| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis
of Presentation The
summary of significant accounting policies is presented to assist in the understanding of the financial statements. These policies conform
to accounting principles generally accepted in the United States of America and have been consistently applied. The Company has elected
a calendar year of December 31 year-end. Principles
of Consolidation The
Consolidated Financial Statements include the accounts of Kid Castle Educational Corporation and all of our controlled subsidiary companies.
All significant intercompany accounts and transactions have been eliminated. Investments in business entities in which we do not have
control, but we have the ability to exercise significant influence over operating and financial policies (generally 20 50 50.1 Revenue,
Assets and Liabilities of Consolidated Subsidiary and Financial Statement Relationship Kid
Castle Educational Corporation is 97.58 COVID-19
Risks, Impacts and Uncertainties COVID-19
Risks, Impacts and Uncertainties —We are subject to the risks arising from COVID-19’s impacts on the residential real estate
industry. Our management believes that these impacts, which include but are not limited to the following, could have a significant negative
effect on our future financial position, results of operations, and cash flows: (i) prohibitions or limitations on in-person activities
associated with residential real estate transactions; (ii) lack of consumer desire for in-person interactions and physical home tours;
and (iii) deteriorating economic conditions, such as increased unemployment rates, recessionary conditions, lower yields on individuals’
investment portfolios, and more stringent mortgage financing conditions. In addition, we have considered the impacts and uncertainties
of COVID-19 in our use of estimates in preparation of our consolidated financial statements. These estimates include, but are not limited
to, likelihood of achieving performance conditions under performance-based equity awards, net realizable value of inventory, and the
fair value of reporting units and goodwill for impairment. Since
April 2020, following the government lockdown order, we asked all employees to begin to work from their homes and we also reduced the
number of hours available to each of our employees by approximately by approximately 75%. These actions taken in response to the economic
impact of COVID-19 on our business resulted in a reduction of productivity for the year ended December 31, 2021. All cost related to
these actions are included in general and administrative expenses, as these costs were determined to be direct and incremental. Use
of Estimates and Assumptions The
preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) requires management
to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates. Cash
and Cash Equivalents We
maintain cash balances in a non-interest-bearing account that currently does not exceed federally insured limits. For the purpose of
the statements of cash flows, all highly liquid investments with a maturity of three months or less are considered to be cash equivalents.
As of December 31, 2021 and 2020 we did maintain $ 601,042 1,630 Financial
Instruments The
estimated fair values for financial instruments were determined at discrete points in time based on relevant market information. These
estimates involved uncertainties and could not be determined with precision. The carrying amount of the our accounts payable and accruals,
our accruals- related parties and loans – related parties approximate their fair values because of the short-term maturities of
these instruments. Fair
Value Measurements ASC
Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), provides a comprehensive framework for measuring fair value
and expands disclosures which are required about fair value measurements. Specifically, ASC 820 sets forth a definition of fair value
and establishes a hierarchy prioritizing the inputs to valuation techniques, giving the highest priority to quoted prices in active markets
for identical assets and liabilities and the lowest priority to unobservable value inputs. ASC 820 defines the hierarchy as follows: Level
1 – Quoted prices are available in active markets for identical assets or liabilities as of the reported date. The types of assets
and liabilities included in Level 1 are highly liquid and actively traded instruments with quoted prices, such as equities listed on
the New York Stock Exchange. Level
2 – Pricing inputs are other than quoted prices in active markets but are either directly or indirectly observable as of the reported
date. The types of assets and liabilities in Level 2 are typically either comparable to actively traded securities or contracts or priced
with models using highly observable inputs. Level
3 – Significant inputs to pricing that are unobservable as of the reporting date. The types of assets and liabilities included
in Level 3 are those with inputs requiring significant management judgment or estimation, such as complex and subjective models and forecasts
used to determine the fair value of financial transmission rights. Our
financial instruments consist of accounts payable and accruals and our accruals- related parties. The carrying amount of the out accounts
payable and accruals, accruals- related parties and loans – related parties approximates their fair values because of the short-term
maturities of these instruments. The
table below describes the Company’s valuation of financial instruments using guidance from ASC 820-10: SCHEDULE
OF VALUATION OF FINANCIAL INSTRUMENTS
Description Level 1 Level 2 Level 3
Investments – trading securities – December 31, 2021 $ 446,050 $ - $ -
Investments – trading securities – December 31, 2020 $ 91,282 $ - $ - Investment
– Trading Securities All
investment securities are classified as trading securities and are carried at fair value in accordance with ASC 320 Investments —
Debt and Equity Securities. Investment transactions are recorded on a trade date basis. Realized gains or losses on sales of investments
are based on the first-in, first-out or the specific identification method. Realized and unrealized gains or losses on investments are
recorded in the statements of operations as realized and unrealized gains or losses as net revenue. All investment securities are held
and transacted by the Company’s broker firm. The Company did not hold more than 4.9% of equity of the shares of any public companies
as investments All
investments that are listed on a securities exchange are valued at their last sales price on the primary securities exchange on which
such securities are traded on such date. Securities that are not listed on any exchange but are traded over-the-counter are valued at
the mean between the last “bid” and “ask” price for such security on such date. The Company does not have any
investment securities for which market quotes are not readily available. The
Company’s trading securities are held by a third-party brokerage firm, and composed of publicly traded companies with readily available
fair value which are quoted prices in active markets. Related
Party Transactions A
related party is generally defined as (i) any person that holds 10% or more of our membership interests including such person’s
immediate families, (ii) our management, (iii) someone that directly or indirectly controls, is controlled by or is under common control
with us, or (iv) anyone who can significantly influence our financial and operating decisions. A transaction is considered to be a related
party transaction when there is a transfer of resources or obligations between related parties. During the period under review, the Company
paid rent $ 1,967.50 Revenue,
Assets and Liabilities of Consolidated Subsidiary and Financial Statement Relationship Until
12/30/2021, GiveMePower Corporation was 88 55 100 Leases In
February 2016, the FASB issued ASU 2016-02, “Leases” that requires for leases longer than one year, a lessee to recognize
in the statement of financial condition a right-of-use asset, representing the right to use the underlying asset for the lease term,
and a lease liability, representing the liability to make lease payments. The accounting update also requires that for finance leases,
a lessee recognize interest expense on the lease liability, separately from the amortization of the right-of-use asset in the statements
of earnings, while for operating leases, such amounts should be recognized as a combined expense. In addition, this accounting update
requires expanded disclosures about the nature and terms of lease agreements. The Company has reviewed the new standard and does not
expect it to have a material impact to the statement of financial condition or its net capital. Prior
to January 1, 2019, the Company accounted for leases under Accounting Standards Codification (ASC) 840, Accounting for Leases.
Effective from January 1, 2019, the Company adopted the guidance of ASC 842, Leases, which requires an entity to recognize a
right-of-use asset and a lease liability for virtually all leases. On February 25, 2016, the FASB issued Accounting Standards Update
No. 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and
lease liabilities on the balance sheet and disclosing key information about leasing transactions. ASC 842 requires that lessees
recognize right of use assets and lease liabilities calculated based on the present value of lease payments for all lease agreements
with terms that are greater than twelve months. It requires for leases longer than one year, a lessee to recognize in the statement
of financial condition a right·of·use asset, representing the right to use the underlying asset for the lease term,
and a lease liability, representing the liability to make lease payments. ASC 842 distinguishes leases as either a finance lease or
an operating lease that affects how the leases are measured and presented in the statement of operations and statement of cash
flows. ASC 842 supersedes nearly all existing lease accounting guidance under GAAP issued by the Financial Accounting Standards
Board (“FASB”) including ASC Topic 840, Leases. The accounting update also requires that for finance leases, a lessee
recognize interest expense on the lease liability, separately from the amortization of the right-of-use asset in the statements of
earnings, while for operating leases, such amounts should be recognized as a combined expense. In addition, this accounting update
requires expanded disclosures about the nature and terms of lease agreements. The
Company does not have operating and financing leases as of December 31, 2021. The adoption of ASC 842 did not materially impact our results
of operations, cash flows, or presentation thereof. The Company has reviewed the new standard and does not expect it to have a material
impact to the statement of financial condition or its net capital. Income
Taxes Under
the asset and liability method prescribed within ASC 740, Income Taxes, the Company recognizes deferred tax assets and liabilities for
the future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in
the years in which those temporary differences are expected to be realized or settled. The effect of a change in tax rates on deferred
tax assets and liabilities is recognized in income in the period that includes the enactment date. The realizability of deferred tax
assets is assessed throughout the year and a valuation allowance is recorded if necessary, to reduce net deferred tax assets to the amount
more likely than not to be realized. Certain prior period deferred tax disclosures were reclassified to conform with current period presentation. ASC
740 provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will
be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits of
the position. ASC 740 also provides guidance on measurement, derecognition, classification, interest and penalties, accounting in interim
periods, disclosure, and transition. The
Company’s practice is to recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in selling
and administrative expense. As of December 31, 2021, the Company had no The
provision for income taxes is computed using the asset and liability method, under which deferred tax assets and liabilities are recognized
for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities,
and for operating losses and tax credit carry-forwards. Deferred tax assets and liabilities are measured using the currently enacted
tax rates that apply to taxable income in effect for the years in which those tax assets are expected to be realized or settled. We record
a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized. Uncertain
Tax Positions We
evaluate tax positions in a two-step process. We first determine whether it is more likely than not that a tax position will be sustained
upon examination, based on the technical merits of the position. If a tax position meets the more-likely-than-not recognition threshold
it is then measured to determine the amount of benefit to recognize in the financial statements. The tax position is measured as the
largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement. We classify gross interest and
penalties and unrecognized tax benefits that are not expected to result in payment or receipt of cash within one year as long term liabilities
in the financial statements. Revenue
Recognition The
Company recognizes revenue in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification
(“ASC”) 606, Revenue from Contracts with Customers, which requires that five basic steps be followed to recognize revenue:
(1) a legally enforceable contract that meets criteria standards as to composition and substance is identified; (2) performance obligations
relating to provision of goods or services to the customer are identified; (3) the transaction price, with consideration given to any
variable, noncash, or other relevant consideration, is determined; (4) the transaction price is allocated to the performance obligations;
and (5) revenue is recognized when control of goods or services is transferred to the customer with consideration given, whether that
control happens over time or not. Determination of criteria (3) and (4) are based on our management’s judgments regarding the fixed
nature of the selling prices of the products and services delivered and the collectability of those amounts. The adoption of ASC 606
did not result in a change to the accounting for any of the in-scope revenue streams; as such, no cumulative effect adjustment was recorded. The
Company generates revenue primarily from: (1) the sale of homes/ During
the year ended December 31, 2021, the Company did recognized revenue of $ 7,477,882
consisting $ 7,331,882
net principal transaction, and $ 146,000
from the Entrepreneurship Development Initiative,
and $ 77 in
dividend income respectively. Advertising
Costs We
expense advertising costs when advertisements occur. During
the year ended December 31, 2021, the Company did recognized advertising costs 14,912 16,235 Concentrations
of Credit Risk The
Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents.
The Company places its cash and cash equivalents with financial institutions of high credit worthiness. The Company maintains cash balances
at financial institutions within the United States which are insured by the Federal Deposit Insurance Corporation (“FDIC”)
up to limits of approximately $ 250,000 Stock
Based Compensation The
cost of equity instruments issued to non-employees in return in accordance with ASC 505-50 “Equity-Based Payments to Non-Employees”
for goods and services is measured by the fair value of the goods or services received or the measurement date fair value of the equity
instruments issued, whichever is the more readily determinable. Measurement date for non-employees is the earlier of performance commitment
date or the completion of services. The cost of employee services received in exchange for equity instruments is based on the grant date
fair value of the equity instruments issued in accordance with ASC 718 “Compensation - Stock Compensation.” |
