SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
x QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2011
o TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
EXCHANGE ACT
Commission File Number: 0-52518
Exact name of small business issuer as specified in its charter
| NEVADA | 20-8051714 | |
| (State or other jurisdiction of | I.R.S. Employer | |
| incorporation or organization) | Identification No. |
1108 West Valley Blvd, STE 6-399
Alhambra, CA 91803
(Address of principal executive offices)
(626) 407-2618
Issuer's telephone number
Check whether the registrant (1) filed all documents and reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days Yes x No o
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 definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer |_| Accelerated filer |_|
Non-accelerated filer |_| Smaller reporting company |X|
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes x No o
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes o No o
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 6,882,273 shares as of July 25, 2011.
Transitional Small Business Disclosure Format (Check one): Yes o No x
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SUNRISE HOLDINGS LIMITED
INDEX
| PART I: FINANCIAL INFORMATION | ||
| Item 1: Financial Statements: | ||
| Consolidated Balance Sheets as of June 30, 2011 and September 30, 2010 (unaudited) | 4 | |
| Consolidated Statements of Expenses for the three and nine months ended June 30, 2011 and 2010, and from October 25, 2005 (inception) to June 30, 2011 (unaudited) | 5 | |
| Consolidated Statements of Cash Flows for the nine months ended June 30, 2011 and 2010, and from October 25, 2005 (inception) to June 30, 2011 (unaudited) | 6 | |
| Notes to the Consolidated Financial Statements (unaudited) | 7 | |
| Item 2: Management's Discussion and Analysis or Plan of Operations | 10 | |
| Item 3: Quantitative and Qualitative Disclosures About Market Risk | 11 | |
| Item 4: Controls and Procedures | 11 | |
| PART II: OTHER INFORMATION | ||
| 12 | ||
| 12 | ||
| 12 | ||
| 12 | ||
| 12 | ||
| 12 | ||
| 13 |
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ITEM 1. UNAUDITED FINANCIAL STATEMENTS
SUNRISE HOLDINGS LIMITED
(an Exploration Stage Company)
CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2011 AND SEPTEMBER 30, 2010
| JUNE 30, 2011 | SEPTEMBER 30, 2010 | |||||||
| (unaudited) | (audited) | |||||||
| ASSETS: | ||||||||
| Current assets: | ||||||||
| Cash | $ | 1,971 | $ | 1,549 | ||||
| Total current assets | 1,971 | 1,549 | ||||||
| TOTAL ASSETS | $ | 1,971 | $ | 1,549 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT): | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,049 | $ | 1,049 | ||||
| Advances from company officers | 10,036 | 36 | ||||||
| Total Current Liabilities | 11,085 | 1,085 | ||||||
| TOTAL LIABILITIES | 11,085 | 1,085 | ||||||
| Stockholders' Equity (Deficit): | ||||||||
| Preferred Stock, $.001par value; 10,000,000 shares authorized, | ||||||||
| 10,000,000 shares issued and outstanding | 10,000 | 10,000 | ||||||
Common Stock, $.001 par value; 190,000,000 shares authorized, 6,882,273 and 6,282,273 shares issued and outstanding at June 30, 2011 and September 30, 2010, respectively | 6,882 | 6,282 | ||||||
| Additional paid-in capital | 168,065 | 146,465 | ||||||
| Deficit accumulated during the exploration stage | (194,061 | ) | (162,283 | ) | ||||
| Total Stockholders' Equity (Deficit) | (9,114 | ) | 464 | |||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | $ | 1,971 | $ | 1,549 | ||||
The accompanying notes are an integral part of these financial statements.
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(an Exploration Stage Company)
CONSOLIDATED STATEMENTS OF EXPENSES
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2011 AND 2010 AND THE PERIOD
FROM OCTOBER 25, 2005 (INCEPTION) THROUGH JUNE 30, 2011
(Unaudited)
| October 25, 2005 | ||||||||||||||||||||
| Three Months Ended | Nine Months Ended | (Inception) to | ||||||||||||||||||
| June 30 | June 30 | June 30, | ||||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | 2011 | ||||||||||||||||
| Expenses: | ||||||||||||||||||||
| Exploration costs | $ | - | $ | - | $ | - | $ | - | $ | 37,956 | ||||||||||
| General and administrative expenses | 2,279 | 2,402 | 31,778 | 10,135 | 218,649 | |||||||||||||||
| Total Operating Expenses | 2,279 | 2,402 | 31,778 | 10,135 | 256,605 | |||||||||||||||
| Net operating loss | (2,279 | ) | (2,402 | ) | (31,778 | ) | (10,135 | ) | (256,605 | ) | ||||||||||
| Operating Income (Expense) | ||||||||||||||||||||
| Interest income | - | - | - | 31 | 64,960 | |||||||||||||||
| Gain on extinguishment of accounts payable | - | - | - | - | 5,669 | |||||||||||||||
| Interest expense | - | - | - | - | (8,085 | ) | ||||||||||||||
| Total Other Income and Expense | - | - | - | 31 | 62,544 | |||||||||||||||
| Net Loss | $ | (2,279 | ) | $ | (2,402 | ) | $ | (31,778 | ) | $ | (10,104 | ) | $ | (194,061 | ) | |||||
| Net Loss per Common Share - Basic and Diluted | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | ||||||||
| Per Share Information: | ||||||||||||||||||||
| Weighted Average Number of Common Stock | ||||||||||||||||||||
| Shares Outstanding - Basic and Diluted | 6,882,273 | 6,282,273 | 6,669,086 | 6,282,273 | ||||||||||||||||
See the accompanying summary of accounting policies and notes to the financial statements.
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(an Exploration Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2011 AND 2010 AND THE PERIOD
FROM OCTOBER 25, 2005 (INCEPTION) THROUGH JUNE 30, 2011
(Unaudited)
| October 25, 2005 | ||||||||||||
| For Nine Months Ended | (Inception) to | |||||||||||
| June 30, | June 30, | |||||||||||
| 2011 | 2010 | 2011 | ||||||||||
| Cash Flows from Operating Activities: | ||||||||||||
| Net Loss | $ | (31,778 | ) | $ | (10,104 | ) | $ | (194,061 | ) | |||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||
| Stocks issued for services | 22,200 | - | 68,031 | |||||||||
| Depreciation | - | - | 3,795 | |||||||||
| Gain on extinguishment of accounts payable | - | - | (5,669 | ) | ||||||||
| Imputed interest on shareholder advance | - | - | 2,711 | |||||||||
| (Increase) decrease in prepaid expenses | - | 1,646 | - | |||||||||
| Increase (decrease) in interest receivable | - | - | (33,259 | ) | ||||||||
| Increase (decrease) in accounts payable | - | (540 | ) | 6,718 | ||||||||
| Net Cash Flows Used by Operations | (9,578 | ) | (8,998 | ) | (151,734 | ) | ||||||
| Cash Flows from Investing Activities: | ||||||||||||
| Purchase of assets | - | - | (1,795 | ) | ||||||||
| Net Cash Flows Used for Investing Activities | - | - | (1,795 | ) | ||||||||
| Cash Flows from Financing Activities: | ||||||||||||
| Stocks issued for cash | - | - | 3,045,464 | |||||||||
| Shares Rescinded | - | - | (2,400,000 | ) | ||||||||
| Issuance of note receivable | - | - | (500,000 | ) | ||||||||
| Advance from company officer | 10,000 | 18 | 10,036 | |||||||||
| Net Cash Flows Provided by Financing Activities | 10,000 | 18 | 155,500 | |||||||||
| Net Increase (Decrease) in Cash | 422 | (8,980 | ) | 1,971 | ||||||||
| Cash and cash equivalents - Beginning of period | 1,549 | 12,396 | - | |||||||||
| Cash and cash equivalents - End of period | $ | 1,971 | $ | 3,416 | $ | 1,971 | ||||||
| SUPPLEMENTARY INFORMATION | ||||||||||||
| Interest Paid | $ | - | $ | - | $ | - | ||||||
| Taxes Paid | $ | - | $ | - | $ | - | ||||||
| Supplement disclosure of non cash investing and financing activities: | ||||||||||||
| Reduction of note in connection with share recission | $ | - | $ | - | $ | 500,000 | ||||||
See the accompany summary of accounting policies and notes to the financial statements.
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SUNRISE HOLDINGS LIMITED
(an Exploration Stage Company)
(Unaudited)
Note 1 - Basis of Presentation
The accompanying unaudited interim consolidated financial statements of Sunrise Holdings Limited have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with Sunrise's audited 2010 annual financial statements and notes thereto filed with the SEC on form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the result of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements, which would substantially duplicate the disclosure required in Sunrise's 2010 annual financial statements have been omitted.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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. The Company regularly evaluates estimates and assumptions related to the deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.
Interim Financial Statements
These interim unaudited financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.
Financial Instruments
Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 and 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 and 825 prioritizes the inputs into three levels that may be used to measure fair value:
Level 1
Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
Level 2
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 3
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.
The Company’s financial instruments consist principally of cash, and amounts due to related parties. Pursuant to ASC 820 and 825, the fair value of our cash is determined based on Level 1 inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.
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Recently Issued Accounting Standards
In March 2010, the FASB (Financial Accounting Standards Board) issued Accounting Standards Update 2010-11 (ASU 2010-11), “Derivatives and Hedging (Topic 815): Scope Exception Related to Embedded Credit Derivatives.” The amendments in this Update are effective for each reporting entity at the beginning of its first fiscal quarter beginning after June 15, 2010. Early adoption is permitted at the beginning of each entity’s first fiscal quarter beginning after issuance of this Update. The Company does not expect the provisions of ASU 2010-11 to have a material effect on the financial position, results of operations or cash flows of the Company.
In February 2010, the FASB Accounting Standards Update 2010-10 (ASU 2010-10), “Consolidation (Topic 810): Amendments for Certain Investment Funds.” The amendments in this Update are effective as of the beginning of a reporting entity’s first annual period that begins after November 15, 2009 and for interim periods within that first reporting period. Early application is not permitted. The Company’s adoption of provisions of ASU 2010-10 did not have a material effect on the financial position, results of operations or cash flows.
In February 2010, the FASB issued ASU No. 2010-09 “Subsequent Events (ASC Topic 855) “Amendments to Certain Recognition and Disclosure Requirements” (“ASU No. 2010-09”). ASU No. 2010-09 requires an entity that is an SEC filer to evaluate subsequent events through the date that the financial statements are issued and removes the requirement for an SEC filer to disclose a date, in both issued and revised financial statements, through which the filer had evaluated subsequent events. The adoption did not have an impact on the Company’s financial position and results of operations.
In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06, “Improving Disclosures about Fair Value Measurements.” ASU No. 2010-06 amends FASB Accounting Standards Codification (“ASC”) 820 and clarifies and provides additional disclosure requirements related to recurring and non-recurring fair value measurements and employers’ disclosures about postretirement benefit plan assets. This ASU is effective for interim and annual reporting periods beginning after December 15, 2009. The adoption of ASU 2010-06 did not have a material impact on the Company’s financial statements.
In January 2010, the FASB issued an amendment to ASC 505, Equity, where entities that declare dividends to shareholders that may be paid in cash or shares at the election of the shareholders are considered to be a share issuance that is reflected prospectively in EPS, and is not accounted for as a stock dividend. This standard is effective for interim and annual periods ending on or after December 15, 2009 and is to be applied on a retrospective basis. The adoption of this standard is not expected to have a significant impact on the Company’s financial statements.
In January 2010, the FASB issued an amendment to ASC 820, Fair Value Measurements and Disclosure, to require reporting entities to separately disclose the amounts and business rationale for significant transfers in and out of Level 1 and Level 2 fair value measurements and separately present information regarding purchase, sale, issuance, and settlement of Level 3 fair value measures on a gross basis. This standard, for which the Company is currently assessing the impact, is effective for interim and annual reporting periods beginning after December 15, 2009 with the exception of disclosures regarding the purchase, sale, issuance, and settlement of Level 3 fair value measures which are effective for fiscal years beginning after December 15, 2010. The adoption of this standard is not expected to have a significant impact on the Company’s financial statements.
In October 2009, FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect the timing or amount of revenue recognition. This standard, for which the Company is currently assessing the impact, will become effective on January 1, 2011.
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In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the product’s essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard, for which the Company is currently assessing the impact, will become effective on January 1, 2011.
On September 30, 2009, the Company adopted changes issued by the Financial Accounting Standards Board (FASB) to the authoritative hierarchy of GAAP. These changes establish the FASB Accounting Standards Codification (Codification) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The FASB will no longer issue new standards in the form of Statements, FASB Staff Positions, or Emerging Issues Task Force Abstracts; instead the FASB will issue Accounting Standards Updates. Accounting Standards Updates will not be authoritative in their own right as they will only serve to update the Codification. These changes and the Codification itself do not change GAAP. Other than the manner in which new accounting guidance is referenced, the adoption of these changes had no impact on the Company’s financial statements.
In August 2009, FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective for the Company on October 1, 2009. The adoption of this amendment did not have a material effect on the Company’s financial statements.
In June 2009, the FASB issued guidance now codified as FASB ASC Topic 105, Generally Accepted Accounting Principles, as the single source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with U.S. GAAP, aside from those issued by the SEC. ASC 105 does not change current U.S. GAAP, but is intended to simplify user access to all authoritative U.S. GAAP by providing all authoritative literature related to a particular topic in one place. The adoption of ASC 105 did not have a material impact on the Company’s consolidated financial statements, but did eliminate all references to pre-codification standards.
In May 2009, FASB issued ASC 855, Subsequent Events, which establishes general standards of for the evaluation, recognition and disclosure of events and transactions that occur after the balance sheet date. Although there is new terminology, the standard is based on the same principles as those that currently exist in the auditing standards. The standard, which includes a new required disclosure of the date through which an entity has evaluated subsequent events, is effective for interim or annual periods ending after June 15, 2009. The adoption of ASC 855-10 did not have a material effect on the Company’s financial statements.
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations
Note 2 - Going Concern
Sunrise's financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business for the foreseeable future. Since inception, the Company has accumulated losses aggregating to $194,061 and has insufficient working capital to meet operating needs for the next twelve months as of June 30, 2011, all of which raise substantial doubt about Sunrise's ability to continue as a going concern.
Note 3 - Related Party Transactions
For the nine months ended June 30, 2011, an officer of the Company advanced $10,000 to the Company. These advances are unsecured, non-interest bearing and have no fixed terms of repayment. No imputed interest was included due to the amount being immaterial.
On January 5, 2011, Sunrise issued 300,000 shares of its restricted common stock to a director and officer, Mr. Shaojun Sun for his services during the three month period ended December 31, 2010. These shares were valued at $11,100 based on their market value of $0.037 per share at closing on January 5, 2011, which is recorded as a contribution of capital for the value of the shares and an equivalent amount to stock based compensation.
On January 5, 2011, Sunrise issued 300,000 shares of its restricted common stock to a director and officer, Mr. Xuguang Sun for his services during the three month period ended December 31, 2010. These shares were valued at $11,100 based on their market value of $0.037 per share at closing on January 5, 2011, which is recorded as a contribution of capital for the value of the shares and an equivalent amount to stock based compensation.
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Item 2. Management's Discussion and Analysis of Financial Condition or Results of Operations
Forward-looking Information
This quarterly report contains forward-looking statements. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. These statements relate to future events or to our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially. There are a number of factors that could cause our actual results to differ materially from those indicated by such forward-looking statements.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Moreover, we do not assume responsibility for the accuracy and completeness of such forward-looking statements. We are under no duty to update any of the forward-looking statements after the date of this report to conform such statements to actual results.
The following discussion should be read along with our financial statements as of June 30, 2011, which are included in another section of this document and with our Form 10-K as of September 30, 2010 which contains a more detailed discussion of our plan. This discussion contains forward-looking statements about our expectations for our business and financial needs. These expectations are subject to a variety of uncertainties and risks that may cause actual results to vary significantly from our expectations. The cautionary statements made in our Report on Form 10-K should be read as applying to all forward-looking statements in any part of this report.
General
The following discussion and analysis summarizes the results of operations of Sunrise Holdings Limited, Inc. (the "Sunrise" or "we") for the three and nine months ended June 30, 2011.
Sunrise is a mining resource company that currently is working to identify and develop projects in Asia. At present, the Company doesn’t own any mining property and has no current operating income.
Results of Operations
Comparison of the three months ended June 30, 2011 and 2010
For the three months ended June 30, 2011 compared to the three months ended June 30, 2010, Sunrise had a net loss of $2,279 compared to a net loss of $2,402, respectively. The decrease of loss was due to the decrease of general and administrative expenses.
Comparison of the nine months ended June 30, 2011 and 2010
For the nine months ended June 30, 2011 compared to the nine months ended June 30, 2010, Sunrise had a net loss of $31,778 compared to a net loss of $10,104, respectively. The increase of loss was due to the increase of general and administrative expenses.
General and administrative expenses increased 214% to $31,778 during the nine months ended June 30, 2011 as compared to $10,135 for the comparable period in 2010. This increase was mainly due to issuances of shares to officers of the Company for their services.
Liquidity and Capital Resources
At June 30, 2011, Sunrise had current assets of $1,971, working capital deficit of $9,114, and had $9,578 of net cash used by operations during the nine months ended June 30, 2011.
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Management is currently looking for more capital to complete our corporate objectives. In addition, we may engage in joint activities with other companies. Sunrise cannot predict the extent to which its liquidity and capital resources will be diminished prior to the consummation of a business acquisition or whether its capital will be further depleted by its operating losses. Sunrise has some discussions concerning potential business cooperation or combination with other companies but no final agreement has been reached yet.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The Company is subject to certain market risks, including changes in interest rates and currency exchange rates. The Company does not undertake any specific actions to limit those exposures.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act (defined below)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.
Changes in Internal Control Over Financial Reporting
In addition, our management with the participation of our Principal Executive Officer and Principal Financial Officer have determined that no change in our internal control over financial reporting occurred during or subsequent to the quarter ended June 30, 2011 that has materially affected, or is (as that term is defined in Rules 13(a)-15(f) and 15(d)-15(f) of the Securities Exchange Act of 1934) reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1 Legal Proceedings
N/A
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
N/A
Item 3 Defaults Upon Senior Securities
N/A
Item 4 Submission of Matters to a Vote of Security Holders
N/A
Item 5 Other Information
N/A
Item 6 Exhibits
Exhibit Number, Name and/or Identification of Exhibit
| 31.1 | Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| 31.2 | Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| 32.1 | Certification of the Chief Executive Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| 32.2 | Certification of the Chief Financial Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| July 25, 2011 | Sunrise Holdings Limited | |
| By: | /s/ Xuguang Sun | |
| Xuguang Sun, Chief Executive Officer and President | ||
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