UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
| x | QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 |
| | FOR THE QUARTERLY PERIOD ENDED May 31, 2014 |
| | |
| | OR |
| | |
| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 |
Commission file number 000-53156
| | UNWALL INTERNATIONAL INC. | |
| | (Exact name of registrant as specified in its charter) | |
| | NEVADA | |
| | (State or other jurisdiction of incorporation or organization) | |
| | Suite 325 – 7582 Las Vegas Blvd South, Las Vegas, NV89123 | |
| | | |
| | (Address of principal executive offices, including zip code.) | |
| | | |
| | 702-560-4373 | |
| | (telephone number, including area code) | |
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 last 90 days. YES o NO x
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
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,” “non-accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer o | Accelerated filer o |
Non-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
State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 23,818,046 shares of common stock as of June 30, 2014.
UNWALL INTERNATIONAL, INC.
FINANCIAL STATEMENTS
MAY 31, 2014
| PART I. - FINANCIAL INFORMATION |
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UNWALL INTERNATIONAL INC.
(Unaudited)
| | | May 31, 2014 | | | November 30, 2013 | |
| ASSETS | | | | | | |
| | | | | | | |
| Current Assets: | | | | | | |
| | | | | | | |
| Cash | | $ | - | | | $ | - | |
| Total current assets | | | - | | | | - | |
| | | | | | | | | |
| Fixed Assets: | | | | | | | | |
| | | | | | | | | |
| Property plant and equipment | | | - | | | | - | |
| Less: accumulated depreciation | | | - | | | | - | |
| Net property plant and equipment | | | - | | | | - | |
| | | | | | | | | |
| Other Assets | | | | | | | | |
| | | | | | | | | |
| Deposits | | | - | | | | - | |
| | | | | | | | | |
| Total Assets | | $ | - | | | $ | - | |
| | | | | | | | | |
| LIABILITIES AND SHAREHOLDERS' DEFICIT | | | | | | | | |
| | | | | | | | | |
| Current Liabilities: | | | | | | | | |
| | | | | | | | | |
| Accrued expenses | | $ | 24,440 | | | $ | 17,140 | |
| Due to shareholder | | | 101,467 | | | | 96,767 | |
| | | | | | | | | |
| Total liabilities | | $ | 125,907 | | | $ | 113,907 | |
| | | | | | | | | |
| Shareholders' Deficit: | | | | | | | | |
| | | | | | | | | |
Preferred stock - Class A - authorized, 100,000,000 shares of $.001 par value; issued and outstanding, 750,000 | | | 750 | | | | 750 | |
Common stock - authorized, 100,000,000 shares of $.001 par value; issued and outstanding, 23,818,046 | | | 23,818 | | | | 23,818 | |
| Capital in excess of par value | | | 6,793,041 | | | | 6,793,041 | |
| | | | | | | | | |
| Accumulated deficit | | | (6,943,516 | ) | | | (6,931,516 | ) |
| Total shareholders' deficit | | | (125,907 | ) | | | (113,907 | ) |
| | | | | | | | | |
| Total Liabilities and Shareholders' Deficit | | $ | - | | | $ | - | |
These accompanying notes are an integral part of these financial statements.
UNWALL INTERNATIONAL INC.
FOR THE THREE MONTH PERIODS ENDED MAY 31,
(Unaudited)
| | | 2014 | | | 2013 | |
| Expenses: | | | | | | |
| | | | | | | | | |
| Selling and administrative expenses | | $ | - | | | $ | 12,795 | |
| | | | | | | | | |
| Operating loss from continuing operations | | | - | | | | (12,795 | ) |
| | | | | | | | | |
| Operating loss from discontinued operations | | | - | | | | (52,877 | ) |
| | | | | | | | | |
| | | | | | | | | |
| Net loss | | | - | | | | (65,672 | ) |
| | | | | | | | | |
| Other comprehensive income (loss:) | | | | | | | | |
| | | | | | | | | |
| Currency rate changes -discontinued operations | | | - | | | | (681 | ) |
| | | | | | | | | |
| Total loss from continuing operations | | | - | | | | (12,795 | ) |
| | | | | | | | | |
| Total comprehensive loss from discontinued operations | | | - | | | | (53,558 | ) |
| | | | | | | | | |
| | | | | | | | | |
| Total comprehensive loss | | $ | - | | | $ | (66,353 | ) |
| | | | | | | | | |
| Loss Per Share - | | | | | | | | |
| Basic and Diluted | | $ | - | | | $ | - | |
| | | | | | | | | |
| Weighted average number of common shares outstanding | | | 23,818,046 | | | | 23,818,046 | |
These accompanying notes are an integral part of these financial statements
UNWALL INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTH PERIODS ENDED MAY 31,
(Unaudited)
| | | 2014 | | | 2013 | |
| Expenses: | | | | | | |
| | | | | | | | | |
| Selling and administrative expenses | | $ | 12,000 | | | $ | 21,810 | |
| | | | | | | | | |
| Operating loss from continuing operations | | | (12,000 | ) | | | (21,810 | ) |
| | | | | | | | | |
| Operating loss from discontinued operations | | | - | | | | (105,796 | ) |
| | | | | | | | | |
| | | | | | | | | |
| Net loss | | | (12,000 | ) | | | (127,606 | ) |
| | | | | | | | | |
| Other comprehensive income (loss:) | | | | | | | | |
| | | | | | | | | |
| Currency rate changes -discontinued operations | | | - | | | | 1,371 | |
| | | | | | | | | |
| Total loss from continuing operations | | | (12,000 | ) | | | (21,810 | ) |
| | | | | | | | | |
| Total comprehensive loss from discontinued operations | | | - | | | | (104,425 | ) |
| | | | | | | | | |
| | | | | | | | | |
| Total comprehensive loss | | $ | (12,000 | ) | | $ | (126,235 | ) |
| | | | | | | | | |
| Loss Per Share - | | | | | | | | |
| Basic and Diluted | | $ | - | | | $ | - | |
| | | | | | | | | |
| Weighted average number of common shares outstanding | | | 23,818,046 | �� | | | 23,818,046 | |
These accompanying notes are an integral part of these financial statements
UNWALL INTERNATIONAL INC.
FOR THE SIX MONTH PERIODS ENDED MAY 31,
(Unaudited)
| | | 2014 | | | 2013 | |
| CASH FLOWS FROM OPERATIONS: | | | | | | |
| Net loss | | $ | (12,000 | ) | | $ | (21,810 | ) |
| Adjustments required to reconcile net loss to net cash | | | | | |
| consumed by operating activities: | | | | | | | | |
| Charges and credits not involving the use of cash | | | - | | | | - | |
| Changes in assets and liabilities: | | | | | | | | |
| Increase in accrued liabilities | | | 7,300 | | | | 2,005 | |
| | | | | | | | | |
| Net Cash Consumed by Operating Activities | | | | | |
| Continued operations | | | (4,700 | ) | | | (19,805 | ) |
| Discontinued operations | | | 0 | | | | (104,198 | ) |
| Total | | | (4,700 | ) | | | (124,003 | ) |
| | | | | | | | | |
| CASH FLOWS USED FOR INVESTING ACTIVITIES | | | - | | | | - | |
| | | | | | | | | |
| Net Cash Consumed by Investing Activities: | | | | | | | | |
| Continued operations | | | - | | | | - | |
| Discontinued operations | | | | | | | (1,322 | ) |
| Total | | | | | | | (1,322 | ) |
| | | | | | | | | |
| CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | |
| Proceeds from shareholder loans | | | 4,700 | | | | 19,805 | |
| | | | | | | | | |
| Net Cash Provided by Financing Activities: | | | | | | | | |
| Continued operations | | | 4,700 | | | | 19,805 | |
| Discontinued operations | | | - | | | | 103,663 | |
| Total | | | 4,700 | | | | 123,468 | |
| | | | | | | | | |
| Effect on cash of currency rate changes | | | | | | | | |
| Discontinued operations | | | - | | | | (74 | ) |
| Net increase (decrease) in cash | | | - | | | | (1,931 | ) |
| Cash balance, beginning of period | | | - | | | | 10,169 | |
| Cash balance, end of period | | $ | - | | | $ | 8,238 | |
The accompanying notes are an integral part of these financial statements.
UNWALL INTERNATIONAL, INC.
MAY 31, 2014
(Unaudited)
1.BASIS OF PRESENTATION
The unaudited interim financial statements of Unwall International, Inc. (the “Company”) as of May 31, 2014 and for the three and six month periods then ended have been prepared in accordance with accounting principles generally accepted in the United States of America. In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of such periods. The results of operations for the six month period ended May 31, 2014 are not necessarily indicative of the results to be expected for the full fiscal year ending November 30, 2014. The Company was a "shell" company as defined by SEC Rule 12b-2 until it began development stage operations on September 1, 2012. The Company was a development stage entity through May 31, 2013 when it discontinued development operations and reverted back to “shell” status.
Certain information and disclosures normally included in the notes to financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements of the Company for the fiscal year ended November 30, 2013.
2.SUPPLEMENTAL CASH FLOWS INFORMATION
There was no cash paid for either interest or income taxes during either of the periods presented. There were no non-cash investing or financing activities during either of the periods presented.
3.GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the financial statements, the Company has experienced continued losses, has a working capital deficiency of $125,907, has an accumulated deficit of $6,943,516 and does not presently have sufficient resources to accomplish its objectives during the next twelve months. The Company has closed its Malaysian operating subsidiary and its social lending division which together incurred substantial development costs. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue in operation. The Company’s present plans, the realization of which cannot be assured, are to raise necessary funds through shareholder loans.
4. CONTINGENCY
The Company does not carry insurance.
5. SHAREHOLDER LOANS
The shareholder loans are non-interest bearing demand loans.
UNWALL INTERNATIONAL, INC.
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2014
(Unaudited)
6.PRINCIPLE OF CONSOLIDATION
The consolidated financial statements represent the combined results of Unwall International, Inc. and its wholly owned subsidiary, Unwall Technologies Holdings, SdnGhd. All intercompany balances have been eliminated.
7.DISCONTINUED OPERATIONS
The Company began development stage activities through its wholly owned Malaysian subsidiary, Unwall Technologies Holdings, SdnGhd. on September 1, 2012. Operations of the Malaysian subsidiary effectively ceased on May 31, 2013, and closed by August 31, 2013. The equipment and software owned by this subsidiary had no material value and were either abandoned or given to employees. Unwall International has assumed responsibility for any remaining accounts payable of the subsidiary. A planned social lending division was terminated with no viable development before October 31, 2013.
8.FOREIGN CURRENCY TRANSACTIONS
Unwall Technologies Holdings Sdn Ghd operated as an independent business unit in Malaysia; its functional currency was the Malaysian Ringit. Currency translation adjustments are included in comprehensive income of discontinued operations. The subsidiary is currently inactive.
The Company does not engage in hedging transactions to offset the risk of exchange rate fluctuations.
This section of this report includes a number of forward- looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.
Management’s Discussion and Analysis of Financial Condition and Results of Operation
From November 30, 2007 until April 2009, our operations were that of distribution of alternative health products. Upon further market research, it was determined that pursuing the marketing and sale of such product was not as profitable as previously projected. Therefore, all efforts relating to the distribution and marketing were ceased. In April 2009, we commenced operations relating to the distribution of the certain systems which were intended to convert a variety of waste materials to marketable by-products. This business was discontinued by March 31, 2011.
On October 30, 2012, we completed the incorporation and registration of Unwall Technologies Holdings SDN.BHD, a wholly-owned Malaysian subsidiary (“Unwall Technologies”), which commenced operations to offer mobile apps through its website, www.uwii.org . The Company planned to introduce applications for mobile devices in the first half of 2013 and web applications later in the year. This venture was discontinued May 31, 2013 and the business closed by August 31, 2013. The subsidiary does still exist with no assets or liabilities remaining.
Development began on a web based social lending division. So far, this business has not proceeded beyond initial plans for a joint venture and, as a result the Company has reverted to shell company status.
We have not been involved in any bankruptcy, receivership or similar proceeding.
The following is an analysis of our revenues and gross profit, details and analysis of components of expenses, and variances comparing the six months ended May 31, 2014 to the six months ended May 31, 2013.
| | | Six Months Ended | |
| | | | |
| | | May 31, 2014 | | | May 31, 2013 | |
| Revenues | | $ - Nil - | | | $- Nil - | |
| Selling and Administrative Expenses | | $ | 12,000 | | | $ | 21,810 | |
| Net Loss from Continuing Operations | | $ | (12,000 | ) | | $ | (21,810) | |
| Net Loss from Discontinued Operations | | | - | | | | (105,796) | |
Expenses
Our expenses for the six months ended May 31, 2014 and May 31, 2013 were as follows:
| | | | |
| | | May 31, 2014 | | | May 31, 2013 | |
| Computer Fees | | $-Nil- | | | $ | 31,497 | |
| Professional Fees | | | 12,000 | | | | 22,424 | |
| Selling Expense | | -Nil- | | | | 7,329 | |
Office and Miscellaneous Expense | | -Nil | | | | 9,666 | |
| Payroll | | -Nil- | | | | 56,690 | |
Expenses from Continuing Operations | | | 12,000 | | | | 21,810 | |
Expenses from Discontinued Operations | | | - | | | | 105,796 | |
| | | | | | | | | |
| | | | | | | | | |
| Total Expenses | | $ | 12,000 | | | $ | 127,606 | |
For the six months ended May 31, 2014, our total operating expenses were $12,000 as compared to $21,810 for the six months ended May 31, 2013. The change in operating expenses from continuing operations is primarily due to expenses related to our Unwall Technologies subsidiary, (which was discontinued in 2013) amounting to $9,810.
Professional Fees
We incurred a total of $12,000 in professional fees for the six months ended May 31, 2014 as compared to $21,810 during the six months ended May 31, 2013. Professional fees include audit and review fees, bookkeeping fees and legal fees consisting mostly of preparation of SEC filings. Our audit and legal fees are expected to vary. There were no expenses incurred during the three months ended May 31, 2014 as the Company was inactive. We expect expenses to increase during the second half of the fiscal year.
Liquidity and Capital Resource
Working Capital Deficit
| | | At | | | At | |
| | | May 28, | | | November 30, | |
| | | 2014 | | | 2013 | |
| | | | | | | |
| Current Assets | | $ | - | | | $ | - | |
| Current Liabilities | | | 125,907 | | | | 113,907 | |
| Working Capital | | $ | (125,907) | | | $ | (113,907) | |
| | At | | At | |
| | May 31, | | May 31, | |
| | 2014 | | 2013 | |
| | | | | |
Net Cash Consumed
by Operating Activities | | $ | (4,700) | | | $ | (19,805 | ) |
Net Cash Provided
(Consumed) by Investing Activities | | - | | | | - | |
Net Cash Provided
by Financing Activities | | 4,700 | | | | 19,805 | |
Change in cash from
continuing operation | | | - | | | | - | |
Change in cash from
discontinued
operations | | | - | | | | (1,931 | ) |
| Net change in cash | | $ | | | | $ | (1,931 | ) |
Net Cash Consumed
Working Capital Needs:
As of May 31, 2014, we had a net working capital deficit of $125,907. Over the next 12 months, we will require approximately $25,000 to sustain our working capital needs as a public reporting company as follows:
| Professional fees | | $ | 15,000 | |
| Other | | | 10,000 | |
| | | | | |
| | | | | |
| Total | | $ | 25,000 | |
Sources of Capital:
We expect to obtain financing through shareholder loans. Shareholder loans will be without stated terms of repayment or interest. We will not consider taking on any long-term or short-term debt from financial institutions in the immediate future. Shareholders loans may be granted from time to time as required to meet current working capital needs. We have no formal agreement that ensures that we will receive such loans. We may exhaust this source of funding at any time.
Cash Flows
Operating Activities:
Net cash consumed by continuing operating activities was $4,700 for the six months ended May 31, 2014 and $19,805 for the six months ended May 31, 2013. The decrease in cash consumption is attributable to a decrease in administrative expenses. Cash in the amount of $104,198 was consumed by discontinued operations in the 2013 period. There was no such consumption in the 2014 period.
Investing and Financing Activities:
We had no investing activities from continuing operations in either the 2014 period or the 2013 period. Our Board of Directors previously approved a sale of 75,000,000 shares of our Common Stock to Great On Technologies Holdings Ltd., our majority shareholder, for $75,000. However, as of May 31, 2014, the shares had not yet been issued.
Cash flows from financing activities from continuing operations produced cash flows during the six month period ended May 31, 2014 of $4,700, compared to $19,805 for the six months ended May 31, 2013. In both periods the cash was provided by shareholder loans to fund our working capital needs. Additional capital is required in order to fund our working capital needs and we may receive additional financing through shareholder loans although we have no formal commitments from any shareholders at this time. We will not be considering taking on any long-term or short-term debt from financial institutions in the immediate future. Shareholder and consultant loans may be granted from time to time as required to meet current working capital needs. We have no formal agreement that ensures that we will receive such loans. We may exhaust this source of funding at any time.
Material Commitments
We do not have any material commitments for capital expenditures.
Seasonal Aspects
Management is not currently aware of any seasonal aspects which would affect the results of our operations during any particular time of year.
Off Balance Sheet Arrangements
We have no off balance sheet arrangements.
Going Concern
We anticipate that additional funding will be required in the form of equity financing from the sale of our common stock. At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through loans from our directors to meet our obligations over the next twelve months. We do not have any arrangements in place for any future debt or equity financing.
Recent Accounting Pronouncements
The Company has analyzed the Accounting Standards Updates that were issued after January 31, 2011 and have determined that none are anticipated to have a material impact on the Company’s financial position, results of operations, or cash flows.
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were not effective during the six month period ended May 31, 2014.
There were no changes in our internal control over financial reporting during the six month period ended May 31, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
The following documents are included herein:
No. | Document Description |
| | |
| 31.1 | Certification of Principal Executive Officer and Principal Financial Officer pursuant Section 302 of the Sarbanes-Oxley Act of 2002 |
| | |
| 32.1 | Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| | |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant and in the capacities on this 21 day of October, 2014.
| | UNWALL INTERNATIONAL INC. |
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| | | | |
| | BY: /s/ | TESHEB CASIMIR TESHEB CASIMIR | |
| | | Principal Executive Officer Principal Financial Officer and Principal Accounting Officer | |
14
