Chindia 10-Q 2009 Q4 Quarterly report

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Quarterly Report under Section 13 or 15 (d) of

Securities Exchange Act of 1934

For the quarterly period ended March 31, 2009

Commission File Number:  333-149014

CHINDIA, INC.

(Exact Name of Issuer as Specified in Its Charter)

Nevada	3715	26-1080965
State of Incorporation	Primary Standard Industrial	I.R.S. Employer Classification
	Code Number	Identification No.

2065 Lanihuli Drive

Honolulu, Hawaii 96822

(808) 347-9826

(Address and Telephone Number of Issuer's Principal Executive Offices)

Timothy S. Orr, Esq.

4328 West Hiawatha, Suite 101

Spokane, WA 99208

P. 509.462.2926

 (Name, Address, and Telephone Number of Agent)

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 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 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 the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer o	Non-Accelerated Filer o
	(Do not check if a smaller reporting company)
Accelerated Filer o	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

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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, 15(d) of the Exchange Act after the distribution of the securities under a plan confirmed by a court.

YES o     NO o

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer's classes of common stock at the latest practicable date. As of May 6, 2009, the registrant had 20,146,000 shares of common stock, $0.001 par value, issued and outstanding.

Transitional Small Business Disclosure Format (Check one):

YES o    NO x

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CHINDIA, INC.

INDEX

	Page
	Number
PART I - FINANCIAL INFORMATION	4
Item 1 – Financial Statements –Unaudited	4
Balance Sheets	F-1
Statements of Operations	F-2
Statements of Cash Flows	F-3
Notes to Financial Statements	F-4
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	6
Item 3 – Quantitative and Qualitative Disclosure About Market Risk	7
Item 4 – Controls and Procedures	8
PART II – OTHER INFORMATION	10
Item 1 - Legal Proceedings	10
Item 2 – Unregistered Sales of  Equity Securities and Use of Proceeds	10
Item 3 - Defaults upon Senior Securities	10
Item 4 – Submission of Matters to a Vote of Security Holders	10
Item 5 - Other Information	10
Item 6 – Exhibits	10
Signatures	11

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PART I ― FINANCIAL INFORMATION

Item 1.                      Financial Statements.

Chindia, Inc.

(A Development Stage Company)

Unaudited Financial Statements

For the Three and Nine Months Ended March 31, 2009 and 2008 and the

Period from December 20, 2006 (Inception) to March 31, 2009

4

Chindia, Inc.

(A Development Stage Company)

Unaudited Financial Statements

For the Three and Nine Months Ended March 31, 2009 and 2008 and the

Period from December 20, 2006 (Inception) to March 31, 2009

	Page(s)
Balance Sheets as of March 31, 2009 and June 30, 2008	F-1
Statements of Operations for the three and nine months ended March 31, 2009 and 2008 and the period of December 20, 2006 (Inception) to March 31, 2009	F-2
Statements of Cash Flows for the nine months ended March 31, 2009 and the period of December 20, 2006 (Inception) to March 31, 2009	F-3
Notes to the Unaudited Financial Statements	F-4-5

5

CHINDIA, INC.
(A Development Stage Company)
Balance Sheets
	March 31, 2009				June 30, 2008
	(unaudited)
ASSETS
Current assets
Cash		$	100			$	100
Total current assets			100				100
Total assets		$	100			$	100
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable		$	6,775			$	2,025
Related party payable			1,650				6,350
Total current liabilities			8,425				8,375
Stockholders' Deficit
Common stock, $.001 par value; 75,000,000 shares authorized, 20,146,000 and 20,000,000 shares issued and outstanding at March 31, 2009 and June 30, 2008			20,146				20,000
Additional paid-in capital			17,554				-
Deficit accumulated during the development stage			(46,025	)			(28,275	)
Total stockholders' deficit			(8,325	)			(8,275	)
Total liabilities and stockholders' deficit		$	100			$	100
See accompanying notes to financial statements

F-1

CHINDIA, INC.
(A Development Stage Company)
Statements of Operations (unaudited)
																For the period from December 20, 2006 (inception) to March 31, 2009
	Three months ended March 31,							Nine months ended March 31,
	2009				2008			2009				2008
Revenue		$	-			$	-		$	-			$	-			$	-
Expenses
Other general & administrative			17,750				-			17,750				6,250				46,025
Total expenses			17,750				-			17,750				6,250				46,025
Net loss		$	(17,750	)		$	-		$	(17,750	)		$	(6,250	)		$	(46,025	)
Basic and diluted loss per common share		$	(0.00	)		$	-		$	(0.00	)		$	(0.00	)
Weighted average shares outstanding			20,135,089				20,000,000			20,125,555				20,000,000
See accompanying notes to financial statements

F-2

CHINDIA, INC.
(A Development Stage Company)
Statements of Cash Flows (unaudited)
									For the period from December 20, 2006 (inception) to March 31, 2009
	Nine months ended March 31,
	2009				2008
Cash flows from operating activities
Net loss		$	(17,750	)		$	(6,250	)		$	(46,025	)
Adjustments to reconcile net loss to net cash used in operating activities
Common stock issued for services			-				-				20,000
Changes in operating assets and liabilities
Accounts payable			4,750				3,000				6,775
Net cash used in operating activities			(13,000	)			(3,250	)			(19,250	)
Net cash used in investing activities			-				-				-
Cash flows from financing activities
Proceeds from related party payable			-				3,350				6,350
Repayments of related party payable			(4,700	)							(4,700	)
Proceeds from issuance of common stock			17,700				-				17,700
Net cash provided by financing activities			13,000				3,350				19,350
Net change in cash			-				100				100
Cash at beginning of period			100				-				-
Cash at end of period		$	100				100			$	100
Supplemental disclosure of non-cash investing and financing activities:
Issuance if 20,000,000 shares of common stock for professional and consulting services		$	-			$	-			$	20,000
Supplemental Cash Flow Information:
Cash paid for interest		$	-			$	-			$	-
Cash paid for income taxes		$	-			$	-			$	-
See accompanying notes to financial statements

F-3

 Chindia, Inc.

Notes to Unaudited Financial Statements

For the Three and Nine Months Ended March 31, 2009 and 2008 and the

Period of December 20, 2006 (Inception) to March 31, 2009

NOTE 1 - NATURE OF ORGANIZATION

Chindia, Inc. (the Company) was incorporated under the laws of the State of Nevada on December 20, 2006 with a principal business objective of investing in and developing all types of businesses related to the publication industry. The Company has not realized any revenues to date and therefore classified as a development stage company in accordance with SFAS No. 7 “Accounting and Reporting by Development Stage Companies.”

The Company has elected a June 30 year end.

NOTE 2 – CONDENSED FINANCIAL STATEMENTS

The accompanying financial statements have been prepared by the Company without audit.  In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at March 31, 2009, and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s June 30, 2008 audited financial statements.  The results of operations for the periods ended March 31, 2009 and 2008 are not necessarily indicative of the operating results for the full years.

NOTE 3 – GOING CONCERN

The Company’s financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern.

F-4

Chindia, Inc.

Notes to Unaudited Financial Statements

For the Three and Nine Months Ended March 31, 2009 and 2008 and the

Period of December 20, 2006 (Inception) to March 31, 2009

The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

F-5

Item 2. Management's Discussion and Analysis of Financial Condition and Plan of Operations.

FORWARD LOOKING STATEMENTS

THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES SUCH AS THE DEPENDENCE OF THE COMPANY ON AND THE ADEQUACY OF CASH FLOWS. THESE FORWARD-LOOKING STATEMENTS AND OTHER STATEMENTS MADE ELSEWHERE IN THIS REPORT ARE MADE IN RELIANCE ON THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.

General

Chindia, Inc. (the “Company”) is a development stage company that was incorporated on December 20, 2006, in the state of Nevada. The Company intends to enter into the import and export industry specializing in American products that are in demand in the Asian markets and importing products that can be sold into the American markets. The Company can be characterized as a marketing/brokerage organization that intends on initially importing unique products from China, India and other Asian countries that have no competitive counterparts in the US.

The Company has never declared bankruptcy, it has never been in receivership, and it has never been involved in any legal action or proceedings. Since becoming incorporated, Chindia has not made any significant purchase or sale of assets, nor has it been involved in any mergers, acquisitions or consolidations and the Company owns no subsidiaries. The fiscal year end is June 30st.  The Company has not had revenues from operations since its inception and/or any interim period in the current fiscal year.

Plan of Operation

As of March 31, 2009, we have $100 of cash available.  We have current liabilities of $8,425.  From the date of inception (December 20, 2006) to March 31, 2009 the Company has recorded a net loss of $46,025 of which were expenses relating to the initial development of the Company, filing its Registration Statement on Form SB-2, and expenses relating to maintaining Reporting Company status with the SEC.  In order to survive as a going concern, the Company will require additional capital investments or borrowed funds to meet cash flow projections and carry forward our business objectives. There can be no guarantee or assurance that we can raise adequate capital from outside sources to fund the proposed business.  Failure to secure additional financing would result in business failure and a complete loss of any investment made into the Company.

The Company filed a registration statement on Form SB-2 on February 1, 2008, which was deemed effective on February 14, 2008.  Since this time the Company has realized $7,300 from the sale of sale of 146,000 shares of common stock to the public.

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All proceeds derived from the offering will be utilized by the Company to fund its initial development including administrative costs associated with maintaining its status as a Reporting Company as defined by the Securities and Exchange Commission (“SEC”) under the Exchange Act of 1934 as amended.  The Company plans to continue to focus efforts on selling their common shares through this offering in order to continue to fund its initial development and fund the expenses associated with maintaining a reporting company status.

In addition, over the course of the next 90 to 120 days, management intends to focus efforts on obtaining a quotation for its common stock on the Over the Counter Bulletin Board (“OTCBB”).  Management believes having its common stock quoted on the OTCBB will provide it increased opportunity to raise additional capital for its proposed business development.  However, there can be no guarantee or assurance the Company will be successful in filing a Form 211 application and obtaining a quotation.  To date there is no public market for the Company’s common stock. There can be no guarantee or assurance that a public market will ever exist for the common stock. Failure to create a market for the Company’s common stock would result in business failure and a complete loss of any investment made into the Company.

Product Research and Development

The Company does not anticipate any costs or expenses to be incurred for product research and development within the next twelve months.

Employees

There are no employees of the Company, excluding the current President and Director, Mr. Kunkle and the Company does not anticipate hiring any additional employees within the next twelve months.

Off-Balance Sheet Arrangements

As of the date of this Quarterly Report, the Company does not have any off-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 that are material to investors.  The term "off-balance sheet arrangement" generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the Company is a party, under which the Company has (i) any obligation arising under a guarantee contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk.

Not Applicable

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Item 4. Controls and Procedures

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting.  Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the company’s principal executive and principal financial officers and effected by the company’s board of directors, management and other personnel, 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 and includes those policies and procedures that:

·   Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;

·   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

·   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 control over financial reporting may not prevent or detect misstatements.  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.  All internal control systems, no matter how well designed, have inherent limitations.  Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.  Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process.  Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

As of March 31, 2009, management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control--Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") and SEC guidance on conducting such assessments.  Based on that evaluation, they concluded that, during the period covered by this report, such internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules as more fully described below.  This was due to deficiencies that existed in the design or operation of our internal controls over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.

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The matters involving internal controls and procedures that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; and (3) ineffective controls over period end financial disclosure and reporting processes.  The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our financial statements as of December 31, 2008.

Management believes that the material weaknesses set forth in items (2) and (3) above did not have an effect on our financial results.  However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

Management’s Remediation Initiatives

In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

We will create a position to segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us.  And, we plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.

Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board.

We anticipate that these initiatives will be at least partially, if not fully, implemented by July 31, 2009.  Additionally, we plan to test our updated controls and remediate our deficiencies by July 31, 2009.

Changes in Internal Controls Over Financial Reporting

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

9

Off-Balance Sheet Arrangements

As of the date of this Quarterly Report the Company does not have any off-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 that are material to investors. The term "off-balance sheet arrangement" generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the Company is a party, under which the Company has (i) any obligation arising under a guarantee contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Company is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated.

No director, officer, or affiliate of the Company and no owner of record or beneficial owner of more than 5.0% of the securities of the Company, or any associate of any such director, officer or security holder is a party adverse to the Company or has a material interest adverse to the Company in reference to pending litigation.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Submission of Matters to Vote of Security Holders

None.

Item 5. Other Information

None.

Item 6. Exhibits

(a)   Exhibits furnished as Exhibits hereto:

Exhibit No.	Description
31.1	Certification of Steven M. Kunkle pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Chindia, Inc.
Date: May 6, 2009	By:	/s/  Steven M. Kunkle
		Steven M. Kunkle
		Chief Financial Officer, Treasurer and Secretary
		(principal financial and accounting officer)
Date: May 6, 2009	By:	/s/  Steven M. Kunkle
		Steven M. Kunkle
		President and Chief Executive Officer

11