UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K/A-1
| [X] | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| | For the fiscal year ended December 31, 2008 |
Commission file number 000-50664
DRAVCO MINING INC.
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of incorporation or organization)
1909 Dufferin Avenue
Saskatoon, Saskatchewan S7J 1B6
(Address of principal executive offices, including zip code.)
(888) 437-5268
(Registrant's telephone number, including area code)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. [ ] Yes No [ X ]
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act: [ ] Yes No [ X ]
Indicate by check mark whether the registrant(1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 day. [ X ] Yes [ ] No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy if information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 if the Exchange Act.
| | | Large Accelerated filer | | [ ] | Accelerated filer | [ ] |
| | | Non-accelerated filer | [ ] | Smaller reporting company | [X] |
| | | (Do not check if a smaller reporting company) |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). [ X ] Yes [ ] No
The aggregate market value of the voting common stock held by non-affiliates (8,000,000 shares of voting common stock) as of June 30, 2008, computed at the par value of the stock of $0.00001 was $80 assuming solely for the purposes of this calculation that the directors and executive officers of the issuer are “affiliates”. This determination of affiliate status is not necessarily a conclusive determination for other purposes.
On February 18, 2009, the Registrant had 18,000,000 outstanding common shares of voting common stock.
DOCUMENTS INCORPORATED BY REFERENCE
Exhibits incorporated by reference are referred to under Part IV.
EXPLANATORY NOTE
This Amendment No. 1 on Form 10-K is being filed in response to certain comments made by the staff of the SEC in a facsimile dated July 27, 2009. In response to such comments, we have amended the disclosure under Item 9A – Controls and Procedures and will file a new Section 302 Certification of our Chief Executive and Chief Financial Officer (Exhibit 31.1) that includes the internal control over financial reporting language from the introductory portion of paragraph 4.
Except as described above, the remainder of the Form 10-K is unchanged and does not reflect events occurring after the original filing of the Form 10-K with the SEC on March 19, 2009.
PART II
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including the Principal Executive Officer and Principal Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, the Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures are not effective since the following material weaknesses exist:
| (i) | The Company’s management is relying on external consultants for purposes of preparing its financial reporting package; the Company’s sole officer may not be able to identify errors and irregularities in the financial reporting package before its release as a continuous disclosure document. |
| (ii) | As the Company is governed by one officer who is also the only director, there is an inherent lack of segregation of duties and lack of independent governing board. |
| (iii) | The Company does not have standard procedures in place to ensure that the financial statements agree to the underlying source documents and accounting records, that all of its transactions are completely reflected in the financial statements. |
| (iv) | There are no controls in place to ensure that expenses are recorded when incurred, as opposed to when invoices are presented by suppliers, increasing the risk of incomplete expenses and accrued liabilities. |
Changes in Internal Controls
There were no changes in our internal control over financial reporting during the quarter ended December 31, 2008 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.
Our internal control over financial reporting includes those policies and procedures that
(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. All internal control systems, no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention of overriding controls. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. 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.
Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2008. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework. Based on our assessment, as of December 31, 2008, management has concluded that the Company’s internal controls over financial reporting were not operating effectively. Management has identified the following deficiencies, that only when aggregated, may possibly be viewed as a material weakness in our internal control over financial reporting as of December 31, 2008 and it is clarified that management did not identify any material weaknesses in its internal control over financial reporting:
| 1. | We do not have an Audit Committee – While not being legally obligated to have an audit committee, it is the Company’s management’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’s financial statements. Currently the Board of Directors acts in the capacity of the Audit Committee, consisting of one sole member who is not independent of management and lacks sufficient financial expertise for overseeing financial reporting responsibilities. |
| 2. | Insufficient documentation of financial statement preparation and review procedures – The Company employs policies and procedures in reconciliation of the financial statements and the financial information based on which the financial statements are prepared, however, such controls and policies employed by the Company are not sufficiently documented. |
| 3. | We did not maintain proper segregation of duties for the preparation of our financial statements – As of December 31, 2008 the majority of the preparation of our financial statements was carried out by one person. Additionally, we currently only have one officer/director having oversight on all transactions. This has resulted in several deficiencies including: |
| | a. | Significant, non-standard journal entries were prepared and approved by the same person, without being checked or approved by any other personnel within the Company. |
| | b. | Lack of control over preparation of financial statements, and proper application of accounting policies. |
| 4. | We lack sufficient information technology controls and procedures – As of December 31, 2008, the Company lacked a proper data back up procedure, and while backup did take place in actuality, we believe that it was not regulated by methodical and consistent activities and monitoring by the Company. |
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’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 December 31, 2008 based on criteria established in Internal Control—Integrated Framework issued by COSO.
Manning Elliott LLP, an independent registered public accounting firm, was not required to and has not issued a report concerning the effectiveness of our internal control over financial reporting as of December 31, 2008.
Continuing Remediation Efforts to address deficiencies in Company’s Internal Control over Financial Reporting
Once the Company is engaged in a business of merit and has sufficient personnel available, then our Board of Directors, in particular and in connection with the aforementioned deficiencies, will establish the following remediation measures:
| 1. | Our Board of Directors will nominate an audit committee and audit committee financial expert. |
| 2. | We will appoint additional personnel to assist with the preparation of the Company’s financial statements; which will allow for proper segregation of duties, as well as additional manpower for proper documentation. |
| 3. | We will engage in a thorough review and restatement of our IT procedures, in addition to procurement of all hardware and software that will enable us to maintain proper backups, access, control etc. |
| 4. | We will establish policies to ensure that all significant transactions resulting in non-standard journal entries are reviewed and approved by the Company’s Board of Directors and that approval be documented in the Company’s corporate records. |
| ITEM 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES. |
| | | Incorporated by reference | |
| Exhibit | Document Description | Form | Date | Number | Filed herewith |
| | | | | | |
| 3.1 | Certificate of Amendment of Articles of Incorporation – Name Change to Dravco Mining Inc. | SB-2/A4 | October 10, 2002 | 3.1 | |
| 3.2 | Amended Bylaws | SB-2/A4 | October 10, 2002 | 3.2 | |
| 3.3 | Articles of Incorporation of Dundee Mining Inc. | SB-2 | January 19, 2001 | 3.3 | |
| 3.4 | Bylaws of Dundee Mining Inc. | SB-2 | January 19, 2001 | 3.4 | |
| 4.1 | Specimen stock certificate | SB-2 | January 19, 2001 | 4.1 | |
| 10.1 | Trust Agreement | SB-2 | January 19, 2001 | 10.1 | |
| 10.2 | Bill of Sale Absolute | SB-2 | January 19, 2001 | 10.2 | |
14.1 | Code of Ethics | 10-KSB | March 30, 2005 | 14.1 | |
| | | | | | |
31.1 | Certification of Principal Executive Officer and Principal Financial Officer pursuant to 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended | | | | X |
| | | | | | |
32.1 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Office and Chief Financial Officer) | | | | X |
| | | | | | |
SIGNATURES
In accordance with Section 13 or 15 (d) of the Exchange Act, the registrant caused this amended report to be signed on behalf by the undersigned, thereto duly authorized on this 10th day of August, 2009.
| | DRAVCO MINING INC. |
| | | |
| | BY: | RODNEY LOZINSKI |
| | | Rodney Lozinski, President, Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer, Secretary, Treasurer and a member of the Board of Directors. |
EXHIBIT INDEX
| | | Incorporated by reference | |
| Exhibit | Document Description | Form | Date | Number | Filed herewith |
| | | | | | |
| 3.1 | Certificate of Amendment of Articles of Incorporation – Name Change to Dravco Mining Inc. | SB-2/A4 | October 10, 2002 | 3.1 | |
| 3.2 | Amended Bylaws | SB-2/A4 | October 10, 2002 | 3.2 | |
| 3.3 | Articles of Incorporation of Dundee Mining Inc. | SB-2 | January 19, 2001 | 3.3 | |
| 3.4 | Bylaws of Dundee Mining Inc. | SB-2 | January 19, 2001 | 3.4 | |
| 4.1 | Specimen Stock Certificate | SB-2 | January 19, 2001 | 4.1 | |
| 10.1 | Trust Agreement | SB-2 | January 19, 2001 | 10.1 | |
| 10.2 | Bill of Sale Absolute | SB-2 | January 19, 2001 | 10.2 | |
14.1 | Code of Ethics | 10-KSB | March 30, 2005 | 14.1 | |
| | | | | | |
31.1 | Certification of Principal Executive Officer and Principal Financial Officer pursuant to 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended | | | | X |
| | | | | | |
32.1 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Office and Chief Financial Officer) | | | | X |
| | | | | | |
