| Nature of Operations and Significant Accounting Policies | NOTE 1. NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES NATURE OF OPERATIONS BUSINESS CannaPharmaRx,
Inc. (the “Copmany”) is a Delaware corporation whose shares were traded on the OTCQB during 2015. The Company
began trading under its new stock ticker symbol “CPMD” effective as of March 21, 2015. The Company is an
early-stage pharmaceutical company whose purpose is to advance cannabinoid research and discovery using proprietary
formulation and drug delivery technology currently under development. It is also an aspect of the Company’s strategy to
own and operate compounding and specialty pharmacies. The Company regularly engages in discussions to acquire such pharmacies
and to finance such acquisitions, but to date, the Company has not completed any such acquisition. HISTORY The Company
was originally incorporated in the State of Colorado in August 1998 under the name “Network Acquisitions, Inc.” It
changed its name to Cavion Technologies, Inc. in February 1999 and subsequently to Concord Ventures, Inc. in October 2006. On
December 21, 2000, the Company filed for protection under Chapter 11 of the United States Bankruptcy Code. In connection with
the filing, on February 16, 2001, the Company sold its entire business, and all of its assets, for the benefit of its creditors.
After the sale, the Company still had liabilities of $8.4 million and was subsequently dismissed by the Court from the Chapter
11 reorganization, effective March 13, 2001, at which time the last of the Company’s then remaining directors resigned.
On March 13, 2001, the Company had no business or other source of income, no assets, no employees or directors, outstanding liabilities
of approximately $8.4 million and had terminated its duty to file reports under securities law. In February 2008, after filing
of a Form 10 registration statement pursuant to the Securities Exchange Act of 1934, as amended, we were re-listed on the OTC
Bulletin Board. In April
2010, the Company re-domiciled in Delaware under the name CCVG, Inc. (“CCVG”).Effective December 31, 2010, the Company
completed an Agreement and Plan of Merger and Reorganization (the “Reorganization") which provided for the merger of
two of the Company’s wholly owned subsidiaries. As a result of this reorganization the Company’s name became “Golden
Dragon Inc.,” which became the surviving publicly quoted parent holding company. On May 9,
2014, the Company entered into a Share Purchase Agreement (the “ Share Purchase Agreement Canna Colorado In October
2014, the Company changed its legal name to “CannaPharmaRx, Inc.” As
a result of the aforesaid transactions, the Company became an early-stage pharmaceutical company whose purpose was to advance
cannabinoid research and discovery using proprietary formulation and drug delivery technology then under development. In
April 2016, the Company ceased operations. Its then management resigned their respective positions with the Company, with the
exception of Mr. Gary Herick, who remains as an officer and director. As
a result, the Company is now considered a “shell” company as defined under the Securities Exchange Act of
1934, as amended. BASIS OF PRESENTATION The accompanying
financial statements have been prepared in accordance with the Financial Accounting Standards Board (“ FASB Codification GAAP USE OF ESTIMATES The preparation
of our financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in these financial statements and accompanying notes. Actual results
could differ from those estimates. Due to uncertainties inherent in the estimation process, it is possible that these estimates
could be materially revised within the next year. CASH AND
CASH EQUIVALENTS Cash and
cash equivalents consist of cash and highly liquid debt instruments with original maturities of less than three months. PROPERTY
AND EQUIPMENT The Company
acquired $102,799 in property and equipment, of which $100,721 was purchased during the year ended December 31, 2014, and
another $2,078 purchased in the first quarter of 2015. Of this amount, $50,000 represents the capitalized cost of the Company’s
proprietary RECRUIT Registry™ website development. This patient registry project was largely completed in the fourth quarter
of 2014, although it is not currently operational, and the timing of the project launch is not certain at this time. Accordingly,
no depreciation expense has been recorded against the capitalized cost of the RECRUIT Registry to date. In addition
to the investment in the Company’s patient registry, another $52,800 has been invested in office and computer equipment,
primarily incurred since the November 2014 establishment of the Company’s new headquarters in Carneys Point, New Jersey.
During the current year ended December 31, 2015 the Company added $2,078 in additional office and computer equipment. As of December
31, 2015, the Company had ceased using the offices that were rented and the related assets were disbursed with no accounting for
their disposition. With this development, the Company recorded a loss on the disposal of the assets in the amount of $87,748. Depreciation
expenses have been calculated using the straight-line method over the estimated useful lives of the respective assets, ranging
from three to seven years. As of March
31, 2016, the Company had no fixed assets on hand. Depreciation expense for the periods ended March 31, 2016 and March 31, 2015
was $-0- and $3,135 respectively. DEFERRED COSTS AND OTHER OFFERING
COSTS All costs
with respect to raising capital in the two private placements of the Company’s common stock were expensed by the Company
both in 2014 and 2015. These costs were applied as internal operational expenses. The Company had no deferred costs or other stock
offering costs as of either March 31, 2016 or December 31, 2015. The Company has not raised any capital since 2015. Future costs
associated with raising capital, be it debt or equity, may more likely be incurred as a direct variable cost with third parties.
Our intent is to initially defer these costs and ultimately offset them against the proceeds from these capital or financial transactions
if successful or expensed if the proposed financial transaction proves unsuccessful. IMPAIRMENT OF LONG-LIVED AND INTANGIBLE
ASSETS In the event
that facts and circumstances indicated that the cost of long-lived and intangible assets may be impaired, an evaluation of recoverability
will be performed. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset will be
compared to the asset’s carrying amount to determine if a write-down to market value or discounted cash flow value will
be required. The Company had no intangible assets at March 31, 2016 or December 31, 2015. FAIR VALUES OF ASSETS AND LIABILITIES The Company
groups its financial assets and financial liabilities generally measured at fair value in three levels, based on the markets in
which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value.
Level 1: Valuation is based on quoted
prices in active markets for identical assets or liabilities. Level 1 assets and liabilities generally include debt and equity
securities that are traded in an active exchange market. Valuations are obtained from readily available pricing sources for
market transactions involving identical assets or liabilities.
Level
2: Valuation is based on observable inputs
other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not
active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term
of the assets or liabilities. For example, Level 2 assets and liabilities may include debt securities with quoted prices that
are traded less frequently than exchange-traded instruments.
Level
3: Valuation is based on unobservable
inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash
flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant
management judgment or estimation. This category generally includes certain private equity investments and long-term derivative
contracts. The fair
value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when
measuring fair value. As of March 31, 2016 and December 31, 2015, the Company does not have any assets or liabilities which
are considered Level 2 or 3 in the hierarchy. The Company
may also be required, from time to time, to measure certain other financial assets at fair value on a nonrecurring basis. These
adjustments to fair value usually result from application of lower-of-cost-or-market accounting or write-downs of individual assets.
There were no such adjustments in the periods ended March 31, 2016, nor December 31, 2015. FINANCIAL INSTRUMENTS The estimated
fair value for financial instruments was determined at discrete points in time based on relevant market information. These estimates
involved uncertainties and could not be determined with exact precision. The fair value of the Company’s financial instruments,
which include cash, prepaid expenses, accounts payable and the related party loan, each approximate their carrying value due either
to their short length to maturity or interest rates that approximate prevailing market rates. INCOME TAXES The Company
accounts for income taxes under the liability method, which requires recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method,
deferred tax assets and liabilities are determined based on the difference between the financial statements and tax bases of assets
and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. COMPREHENSIVE INCOME (LOSS) 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 assets and liabilities that are reported directly
in equity such as translation adjustments on investments in foreign subsidiaries and unrealized gains (losses) on available-for-sale
securities. From our inception, there have been no differences between our comprehensive loss and net loss. INCOME (LOSS) PER SHARE Income (loss)
per share is presented in accordance with Accounting Standards Update (“ ASU Earning per Share EPS Stock options
outstanding at March 31, 2016 to purchase 2,500,000 shares of common stock are excluded from the calculations of diluted
net loss per share since their effect is antidilutive. STOCK-BASED COMPENSATION The Company
has adopted ASC Topic 718, (Compensation—Stock Compensation) BUSINESS SEGMENTS The Company’s
activities during the three month period ended March 31, 2016 and the year ended December 31, 2015 comprised a single segment. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Company
has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not
believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position
or results of operations. |
