Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 31, 2017 | Feb. 12, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Almost Never Films Inc. | |
Entity Central Index Key | 1,422,768 | |
Trading Symbol | hlwd | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 4,670,049 | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Dec. 31, 2017 | Jun. 30, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 381,303 | $ 91,590 |
Interest receivable | 5,159 | |
Promissory notes receivable | 350,000 | 400,000 |
Prepaid expenses and deposits | 32,523 | 16,607 |
Loan Receivable | 12,000 | |
Total Current Assets | 775,826 | 513,356 |
Film costs | 414,937 | |
TOTAL ASSETS | 1,190,763 | 513,356 |
Current Liabilities | ||
Accrued liabilities | 60,369 | 41,436 |
Interest payable | 29,608 | 17,068 |
Note payable | 66,613 | 66,613 |
Promissory Note Payable | 450,000 | 200,000 |
Promissory note payable - related party | 200,000 | |
Total Current Liabilities | 606,590 | 525,117 |
Long-term Liabilities | ||
Promissory note payable - related party | 350,000 | |
TOTAL LIABILITIES | 956,590 | 525,117 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Stockholders' Equity Preferred stock: no par value, 5,000,000 authorized; Series A Preferred stock: 2,000,000 authorized; No shares issued and outstanding | ||
Common stock: 25,000,000 authorized; $0.001 par value 4,670,049 and 4,755,524 shares issued and outstanding respectively. | 4,670 | 4,756 |
Additional paid in capital | 908,826 | 928,740 |
Stock subscription | 386,000 | |
Accumulated deficit | (1,065,323) | (945,257) |
Total Stockholders' Equity | 234,173 | (11,761) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,190,763 | $ 513,356 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Dec. 31, 2017 | Jun. 30, 2017 |
Preferred stock, no par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Common stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares issued (in shares) | 4,670,049 | 4,755,524 |
Common stock, shares outstanding (in shares) | 4,670,049 | 4,755,524 |
Series A Voting Preferred stock | ||
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Statement [Abstract] | ||||
Revenues | $ 0 | $ 0 | $ 0 | $ 0 |
Operating Expenses | ||||
General and administration | 25,130 | 5,864 | 47,106 | 9,924 |
Professional | 35,558 | 32,865 | 55,261 | 46,330 |
Total operating expenses | 60,688 | 38,729 | 102,367 | 56,254 |
Loss from operations | (60,688) | (38,729) | (102,367) | (56,254) |
Other (Expense) Income | ||||
Interest income | 4,841 | |||
Interest expense | (14,702) | (1,679) | (22,540) | (3,358) |
Total other income (expense) | (14,702) | (1,679) | (17,699) | (3,358) |
Net loss before taxes | (75,390) | (40,408) | (120,066) | (59,612) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net loss | $ (75,390) | $ (40,408) | $ (120,066) | $ (59,612) |
Net Loss Per Common Share - Basic and Diluted (in dollars per share) | $ (0.02) | $ (0.01) | $ (0.03) | $ (0.01) |
Weighted Average Common Shares Outstanding - Basic and Diluted (in shares) | 4,670,049 | 4,580,053 | 4,672,359 | 4,510,997 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (120,066) | $ (59,612) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Interest receivable | 5,159 | |
Prepaid expense | (15,916) | (19,971) |
Film costs | (414,937) | |
Accrued liabilities | 18,933 | 18,711 |
Interest payable | 12,540 | |
Net Cash Used in Operating Activities | (514,287) | (60,872) |
Cash Flows from Investing Activities: | ||
Issuance of Promissory note receivable | (350,000) | |
Collection of Promissory note receivable | 400,000 | |
Loan receivable | (12,000) | |
Net Cash Provided by Investing Activities | 38,000 | |
Cash Flows from Financing Activities: | ||
Proceeds from common stock subscribed | 386,000 | |
Retirement of Common Stock | (20,000) | |
Promissory note payable | 800,000 | |
Payment of Promissory note payable | (200,000) | |
Payment of Promissory note payable - related party | (200,000) | |
Proceeds from issuance of stock | 115,000 | |
Net Cash Provided By Financing Activities | 766,000 | 115,000 |
Net Increase in Cash and Cash Equivalents | 289,713 | 54,128 |
Cash and Cash Equivalents, beginning of period | 91,590 | 84,967 |
Cash and Cash Equivalents, end of period | 381,303 | 139,095 |
Supplemental Disclosure Information: | ||
Cash paid for interest | 10,000 | |
Cash paid for income taxes | $ 0 | $ 0 |
ORGANIZATION, OPERATIONS AND BA
ORGANIZATION, OPERATIONS AND BASIS OF ACCOUNTING | 6 Months Ended |
Dec. 31, 2017 | |
Organization, Operations and Basis of Accounting [Abstract] | |
ORGANIZATION, OPERATIONS AND BASIS OF ACCOUNTING | NOTE 1 - ORGANIZATION, OPERATIONS AND BASIS OF ACCOUNTING Nature of the Business Almost Never Films Inc. (the “Company”) was originally incorporated in Nevada in October 2007 as Smack Sportswear (“Smack”), which originally manufactured and sold performance and lifestyle based indoor and sand volleyball apparel and accessories. The Company is now an independent film company focused on film production, finance and production related services for movies under budgets of $35 million. Share Exchange and Recapitalization On January 15, 2016, Smack entered into a share exchange agreement with Almost Never Films Inc., a private company incorporated in Indiana on July 8, 2015, and its two shareholders, Danny Chan and Derek Williams. Pursuant to the agreement, Smack issued 1,000,000 shares of our Series A Convertible Preferred Stock to Mr. Chan and Mr. Williams in exchange for all 2,500,000 shares of issued and outstanding common stock of Almost Never Films Inc. (Indiana). As a result of the share exchange, Almost Never Films Inc. (Indiana) became Smack’s wholly-owned subsidiary, and Mr. Chan and Mr. Williams acquired a controlling interest in the Company. The share exchange was accounted for as a "reverse acquisition," and resulted in a recapitalization. Almost Never Films Inc. (Indiana) is deemed to be the acquirer for accounting purposes. The assets acquired and liabilities assumed were $6,566 and $598,869, respectively. Consequently, the assets and liabilities and the historical operations that will be reflected in the financial statements prior to the share exchange will be those of Almost Never Films Inc. (Indiana) and will be recorded at the historical cost basis of Almost Never Films Inc. (Indiana), and the combined financial statements after completion of the share exchange include the assets and liabilities of Almost Never Films Inc. (Indiana), historical operations of Almost Never Films Inc. (Indiana), and operations of Almost Never Films Inc. (Indiana) from the closing date of the share exchange. As a result of the issuance of the shares of our Series A Convertible Preferred Stock pursuant to the share exchange, a change in control of the Company occurred as of the date of consummation of the share exchange. All share and per share information in the accompanying consolidated financial statements and footnotes has been retroactively restated to reflect the recapitalization. The Company has not yet generated any revenue since inception. On February 29, 2016, the stockholders of Smack voted to amend the Articles of Incorporation of the Company to (i) increase the authorized capital of the Company to 5,000,000 shares of common stock and (ii) to change the name of the Company to “Almost Never Films Inc.” which took effect on March 2, 2016. On August 9, 2017, the Company has approved a 1 for 40 reverse split of its issued and outstanding common stock. The common stock accounts and all share related balances have been be applied retroactively for all periods presented. The new symbol of the Company is HLWD in OTCQB. Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying consolidated financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern. During the six months ended December 31, 2017, the Company had a net loss from operations of $102,367 and net cash outflows from operating activities of $514,287. As of December 31, 2017, the Company is delinquent in payments of $66,613 of a note payable and has an accumulated deficit of $1,065,323. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, an additional cash infusion and an identification of new business opportunities. Management has reviewed the entity’s financial condition, and has improved the Company’s working capital during the past fiscal year. Management believes the Company will be able to fund operations for the next year through cash on hand, and further potential equity and debt offerings. There are no other significant conditions or events that management has identified that will adversely affect the Company’s ability to meet its obligations over the next year of operations. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements. Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Team Sports Superstore (Inactive) and Almost Never Films Inc. (Indiana), One HLWD KY LLC (Kentucky), Two HLWD KY LLC (Kentucky), Three HLWD KY (Kentucky), LLC, and FWIL, LLC (Indiana). All significant intercompany transactions and balances have been eliminated in consolidation. Basis of Presentation The unaudited condensed consolidated financial statements presented herein have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Regulation S-X. Accordingly, the financial statements do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, including normal recurring adjustments, considered necessary for a fair statement of the financial statements have been included. Operating results for the six months ended December 31, 2017 are not necessarily indicative of the results that may be expected for the year ending June 30, 2018. These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended June 30, 2017, which were included in the Company’s 2017 Annual Report on Form 10-K. The accompanying condensed consolidated balance sheet as of June 30, 2017, has been derived from the Company’s audited consolidated financial statements as of that date. Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the U.S requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial statement date, and reported amounts of revenue and expenses during the reporting period. Significant estimates are used in valuing the fair value of common stock issued for services, film costs, among others. Actual results could differ from these estimates. Cash Cash includes demand deposits with banks or other financial institutions. All cash balances are hold by major banking institutions. The Company maintains its cash with a financial institution, and at times, amounts may exceed federally insured limits. Currently the FDIC insurance coverage limit is $250,000, and the Company is potentially exposed to no un-insured cash balances. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash. Film Costs The Company records film costs in accordance with ASC – 926 - Entertainment – Films Fair Value of Financial Instruments Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk. In addition to defining fair value, the standard expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which are determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 – inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. Level 2 – inputs are based upon significant observable inputs other than quoted prices included in Level 1, such as quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques. As of December 31, 2017, the balance reported for cash approximates its fair value because of its short maturities. Notes payable are recorded at agreed values. Debt balances are stated at historical amounts less principal payments, which approximate fair market value. Promissory notes receivable and payable are stated at historical amounts less principal payments. The Company believes interest rates in its debt agreements are commensurate with lender risk profiles for similar companies. Revenue Recognition The Company recognizes revenue from the sale of services in accordance with ASC 926 - 605 – Entertainment - Films. Stock Repurchase and Cancellation During the six months ended December 31, 2017, the Company repurchased and cancelled 85,475 shares of common stock. The Company accounted for the transaction in accordance with ASC 505 – Equity – 30 Treasury Stock, Purchase of Treasury Shares or Stock Rights. Stock Subscription Receivable The Company has accounted for Stock Subscription Receivable in accordance with ASC – 505 – Equity – 10 Loss per Share Calculations Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares available. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company’s diluted loss per share is the same as the basic loss per share for the six months ended December 31, 2017, and 2016, as there are no potential shares outstanding that would have a dilutive effect. Recently Issued Accounting Pronouncements Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements. |
PROMISSORY NOTES RECEIVABLE
PROMISSORY NOTES RECEIVABLE | 6 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
PROMISSORY NOTES RECEIVABLE | NOTE 3 – PROMISSORY NOTES RECEIVABLE On June 7, 2017, the Company received a 2.5% promissory note in exchange for lending $200,000 to a third party. The principal of $200,000 is due to the Company forty-five (45) days from receipt of the funds. On June 12, 2017, the Company received a 2.5% promissory note in exchange for lending $200,000 to a third party. The principal of $200,000 is due to the Company forty-five (45) days from receipt of the funds. The proceeds from the two Promissory Notes Receivable were utilized in order to provide a Bridge Loan to a third party in connection with the productions of the certain motion pictures. During the six months and three months ended December 31, 2017, a total amount of $4,841 was recorded as interest income. The Company received full payments for the two Promissory Notes Receivable and $10,000 of interest income related to the two Promissory Notes Receivable during the six months ended December 31, 2017. On December 14, 2017, the Company entered into a promissory note agreement for $450,000, for the borrower to utilize the funds for production costs of a motion picture with a non-related party. As of December 31, 2017, the Company had provided the borrower with $350,000. Per the terms of the promissory note, the security for the promissory note is the tax credits and tax credit proceeds of the motion picture. The promissory note is non-interest bearing, and no terms of repayment. The Company expects to collect the full balance by August 2018. |
FILM COSTS
FILM COSTS | 6 Months Ended |
Dec. 31, 2017 | |
Film Costs [Abstract] | |
FILM COSTS | NOTE 4 – FILM COSTS Film costs are comprised of the following: December 31, 2017 June 30, 2016 Motion picture and television productions 414,937 - Film Costs 414,937 - Film costs include salaries and wages, and all other direct costs associated with the motion pictures and television productions. |
PROMISSORY NOTES PAYABLE
PROMISSORY NOTES PAYABLE | 6 Months Ended |
Dec. 31, 2017 | |
Promissory Notes Payable [Abstract] | |
PROMISSORY NOTES PAYABLE | NOTE 5 – PROMISSORY NOTES PAYABLE On June 6, 2017, the Company issued a 2.5% promissory note in exchange for receiving $200,000 to an unrelated third party. The principal of $200,000 is due to the lender ninety (90) days from receipt of the funds. The promissory note payable, was fully paid along with interest payable as of December 31, 2017. During the three and six months ended December 31, 2017, a total amount of $0 and $2,396 was recorded as interest expense, respectively. On October 11, 2017, the Company issued a $150,000 Promissory Note in exchange for receiving $150,000 proceeds. The principal of $150,000 is due fourteen (14) months from the receipt of the funds, and a total interest charge of ten percent, or $15,000 is to be recorded over the term of the loan. An interest payable of $2,859 has been recorded as of December 31, 2017. During the three and six months ended December 31, 2017, interest expense of $2,859 was recorded. The proceeds will be used by the Company to fund the motion picture known as One HLWD KY LLC. On December 17, 2017, the Company issued a $300,000 Promissory Note in exchange for receiving $300,000 proceeds. The principal of $300,000 is due twelve (12) months from the receipt of the funds, and bears interest at 10% per annum. An interest payable of $1,342 has been recorded as of December 31, 2017. During the three and six months ended December 31, 2017, interest expense of $1,342 was recorded. The proceeds will be used by the Company to fund the motion picture known as River Runs Red. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 6 – RELATED PARTY TRANSACTIONS On June 9, 2017, the Company issued a 2.5% promissory note in exchange for receiving $200,000 to William R. Kruse, one of the Company’s principle owners. The principal of $200,000 was due to the lender ninety (90) days from receipt of the funds. The note was fully paid along with interest of $5,000, during the six months ended December 31, 2017. During the six months and three months ended December 31, 2017, interest expense of $2,708 and $0, respectively, was recorded. On September 19, 2017 the company issued a 10% Promissory Note in exchange for receiving $350,000 to Kruse Farms, LP., a Company owned by one of the Company’s principle owners. The principal of $350,000 is due to the lender in twenty four (24) months from receipt of the funds. An interest payable of $9,877 has been recorded as of December 31, 2017. During the six months and three months ended December 31, 2017, interest expense of $9,877, and $8,822, respectively, was recorded. The proceeds will be used by the Company to fund production of a motion picture. |
NOTE PAYABLE
NOTE PAYABLE | 6 Months Ended |
Dec. 31, 2017 | |
Short-term Debt [Abstract] | |
NOTE PAYABLE | NOTE 7 – NOTE PAYABLE In August 2015, Smack entered into an unsecured promissory note agreement with an individual. The agreement allowed for Smack to borrow up to $66,613 at an interest rate of 10 percent per year. This $66,613 note was assumed by the Company during the recapitalization. The outstanding principal balance under the agreement at December 31, 2017 was $66,613. The outstanding principal amount and all accrued and unpaid interest was due by August 2016 and is currently delinquent. As of December 31, 2017 and June 30, 2017 amounts of $15,530 and $12,172 have recorded as interest payable. For the three and six months ended December 31, 2017, interest expense of $1,679 and $3,358 was recorded, respectively. For the three and six months ended December 31, 2016, interest expense of $1,679 and $3,358 was recorded, respectively. |
SHARE CAPITAL
SHARE CAPITAL | 6 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
SHARE CAPITAL | NOTE 8 – SHARE CAPITAL Common Stock On August 9, 2017, the Company has approved a 1 for 40 reverse split of its issued and outstanding common stock. The common stock accounts and all share related balances have been applied retroactively for all periods presented. On September 11, 2017, the Company amended the Articles of Incorporation to increase the authorized capital to 25,000,000 shares of common stock. During the six months ended December 31, 2017, the company entered into three share purchase agreements with three investors for 386,000 shares at $1 per share. The company has received a $386,000 and has recorded as stock subscription of $386,000. On July 5, 2017, the Company repurchased and cancelled 85,475 shares of common stock of the company for $20,000. There were 4,670,049 shares of common stock issued and outstanding as of December 31, 2017. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 9 – INCOME TAXES The Company provides for income taxes under ASC 740, "Income Taxes." Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. The provision for income taxes differs from the amounts which would be provided by applying the statutory federal income tax rate of 34% to the net loss before provision for income taxes for the following reasons: Three months Six months Three months Six months ended ended ended ended December 31, December 31, December 31, December 31, 2017 2017 2016 2016 Federal income tax benefit attributable to: Net operating loss $ 25,633 $ 40,823 $ 13,739 $ 20,268 Less: valuation allowance (25,633 ) (40,823 ) (13,739 ) (20,268 ) Net provisions for Federal income taxes $ - $ - $ - $ - Net deferred tax assets consist of the following components as of: As of December 31, June 30, 2017 2017 Deferred tax asset attributable to: Net operating loss carryover $ 85,624 $ 44,801 Less: valuation allowance (85,624 ) (44,801 ) Net deferred tax asset $ - $ - The following table reconciles the US statutory rates to the Company’s effective tax rate for the six months ended December 31, 2017 and 2016: Three months ended December 31, 2017 Six months ended December 31, 2017 Three months ended December 31, 2016 Six months ended December 31, 2016 Effective tax rate attributable to: US statutory rate 34 % 34 % 34 % 34 % Less: change in unrecognized tax benefit from uncertain tax provision -34 % -34 % -34 % -34 % Tax per Financial Statements - - - - In accordance with Income Tax laws of United States of America, net operating loss carry forwards of $251,835 which expire commencing in fiscal 2036, for federal income tax reporting purposes are subject to annual limitations. When a change in ownership occurs, net operating loss carry forwards may be limited as to use in future years. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 10 – COMMITMENTS AND CONTINGENCIES The Company neither owns nor leases any real or personal property. The Company's officers have provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future. On December 12, 2016, the Company entered into an agreement with Saisam Entertainment, LLC to develop, finance, and produce a motion picture project. Per the terms of the agreement, the Company will provide or source equity financing for the project in the amount of approximately $1,300,000. Per the terms of the agreement, the Company and Saisam Entertainment, LLC will create an LLC or other entity for the project currently entitled “Love is not Easy”. Saisam Entertainment, LLC owns and controls the rights to the screenplay, and will assign all rights in and to the project, pursuant to the terms of an option purchase agreement between the two parties, which includes an initial option fee of $10,000 for an option period of 18 months, a lien for all of the Company’s out of pocket costs, and will assist in additional funding. The Company will make or source financial contributions in accordance with the terms of the agreement, assist in the raising of additional financing, and will participate in the development and production. The Company and Saisam Entertainment, LLC will own an undivided 50% interest in the LLC or entity that is formed. The Company will be the managing member of the LLC or entity. The approved budget for the project is approximately $2,000,000. In consideration, the Company will receive a return of 20% of its investment, and will subsequently receive its portion of the net profits per the terms of the agreement. The LLC or entity has not been formed to date. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 11 – SUBSEQUENT EVENTS Management has evaluated subsequent events through the date these financial statements were issued. Based on our evaluation no events have occurred that require disclosure. |
SUMMARY OF SIGNIFICANT ACCOUN17
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Team Sports Superstore (Inactive) and Almost Never Films Inc. (Indiana), One HLWD KY LLC (Kentucky), Two HLWD KY LLC (Kentucky), Three HLWD KY (Kentucky), LLC, and FWIL, LLC (Indiana). All significant intercompany transactions and balances have been eliminated in consolidation. |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements presented herein have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Regulation S-X. Accordingly, the financial statements do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, including normal recurring adjustments, considered necessary for a fair statement of the financial statements have been included. Operating results for the six months ended December 31, 2017 are not necessarily indicative of the results that may be expected for the year ending June 30, 2018. These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended June 30, 2017, which were included in the Company’s 2017 Annual Report on Form 10-K. The accompanying condensed consolidated balance sheet as of June 30, 2017, has been derived from the Company’s audited consolidated financial statements as of that date. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the U.S requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial statement date, and reported amounts of revenue and expenses during the reporting period. Significant estimates are used in valuing the fair value of common stock issued for services, film costs, among others. Actual results could differ from these estimates. |
Cash | Cash Cash includes demand deposits with banks or other financial institutions. All cash balances are hold by major banking institutions. The Company maintains its cash with a financial institution, and at times, amounts may exceed federally insured limits. Currently the FDIC insurance coverage limit is $250,000, and the Company is potentially exposed to no un-insured cash balances. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash. |
Film Costs | Film Costs The Company records film costs in accordance with ASC – 926 - Entertainment – Films |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk. In addition to defining fair value, the standard expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which are determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 – inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. Level 2 – inputs are based upon significant observable inputs other than quoted prices included in Level 1, such as quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques. As of December 31, 2017, the balance reported for cash approximates its fair value because of its short maturities. Notes payable are recorded at agreed values. Debt balances are stated at historical amounts less principal payments, which approximate fair market value. Promissory notes receivable and payable are stated at historical amounts less principal payments. The Company believes interest rates in its debt agreements are commensurate with lender risk profiles for similar companies. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue from the sale of services in accordance with ASC 926 - 605 – Entertainment - Films. |
Stock Repurchase and Cancellation | Stock Repurchase and Cancellation During the six months ended December 31, 2017, the Company repurchased and cancelled 85,475 shares of common stock. The Company accounted for the transaction in accordance with ASC 505 – Equity – 30 Treasury Stock, Purchase of Treasury Shares or Stock Rights. |
Stock Subscription Receivable | Stock Subscription Receivable The Company has accounted for Stock Subscription Receivable in accordance with ASC – 505 – Equity – 10 |
Loss per Share Calculations | Loss per Share Calculations Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares available. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company’s diluted loss per share is the same as the basic loss per share for the six months ended December 31, 2017, and 2016, as there are no potential shares outstanding that would have a dilutive effect. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements. |
FILM COSTS (Tables)
FILM COSTS (Tables) | 6 Months Ended |
Dec. 31, 2017 | |
Film Costs [Abstract] | |
Schedule of Film costs | December 31, 2017 June 30, 2016 Motion picture and television productions 414,937 - Film Costs 414,937 - |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision for income taxes differs from the amounts | Three months Six months Three months Six months ended ended ended ended December 31, December 31, December 31, December 31, 2017 2017 2016 2016 Federal income tax benefit attributable to: Net operating loss $ 25,633 $ 40,823 $ 13,739 $ 20,268 Less: valuation allowance (25,633 ) (40,823 ) (13,739 ) (20,268 ) Net provisions for Federal income taxes $ - $ - $ - $ - |
Schedule of Net deferred tax assets | As of December 31, June 30, 2017 2017 Deferred tax asset attributable to: Net operating loss carryover $ 85,624 $ 44,801 Less: valuation allowance (85,624 ) (44,801 ) Net deferred tax asset $ - $ - |
Schedule of reconciles the US statutory rates | Three months ended December 31, 2017 Six months ended December 31, 2017 Three months ended December 31, 2016 Six months ended December 31, 2016 Effective tax rate attributable to: US statutory rate 34 % 34 % 34 % 34 % Less: change in unrecognized tax benefit from uncertain tax provision -34 % -34 % -34 % -34 % Tax per Financial Statements - - - - |
ORGANIZATION, OPERATIONS AND 20
ORGANIZATION, OPERATIONS AND BASIS OF ACCOUNTING (Detail Textuals) | Aug. 09, 2017 | Jan. 15, 2016USD ($)Shareholdershares | Dec. 31, 2017USD ($)shares | Jun. 30, 2017shares | Feb. 29, 2016shares |
Organization Operations And Basis Of Accounting [Line Items] | |||||
Film production costs | $ | $ 35,000,000 | ||||
Assets acquired | $ | $ 6,566 | ||||
liabilities assumed | $ | $ 598,869 | ||||
Common stock, shares authorized (in shares) | shares | 25,000,000 | 25,000,000 | 5,000,000 | ||
Common stock reverse stock split, Description | 1 for 40 | ||||
Share exchange agreement | Smack Sportswear ("Smack") | Mr. Chan and Mr. Williams | Series A Convertible Preferred Stock | |||||
Organization Operations And Basis Of Accounting [Line Items] | |||||
Number of shareholders | Shareholder | 2 | ||||
Number of preferred stock converted | shares | 1,000,000 | ||||
Number of common stock issued in conversion of preferred stock | shares | 2,500,000 |
ORGANIZATION, OPERATIONS AND 21
ORGANIZATION, OPERATIONS AND BASIS OF ACCOUNTING (Detail Textuals 1) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2017 | |
Organization, Operations and Basis of Accounting [Abstract] | |||||
Loss from operations | $ (60,688) | $ (38,729) | $ (102,367) | $ (56,254) | |
Cash used in operating activities | (514,287) | $ (60,872) | |||
Note payable | 66,613 | 66,613 | $ 66,613 | ||
Accumulated deficit | $ (1,065,323) | $ (1,065,323) | $ (945,257) |
SUMMARY OF SIGNIFICANT ACCOUN22
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals) - USD ($) | Jul. 05, 2017 | Dec. 31, 2017 |
Summary of Significant Accounting Policies [Abstract] | ||
FDIC insurance uninsured amount | $ 250,000 | |
Stock repurchased and forfeited shares during the period | 85,475 | 85,475 |
PROMISSORY NOTES RECEIVABLE (De
PROMISSORY NOTES RECEIVABLE (Detail Textuals) | Jun. 12, 2017USD ($) | Jun. 07, 2017USD ($) | Dec. 31, 2017USD ($)Promissory_Note | Dec. 14, 2017USD ($) | Jun. 30, 2017USD ($) |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Promissory notes receivable | $ 350,000 | $ 400,000 | |||
Number of notes receivable | Promissory_Note | 2 | ||||
Interest income | $ 4,841 | ||||
Cash paid for interest | 10,000 | ||||
Promissory note agreement | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Promissory note receivable gross | $ 350,000 | $ 450,000 | |||
Third Party One | Promissory Notes Receivable | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Percentage of promissory note | 2.50% | ||||
Promissory notes receivable | $ 200,000 | ||||
Term of promissory note receivable | 45 days | ||||
Third Party Two | Promissory Notes Receivable | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Percentage of promissory note | 2.50% | ||||
Promissory notes receivable | $ 200,000 | ||||
Term of promissory note receivable | 45 days |
FILM COSTS (Details)
FILM COSTS (Details) - USD ($) | Dec. 31, 2017 | Jun. 30, 2017 |
Film Costs [Abstract] | ||
Motion picture and television productions | $ 414,937 | $ 0 |
Film Costs | $ 414,937 |
PROMISSORY NOTES PAYABLE (Detai
PROMISSORY NOTES PAYABLE (Detail Textuals) - USD ($) | Oct. 11, 2017 | Jun. 06, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2017 |
Short-term Debt [Line Items] | |||||||
Promissory Note Payable | $ 450,000 | $ 450,000 | $ 200,000 | ||||
Proceeds from promissory notes payable | 800,000 | ||||||
Interest expense | 13,023 | $ 1,679 | 20,861 | $ 3,358 | |||
Promissory note on June 6, 2017 | Unrelated Third Party | |||||||
Short-term Debt [Line Items] | |||||||
Percentage of notes payable | 2.50% | ||||||
Promissory Note Payable | $ 200,000 | ||||||
Term of promissory note payable | 90 days | ||||||
Interest expense | 0 | 2,396 | |||||
Promissory note on October 11, 2017 | |||||||
Short-term Debt [Line Items] | |||||||
Percentage of notes payable | 10.00% | ||||||
Promissory Note Payable | $ 150,000 | ||||||
Proceeds from promissory notes payable | $ 150,000 | ||||||
Term of promissory note payable | 14 months | ||||||
Recorded interest over term of loan | $ 15,000 | ||||||
Interest expense | 2,859 | 2,859 | |||||
Interest payable | $ 2,859 | $ 2,859 | |||||
Promissory note December 17, 2017 | |||||||
Short-term Debt [Line Items] | |||||||
Percentage of notes payable | 10.00% | 10.00% | |||||
Promissory Note Payable | $ 300,000 | $ 300,000 | |||||
Proceeds from promissory notes payable | 300,000 | ||||||
Term of promissory note payable | 12 months | ||||||
Interest expense | $ 1,342 | 1,342 | |||||
Interest payable | $ 1,342 | $ 1,342 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Detail Textuals) | Jun. 09, 2017USD ($)Owner | Sep. 19, 2017USD ($)Owner | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Related Party Transaction [Line Items] | ||||||
Interest expense | $ 14,702 | $ 1,679 | $ 22,540 | $ 3,358 | ||
William R Kruse | Promissory note on June 6, 2017 | ||||||
Related Party Transaction [Line Items] | ||||||
Promissory note receivable | $ 200,000 | |||||
Percentage of promissory note | 2.50% | |||||
Number of principle owners | Owner | 1 | |||||
Term of promissory note receivable | 90 days | |||||
Interest expense | 2,708 | 2,708 | ||||
Promissory note interest payable | 5,000 | |||||
Kruse Farms, LP | Promissory note on June 6, 2017 | ||||||
Related Party Transaction [Line Items] | ||||||
Promissory note receivable | $ 350,000 | |||||
Percentage of promissory note | 10.00% | |||||
Number of principle owners | Owner | 1 | |||||
Term of promissory note receivable | 24 months | |||||
Interest expense | $ 8,822 | 9,877 | ||||
Promissory note interest payable | $ 9,877 |
NOTE PAYABLE (Detail Textuals)
NOTE PAYABLE (Detail Textuals) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Aug. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2017 | |
Debt Instrument [Line Items] | ||||||
Outstanding balance of notes payable | $ 66,613 | $ 66,613 | $ 66,613 | |||
Interest expense | 14,702 | $ 1,679 | 22,540 | $ 3,358 | ||
Interest payable | 29,608 | 29,608 | 17,068 | |||
Unsecured promissory note | ||||||
Debt Instrument [Line Items] | ||||||
Interest expense | 1,679 | $ 1,679 | 3,358 | $ 3,358 | ||
Interest payable | $ 15,530 | $ 15,530 | $ 12,172 | |||
Smack Sportswear ("Smack") | Unsecured promissory note | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity of unsecured debt | $ 66,613 | |||||
Note payable interest rate | 10.00% | |||||
Outstanding balance of notes payable | $ 66,613 | |||||
Notes payable, maturity date | Aug. 31, 2016 |
SHARE CAPITAL (Detail Textuals)
SHARE CAPITAL (Detail Textuals) | Aug. 09, 2017 | Jul. 05, 2017USD ($)shares | Dec. 31, 2017USD ($)AgreementInvestors$ / sharesshares | Jun. 30, 2017$ / sharesshares | Feb. 29, 2016shares |
Schedule of Capitalization, Equity [Line Items] | |||||
Common stock reverse stock split, Description | 1 for 40 | ||||
Common stock, shares authorized | 25,000,000 | 25,000,000 | 5,000,000 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |||
Common stock issued (in shares) | 4,670,049 | 4,755,524 | |||
Common stock, shares outstanding (in shares) | 4,670,049 | 4,755,524 | |||
Stock repurchased and forfeited shares during the period | 85,475 | 85,475 | |||
Stock repurchased and forfeited during the period | $ | $ 20,000 | ||||
Share Purchase Agreements | |||||
Schedule of Capitalization, Equity [Line Items] | |||||
Proceeds from shares purchased in transaction | $ | $ 386,000 | ||||
Stock subscription receivable | $ | $ 386,000 | ||||
Number of agreements | Agreement | 3 | ||||
Number of investor | Investors | 3 | ||||
Number of share purchase | 386,000 | ||||
Share price of stock purchase in agreement | $ / shares | $ 1 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Federal income tax benefit attributable to: | ||||
Net operating loss | $ 25,633 | $ 13,739 | $ 40,823 | $ 20,268 |
Less: valuation allowance | (25,633) | (13,739) | (40,823) | (20,268) |
Net provisions for Federal income taxes | $ 0 | $ 0 | $ 0 | $ 0 |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | Dec. 31, 2017 | Jun. 30, 2017 |
Deferred tax asset attributable to: | ||
Net operating loss carryover | $ 85,624 | $ 44,801 |
Less: valuation allowance | (85,624) | (44,801) |
Net deferred tax asset | $ 0 | $ 0 |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Effective tax rate attributable to: | ||||
US statutory rate | 34.00% | 34.00% | 34.00% | 34.00% |
Less: change in unrecognized tax benefit from uncertain tax provision | (34.00%) | (34.00%) | (34.00%) | (34.00%) |
Tax per Financial Statements | 0.00% | 0.00% | 0.00% | 0.00% |
INCOME TAXES (Detail Textuals)
INCOME TAXES (Detail Textuals) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Statutory federal income tax rate | 34.00% | 34.00% | 34.00% | 34.00% |
Net operating loss carry forwards | $ 251,835 | $ 251,835 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Detail Textuals) - Saisam Entertainment LLC | Dec. 12, 2016USD ($) |
Commitments And Contingencies [Line Items] | |
Project contractual obligation | $ 1,300,000 |
Initial option fee of project | $ 10,000 |
Initial option validity period | 18 months |
Undivided rights hold | 50.00% |
Total cost of the project | $ 2,000,000 |
Percentage of return on investment | 20.00% |