||||
GEANT CORP.8
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOVEMBER 30, 2017
(UNAUDITED)
NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS
GeantCannabis Suisse Corp. (“the Company”, “we”, “us” or “our”(“Company”) was incorporated in the State of Nevada on February 26, 2016 to start business operations concernedconnected with production of paper made from elephant dung for making various stationery products and subsequent selling thereof. Our office is
On February 20, 2019, the Company filed a Certificate of Amendment to its Articles of Incorporation with the Nevada Secretary of State which changed the Company’s name from Geant Corp. to Cannabis Suisse Corp.
Following the acquisition of Cannabis Suisse LLC, the Company has been engaged in the business of production of OTC (over-the-counter) products - for example CBD oils, as well as retail branded cigarettes, and other health related supplements.
On March 1, 2020, the management of the Company decided to cease operations involving elephant dung-made paper based in Sri Lanka and discontinue using the premises located at Kiranthidiya road 114, Beruwala, Sri Lanka, 12070. Our phone
Due to the COVID-19 pandemic, starting April 2020, the Company has been engaged in the selling of face masks and disinfectants in order to extend the number is +17027510467.of available products and provide the customers with an opportunity to comply with the safety measures.
On November 23, 2020, Cannabis Suisse Corp. (the NOTE 2 – GOING CONCERN“
Transferor”), entered into an Asset Transfer Agreement with Cecillia Merige Jensen (the “Transferee”) and Cannabis Suisse LLC. In accordance with the terms of the Agreement, the Transferor transferred to the Transferee all its right, title and interest to one hundred percent (100%) of Cannabis Suisse LLC, including all its right, title and interest to one hundred percent (100%) of Grow Factory GmbH and the Transferee transferred and assign to the Transferor 10,000,000 restricted shares of Cannabis Suisse Corp., free and clear of any and all liens and encumbrances. The accompanying financial statements have been prepared in conformityabove-mentioned Asset Transfer Agreement hereby revokes the effect of Stock Transfer Agreement entered into with generally accepted accounting principles, which contemplate continuationCecillia Jensen on May 31, 2019, and the 10,000,000 shares were returned to the President of the Company as a going concern. The Company had limited revenues as of November 30, 2017. The Company has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern.reinstate his ownership percentage pre-acquisition.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. The Company intends to position itself so that it will be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
Disposal of Assets: |
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Related Party Receivable | $ | 1,618 |
Inventory |
| 29,902 |
Prepaid Taxes |
| 12,346 |
Property and Equipment |
| 71,006 |
VAT Tax Receivable | 4,316 | |
Operating lease right of use asset | 126,881 | |
Total Assets Transferred | $ | 246,069 |
NOTE 3 2 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES
The financial information furnished herein reflects all adjustments, consisting of normal recurring items that, in the opinion of management, are necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the interim periods. The results of operations for the nine months ended February 28, 2021 are not necessarily indicative of the results to be expected for the year ending May 31, 2021.
9
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The information included in this Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended May 31, 2020.
Basis of presentationPresentation and Consolidation
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted accounting principles in the United States of America.America, (GAAP). The Company’s yearendCompany’s year-end is May 31. The consolidated financial statements include the accounts of the Company and its former wholly-owned subsidiary, Cannabis Suisse LLC, through the date of disposal. All significant inter-company accounts and transactions have been eliminated in consolidation.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principlesGAAP 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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and CashEquivalents Equivalents
TheCompanyconsidersThe Company considers allhighlyliquidinvestmentswiththeoriginalmaturitiesofthreemonths highly liquid investments with the original maturities of three months orless less tobe cashequivalents.cash equivalents. The Company had $6,339$0 and $5 of cash and cash equivalents as of November 30, 2017February 28, 2021 and $6,187May 31, 2020, respectively.
Accounts Receivable
The Company records accounts receivable at the time products and services are delivered. An allowance for losses is established through a provision for losses charged to expenses. Receivables are charged against the allowance for losses when management believes collectability is unlikely. The allowance (if any) is an amount that management believes will be adequate to absorb estimated losses on existing receivables, based on evaluation of the collectability of the accounts and prior loss experience. The allowance for doubtful accounts was $0 as of February 28, 2021 and May 31, 2017.2020.
Prepaid ExpensesInventories
Prepaid Expenses are recorded at fair market value. The Company had $103 of prepaid rent as of November 30, 2017and $823 as of May 31, 2017.
Inventories
Inventories are stated at the lower of cost or market. Cost is principally determined using the first-in, first out (FIFO) method. The Company had $6,693$53,091 and $58,061 in raw material inventory as of November 30, 2017February 28, 2021 and $8,996May 31, 2020, respectively. The Company also determines a reserve for excess and obsolete inventory based on historical usage, and projecting the year in which inventory will be consumed into a finished product. The valuation of inventories requires management to make significant assumptions, including the assessment of market value by inventory category considering historical usage, future usage and market demand for their products, and qualitative judgments related to discontinued, slow moving and obsolete inventories. The Company had $0 and $5,936 in reserve for excess and obsolete inventory as of February 28, 2021 and May 31, 2017.2020, respectively.
Depreciation, Amortization, and Capitalization
The Company records depreciationhad $0 and amortization when appropriate using straight-line balance method$9,408 of work in progress (WIP) inventory as of February 28, 2021 and May 31, 2020, respectively. Cannabis plants in the growth process are recognized as WIP inventory.
The following table sets out a breakdown of the inventory by classes as of February 28, 2021, and May 31, 2020:
February 28, 2021 | May 31, 2020 | |||
Raw materials | $ | 53,091 | $ | 26,768 |
Finished goods | - | 27,821 | ||
Work in Process inventory | - | 9,408 | ||
Reserve for inventory | - | (5,936) | ||
Total Inventory, net | $ | 53,091 | $ | 58,061 |
Property and equipment
Property and equipment are carried at cost less accumulated depreciation. Depreciation is provided over the assets’estimated useful lifelives, using the straight-line method. Estimated useful lives of the assets. We estimate that the useful life of ourplant and equipment (beater machine, stainless steel drum, plastic barrel drums) is fiveare as follows:
Equipment, Furniture and fixtures
5-10 years
Office machines, IT equipment
5-10 years
Leasehold Improvements
2-5 years
10
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The cost and industrial water filter is seven years.Expenditures for maintenance and repairs are charged to expense as incurred. Additions, major renewals and replacements that increase the property's useful life are capitalized. Property sold or retired, together with the related accumulated depreciation is removedof assets sold or otherwise retired are eliminated from theappropriatedthe accounts and the resultantany gain or loss is included in net income.the consolidated statements of operations and comprehensive loss. The cost of maintenance and repairs is charged to the consolidated statements of operations and comprehensive loss as incurred, whereas significant renewals and betterments are capitalized.
7
GEANT CORP.
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2017
(UNAUDITED)
NOTE 3 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTUNUED)
Impairment
We evaluate the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Our evaluation is based on an assessment of potential indicators of impairment, such as an adverse change in the business climate that could affect the value of an asset, current or forecasted operating or cash flow losses that demonstrate continuing losses associated with the use of an asset, and a current expectation that, more likely than not, an asset will be disposed of before the end of its previously estimated useful life. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.
There was no impairment recognized during the nine months ended February 28, 2021 and February 29, 2020.
Fair Value of Financial Instruments
Accounting Standards Codification (“ASC Topic”) 820 "FairFair Value Measurements and Disclosures"Disclosures establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
These tiers include:
Level 1: | defined as observable inputs such as quoted prices in active markets; |
Level 2: | defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and |
Level 3: | defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. |
The carrying value of the Company’s cash, other current assets, accounts payable, accrued expenses and the Company’s loanadvances from shareholderrelated parties approximates its fair value due to their short-term maturity.
Derivatives
Derivative instruments are recognized in the Consolidated Financial Statements at fair value. Where the Company has entered into master netting agreements with counterparties, the derivative positions are netted by counterparties and are reported accordingly in other assets or other liabilities. Changes in the fair value of derivative instruments are recognized in earnings each period, unless the derivative is designated and qualifies as a cash flow or net investment hedge.
Income Taxes
The Company accounts for its income taxes in accordance with ASC 740, Income Taxes Topic of the FASB ASC 740,, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases and tax credit,credits and carry forwards. 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.
Revenue Recognition
The Company recognizes revenue in accordance with ASC 605, “Revenue Recognition” ("ASC-605"), whichAccounting Standards Update (ASU) 2014-09, “Revenue from contracts with customers”(Topic 606). Revenue is recognized when a customer obtains control of promised goods or services. In addition, the standard requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed naturedisclosure of the selling pricesnature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product has not been delivered or is subject to refund until such timeconsiderations that the Company expects to receive in exchange for those goods.
11
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the customer jointly determineCompany satisfies each performance obligation.
The Company only applies the five-step model to contracts when it is probably that the product hasentity will collect the consideration it is entitled in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred to customers at a point in time, typically upon delivery.
Cost of Goods Sold
Cost of goods sold includes direct costs of selling items, direct labor cost, rent expense and electricity.
Leases
The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities in our consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in the consolidated balance sheets.
ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the leases do not provide an implicit rate, The Company generally use the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
Reclassification of Prior Year Presentation
Certain prior year amounts have been delivered orreclassified for consistency with the current year presentation. These reclassifications had no refund will be required.effect on the reported results of operations. Adjustments have been made to the consolidated statements of operations and comprehensive loss for the nine months ended February 29, 2020, where approximately $214,579 of operating expenses were reclassified to cost of goods sold. These changes in classification do not affect previously reported net loss.
Basic Income (Loss) Per Share
The Company computes income (loss) per share in accordance with FASB ASC 260 “EarningsEarnings per Share”Share. Basic loss per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. As of November 30, 2017February 28, 2021 and February 29, 2020, there were no potentially dilutive debt or equity instruments issued or outstanding.
Comprehensive IncomeForeign Currency Translation
Comprehensive income is defined as all changes in stockholders' equity (deficit), exclusive of transactions with owners, such as capital investments. Comprehensive income includes net income or loss, changes in certain assetsAssets and liabilities thatof the Company’s Swiss subsidiary are reported directlytranslated from Swiss francs to United States dollars at exchange rates in equity such aseffect at the balance sheet date. Income and expenses are translated at average exchange rates during the period. The translation adjustments on investmentsfor the reporting period are included in foreign subsidiariesthe Company’s consolidated statements of operations and unrealized gains (losses) on available-for-sale securities. As of November 30, 2017and 2016there were no differences between our comprehensive loss, and net loss.the cumulative effect of these adjustments are reported in the Company’s consolidated balance sheets as accumulated other comprehensive loss within stockholders’ deficit.
12
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Stock-Based CompensationRecent Accounting Pronouncements
Stock-based compensation is accounted for at fair valueThere have been no recent accounting pronouncements or changes in accordanceaccounting pronouncements during the nine months ended February 28, 2021 that are of significance or potential significance to the Company.
NOTE 3 – GOING CONCERN
The accompanying consolidated financial statements have been prepared in conformity with ASC Topic 718. To date,GAAP, which contemplate continuation of the Company as a going concern. However, the Company had limited revenues and recurring losses as of February 28, 2021. The Company has not adoptedcompleted its efforts to establish a stock option planstabilized source of revenues sufficient to cover operating costs over an extended period of time. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. The Company intends to position itself so that it will be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and has not granted any stock options.
8continue as a going concern.
GEANT CORP.
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2017
(UNAUDITED)
NOTE 3 4 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTUNUED) PROPERTY AND EQUIPMENT
February 28, 2021 | May 31, 2020 | |||
Equipment | $ | 16,451 | $ | 70,998 |
Furniture and fixtures | - | 42,684 | ||
Office machines, IT equipment | - | 1,992 | ||
Leasehold Improvements | 8,354 | 8,354 | ||
Accumulated depreciation | (19,775) | (38,989) | ||
Net property and equipment | $ | 5,030 | $ | 85,039 |
Recent Accounting PronouncementsDuring the nine months ended February 28, 2021 $99,223 of property and equipment was disposed of under the Asset Transfer Agreement discussed in Note 1.
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company.
NOTE 4 – EQUIPMENT
| November 30, 2017 | May 31, 2017 | |||||
Equipment | $ | 16,451 | 16,451 | ||||
Leasehold improvements | $ | 8,354 | 8,354 | ||||
Accumulated Depreciation | $ | (6,068 | ) | (2,621 | ) | ||
Net equipment | $ | 18,737 | 22,184 | ||||
For the sixthree months ended November 30, 2017February 28, 2021 and 2016 weFebruary 29, 2020 the Company recognized a depreciation expense in the amount of $3,448$679 and $195$4,161, respectively. For the nine months ended February 28, 2021 and February 29, 2020, the Company recognized depreciation expense in the amount of $9,003 and $12,484, respectively.
NOTE 5 – COMMITMENTS AND CONTINGENCIES
Our sole officer and director, Suneetha Nandana Silva Sudusinghe, has agreed to provide us his own premises for free. He won’t take any fee for these premises. It isused for the production of goods.
OnSeptember 28,In 2016, the Company has signed a Rentrental agreement for office agreement, beginningspace in Sri Lanka which terminated on January 1, 2017 and will terminate on January 01, 2018. These premises will beFebruary 29, 2020. This premise was used as a representative office for the customers.
In 2017, the Company’s former subsidiary signed a rental agreement for office space in Switzerland which will terminate on May 31, 2022. This lease was transferred in the Asset Transfer Agreement discussed in Note 1. The rent expense for the sixnine months ended November 30, 2017February 29, 2021 and 2016February 28, 2020 was $720$38,397 and $0$54,550, respectively.
The Company implemented a new accounting policy according to the ASC 842, Leases, on June 1, 2019 on a modified retrospective basis and did not restate comparative periods. Under the new policy, the Company recognized a $214,153 lease liability as well as right-of-use asset for all leases (with the exception of short-term leases) at the commencement date. Lease liabilities are measured at present value of the sum of remaining rental payments, discounted at the incremental borrowing rate. A single lease cost is recognized over the lease term on a straight-line basis. All cash payments of operating lease cost are classified within operating activities in the consolidated statements of cash flows.
13
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
As of February 28, 2021, and May 31, 2020, the right-of use asset and lease liabilities are as follows:
February 28, 2021 | May 31, 2020 | ||||
(unaudited) | |||||
Right-of-use asset – operating leases | $ | - | $ | 139,653 | |
Lease Liabilities - Short-term | $ | - | $ | 70,859 | |
Lease Liabilities - Long-term | - | 68,794 | |||
Total Lease Liabilities | $ | - | $ | 139,653 | |
Lease cost and other information
Nine months ended | |||||
February 28, 2021 | February 29, 2020 | ||||
(unaudited) | (unaudited) | ||||
Operating lease cost | $ | - | $ | 60,868 | |
Weighted average remaining lease term - Operating leases (years) | - | 2.5 | |||
Weighted average discount rate | -% | 3% | |||
NOTE 6 –RELATED RELATED/THIRD PARTY TRANSACTIONS
The Company’s President has agreed to provide interest free advances, due on demand, to the Company up to $100,000. As of February 28, 2021 and May 31, 2020, Suneetha Nandana Silva Sudusinghe advanced to the Company $49,327 and $56,323, respectively. In addition, the Company’s president has agreed to provide production space in Sri Lanka at no charge for the production of goods. The Company discontinued using the mentioned office space on March 1, 2020.
NOTE 7 –DERIVATIVE FINANCIAL INSTRUMENTS
On December 1, 2020 Suneetha Nandana Silva Sudusinghe assigned SAPA Investments, LLC $10,000 of his loan to Cannabis Suisse Corp. The Agreement contains a provision allows SAPA Investments, LLC to convert the loan to common stock at a 70%-discount to the market price at the time of conversion after a period of lockup of 30 days.
The original loan to Cannabis Suisse Corp. from Mr. Sudusinghe was pursuant to Loan Agreement dated March 1, 2016 and Verbal Agreement dated April 2, 2019.
On December 4, 2020 Suneetha Nandana Silva Sudusinghe assigned SAPA Group, LLC $10,000 of his loan to Cannabis Suisse Corp. The Agreement contains a provision allows SAPA Group, LLC to convert the loan to common stock at a 70%-discount to the market price at the time of conversion after a period of lockup of 30 days.
The original loan to Cannabis Suisse Corp. from Mr. Sudusinghe was pursuant to Loan Agreement dated March 1, 2016 and Verbal Agreement dated April 2, 2019.
On December 7, 2020 Suneetha Nandana Silva Sudusinghe assigned GSS Group LLC $10,000 of his loan to Cannabis Suisse Corp. The Agreement contains a provision allows GSS Group LLC to convert the loan to common stock at a 70%-discount to the market price at the time of conversion after a period of lockup of 30 days.
The original loan to Cannabis Suisse Corp. from Mr. Sudusinghe was pursuant to Loan Agreement dated March 1, 2016 and Verbal Agreement dated April 2, 2019.
On December 10, 2020 Suneetha Nandana Silva Sudusinghe assigned Noi Tech LLC $10,000 of his loan to Cannabis Suisse Corp. The Agreement contains a provision that allows Noi Tech LLC to convert the loan to common stock at a 70%-discount to the market price at the time of conversion after a period of lockup of 30 days.
The original loan to Cannabis Suisse Corp. from Mr. Sudusinghe was pursuant to Loan Agreement dated March 1, 2016 and Verbal Agreement dated April 2, 2019.
14
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The Company’s convertible promissory notes gave rise to derivative financial instruments. The notes embodied certain terms and conditions that were not clearly and closely related to the host debt agreement in terms of economic risks and characteristics. These terms and features consist of the embedded conversion option.
The following tables summarize the components of the Company’s derivative liabilities and linked common shares as of February 28, 2021 and the amounts that were reflected in income related to derivatives for the period ended:
| February 28, 2021 | |||||
The financings giving rise to derivative financial instruments | Indexed |
|
| Fair | ||
Embedded derivatives |
| 737,982 |
|
| $ | 22,150 |
Total | 737,982 |
|
| $ | 22,150 | |
The following table summarizes the effects on the Company’s gain (loss) associated with changes in the fair values of the derivative financial instruments by type of financing for the three and nine months ended February 28, 2021:
The financings giving rise to derivative financial instruments and the gain (loss) effects: | For the Three and Nine Months Ended | |
February 28, 2021 | ||
Embedded derivatives | $ | 10,981 |
Total | $ | 10,981 |
Current accounting principles that are provided in ASC 815 - Derivatives and Hedging require derivative financial instruments to be classified in liabilities and carried at fair value with changes recorded in income. The Company has selected the Monte Carlo Simulation Model, which approximates the Monte Carlo Simulations, valuation technique to fair value the embedded derivative because it believes that this technique is utilizingreflective of all significant assumption types, and will continueranges of assumption inputs, that market participants would likely consider in transactions involving embedded derivatives. Such assumptions include, among other inputs, interest risk assumptions, credit risk assumptions and redemption behaviors in addition to utilize fundstraditional inputs for option models such as market trading volatility and risk-free rates. The Binomial Lattice Model technique is a level three valuation technique because it requires the development of significant internal assumptions in addition to observable market indicators. For instruments in which the time to expiration has expired, the Company has utilized the intrinsic value as the fair value. The intrinsic value is the difference between the quoted market price on the valuation date and the applicable conversion price.
Significant inputs and results arising from our sole officerthe Monte Carlo Simulation process are as follows for the embedded derivatives that have been bifurcated from the convertible notes and director who has verbally agreed to provide an interest-free loan as indicated by a verbal agreement finished up between Mr.Sudusingheclassified in liabilities:
December 1, 2020 | |||
Quoted market price on valuation date | $0.0615 | ||
Effective contractual conversion rates | $0.044 | ||
Contractual term to maturity | 0.25 years | ||
Market volatility: | |||
Volatility | 299.09% - 479.35% | ||
Risk-adjusted interest rate | 0.13% |
December 4, 2020 | |||
Quoted market price on valuation date | $0.0722 | ||
Effective contractual conversion rates | $0.056 | ||
Contractual term to maturity | 0.25 years | ||
Market volatility: | |||
Volatility | 239.43% - 391.85% | ||
Risk-adjusted interest rate | 0.13% |
15
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
December 7, 2020 | |||
Quoted market price on valuation date | $0.06 | ||
Effective contractual conversion rates | $0.0455 | ||
Contractual term to maturity | 0.25 years | ||
Market volatility: | |||
Volatility | 281.02% - 381.87% | ||
Risk-adjusted interest rate | 0.12% |
December 10, 2020 | |||
Quoted market price on valuation date | $0.0551 | ||
Effective contractual conversion rates | $0.0419 | ||
Contractual term to maturity | 0.25 years | ||
Market volatility: | |||
Volatility | 196.85% - 382.99% | ||
Risk-adjusted interest rate | 0.12% |
February 28, 2021 | |||
Quoted market price on valuation date | $0.07 | ||
Effective contractual conversion rates | $0.0546 | ||
Contractual term to maturity | 0.25 years | ||
Market volatility: | |||
Volatility | 163.49% - 204.54% | ||
Risk-adjusted interest rate | 0.08% |
The following table reflects the issuances of embedded derivatives and Geant Corp.changes in the amount of $50,000.Thefair value inputs and assumptions related party loan to the sole memberembedded derivatives during the nine months ended February 28, 2021.
Period Ended | |||
February 28, 2021 | |||
Balances at beginning of period |
| $ | - |
Issuances: |
|
|
|
Embedded derivatives |
|
| 33,131 |
Changes in fair value inputs and assumptions reflected in income |
|
| (10,981) |
|
|
|
|
Balances at end of period |
| $ | 22,150 |
NOTE 8 - BANK INDEBTEDNESS
On March 26, 2020, due to COVID-19 the Company's former Subsidiary, Cannabis Suisse LLC, entered into a loan agreement with a bank for CHF60,000. The loan carries an interest rate of 0.5% per year. The term of the board and president ofloan is 5 years. The state acts as the company is unsecured,guarantor for this loan. Accrued interest free and due on demand. The balance due to the director and president of the companythis loan was $29,100 as of November 30, 2017 and $29,100$0 as of May 31, 2017.2020.
Our sole officer and director, Suneetha Nandana Silva Sudusinghe, has agreed to provide us his own premises for free. He won’t take any fee for these premises. It is used for the production of goods.
NOTE 7 9 – COMMON STOCK
The Company has 75,000,000, $0.001 par value shares of common stock authorized.
In November 2016, the Company issued 240,000 shares of common stock for cash proceeds of $9,530 at $0.04 per share.
In December 2016, the Company issued 405,000 shares of common stock for cash proceeds of $16,280 at $0.04 per share.
In January 2017, the Company issued 120,000 shares of common stock for cash proceeds of $4,800 at $0.04 per share.
In March 2017, the Company issued 90,000 shares of common stock for cash proceeds of $3,585 at $0.04 per share.
There were 2,855,000 shares of common stock issued and outstanding as of November 30, 2017 and 2,855,000 as of May 31, 2017.
9
GEANT CORP.
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2017
(UNAUDITED)
NOTE 8 – INCOME TAXES
The Company adopted the provisions of uncertain tax positions as addressed in ASC 740-10-65-1. As a result of the implementation of ASC 740-10-65-1, the Company recognized no increase in the liability for unrecognized tax benefits.
The Company has no tax position at November 30, 2017February 28, 2021 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. The Company does not recognizerecognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. No such interest or penalties were recognized during the period presented. The Company had no accruals for interest and penalties at November 30, 2017.February 28, 2021. The Company’sCompany’s utilization of any net operating loss carry forwardcarryforward may be unlikely as a result of its intended activities.
16
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The valuation allowance at November 30, 2017February 28, 2021 was $11,364.$168,551. The net change in valuation allowance during the sixnine months endedNovember 30, 2017 February 28, 2021 and February 29, 2020 was $2,149.$72,900 and $70,803, respectively. In assessing the reliabilityrealizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.
Based on consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a full valuation allowance as of November 30, 2017February 28, 2021 and 2016.May 31, 2020. All tax years since inception remains open for examination only by taxing authorities of US Federal and state of Nevada.
The Company has a net operating loss carryforward for tax purposes totaling $33,423 $802,623 at November 30, 2017,February 28, 2021, expiring through 2035.fiscal year 2036. There is a limitation on the amount of taxable income that can be offset by carryforwards after a change in control (generally greater than a 50% change in ownership). Temporary differences, which give rise to a net
The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the new statutory rate of 21% to the income tax amount recorded as of February 28, 2021 and May 31, 2020, are as follows:
| As of November 30, 2017 | As of May 31, 2017 | |||||
Non-current deferred tax assets: |
|
|
| ||||
Net operating loss carryforward | $ | (33,423 | ) | (27,105 | ) | ||
Stock based compensation | $ | - | - | ||||
Inventory obsolescence | $ | - | - | ||||
Accrued officer compensation | $ | - | - | ||||
|
|
|
| ||||
Total deferred tax assets | $ | (11,364 | ) | (9,215 | ) | ||
Valuation allowance | $ | 11,364 | 9,215 | ||||
Net deferred tax assets | $ | - | - |
February 28, 2021 | May 31, 2020 | |||
Net operating loss carryforward | $ | (802,623) | $ | (455,482) |
Effective tax rate | 21 % | 21 % | ||
Deferred tax asset | 168,551 | 95,651 | ||
Less: Valuation allowance | (168,551) | (95,651) | ||
Net deferred asset | $ | - | $ | - |
February 28, 2021 | May 31, 2020 | |||
Federal income tax benefit attributed to: | ||||
Net operating loss from continuing operations | $ | 168,551 | $ | 95,651 |
Valuation allowance | (168,551) | (95,651) | ||
Net benefit | $ | - | $ | - |
NOTE 10 - CONCENTRATION OF CREDIT RISK
Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. The Company did not have cash in excess of FDIC insured limit as of February 28, 2021 and May 31, 2020.
NOTE 11 –REPORTABLE SEGMENTS
The Company follows segment reporting in accordance with ASC Topic 280, Segment Reporting. As a result of the business combination with Cannabis Suisse LLC in May 2019, the Company has changed its operating segments to consist of the Cannabis Suisse LLC segment and the Cannabis Suisse Corp segment. After the Cannabis Suisse LLC business combination, the Company's CEO began assessing performance and allocating resources based on the financial information of these two reporting segments.
17
CANNABIS SUISSE CORP.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The Cannabis Suisse LLC segment is involved in cannabis cultivation and distribution in Switzerland of recreational tobacco products and medical CBD oils. On November 23, 2020, Cannabis Suisse LLC and Cannabis Suisse Corp canceled their acquisition by Asset Transfer Agreement.
The Cannabis Suisse Corp segment produces the paper made from elephant dung for making various stationery products and subsequent selling thereof. The Company ceased the mentioned operations on March 1, 2020. Cannabis Suisse Corp is engaged in the development of its business activities by conquering the USA market of CBD products since November 2020.
Net revenue by reporting segment for the three and nine months ended February 28, 2021 and February 29, 2020, is as follows:
For the three months ended February 28, 2021 | For the three months ended February 29, 2020 | For the nine months ended February 28, 2021 | For the nine months ended February 29, 2020 | |||||
Cannabis Suisse Corp | $ | - | $ | - | $ | - | $ | 1,066 |
Cannabis Suisse LLC | - | 57,531 | 50,850 | 162,907 | ||||
Total Revenue | $ | - | $ | 57,531 | $ | 50,850 | $ | 163,973 |
Gross profit by reporting segment for the three and nine months ended February 28, 2021 and February 29, 2020, is as follows:
For the three months ended February 28, 2021 | For the three months ended February 29, 2020 | For the nine months ended February 28, 2021 | For the nine months ended February 29, 2020 | |||||
Cannabis Suisse Corp | $ | - | $ | - | $ | - | $ | (263) |
Cannabis Suisse LLC | - | (15,057) | (51,798) | (108,907) | ||||
Total Gross (Loss) Profit | $ | - | $ | (15,057) | $ | (51,798) | $ | (109,170) |
Assets by reporting segment as of February 28, 2021 and February 29, 2020, is as follows:
2021 | 2020 | |||
Cannabis Suisse Corp | $ | 58,571 | $ | 8,068 |
Cannabis Suisse LLC | - | 383,911 | ||
Total Assets | $ | 58,571 | $ | 391,979 |
NOTE 9 12 – SUBSEQUENT EVENTS
In accordance with SFAS 165 (ASC 855-10)855), Subsequent Events the Companyhas analyzed its operations subsequent to November 30, 2017February 28, 2021 to December 28, 2017, the date these consolidated financial statements were issued, and has determined that it does not have any other material subsequent events to disclose in these consolidated financial statements.
18
10
Item 2. Management’sManagement’s Discussion and Analysis of Financial Condition and Results of Operations.
This quarterly report and other reports filed by Cannabis Suisse Corp. (Formerly Geant Corp. (“) (“we,” “us,“us,” “our,“our,” or the “Company”“Company”), from time to time contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, the Company’sCompany’s management as well as estimates and assumptions made by Company’sCompany’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the filings, the words “anticipate”“anticipate”, “believe”“believe”, “estimate”“estimate”, “expect”“expect”, “future”“future”, “intend”“intend”, “plan”“plan” or the negative of these terms and similar expressions as they relate to the Company or the Company’sCompany’s management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.
Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results.
Our financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”(“GAAP”). These accounting principles require us to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial statements would be affected to the extent there are material differences between these estimates.
Organization within the Last Five YearsIn General
We were incorporated in the State of Nevada on February 26, 2016. Our initial business direction was production of paper made from elephant dung for making different stationery products and distributing them mainly in Sri Lanka. The Company ceased the mentioned operations on March 1, 2020.
On February 20, 2019, the Company filed a Certificate of Amendment to its Articles of Incorporation with the Nevada Secretary of State for changing the Company’s name from ‘Geant Corp.’ to ‘Cannabis Suisse Corp.
The Company is engaged in distribution of CBD Oils in the U.S. market using online means.
We have never declared bankruptcy, have never been in receivership, and have never been involved in any legal action or proceedings. Since incorporation, we have not made any significant purchase or sale of assets.
Our business office is located atKiranthidiya road 114, Beruwala, Sri Lanka, 12070.at Lerzenstrasse 12, 8953 Dietikon, Switzerland. The Board of Directors considers the said premises appropriate for the business direction the Company is following. Our telephone number is +17027510467.+15022082098.
In General
We were incorporatedProduct Overview
The main business of the Company is distribution of cannabis and the related products. They are laboratory tested to ensure the end-users have access to a standardized, safe, and consistent product. Cannabis Suisse Corp. sells online under the retail brand Swiss4Life.
Swiss4Life concept is based on the Company's mission to improve the quality of life of its customers by providing them with high-grade CBD products. At this stage Cannabis Suisse Corp. offers following products:
1)
The Swiss4Life first product comes in one fluid ounce (30ml) available in two flavors: Crème de Menthe and Cherry Vanilla. It is a Broad Spectrum Oil with CBD concentrations of 1500 mg, 2500 mg, 3500 mg.
2)
Swiss4Life TerpX2 is one fluid ounce (30ml). It is a CBD tincture with 1000mg CBD concentrations per bottle and 33.33 mg CBD per serving. The product contains 0% THC, which means it will effectively perform therapeutic functions without causing adverse reactions. High quality hemp seed oil is the carrier in the Statenew product saving all the important nutrients, including protein, vitamins, fatty acids and minerals. Omega 3-6-9 is a complex of Nevada on February 26, 2016. We just recently started our operations. Our businessthe most important unsaturated fatty acids for human health.
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3)
Swiss4Life TerpX3 is a one fluid ounce (30ml) CBD tincture with 1000mg CBD concentrations per bottle and 33.33 mg CBD per serving. Swiss4Life TerpX3 will contain 0% THC, which means it will effectively perform therapeutic functions without causing adverse reactions.
4)
Swiss4Life TerpX5 is one fluid ounce (30ml). It will be CBD tincture with 1000mg CBD concentrations per bottle and 33.33 mg CBD per serving. All of the productionoil products will include graduated droppers for accurate dosing, so consumers will have the ability to choose the dosage that best suits them personally. Natural Sleep Formula in Swiss4Life TerpX5 composition will provide anti-stress and sedative effects without losses in concentration level during the day and will help you to improve your natural sleep during the night. Swiss4Life TerpX5 may help you get rid of paper madeinsomnia, staying focused, and being full of energy.
Market background
Cannabis users from elephant dung (poo) for making different stationery productsCalifornia, Colorado, Arizona, Oregon, and distribution thereof primarilyWashington spend around $36 million in Sri Lanka. We have generated limited revenues since inceptionpre-rolled joints monthly according to the report introduced by BDS Analytics.
Some European countries like Germany, Denmark, Malta, Greece, and our principal business activities to date also consistItaly discussed the possibility of creating a business plan, purchasingcompletely regulated cannabis market by 2028. Furthermore, Luxembourg intends to introduce a domain-nameregulated market for our prospective webpage.adult use of cannabis by 2023.
The research conducted by the Brightfield Group, and based on impending regulatory changes in EU, indicates that the European CBD market is expected to be worth $1.7 billion by 2023. The cannabis market in general is also set to experience rapid growth, from $318 million in 2018 to nearly $8 billion by 2023.
Competition
We are not a “shell company” within the meaning of Rule 405, promulgated pursuant to Securities Act, because we do have hard assets and real business operations.The total estimated minimum amount of funds required to develop our business is approximately $20,000. We need funds for offering costs, general administrative expenses, production equipment purchase, business development, marketing costs, support materials and costs associated with being a publicly reporting company. We have generated limited revenues from operations to date.
We will disperse our items in Sri Lanka and neighboring countries. We plan to use various distribution channels for various types of customers. As a rule we arranged for a wholesale exchange, however in the future we can make some items for various traveler shops and kiosks; corporate customers and individual customers will be covered by our web page and targeted marketing exercises.
Product Overview
Geant Corp.’s business is in making unique products to be sold to both mass-market customers and individual clients in the future. We want to focus on something that is socially and environmentally responsible so we are contributing to the solution and not adding to the problem. We want to work with something that had more meaning to us, something we could be passionate about, and that possibly could have an important social statement attached to it. All of our paper products are 100% recycled. They do not have any smell. They are made up of 70% fiber from elephant dung and 30%post-consumer paper. All papers everywhere are made from a pulp mixture derived from fiber materials. The most common papers today come from wood fiber pulp from cut trees. Our fibers of choice, of course, are dung fibers. We use the dung fibers from elephants to make our dung paper products.
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All elephants that generate the dung that we require for our process have at least two things in common:
1) All are herbivores and have highly fibrous diets of different plants and vegetation.
2) All possess inefficient digestive systems that do not completely digest and breakdown all the fibers that they eat. This results in a significant amount of fibers remaining intact when these animals dung. There are no toxic chemicals used in our paper making process. Natural vegetative binding agents, along with water-soluble salt dyes for coloring are used.
Our dung papers are handmade and acid free.
We are focused on the production of dung paper for mass-market customers to give them the ability of making different stationery products, souvenirs, tourist-oriented products, up-market gifts and interior design items from natural products on advanced and unique designs. It would be easier for them to buy raw materials (paper) from us to produce needed products instead of making paper. It is easier for us at the beginning to set up the production of paper instead of setting up the whole paper production and of different kinds of stationery products at the same time. In the future we have plans about production of some additional stationery items aside from paper.
Geant Corp. has the ability to product handmade dung paper for making such original items as, for example:
Bags
Frames
Photo Albums
Notebooks
Stationery
Cards
However, first, we intend to launch a mass production of inexpensive handmade dung paper for making different stationery products and various tourist souvenirs, which were made using elephant dung.
Potential Customers
Our President and Director, Suneetha Nandana Silva Sudusinghe, will showcase our item and arrange with potential clients and wholesale purchasers. We expect to create and keep up a database of potential corporate customers who might be keen on our items. We will catch up with these customers intermittently and offer them free samples, presentations and uncommon rebates now and again.
Two fundamental classifications of our customers are:
Wholesale exchange; speaking to expansive organizations, which are assembling diverse stationery items. It is preference for them to purchase fit dung paper instead of making it themselves. Furthermore they have an opportunity to concentrate on the manufacturing process of stationery items.
Corporate customers, speaking to extensive, medium and little scale organizations, different affiliations and so on. This is a somewhat generous fragment of the business sector, which develops and routinely creates interest for different corporate blessings, gifts; things that advance brand mindfulness and so on.
Competition
We know that there are a number of obstacles to enteringacknowledge the market of dung paperCBD-related items and the competition is rather high.competitive. There are several companies that offer comparative items and we will have to compete with them. We see the main competitive advantage of our competitors inis the established customer base and marketing outlets. Howbeit,Nevertheless, we arrangedarrange on a wholesale exchange, for the most part, so we will have capacity to offer our itemitems for extensive organizations in huge amount. Soamounts. Therefore, we believe our item is more extensive, andthe quality is better, and our ways to deal with business are more flexible.
One of our biggest competitive advantages is that our item is raw material for different companies. So we would have a major measure of delivering the item in a brief timeframe.
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Some of the factors that may affect our business are as follows:Marketing
1. Number of Competitors Increase: different companies may follow our business model of distributing high quality paper items made from elephant dung, which will reduce our competitive edge.
2. Price: Our competitors may be selling similar product at a lower price forcing us to lower our prices as well and possibly sell our product at loss.
3. Substitute Products: competitors may substitute items made from elephant dung with comparable items made from dung of some other animals.
Marketing
Our sole director and chief executive officer, Suneetha Nandana Silva Sudusinghe, will be in charge of promoting of our company and our high quality dung paper. We intend to use such marketing strategies such as web advertisements, press releases, direct mailing, and phone calls to acquire potential customers. We intend to attract traffic to our website by a variety of online marketing tactics, such as registering with top search engines, using selected key words and meta-tags, and utilizing link and banner exchange options.
The website related to cannabis cultivation is https://www.cannabissuisse.com. The growing process is streamed online on this website. Also, it includes the information about the main Company’s products, our team and our plans for further development.
We will utilize numerous Internet showcasing instruments to direct activity to our site and distinguish potential clients. As of the date of this prospectus we have already purchased a website (www.geantcorp.com) and plan to develop it. We already have some description of our item, the procedure of production and incorporate some broad data and pictures of items companies can make from our paper.
Our site portrays samples of products which our Company is able to produce, the production procedure, and incorporates some broad data and pictures of high quality dung paper. We plan to utilize Internet advancement apparatuses on Facebook and Twitter to publicize our company and make connections to our site.
We intend to continue our marketing efforts during the life of our operations. There is no guarantee that we will be able to attract and more importantly retain enough customers to justify our expenditures. If we are unable to generate a significant amount of revenue and to successfully protect ourselves against those risks, then it would materially affect our financial condition and our business could be harmed.
Description of property
Our solechief executive officer, and director, Suneetha Nandana Silva Sudusinghe, has agreed to provide us his own premises at no charge. He will not take any fee for these premises. This premise is used for production of the goods. The Company has discontinued using the mentioned office space on March 1, 2020.
On September 28, 2016 the Company has signedexecuted a Rent office agreement, beginning on January 1, 2017, and will terminateterminated on January 01, 2018.1, 2018 which was extended through December 31, 2019. These premises will be used as a representative office for the customers. The rent payment is $120 per month. For the six months ended November 30, 2017 and 2016 we have $720 and $0 of rent expense respectively.
InsuranceThis Rent office agreement was terminated on March 1, 2020.
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On April 18, 2017, the Company signed a Rent office agreement, beginning on June 1, 2017 which will terminate on May 31, 2022. These premises will be used as a representative office for the customers of Grow Factory GmbH. The rent payment is $6,646 per month. For the nine months ended February 28, 2021, we have $38,397 of rent expense. The rent office agreement was not maintain any insurance and do not intendeffective as of February 28, 2021. On November 23, 2020, Cannabis Suisse Corp. transferred all the assets to maintain insurance in the future. Because we do not have any insurance, if we are made a party of a products liability action, we may not have sufficient funds to defend the litigation. If that occurs a judgment could be rendered against us that could cause us to cease operations.Cannabis Suisse LLC.
Research and Development Expenditures
We have not incurred any research expenditures since our incorporation.
Bankruptcy or Similar Proceedings
There has been no bankruptcy, receivership or similar proceeding.
Employees; Identification of Certain Significant Employees
We currently have no employees, other than our sole officer and director Suneetha Nandana Silva Sudusinghe.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Results of Operations for the three and six monthnine months ended November 30, 2017February 28, 2021 and 2016:February 29, 2020:
13Revenue and Cost of Goods Sold
For the three months ended February 29, 2020, the Company generated total revenue of $57,531 from selling products to the customer. The cost of goods sold for the three months ended February 29, 2020, was $72,588, which represent the cost of raw materials.
For the nine months ended February 29, 2020, the Company generated total revenue of $163,973 from selling products to the customer. The cost of goods sold for the nine months ended February 29, 2020, was $273,143, which represent the cost of raw materials.
Revenue
For the three months ended February 28, 2021, the Company has not generated any revenue.
For the nine months ended February 28, 2021, the Company generated total revenue of $50,850 from selling products to the customer. The cost of goods sold for the nine months ended February 28, 2021, was $102,648.
The Company's revenues consist of the sale of goods from principal activity and secondary activity. The sale of goods from principal activity includes the sale of CBD products. The sale of goods from secondary activity includes the sale of face masks and disinfectants.
The decrease in revenues and cost of goods sold is a result of the separation of Cannabis Suisse LLC in November 2020.
For the three month period ended November 30, 2017 and 2016 the Company generated $6,500 and $3,800 revenue from selling products to the customers.
For the six month period ended November 30, 2017 and 2016 the Company generated $6,500 and $5,100 revenue from selling products to the customers.
Operating expenses
Total operating expenses for the three month periodmonths ended November 30, 2017 and 2016February 29, 2020 were $4,431 and $221.$50,145. The operating expenses for the three month periodmonths ended November 30, 2017February 29, 2020, included bank service chargesprofessional fees of $47;$29,880; depreciation expense of $1,724; audit$4,161; and general and administrative expenses of $16,104.
Total operating expenses for the three months ended February 28, 2021 were $58,494. The operating expenses for the three months ended February 28, 2021, included professional fees of $2,300; rent$4,405; depreciation expense of $360.$679; and general and administrative expenses of $53,410.
Total operating expenses for the six month periodnine months ended November 30, 2017 and 2016February 29, 2020 were $10,515 and $7,661.$227,986. The operating expenses for the six month periodnine months ended November 30, 2017February 29, 2020, included bank service chargesprofessional fees of $47;$76,235; depreciation expense of $3,448; audit$12,484; and general and administrative expenses of $139,267.
Total operating expenses for the nine months ended February 28, 2021 were $264,665. The operating expenses for the nine months ended February 28, 2021, included professional fees of $6,300; rent$34,566; depreciation expense of $720.$9,003; and general and administrative expenses of $221,096.
Net LossThe change in operating expenses is related to the accrual of salaries to the Company's officers.
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Changes in Fair Value of Derivatives
The net loss/incomechanges in fair value of derivatives for the three month periodmonths ended November 30, 2017February 28, 2021 and 2016February 29, 2020, was loss $234$(22,150) and income $2,568.$0, respectively
The changes in fair value of derivatives for the nine months ended February 28, 2021 and February 29, 2020, was $(22,150) and $0, respectively
Net Loss
The net loss for the six month periodthree months ended November 30, 2017February 28, 2021 and 2016February 29, 2020, was $6,318$80,644 and $4,046.$65,202, respectively.
The net loss for the nine months ended February 28, 2021 and February 29, 2020, was $338,663 and $337,156, respectively.
Comprehensive Loss
The comprehensive loss for the three months ended February 28, 2021 and February 29, 2020 was $0 and $9,273, respectively.
The comprehensive loss for the nine months ended February 28, 2021 and February 29, 2020 was $8,528 and $9,273, respectively.
Liquidity and Capital Resources and Cash Requirements
AtNovember 30, 2017,As of February 28, 2021, the Company had cash of $6,339 ($6,187 as of May 31, 2017).Furthermore,$0. Furthermore, the Company had a working capital deficit of $15,965 (deficit of $13,094 as ofMay 31, 2017).$205,263.
During the six month periodnine months ended November 30, 2017,February 28, 2021 and February 29, 2020, the Company used $153$112,083 and $241,265 of cash in operating activities duerespectively. The change in cash used in operating activities is related to its net loss andthe decrease in inventory of $2,303; decreasenet income, depreciation, accounts receivable, accrued wages, and advances from customers and the reduction in prepaidaccounts payable, accrued expenses, of $720 and depreciation of $3,448. VAT tax receivable.
During the six month periodnine months ended November 30, 2017February 28, 2021 and February 29, 2020, the Company used nohad $0 of cash in investing activities.
During the six month periodnine months ended November 30, 2017,February 28, 2021 and February 29, 2020, the Company generated no cash in financing activities.
During the six month period ended November 30, 2016, the Company used $6,299 of cash in operating activities due to its net losswas provided $112,078 and increase in inventory of $745; increase in prepaid expenses of $1,423; decrease in accounts payable of $280 and depreciation of $195.
During the six month period ended November 30, 2016 the Company used no cash in investing activities.
During the six month period ended November 30, 2016, the Company generated $15,530$176,894 of cash in financing activities.activities respectively, which came from advances from related, convertible debt and bank indebtedness.
AsIn its audited consolidated financial statements as of the date of this report, the current funds available toMay 31, 2020, the Company will not be sufficient to continue maintaining a reporting status. The Company’s sole officer and director, Suneetha Nandana Silva Sudusinghe, has concluded a verbal agreement with the Geant Corp. in order to fund completion of the registration process and to maintain the reporting status with SEC.
Our auditors havewas issued a “going concern”“going concern” opinion, meaning that there is substantial doubt we can continue as an on-going business for the next twelve months unless we obtain additional capital. Our only sources for cash at this time are investments by others, in this offering, selling our paper dung products and loans from our director. We must raise cash to implement our plan and stay in business.We cannot guarantee that we will manage to sell all the shares required. We will attempt to raise the necessary funds to proceed with all phases of our plan of operation.
Management believes that current trends toward lower capital investment in start-up companies pose the most significant challenge to the Company’sCompany’s success over the next year and in future years. Additionally, the Company will have to meet all the financial disclosure and reporting requirements associated with being a publiclypublic reporting company. TheCompany’sThe Company’s management will have to spend additional time on policies and procedures to make sure it is compliant with various regulatory requirements, especially that of Section 404 of the Sarbanes-Oxley Act of 2002. This additional corporate governance time required of management could limit the amount of time management has to implement is business plan and impede the speed of its operations.
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Limited operating history; need for additional capital
There is no historical financial information about us upon which to base an evaluation of our performance. We are in a start-up stage of operations and have generated limited revenues since inception. We cannot guarantee that we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.
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Related party transaction
The Company is utilizing and will continue to utilize funds from our sole officer and director who has verbally agreed to provide an interest-free loan as indicated by a verbal agreement finished up between Mr.Sudusinghe and Geant Corp. in the amount of $50,000. The related party loan to the sole member of the board and president of the company is unsecured, interest free and due on demand. The balance due to the director and president of the company was $29,100 as of November 30, 2017 and $29,100 as of May 31, 2017.
Our sole officer and director, Suneetha Nandana Silva Sudusinghe, has agreed to provide us his own premises for free. He won’t take any fee for these premises. It is used for the production of goods.
Off-Balance Sheet Arrangements
The Company does not have any off balanceoff-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Related Party Transactions
There are two signed loan agreements between Cannabis Suisse Corp. and the President/CEO and a Director of the Company, Suneetha Nandana Silva Sudusinghe. The CEO agreed to loan the Loan Amount to the Company in the event of not raising sufficient amount of funds from the offering in accordance to the Form S-1 registration statement of the Company; the director agreed to loan the Loan Amount to the Company on demand of the Company; the Company will conduct the repayments of all amounts of the Director’s loan accordingly to the sequence of loans; the director will be repaid from revenues of the Company, when it starts to earn significant revenues; advanced Loan funds are non-interest bearing, secured and payable upon demand.
Critical Accounting Policies
The preparation of financial statements in accounting principles generally accepted in the United States of America 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. A change in managements’ estimates or assumptions could have a material impact on our financial condition and results of operations during the period in which such changes occurred. Actual results could differ from those estimates. Our financial statements reflect all adjustments that management believes are necessary for the fair presentation of their financial condition and results of operations for the periods presented.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
As a “smaller“smaller reporting company”company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.
Item 4. Controls and Procedures.
Disclosure Controls and Procedures
We maintain disclosure controls and procedures, as defined in Rule 13a‐15(e) promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as ofNovember 30, 2017. February 28, 2021. Based on the evaluation of these disclosure controls and procedures, and in light of the material weaknesses found in our internal controls over financial reporting, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective.
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ManagementManagement’s’s Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)). The Company’sCompany’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.Also,misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of the Company’sCompany’s internal control over financial reporting as of November 30, 2017February 28, 2021, using the criteria established in “Internal“Internal Control - Integrated Framework”Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO - 2013").
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A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’sCompany’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of November 30, 2017,February 28, 2021, the Company determined that there were control deficiencies that constituted material weaknesses, as described below.
1.
We do not have an Audit Committee – While not being legally obligated to have an audit committee, it is the management’smanagement’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’sCompany’s financial statement. Currently the Board of Directors acts in the capacity of the Audit Committee, and does not include a member that is considered to be independent of management to provide the necessary oversight over management’smanagement’s activities.
2.
We did not maintain appropriate cash controls – As of November 30, 2017,February 28, 2021, the Company has not maintained sufficient internal controls over financial reporting for cash, including failure to segregate cash handling and accounting functions, and did not require dual signatures on the Company’s bank accounts. Alternatively, the effects of poor cash controls were mitigated by the fact that the Company had limited transactions in its bank accounts.functions.
3.
We did not implement appropriate information technology controls – As at November 30, 2017,of February 28, 2021, the Company retains copies of all financial data and material agreements; however, there is no formal procedure or evidence of normal backup of the Company’sCompany’s data or off-site storage of data in the event of theft, misplacement, or loss due to unmitigated factors.
Accordingly, the Company concluded that these control deficiencies resulted in a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the company’scompany’s internal controls.
As a result of the material weaknesses described above, management has concluded that the Company did not maintain effective internal control over financial reporting as of November 30, 2017February 28, 2021, based on criteria established in Internal Control- Integrated Framework issued by COSO-2013.
Changes in Internal Controls over Financial Reporting
There has been no change in our internal control over financial reporting occurred during our secondthird fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
Item 1. | LEGAL PROCEEDINGS |
We know of no material, existing or pending legal proceedings against our Company, norto which we are we involved as a plaintiff in any material proceedingparty or pending litigation. There are no proceedings into which any of our directors, officersproperty is the subject which are pending, threatened or affiliates,contemplated or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.unsatisfied judgments against us.
Item 1A. | RISK FACTORS |
As a “smaller“smaller reporting company”company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.
Item 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
None.
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Item 3. | DEFAULTS UPON SENIOR SECURITIES |
None.None.
Item 4. | MINE SAFETY DISCLOSURE |
Not applicable to our Company.
Item | OTHER INFORMATION |
There is no other information required to be disclosed under this item which was not previously disclosed.
Item | EXHIBITS |
The following exhibits are included as part of this report by reference:
Exhibit No. | Description | |
31.1 |
| |
32.1 |
|
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in Sri Lanka, BeruwalaDietikon, Switzerland on December 28, 2017.April 19, 2021.
| |||
By: | /s/ | Suneetha Nandana Silva Sudusinghe |
|
| Name: | Suneetha Nandana Silva Sudusinghe |
|
| Title: | President, Treasurer, Secretary and Director | |
|
| (Principal Executive, Financial and Accounting Officer) | |
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