Document and Entity Information
Document and Entity Information | 9 Months Ended |
May 31, 2016shares | |
Document and Entity Information: | |
Entity Registrant Name | CHERUBIM INTERESTS, INC. |
Entity Trading Symbol | chit |
Document Type | 10-Q |
Document Period End Date | May 31, 2016 |
Amendment Flag | false |
Entity Central Index Key | 1,421,865 |
Current Fiscal Year End Date | --08-31 |
Entity Common Stock, Shares Outstanding | 3,862,296,184 |
Entity Filer Category | Smaller Reporting Company |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Well-known Seasoned Issuer | No |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheet (Unaudited) - USD ($) | May 31, 2016 | Aug. 31, 2015 |
Current assets | ||
Cash | $ 90,107 | $ 16,293 |
Due from Related Party | 42,844 | 0 |
Prepaid costs | 5,507 | 0 |
Total current assets | 138,458 | 16,293 |
Property and equipment | 12,411 | 3,572 |
Total assets | 150,869 | 19,865 |
Current liabilities | ||
Accounts payable | 35,336 | 0 |
Deferred Revenue | 121,721 | 0 |
Notes payable | 758,340 | 1,179,993 |
Unclaimed debt | 580,006 | 557,876 |
Accrued interest | 571,796 | 532,454 |
Derivative liability | 86,168 | 432,293 |
Accrued expenses and other liabilities | 62,123 | 214,230 |
Total current liabilities | 2,215,490 | 2,916,846 |
Total liabilities | 2,215,490 | 2,916,846 |
Stockholders' Deficit | ||
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 3,862,329,167 and 125,025,261 issued and outstanding at May 31, 2016 and August 31, 2015, respectively | 38,618 | 125,025 |
Series B preferred stock to be issued | (1) | 0 |
Shares held in escrow | (10,000) | (10,000) |
Additional paid in capital | 4,169,507 | 1,203,715 |
Accumulated deficit | (6,262,745) | (4,215,721) |
Total stockholders' deficit | (2,064,621) | (2,896,981) |
Total liabilities and stockholders' deficit | $ 150,869 | $ 19,865 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets Parentheticals - $ / shares | May 31, 2016 | Aug. 31, 2015 |
Parentheticals | ||
Common Stock, par value | $ 0.00001 | $ 0.00001 |
Common Stock, shares authorized | 5,000,000,000 | 5,000,000,000 |
Common Stock, shares issued | 3,862,329,167 | 125,025,261 |
Common Stock, shares outstanding | 3,862,329,167 | 125,025,261 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | |
REVENUE: | ||||
Revenues | $ 27,937 | $ 0 | $ 27,937 | $ 0 |
Cost of Goods Sold | 19,975 | 0 | 19,975 | 0 |
Gross Profit | 7,962 | 0 | 7,962 | 0 |
Operating expenses | ||||
Compensation expense | 114,375 | 0 | 2,404,206 | 0 |
Professional fees | (3,381) | (289,480) | (21,081) | (32,756) |
Travel and promotion | 3,041 | 2 | 7,266 | 21,776 |
Depreciation | 1,220 | 0 | 3,661 | 0 |
General and administrative | 12,870 | 282 | 48,456 | 14,845 |
Total operating expenses | 134,887 | (289,196) | 2,484,670 | 69,377 |
(Income) loss from operations | 126,925 | (289,196) | 2,476,708 | 69,377 |
Other income (expense) | ||||
Interest expense | (32,783) | (40,752) | (105,587) | (106,544) |
Debt discount | 0 | 0 | 0 | (65,500) |
Derivative recovery | (50,610) | (9,717) | (346,126) | (110,834) |
Loss on extinguishment of debt | 0 | 0 | (35,925) | 22,085 |
Forgiveness of debt income | 225,070 | 0 | 225,070 | 0 |
Total other income (expense) | 141,677 | (50,469) | 429,684 | (39,125) |
Income (loss) before provision for income taxes | 14,752 | 238,727 | (2,047,024) | (108,502) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net income (loss) | $ 14,752 | $ 238,727 | $ (2,047,024) | $ (108,502) |
Basic and diluted income (loss) per common share | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted average shares outstanding | 3,555,139,779 | 77,626,880 | 3,862,329,167 | 71,588,171 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) | 9 Months Ended | |
May 31, 2016 | May 31, 2015 | |
Cash flows from operating activities | ||
Net loss | $ (2,047,024) | $ (108,502) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Change in derivative liability | (346,125) | (110,834) |
Debt discount | 0 | 65,500 |
Common stock issued for services | 2,160,000 | 157,500 |
Extinguishment of debt | (35,925) | (20,506) |
Bad debt expense | 0 | 0 |
Depreciation | 3,661 | 0 |
Debt converted to equity | 173,556 | 0 |
Forgiveness of debt | (225,070) | 0 |
Changes in operating assets and liabilities: | ||
Prepaid costs | (5,507) | 0 |
Accounts payable | 35,336 | (25,631) |
Deferred revenue | 121,721 | 0 |
Interest payable | 39,342 | 104,965 |
Accrued expenses and other liabilities | 162,342 | (164,481) |
Cash provided by (used in) operating activities | 36,307 | (101,989) |
Cash flows from investing activities | ||
Investment in oil and natural gas property | 0 | 25,000 |
Purchase of fixed assets | (12,500) | 0 |
Cash flows used in investing activities | (12,500) | 25,000 |
Cash flows from financing activities | ||
Proceeds from related party loan | 92,851 | 0 |
Due to(from) related parties | (42,844) | 0 |
Proceeds from notes payable | 0 | 65,500 |
Cash provided by financing activities | 50,007 | 65,500 |
Net change in cash | 73,814 | (11,489) |
Cash at beginning of period | 16,293 | 11,489 |
Cash at end of period | 90,107 | 0 |
Supplemental cash flow Information: | ||
Cash paid for interest | 0 | 0 |
Cash paid for income taxes | 0 | 0 |
Notes payable converted to common stock | $ 0 | $ 80,000 |
CONDENSED FINANCIAL STATEMENTS
CONDENSED FINANCIAL STATEMENTS | 9 Months Ended |
May 31, 2016 | |
CONDENSED FINANCIAL STATEMENTS | |
CONDENSED FINANCIAL STATEMENTS | NOTE 1 CONSOLIDATED FINANCIAL STATEMENTS The accompanying financial statements have been prepared by Cherubim Interests Inc. (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 May 31, 2016 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 Companys August 31, 2015 and 2014 audited financial statements. The results of operations for the period ended May 31, 2016 are not necessarily indicative of the operating results for the full year. |
NATURE OF BUSINESS
NATURE OF BUSINESS | 9 Months Ended |
May 31, 2016 | |
NATURE OF BUSINESS | |
NATURE OF BUSINESS | NOTE 2 NATURE OF BUSINESS Cherubim Interests Inc. ("Company") was organized September 27, 2006 under the laws of the State of Nevada for the purpose of selling new food products produced or developed by North American companies to foreign markets. On August 31, 2009, the Company discontinued its involvement in the sales of tea due to a strategic change in business focus by the acquisition of mineral rights as disclosed in the Company's 8-K filed with the Securities and Exchange Commission on September 2, 2009. The Company currently has limited operations or realized revenues from its planned principle business purpose and, in accordance with ASC 915, "Development Stage Entities", formerly known as SFAS 7, "Accounting and Reporting by Development State Enterprises." is considered a Development Stage Enterprise. The Company was incorporated in the State of Nevada, United States of America on September 27, 2006 and its fiscal year end is August 31. The Company was engaged in sales of new food products produced or developed by North American companies to foreign markets and discontinued that business in August 2009. The Company previously operated in the oil and gas industry, focused on the exploration for and development of oil and gas properties. Cherubim Interests now targets alternative, commercial, single and multifamily dwelling opportunities for the purpose of investment purchase. It also provides renovation services to third party multifamily dwelling unit owners on a turn-key basis. Cherubim Interests specializes in covering the entire spectrum of development including due diligence, acquisition, planning, construction, renovation, and property management. This comprehensive expertise allows the company to provide complete beginning-to-end development programs for all acquisitions. Cherubim Interests LLC, is a 100% wholly-owned subsidiary of Cherubim Interests Inc. and acts as a construction subcontractor for the company. Victura Roofing LLC, is a 100% wholly-owned subsidiary of Cherubim Interests Inc. and acts as a residential and commercial roofing subcontractor for the company. |
GOING CONCERN
GOING CONCERN | 9 Months Ended |
May 31, 2016 | |
GOING CONCERN | |
GOING CONCERN | NOTE 3 GOING CONCERN The Companys financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. The Company has accumulated deficit since inception of $6,262,745 and a negative working capital of $2,047,024 as of May 31, 2016. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has minimal cash and no material assets, nor does it have operations or a source of revenue sufficient to cover its operation costs and allow it to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of our common stock and/or preferred stock in order to implement its business plan. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern. The officers and directors have committed to advancing certain operating costs of the Company. |
CONVERTIBLE NOTES PAYABLE
CONVERTIBLE NOTES PAYABLE | 9 Months Ended |
May 31, 2016 | |
CONVERTIBLE NOTES PAYABLE | |
CONVERTIBLE NOTES PAYABLE | NOTE 4 - CONVERTIBLE NOTES PAYABLE As of May 31, 2016, the convertible notes payable consisted of: Date of Interest Conversion Maturity Principal Net Note Noteholder Rate Rate Date Amount Note Various J. Gingerich 10% 50% Various $815,880 $658,067 8/15/14 LG Capital, Inc, 8% 55% 4/15/15 $36,750 $20,082 9/14/14 Bay Street Capital 8% 50% 5/14/15 $25,000 $22,300 7/31/15 Auctus Fund, LLC 10% 50% 1/31/16 $45,750 $45,750 Various Chic & Savvy 10% 50% Various $9,450 $9,450 Various Small Miscellaneous Other 10% 50% Various $2,691 $758,340 |
DERIVATIVE LIABILITIES
DERIVATIVE LIABILITIES | 9 Months Ended |
May 31, 2016 | |
DERIVATIVE LIABILITIES | |
DERIVATIVE LIABILITIES | NOTE 5 DERIVATIVE LIABILITIES In accordance with ASC 815, the Company has bifurcated the conversion feature of their convertible notes and recorded a derivative liability on the date each note became convertible. The derivative liability was then revalued on each reporting date. The Company uses the Black-Scholes option-pricing model to value the derivative liability. There was no derivative liability at May 31, 2016. Once the loans are fully converted, the remaining derivative liability is reclassified to equity as additional paid-in capital. ASC 815 requires Company management to assess the fair market value of certain derivatives at each reporting period and recognize any change in the fair market value as another income or expense item. The Companys only asset or liability measured at fair value on a recurring basis is its derivative liability associated with the above convertible debt. During the nine months ended May 31, 2016, the Company recorded a total change in the value of the derivative liabilities of $(346,125). From inception to May 31, 2016 the Company has not granted any stock options. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
May 31, 2016 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | NOTE 6 - STOCKHOLDERS' EQUITY The total number of common shares authorized that may be issued by the Company is 5,000,000,000 shares with a par value of $0.0001 per share and 50,000,000 preferred shares. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
May 31, 2016 | |
Related Party Disclosures: | |
RELATED PARTY TRANSACTIONS | NOTE 7 - RELATED PARTY TRANSACTIONS The Company has amounts due to related parties utilized to fund operations which carry varying interest rates. As of May 31, 2016 (August 31, 2015), the Company owed $639,108 ($995,698) of principal plus accrued interest of $202,387 ($532,454). The loans are unsecured and due on demand and as such are included in current liabilities. These amounts have been reduced by the conversion of debt into equity. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
May 31, 2016 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 9 SUBSEQUENT EVENTS On July 31, 2015, the Company issued a convertible promissory note to Auctus Fund LLC. in the amount of $45,750. On June 23, 2016, $64,934 of the principal and interest was converted into 865,792 common shares of the Companys common stock. |
GOING CONCERN (Details)
GOING CONCERN (Details) | May 31, 2016USD ($) |
GOING CONCERN DETAILS | |
Accumulated deficit since inception | $ 6,262,745 |
Negative working capital | $ 2,047,024 |
DERIVATIVE LIABILITIES (Details
DERIVATIVE LIABILITIES (Details) | 9 Months Ended |
May 31, 2016USD ($) | |
DERIVATIVE LIABILITIES DETAILS | |
Total change in the value of the derivative liabilities | $ (346,125) |
EQUITY (Details)
EQUITY (Details) | May 31, 2016$ / sharesshares |
EQUITY DETAILS | |
Authorized issuance of common shares | 500,000,000 |
Authorized issuance of common shares, par value | $ / shares | $ 0.0001 |
Authorized the issuance of preferred shares | 50,000,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | May 31, 2016 | Aug. 31, 2015 |
RELATED PARTY TRANSACTIONS DETAILS: | ||
Related party payables | $ 639,108 | $ 995,698 |
Accrued interest | $ 202,387 | $ 532,454 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Jun. 23, 2016 | Jul. 31, 2015 |
SUBSEQUENT EVENTS DETAILS: | ||
Issued a convertible promissory note to Auctus Fund LLC | $ 45,750 | |
Principal and interest converted into common shares value | $ 64,934 | |
Principal and interest converted into common shares | 865,792 |