U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X]
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2008
OR
[ ]
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to ______
Commission file number 000-52966
PETMAN ACQUISITION, INC.
(Exact name of small business issuer as specified in its charter)
Wyoming |
| Applied For |
(State or other jurisdiction of incorporation or organization) |
| (I.R.S. Employer Identification No.) |
c/o Wyoming Corporate Services Inc., 2710 Thomes Ave., Cheyenne, WY |
| 82001 |
(Address of principal executive offices) |
| (Zip Code) |
Issuer’s telephone number: (307) 632-3333
No change
(Former name, former address and former fiscal year, if changed since last report)
1
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 [ ] No [X]
Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13, or 15(d) of the Exchange Act subsequent to the distribution of securities under a plan confirmed by a court. Yes [ ] No [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 [ ]
At June 30, 2008, 6,000,000 shares of the Registrant's Common Stock and 0 shares of the Registrant’s Preferred Stock were issued and outstanding.
Transitional Small Business Disclosure Format: Yes [ ] No [X]
2
PETMAN ACQUISITION, INC.
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
PAGE
UNAUDITED FINANCIAL STATEMENTS
Balance Sheet as of June 30, 2008 (unaudited)
F1
Statement of Operations for three months ended June 30, 2008 and the
period from inception (November 19, 2007) to June 30, 2008 (unaudited)
F2
Statement of Stockholders’ Deficit for the period from inception (November 19,
F3
2007) to June 30, 2008 (unaudited)
Statement of Cash Flows for three months ended June 30, 2008 and the
period from inception (November 19, 2007) to June 30, 2008 (unaudited)
F4
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS F5 – F10
3
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Balance Sheet
As at June 30, 2008 (unaudited)
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TOTAL ASSETS |
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| $ - | |||
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LIABILITIES |
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CURRENT |
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Director loan |
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| $ 3,191 | |||
Accounts Payable |
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| 1,000 | |||
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| 4,191 | |||
STOCKHOLDERS’ DEFICT |
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Preferred stock – no par value; |
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30,000,000 shares authorized; none issued or outstanding |
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Common stock – no par value; |
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70,000,000 shares authorized; 6,000,000 issued and |
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outstanding |
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| 300 | |||
Additional paid-in capital |
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| - | |||
Deficit accumulated during development stage |
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TOTAL STOCKHOLDERS’ DEFICIT |
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| (4,191) | |||
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TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
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| $ - | |||
(Going Concern)
The accompanying notes are an integral part of the financial statements.
F1
4
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Statement of Operations
For the Three Months Ended June 30, 2008 and the Period from Inception (November 19, 2007) to June 30, 2008 (unaudited)
| Three Months Ended June 30, 2008 | Period from Inception (November 19, 2007) to June 30, 2008 |
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REVENUE | $ - | $ - |
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GENERAL AND ADMINISTRATIVE EXPENSES | 1,000 | 4,491 |
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NET LOSS FOR THE PERIOD | ($1,000) | ($4,491) |
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EARNINGS PER SHARE COMPUTATION: |
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Net loss per common share | (Less than $0.01) | (Less than $0.01) |
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Weighted average number of common shares outstanding - basic | 6,000,000 | 6,000,000 |
The accompanying notes are an integral part of the financial statements.
F2
5
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Statement of Stockholders’ Deficit
For the Period from Inception (November 19, 2007) to June 30, 2008 (unaudited)
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| Additional |
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| Common Stock | Paid-in | Accumulated |
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| Shares | Amount | Capital | Deficit | Total |
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Balance, inception (November 19, 2007) | - | $ - | $ - | $ - | $ - |
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Stock issued as compensation for |
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reimbursement of incorporation |
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expenses on November 21, |
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2007 - no par value | 6,000,000 | 300 | - | - | 300 |
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Net loss for the period | - | - |
| (2,491) | (2,491) |
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Balance, December 31, 2007 | 6,000,000 | $300 | $ - | ($2,491) | ($2,191) |
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Net loss for the period | - | - |
| (2,000) | (2,000) |
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Balance, June 30, 2008 | 6,000,000 | $300 | $ - | ($4,491) | ($4,191) |
The accompanying notes are an integral part of the financial statements.
F3
6
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Statement of Cash Flows
For the Three Months Ended June 30, 2008 and the Period from Inception (November 19, 2007) to June 30, 2008 (unaudited)
| Three Months Ended June 30, 2008 | Period from Inception (November 19, 2007) to June 30, 2008 |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net loss for the period Stock issued as payment on expenses | ($1,000) | ($4,491) 300 |
Increase in accounts payable | - | 1,000 |
NET CASH PROVIDED BY OPERATIONS | (1,000) | (3,191) |
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CASH FLOWS FROM FINANCING ACTIVITIES: |
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Proceeds from director loan | 1,000 | 3,191 |
NET CASH PROVIDED BY FINANCING ACTIVITIES: | 1,000 | 3,191 |
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NET CHANGE IN CASH AND CASH BALANCE, END OF PERIOD | $ - | $ - |
The accompanying notes are an integral part of the financial statements.
F4
7
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2008 (unaudited)
1.
THE COMPANY
Petman Acquisition, Inc. (“the Company”), a company incorporated in the State of Wyoming on November 19, 2007, plans to locate and negotiate with a business entity (“the target company”) for the combination of that target company with the Company. The combination is expected to take the form of a merger, stock-for-stock exchange or stock-for-assets exchange. In most instances, the target company will wish to structure the business combination to be within the definition of a tax-free reorganization under Section 351 or Section 368 of the Internal Revenue Code of 1986, as amended. No assurances can be given that the Company will be successful in locating or negotiating with any target company.
The Company has been formed to provide a method for a foreign or domestic private company to become a reporting (“public”) company whose securities are qualified for trading in the United States secondary market.
2.
SIGNIFICANT ACCOUNTING POLICIES
The Company’s accounting policies conform to United States generally accepted accounting principles and have been consistently applied in the preparation of financial statements.
The financial statements included herein have not been audited by an independent registered public accounting firm, but include all adjustments (including normal, recurring entries), which are, in the opinion of management, necessary for a fair presentation of the results for such periods.
Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
Revenue Recognition
The Company recognizes revenue when earned in accordance with SEC Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements.”
F5
8
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2008 (unaudited)
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Comprehensive Income
Statement of Financial Accounting Standards No. 130 (“SFAS 130”), “Reporting Comprehensive Income,” establishes standards for reporting and displaying comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners and distributions to owners. Among other disclosures, SFAS 130 requires that all items that are required to be recognized under current accounting standards as components of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. The Company did not have any items of comprehensive income during the period from inception (November 19, 2007) to June 30, 2008.
Net Loss per Share
The Company has adopted Statement of Financial Accounting Standard No. 128, “Earnings per Share,” specifying the computation, presentation and disclosure requirements of earnings per share information. Basic earnings per share have been calculated based upon the weighted average number of common shares outstanding.
Advertising
The Company follows a policy of charging the costs of advertising to expenses incurred. The Company incurred advertising expenses of $0 during the period from inception (November 19, 2007) to June 30, 2008.
Income Taxes
The Company utilizes the asset and liability method to measure and record deferred income tax assets and liabilities. Deferred tax assets and liabilities reflect the future income tax effects of temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and are measured using enacted tax rates that apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.
F6
9
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2008 (unaudited)
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
Recent Accounting Pronouncements
In September 2006, the FASB issued SFAS No. 157,Fair Value Measurements (“SFAS 157”). SFAS 157 addresses the measurement of fair value by companies when they are required to use a fair value measure for recognition or disclosure purposes under GAAP. SFAS 157 provides a common definition of fair value to be used throughout GAAP, which is intended to make the measurement of fair value more consistent and comparable and improve disclosures about those measures. SFAS 157 clarifies the principal that fair value should be based on the assumptions market participants would use when pricing an asset or liability and establishes a fair value hierarchy that prioritizes the information used to develop those assumptions. The provisions of FAS 157 are effective for fair value measurements made in fiscal years beginning after November 15, 2007. In November 2007, th e FASB announced an option to defer implementation of some of the requirements of this standard for certain non-financial assets and liabilities.
Beginning January 1, 2008, the Company partially applied FAS 157 as allowed by FASB Staff Position (“FSP”) 157-2, which delayed the effective date of FAS 157 for nonfinancial assets and liabilities. As of January 1, 2008 the Company has applied the provisions of FAS 157 to its financial instruments and the impact was not material. Under FSP 157-2, the Company will be required to apply FAS 157 to its nonfinancial assets and liabilities beginning January 1, 2009. Management is currently reviewing the applicability of FAS 157 to the Company’s nonfinancial assets and liabilities and the potential impact that application will have on its consolidated statements.
In September 2006, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 108 (Topic 1N),Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements (“SAB 108”), which addresses how the effect of prior year uncorrected misstatements should be considered when quantifying misstatements in current year financial statements. The provisions of SAB 108 become effective as of the end of the 2007 fiscal year. SAB 108 requires SEC registrants (i) to quantify misstatements using a combined approach which considers both the balance sheet and income statement approaches; (ii) to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative and qualitative factors; and (iii) to adjust their financial statements if the new combined approach results in a conclusion that a n error is material. SAB No. 108 addresses the mechanics of correcting misstatements that include effects from prior years. It indicates that the current year correction of a material error that includes prior year effects may result in the need to correct prior year financial statements even if the misstatement in the prior year or years is considered immaterial. Any prior year financial statements found to be materially misstated in years subsequent to the issuance of SAB 108 would be restated in accordance with FAS No. 154,Accounting Changes and Error Corrections. SAB 108 is effective for fiscal years ending after November 15, 2006. The adoption of SAB 108 did not have a material effect on the Company's reported financial position or results of operations.
F7
10
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2008 (unaudited)
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(continued)
Recent Accounting Pronouncements (continued)
In February 2007, the FASB issued Statement No. 159,The Fair Value Option for Financial Assets and Financial Liabilities - Including an Amendment of FASB Statement No. 115 (“FAS 159”). This statement permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of FAS 159 apply only to entities that elect the fair value option. However, the amendment to FAS 115,Accounting for Certain Investments in Debt and Equity Securities, applies to all entities with available-for-sale and trading securities. FAS 159 is effective as of the beginning of an entity's first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of FAS 157,Fair Value Measure ments. As of January 1, 2008 the Company has applied the provisions of FAS 159 to its financial instruments and the impact was not material.
In December 2007, the FASB issued SFAS No. 141(R),Business Combinations(“SFAS No. 141R”), replacing SFAS No. 141,Business Combinations (“SFAS No. 141”). This Statement retains the fundamental requirements in Statement 141 that the acquisition method of accounting (which Statement 141 called thepurchase method) be used for all business combinations and for an acquirer to be identified for each business combination. This Statement also establishes principles and requirements for how the acquirer: a) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase and c) determines what information to disclose to enable users of the fina ncial statements to evaluate the nature and financial effects of the business combination. This Statement clarifies that acquirers will be required to expense costs related to any acquisitions. SFAS No. 141(R) will apply prospectively to business combinations for which the acquisition date is on or after fiscal years beginning December 15, 2008. Early adoption is prohibited. The Company has not yet evaluated the impact, if any, that SFAS No. 141(R) will have on its financial statements. Determination of the ultimate effect of this pronouncement will depend on the Company’s structure at the date of adoption.
F8
11
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2008 (unaudited)
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(continued)
Recent Accounting Pronouncements (continued)
In December 2007, the FASB issued SFAS No. 160,Noncontrolling Interests in Consolidated Financial Statements — An Amendment of ARB No. 51 (“SFAS No. 160”). SFAS No.160 establishes new accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. Specifically, this statement requires the recognition of a noncontrolling interest (minority interest) as equity in the consolidated financial statements and separate from the parent’s equity. The amount of net income attributable to the noncontrolling interest will be included in consolidated net income on the face of the income statement. SFAS No.160 clarifies that changes in a parent’s ownership interest in subsidiary that do not result in deconsolidation are equity transactions if the parent retains its controlling financial i nterest. In addition, this statement requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated. Such gain or loss will be measured using the fair value of the noncontrolling equity investment on the deconsolidation date. SFAS No.160 also includes expanded disclosure requirements regarding the interests of the parent and its noncontrolling interest. SFAS No.160 is effective for fiscal years beginning on or after December 15, 2008, with retrospective presentation and disclosure for all periods presented. Early adoption is prohibited. The Company currently has no entities or arrangements that will be affected by the adoption of SFAS No. 160. However, determination of the ultimate effect of this pronouncement will depend on the Company’s structure at the date of adoption.
In May 2008, the FASB issued SFAS No. 162,The Hierarchy of Generally Accepted Accounting Principles(SFAS 162). SFAS 162 identifies the sources of accounting principles and the framework for selecting the principles used in the preparation of financial statements of nongovernmental entities that are presented in conformity with GAAP. SFAS 162 will be effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board (PCAOB) amendments to AU Section 411,The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles. The Company does not expect that the adoption of SFAS 162 will have a material effect on its results of operations or financial condition.
F-9
12
PETMAN ACQUISITION, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2008 (unaudited)
3.
GOING CONCERN
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying financial statements, during the period from inception (November 19, 2007) to June 30, 2008, the Company incurred a loss of $4,491. In addition, the Company has an accumulated deficit of the same amount. It is the intention of the Company’s stockholders to fund capital shortfalls for the foreseeable future.
As discussed in note 1, it is management’s intention to secure a business combination with the goal of listing the combined entity in the United States secondary market. Management is devoting substantially all of its efforts to becoming a public entity so that capital financing may be achieved. The accompanying statements do not include any adjustments that might result should the Company be unable to continue as a going concern. There can be no assurance the Company will be successful in its effort to secure additional equity financing.
4.
RELATED PARTY TRANSACTION
The Company issued 6,000,000 common shares to stockholders as reimbursement of incorporation expenses.
Since inception the sole director has advanced the Company $3,191 to pay for operating expenses. These funds have been advanced interest free, are unsecured, and are due on demand.
F10
13
Item 2. Management’s Discussion and Analysis or Plan of Operation.
Plan of Operation. Petman Acquisition, Inc. (“we”, “our”, “us” or the “Company”) has not realized any revenues from operations since November 19, 2007 (inception), and our plan of operation for the next twelve months shall be to continue its efforts to locate suitable acquisition candidates. The Company can provide no assurance that it can continue to satisfy its cash requirements for at least the next twelve months.
Results of Operations. The Company has not conducted any active operations since inception, except for its efforts to locate suitable acquisition candidates. No revenue has been generated by the Company from November 19, 2007 (inception) to June 30, 2008. It is unlikely the Company will have any revenues unless it is able to effect an acquisition, or merger with an operating company, of which there can be no assurance. The Company incurred expenses of $1,000 relating to professional fees for the 3 month period ended June 30, 2008.
Item 3 Quantitative and Qualitative Disclosures About Market Risk.
A smaller reporting company is not required to provide the information required by this Item. However, we do not consider the effects of interest rate movements to be a material risk to our financial condition. We do not hold any derivative instruments and do not engage in any hedging activities
Item 4. Controls and Procedures.
Evaluation of disclosure controls and procedures.
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules, regulations and related forms, and that such information is accumulated and communicated to our sole officer, as appropriate, to allow timely decisions regarding required disclosure.
As of June 30, 2008, we carried out an evaluation, under the supervision and with the participation of our sole officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our sole officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.
14
Changes in internal controls.
There have been no changes in our internal controls or in other factors during our most recent fiscal quarter that could significantly affect these controls and procedures during the quarterly period ended June 30, 2008.
PART II — OTHER INFORMATION
Item 1. Legal Proceedings.
To the best knowledge of the officers and directors, the Company is not a party to any legal proceeding or 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 a Vote of Security Holders. None.
Item 5. Other Information. None.
Item 6. Exhibits.
(a) Exhibits required by Item 601 of Regulation S-B.
Exhibit |
| Description |
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*3.1 |
| Certificate of Incorporation. |
*3.2 |
| By-laws. |
31.1 |
| Certification of the Company’s Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly Report on Form 10-QSB for the quarter ended June 30, 2008. |
31.2 |
| Certification of the Company’s Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly Report on Form 10-QSB for the quarter ended June 30, 2008. |
32.1 |
| Certification of the Company’s Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002. |
15
* | Filed as an exhibit to the Company's registration statement on Form 10-SB, as filed with the Securities and Exchange Commission on December 11, 2007, and incorporated herein by this reference. |
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.
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Date: August 19, 2008 | PETMAN ACQUISITION, INC. | |
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| By: | /s/ Shawn Pecore |
| Name: | Shawn Pecore |
| Title: | President |
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16
