Monar International (MNAI) 10-Q 2010 Q3 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X]	QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED APRIL 30, 2010
OR
[  ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number:   333-161566

MONAR INTERNATIONAL INC.

(Exact name of registrant as specified in its charter)

NEVADA

(State or other jurisdiction of incorporation or organization)

Suite 1302, Sino Favour Centre

1 On Yip Street

Chaiwan

Hong Kong, China

(Address of principal executive offices, including zip code)

852-9738-1945

(Registrant’s telephone number, including area code)

Indicate by check mark whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 last 90 days.   YES [X]   NO [  ]

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 (SS 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   YES [X]   NO [  ]

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. (Check one):

Large Accelerated Filer	[  ]	Accelerated Filer	[  ]
Non-accelerated Filer	[  ]	Smaller Reporting Company	[X]
(Do not check if smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   YES [X]  NO [  ]

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicated the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 5,595,000 as of June 5, 2010.

Monar International Inc

Form 10-Q for the Quarter Ended April 30, 2010

INDEX TO FINANCIAL STATEMENTS

Part I. Financial Information
		Page No.
Item 1. Financial statements		3
	Balance Sheet as of April 30, 2010 and July 31, 2009 (Unaudited)	F-1
	Statement of Operations for the three months and nine months ended April 30, 2010 and for the period from July 6, 2009 (inception) to April 30, 2010 (Unaudited)	F-2
	Statement of Stockholders’ Deficit for the period from July 6, 2009 (inception) to April 30, 2010 (Unaudited)	F-3
	Statement of Cash Flows for the nine months ended January 31, 2010 and for the period from July 6, 2009 (inception) to January 31, 2010 (Unaudited)	F-4
	Notes to the Financial Statements (Unaudited)	F-5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		8
Item 3. Quantitative and Qualitative Disclosure about Market Risk		10
Item 4. Controls and Procedures		10
Part II. Other Information
Item 1A. Risk Factors		10
Item 2. Changes in Securities and Use of Proceeds		10
Item 6. Exhibits		10
Signatures		11
Exhibit Index		12

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PART I. FINANCIAL INFORMATION

ITEM 1.          FINANCIAL STATEMENTS

Monar International Inc
(A Development Stage Enterprise)
Balance Sheets
As of April 30, 2010
		April 30, 2010		July 31, 2009
Current Assets
	Cash	$	47,028	$	-
	Prepaid Expenses		-		2,230
Total Current Assets			47,028		2,230
	TOTAL ASSETS	$	47,028	$	2,230
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities
	Accounts Payable	$	585	$	1,000
	Advance from related party		38,621		17,768
Total Current Liabilities			39,206		18,768
Total Liabilities		$	39,206	$	18,768
Stockholders' Equity
Preferred Stock, $0.0001 par value, 100,000,000 share
authorized, 0 issued and outstanding		$	-	$	-
Common Stock, $0.0001 par value, 100,000,000 share
authorized, 5,000,000 issued and outstanding			50		50
Stock Payable			46,500		-
Additional paid-in capital			-		-
Cumulative translation adjustments			(55)		-
Deficit accumulated during development stage			(38,673)		(16,588)
Total Stockholders' Equity			7,822		(16,538)
Total Liabilities & Stockholders' Equity		$	47,028	$	2,230

F-1

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Monar International Inc
(A Development Stage Enterprise)
Statement of Expenses
For the Period From July 6, 2009 (Inception) to April 30, 2010
			Three		Nine		From
			Months		Months		July 6, 2009
			Ended		Ended		(Inception) to
			April 30, 2010		April 30, 2010		April 30, 2010
Revenue				-		-		-
Expenses
	Professional fees		$	3,048	$	21,500	$	37,588
	Filing Fees			-		-		500
	Rent Expense			195		585		585
		Total Expenses		3,243		22,085		38,673
Loss From Operations				(3,243)		(22,085)		(38,673)
Net Loss				(3,243)		(22,085)		(38,673)
Basic and Diluted Net Loss Per Share			$	(0.001)	$	(0.004)	$	(0.008)
Weighted Average Number of
Common Shares Outstanding
Basic and Diluted				5,000,000		5,000,000		5,000,000

F-2

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Monar International Inc
(A Development Stage Enterprise)
Statement of Changes in Stockholders' Equity
For the Period From July 6, 2009 (Inception) to April 30, 2010
										Deficit
										Accumulated
		Common				Additional		Cumulative		During
	Common	Stock		Stock		Paid-in		Translation		Development
	Stock	Amount		Payable		Capital		Adjustments		Stage		Total
Balance, July 6, 2009
(Inception)	-	$	-	$	-	$	-	$	-	$		$	-
Stock issued for cash
July 6, 2009
$0.00001 per share	5,000,000		50				-				-		50
Net loss, July 31, 2009											(16,588)		(16,588)
Balance, July 31, 2009	5,000,000		50				-				(16,588)		(16,538)
Net loss, October 31, 2009											(13,383)		(13,383)
Balance, October 31, 2009	5,000,000		50				-				(29,971)		(29,921)
Net loss, January 31, 2010											(5,459)		(5,459)
Balance, January 31, 2010	5,000,000		50				-				(35,430)		(35,380)
Cumulative Translation
Adjustments									(55)				(55)
Stock subscription					46,500								46,500
Net Loss, April 30, 2010											(3,243)		(3,243)
Balance, April 30, 2010	5,000,000	$	50	$	46,500	$	-	$	(55)	$	(38,673)	$	7,822

F-3

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Monar International Inc
(A Development Stage Enterprise)
Statement of Cash Flows
For the Periods From July 6, 2009 (Inception) to April 30, 2010
			Nine
			Months		July 6, 2009		July 6, 2009
			Ended		(Inception) to		(Inception) to
			April 30, 2010		April 30, 2010		July 31, 2009
CASH FLOWS FROM OPERATING ACTIVITIES
	Net loss		$	(22,085)	$	(38,673)	$	(16,588)
	Adjustments to reconcile net loss to net cash
		used in operating activities:
	Changes in operating assets and liabilities:
	Prepaid expenses and Deposits			2,230		-		(2,230)
	Accounts payable			(415)		585		1,000
	Net cash provided by (used in) operating activities		$	(20,270)	$	(38,088)	$	(17,818)
CASH FLOWS FROM FINANCING ACTIVITIES
	Proceeds from sale of stock to founder			-		50		50
	Advance payable from Related Party- stockholder			20,853		38,621		17,768
	Proceeds from stock subscription			46,500		46,500		-
	Net cash provided by (used in) financing activities		$	67,353	$	85,171	$	17,818
	Effect of exchange rate on cash			(55)		(55)		-
	Net increase (decrease) in cash		$	47,028	$	47,028	$	-
	Cash at beginning of period			-		-		-
	Cash at end of year		$	47,028	$	47,028	$	-

F-4

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Monar International Inc

(A DEVELOPMENT STAGE COMPANY)

Notes to the Financial Statements

(Unaudited)

NOTE 1 – BASIS OF PRESENTATION

The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s most recent Annual Financial Statements filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim period presented have been reflected herein. The results of operations for the interim period are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal period, as reported in the Form 10-K, have been omitted.

NOTE 2 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business.  The Company has net losses for the period from inception to April 30, 2010 of $38,673.  The Company intends to fund operations through sales and equity financing arrangements.

The ability of the Company to emerge from the development stage is dependent upon the Company's successful efforts to raise sufficient capital and then attaining profitable operations. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 3 – RELATED PARTY TRANSACTIONS

On November 17, 2009, 7Bridge Capital Partners Limited advanced Monar $7,000 cash. This advance is non-interest bearing, unsecured and due on demand.  

From inception to April 30, 2010, $31,621 is due to the President and Director for cash advances to the Company. This advance is non-interest bearing, unsecured and due on demand.

NOTE 4 – COMMON STOCK SUBSCRIPTION

During the quarter ended April 30, 2010, the Company received $46,500 for subscriptions to purchase 465,000 common shares at $0.1 per share. The stock has not been issued as of April 30, 2010.

NOTE 5 – SUBSEQUENT EVENTS

In June 2010, the Company received $13, 000 for subscriptions to purchase 130,000 common shares at $0.1 per share.

F-5

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

This section of this quarterly 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.

Plan of Operation

Upon completion of our public offering, our specific goal is to profitably sell products on our Internet website to the public. We intend to accomplish the foregoing by the following steps.

1.          Complete our public offering. We believe that we will raise sufficient capital to begin our operations. We believe this could take up to 230 days. We will not begin operations until we have closed our public offering. We intend to concentrate all of our efforts on raising as much capital as we can during this period. After we complete our public offering, we intend to spend the funds as described in the Use of Proceeds section of our prospectus, which was filed with the SEC on December 3, 2009.

2.          After completing the offering, we will immediately begin to establish our office and acquire the equipment we need to begin operations. Establishing our offices will take approximately a week. We have allocated $10,000 for the initial setup of the office. We do not intend to hire employees unless we raise at least $100,000. Our sole officer and director will handle our administrative duties.

3.          We have spent nominal time designing the website. We plan to retain a website developer create a state of the art website to promote our products. We expect to spend $5,000 to $10,000 for the website which will include graphics and links from our site. We intend to locate smaller, new manufacturers to offer their products on a more exclusive basis.

4.          Marketing and advertising will be focused on promoting our website and products. The advertising campaign may also include the design and printing of various sales materials. We intend to market our website through traditional sources such as advertising in magazines, billboards, telephone directories and preparing and sending out flyers and mailers both through the regular mail and via email. Advertising and promotion will be an ongoing effort but the initial cost of developing the campaign is estimated to cost between $15,000 to $35,000.

5.          Once the website is fully functional and we have located and negotiated agreements with a suitable number of suppliers to offer their products for sale, we intend to hire 1 or 2 part-time salesperson(s) to fill Internet orders from customers.

6.          We anticipate that we will generate revenues as soon as we are able to offer products for sale on our website. This will happen once we negotiated agreements with one or two suppliers of products.

7.          We will not be conducting any research. We are not going to buy or sell any plant or significant equipment during the next twelve months.

8.          If we cannot generate sufficient revenues to continue operations, we will suspend or cease operations. If we cease operations, we do not know what we will do and we do not have any plans to do anything.

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Limited operating history and need for additional capital

There is no historical financial information about us upon which to base an evaluation of our performance. We are in a start-up stage operations and have not generated any revenues. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.

To become profitable and competitive, we have to locate and negotiate agreements with manufacturers to offer their products for sale to us at pricing that will enable us to establish and sell the products to our clientele at a profit. We are seeking equity financing to provide for the capital required to implement our operations.

We have no assurance that future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholders.

Results of operations

From Inception on July 6, 2009 to April 30, 2010

We have had a loss from operations for the six months ended April 30, 2010 of $3,243 of which $898 is for legal fees, $1,200 is for audit fees, $706 is for accounting services, $195 is for rent expense, and $244 is for bank services charges. We have not started our proposed business operations and will not do so until we have completed our public offering.

We have had a loss from operations for the nine months ended April 30, 2010 of $22,085 of which $11,895 is for legal fees, $4,630 is for audit fees, $2,189 is for accounting services, $585 is for rent expense, and $2,542 is for filing fees and general office cost. We have not started our proposed business operations and will not do so until we have completed our public offering.

We have had a loss from operations from inception on July 6, 2009 to April 30, 2010 of $38,673 of which $26,895 is for legal fees, $4,630 is for audit fees, $3,189 is for accounting services, $585 is for rent expense, and $3,130 is for filing fees and other professional services. We expect to begin operations 100 days after we complete our public offering.

Since inception, we sold 5,000,000 shares of common stock to our sole officer and director for $50 and have collected gross proceeds under our public offering of $46,500 as of April 30, 2010. Shares have yet to be issued to the subscribers of our public offering pending the reaching of the minimum subscription amount of $75,000.

Liquidity and capital resources

As of the date of this report, we have yet to generate any revenues from our business operations.

We issued 5,000,000 shares of common stock pursuant to the exemption from registration contained in Regulation S of the Securities Act of 1933. This was accounted for as a sale of common stock. We are also holding net proceeds of $46,256 received as subscriptions under our public offering.

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As of April 30, 2010, our total assets were $47,028 and our total liabilities were $39,206 of which $38,621 comprising of $7,000 to 7 Bridge Capital Partners Limited and $31,621 to Robert Clarke, our sole officer and director, for payments made to our attorney, auditor and accountant, and for filing fees to the Nevada Secretary of State.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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.

ITEM 4. CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including the Principal Executive Officer and Principal 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 Principal Executive Officer and Principal Financial Officer have concluded that these disclosure controls and procedures are not effective because of the identification of a material weakness in our internal control over financial reporting which is identified below, which we view as an integral part of our disclosure controls and procedures. There were no changes in our internal control over financial reporting during the quarter ended April 30, 2010 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1A.       RISK FACTORS

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.

ITEM 2.          CHANGES IN SECURITIES AND USE OF PROCEEDS.

On November 30, 2009, our Form S-1 registration statement (SEC file no. 333-161566) was declared effective by the SEC. Pursuant to the Form S-1, we offered 750,000 shares minimum, 1,500,000 shares maximum at an offering price of $0.10 per share in a direct public offering, without any involvement of underwriters or broker-dealers. As of the June 5, 2010, we have sold 595,000 shares of common stock.

ITEM 6.          EXHIBITS.

The following documents are included herein:

Exhibit No.	Document Description
31.1	Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

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 11th day of June, 2010.

MONAR INTERNATIONAL INC.
(the “Registrant”)
BY:	ROBERT G. CLARKE
	Robert G. Clarke
	President, President, Principal Executive Officer, Principal Accounting Officer, Principal Financial Officer, Secretary/Treasurer and sole member of the Board of Directors

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EXHIBIT INDEX

Exhibit 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 Chief Executive Officer and Chief Financial Officer pursuant Section 906 of the Sarbanes-Oxley Act of 2002.

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