UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended SEPTEMBER 30, 2012
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________
Commission file number 333-178472
ALLIED TECHNOLOGIES GROUP, INC.
(Exact name of registrant as specified in its charter)
Nevada (State or Other Jurisdiction of Incorporation or Organization) | 8711 (Primary Standard Industrial Classification Code Number) | 99-0369568 (IRS Employer Identification No.) |
(Address, including zip code, Telephone and Facsimile Number including area code, of Registrant’s
Principal Executive Offices)
28A Horbow-Kolonia
Zalesie, Poland 21-512
Telephone +48833111672
(Address and telephone number of principal executive offices)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
1
Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant as required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes [ ] No [X]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes [ ] No [X ]
As of November 30, 2012, the registrant had 2,590,000 shares of common stock issued and outstanding. No market value has been computed based upon the fact that no active trading market has been established as of November 30, 2012.
2
TABLE OF CONTENTS
| PART 1 |
|
ITEM 1 | Description of Business | 4 |
ITEM 1A | Risk Factors | 5 |
ITEM 2 | Description of Property | 5 |
ITEM 3 | Legal Proceedings | 5 |
ITEM 4 | Mine Safety Disclosures | 5 |
| PART II |
|
ITEM 5 | Market for Common Equity and Related Stockholder Matters | 6 |
ITEM 6 | Selected Financial Data | 7 |
ITEM 7 | Management's Discussion and Analysis of Financial Condition and Results of Operations | 7 |
ITEM 7A | Quantitative and Qualitative Disclosures about Market Risk | 9 |
ITEM 8 | Financial Statements and Supplementary Data | 10 |
ITEM 9 | Changes In and Disagreements with Accountants on Accounting and Financial Disclosure | 19 |
ITEM 9A (T) | Controls and Procedures | 19 |
| PART III |
|
ITEM 10 | Directors, Executive Officers, Promoters and Control Persons of the Company | 20 |
ITEM 11 | Executive Compensation | 21 |
ITEM 12 | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 22 |
ITEM 13 | Certain Relationships and Related Transactions | 22 |
ITEM 14 | Principal Accountant Fees and Services | 22 |
| PART IV |
|
ITEM 15 | Exhibits | 23 |
3
PART I
ITEM 1. Description of Business
FORWARD-LOOKING STATEMENTS
This annual report contains forward-looking statements. These statements relate to future events or our future financial performance. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.
GENERAL
We were incorporated in the State of Nevada on September 22, 2011. To date, our business operations have been limited to primarily, the development of a business plan and the signing of the service agreement with Star Guide, Inc., a private Polish company. We intend to provide consulting services in small boat building and maintenance, which will include but is not limited to consulting in boat building, boat repairs and maintenance, refurbishing, winterizing, custom refinishing and modifications, interior customization, appraisals and major boat renovations in Poland. We plan to expand our services to European and North American market in the future if we have the available resources and growth to warrant it.
Consulting Services
Our consulting services in small boat building and maintenance will include but are not limited to:
- Consulting in boat building
- Boat repairs and maintenance
- Refurbishing and winterizing
- Custom refinishing and modifications
- Interior customization
- Appraisals
- Major renovations
4
Our specific areas of services will include the following:
- Analyze existing plans, schemes and designs to be used by clients in boat building
- Prepare written recommendations for improvement of current vessel design and specifications. Special consideration will be given to selecting boat cooling & heating systems, electrical systems and installation, design of special loading and unloading components and governmental safety requirements
- Review of the navigation system and all operational details
- Recommendations regarding cost efficiency in boat building process
- Use of alternate fuels: CNG, electric and bio-diesel
ITEM 1A. Risk Factors
Not applicable to smaller reporting companies.
ITEM 2. Description of Property
We do not own any real estate or other properties.
ITEM 3. Legal Proceedings
We are not currently involved in any legal proceedings and we are not aware of any pending or potential legal actions.
ITEM 4. Mine Safety Disclosures
None.
5
PART II
ITEM 5. Market for Common Equity and Related Stockholder Matters
Market Information
There is a limited public market for our common shares. Our common shares are quoted on the OTC Bulletin Board under the symbol “ALIE”. Trading in stocks quoted on the OTC Bulletin Board is often thin and is characterized by wide fluctuations in trading prices due to many factors that may be unrelated to a company’s operations or business prospects. We cannot assure you that there will be a market in the future for our common stock.
OTC Bulletin Board securities are not listed or traded on the floor of an organized national or regional stock exchange. Instead, OTC Bulletin Board securities transactions are conducted through a telephone and computer network connecting dealers in stocks. OTC Bulletin Board issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.
As of September 30, 2012, no shares of our common stock have traded.
Number of Holders
As of September 30, 2012, the 2,590,000 issued and outstanding shares of common stock were held by a total of 26 shareholders of record.
Dividends
No cash dividends were paid on our shares of common stock during the fiscal years ended September 30, 2012. We have not paid any cash dividends since our inception and do not foresee declaring any cash dividends on our common stock in the foreseeable future.
Recent Sales of Unregistered Securities
None.
Purchase of our Equity Securities by Officers and Directors
None.
Other Stockholder Matters
6
ITEM 6. Selected Financial Data
Not applicable.
ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.
RESULTS OF OPERATIONS
We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.
We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.
FISCAL YEAR ENDED SEPTEMBER 30, 2012 COMPARED TO FISCAL YEAR ENDED SEPTEMBER 30, 2011.
Our net loss for the fiscal year ended September 30, 2012 was $40,276 compared to a net loss of $4,075 during the fiscal year ended September 30, 2011. During fiscal year ended September 30, 2012, the Company generated revenue of $3,990.
During the fiscal year ended September 30, 2012, we incurred general and administrative expenses of $34,966 and professional fees of $9,300 compared to general and administrative expenses of $75 and professional fees of 4,000 incurred during fiscal year ended September 30, 2011. These expenses incurred during the fiscal year ended September 30, 2012 consisted of: bank charges of $579 (2011: $0); professional fees of $9,300 (2011: $4,000) and miscellaneous charges of $34,387 (2011: $75).
Expenses incurred during fiscal year ended September 30, 2012 compared to fiscal year ended September 30, 2011 increased primarily due to the increased scale and scope of business operations. General and administrative expenses generally include corporate overhead, financial and administrative contracted services, marketing, and consulting costs.
The weighted average number of shares outstanding was 2,063,743 for the fiscal year ended September 30, 2012 compared to 166,667 for the fiscal year ended September 30, 2011.
7
LIQUIDITY AND CAPITAL RESOURCES
FISCAL YEAR ENDED SEPTEMBER 30, 2012
As of September 30, 2012, our current assets were $5,404 and our total liabilities were $26,455. As of September 30, 2012, current assets were comprised of $5,404 in cash. As of September 30, 2012, total liabilities were comprised of $22,155 in loans from a related party and $4,300 in accounts payable.
As of September 30, 2012, our total assets were $5,404 comprised entirely of current assets. Stockholders’ deficit was $21,051 as of September 30, 2012.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities. For the fiscal year ended September 30, 2012, net cash flows used in operating activities was $39,976 consisting of a net loss of $40,276 and increase in accounts payable of $300. Net cash flows used in operating activities was $40,051 for the period from inception (September 22, 2011) to September 30, 2012.
Cash Flows from Financing Activities
We have financed our operations primarily from either loans from a related party or the sale of equity . For the fiscal year ended September 30, 2012 net cash provided by financing activities was $43,780, received from proceeds from issuance of common stock and loans from a related party. For the period from inception (September 22, 2011) to September 30, 2012, net cash provided by financing activities was $45,455 received from proceeds from issuance of common stock and loans from a related party.
PLAN OF OPERATION AND FUNDING
We are a development stage company with limited operations. Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an ongoing business for the next twelve months. In the event that we are not able to generate sufficient revenue and do not have sufficient cash assets to continue as a public company, we may engage in discussions with other entities to enter into a possible merger or acquisition of our company.
We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.
Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next six months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; (ii) developmental expenses associated with a start-up business; and (iii) marketing expenses. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.
8
MATERIAL COMMITMENTS
As of the date of this Annual Report, we do not have any material commitments.
PURCHASE OF SIGNIFICANT EQUIPMENT
We do not intend to purchase any significant equipment during the next twelve months.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Annual Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
GOING CONCERN
The independent auditors' report accompanying our September 30, 2012 and September 30, 2011 financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk
Not applicable to smaller reporting companies.
9
ITEM 8. Financial Statements and Supplementary Data
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
TABLE OF CONTENTS
SEPTEMBER 30, 2012
Report of Independent Registered Public Accounting Firm | F-1 |
Balance Sheets as of September 30, 2012 and 2011 | F-2 |
Statements of Operations for the periods ended September 30, 2012 and 2011 and the period from September 22, 2011 (Date of Inception) to September 30, 2012 | F-3 |
Statement of Stockholder’s Deficit as of September 30, 2012 | F-4 |
Statements of Cash Flows for the periods ended September 30, 2012 and 2011 and the period from September 22, 2011 (Date of Inception) to September 30, 2012 | F-5 |
Notes to Financial Statements | F-6 –F-8 |
10
Silberstein Ungar, PLLC CPAs and Business Advisors
Phone (248) 203-0080
Fax (248) 281-0940
30600 Telegraph Road, Suite 2175
Bingham Farms, MI 48025-4586
www.sucpas.com
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Boards of Directors
Allied Technologies Group, Inc.
Zalesie, Poland
We have audited the accompanying balance sheets of Allied Technologies Group, Inc., as of September 30, 2012 and 2011, and the related statements of operations, stockholders’ deficit, and cash flows for the periods then ended and the period from September 22, 2011 (date of inception) to September 30, 2012. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Allied Technologies Group, Inc., as of September 30, 2012 and 2011 and the results of its operations and cash flows for the periods then ended and the period from September 22, 2011 (date of inception) to September 30, 2012, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 7 to the financial statements, the Company has negative working capital, has received minimal received revenue from sales of products or services, and has incurred losses from operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans with regard to these matters are described in Note 7. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Silberstein Ungar, PLLC
Silberstein Ungar, PLLC
Bingham Farms, Michigan
November 19, 2012
F-1
11
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
AS OF SEPTEMBER 30, 2012 AND 2011
| 2012 | 2011 |
ASSETS |
|
|
Current Assets |
|
|
Cash and equivalents | $ 5,404 | $ 1,600 |
Total Current Assets | 5,404 | 1,600 |
|
|
|
TOTAL ASSETS | $ 5,404 | $ 1,600 |
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT |
|
|
Liabilities |
|
|
Current Liabilities |
|
|
Accrued expenses | $ 4,300 | $ 4,000 |
Notes payable – related party | 22,155 | 175 |
Total Liabilities | 26,455 | 4,175 |
|
|
|
Stockholders’ Deficit |
|
|
Common Stock, $.001 par value, 75,000,000 shares authorized, 2,590,000 shares issued and outstanding (1,500,000 – 2011) | 2,590 | 1,500 |
Additional paid-in capital | 20,710 | - |
Deficit accumulated during the development stage | (44,351) | (4,075) |
Total Stockholders’ Deficit | (21,051) | (2,575) |
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ 5,404 | $ 1,600 |
See accompanying notes to financial statements.
F-2
12
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
FOR THE PERIODS ENDED SEPTEMBER 30, 2012 AND 2011
FOR THE PERIOD FROM SEPTEMBER 22, 2011 (INCEPTION) TO SEPTEMBER 30, 2012
| Year ended September 30, 2012 | Period from September 22, 2011 (Inception) to September 30, 2011 | Period from September 22, 2011 (Inception) to September 30, 2012 |
|
|
|
|
REVENUES | $ 3,990 | $ - | $ 3,990 |
|
|
|
|
EXPENSES |
|
|
|
Professional fees | 9,300 | 4,000 | 13,300 |
General and administrative | 34,966 | 75 | 35,041 |
TOTAL EXPENSES | 44,266 | 4,075 | 48,341 |
|
|
|
|
LOSS FROM OPERATIONS | (40,276) | (4,075) | (44,351) |
|
|
|
|
PROVISION FOR INCOME TAXES | - | - | - |
|
|
|
|
NET LOSS | $ (40,276) | $ (4,075) | $ (44,351) |
|
|
|
|
NET LOSS PER SHARE: BASIC AND DILUTED | $ (0.02) | $ (0.02) |
|
|
|
|
|
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED | 2,063,743 | 166,667 |
|
See accompanying notes to financial statements.
F-3
13
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS’ DEFICIT
FOR THE PERIOD FROM SEPTEMBER 22, 2011 (INCEPTION) TO SEPTEMBER 30, 2012
| Common Stock | Additional paid-in | Deficit accumulated during the development |
| |
| Shares | Amount | capital | stage | Total |
|
|
|
|
|
|
Inception, September 22, 2011 | - | $ - | $ - | $ - | $ - |
|
|
|
|
|
|
Shares issued for cash at $0.001 per share | 1,500,000 | 1,500 | - | - | 1,500 |
|
|
|
|
|
|
Net loss for the period ended September 30, 2011 | - | - | - | (4,075) | (4,075) |
|
|
|
|
|
|
Balance, September 30, 2011 | 1,500,000 | 1,500 | 0 | (4,075) | (2,575) |
|
|
|
|
|
|
Shares issued for cash at $0.02 per share | 1,090,000 | 1,090 | 20,710 | - | 21,800 |
|
|
|
|
|
|
Net loss for the year ended September 30, 2012 | - | - | - | (40,276) | (40,276) |
|
|
|
|
|
|
Balance, September 30, 2012 | 2,590,000 | $ 2,590 | $ 20,710 | $ (44,351) | $ (21,051) |
See accompanying notes to financial statements.
F-5
14
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
FOR THE PERIODS ENDED SEPTEMBER 30, 2012 AND 2011
FOR THE PERIOD FROM SEPTEMBER 22, 2011 (INCEPTION) TO SEPTEMBER 30, 2012
| Year ended September 30, 2012 | Period from September 22, 2011 (Inception) to September 30, 2011 | Period from September 22, 2011 (Inception) to September 30, 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
Net loss for the period | $ (40,276) | $ (4,075) | $ (44,351) |
Adjustments to reconcile net loss to net cash used in operating activities |
|
|
|
Changes in assets and liabilities: |
|
|
|
Increase (decrease) in accrued expenses | 300 | 4,000 | 4,300 |
Net Cash Used in Operating Activities | (39,976) | (75) | (40,051) |
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
Proceeds from notes payable – related party | 21,980 | 175 | 22,155 |
Proceeds from issuance of common stock | 21,800 | 1,500 | 23,300 |
Net Cash Provided by Financing Activities | 43,780 | 1,675 | 45,455 |
|
|
|
|
NET INCREASE IN CASH | 3,804 | 1,600 | 5,404 |
|
|
|
|
Cash, beginning of period | 1,600 | - | - |
Cash, end of period | $ 5,404 | $ 1,600 | $ 5,404 |
|
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
|
Cash paid for interest | $ 0 | $ 0 | $ 0 |
Cash paid for income taxes | $ 0 | $ 0 | $ 0 |
See accompanying notes to financial statements.
F-5
15
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30, 2012
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
Allied Technologies Group, Inc. (‘Allied” or “the Company”) was incorporated under the laws of the State of Nevada, U.S. on September 22, 2011. The Company is a Poland-based company and intends to provide consulting services) in small boat building and maintenance, which will include but is not limited to consulting in boat building, boat repairs and maintenance, refurbishing, winterizing, custom refinishing and modifications, interior customization, appraisals and major renovations first in Poland and later, assuming available funds, in Europe and North America.
Development Stage Company
The accompanying financial statements have been prepared in accordance with generally accepted accounting principles related to development-stage companies. A development-stage company is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from.
Basis of Presentation
The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.
Accounting Basis
The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted a September 30 fiscal year end.
Cash and Cash Equivalents
Allied considers all highly liquid investments with maturities of three months or less to be cash equivalents. At September 30, 2012 and 2011, respectively, the Company had $5,404 and $1,600 of cash.
Fair Value of Financial Instruments
The Company’s financial instruments consist of cash and cash equivalents, accrued expenses and notes payable to a related party. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.
Income Taxes
Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
F-6
16
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30, 2012
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Revenue Recognition
The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.
Basic Income (Loss) Per Share
Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of September 30, 2012.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Recent Accounting Pronouncements
Allied Technologies does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow.
NOTE 2 – ACCRUED EXPENSES
Accrued expenses consisted of amounts due to the Company’s outside independent auditors as of September 30, 2012 and 2011 for periods reported on in these financial statements.
NOTE 3 – NOTES PAYALBE – RELATED PARTY
The shareholder has loaned funds to the Company to help pay operating expenses. The loans are unsecured, non-interest bearing and due on demand. The balances due to the shareholder were $22,155 and $175 as of September 30, 2012 and 2011, respectively.
NOTE 4 – COMMON STOCK
The Company has 75,000,000 shares of $0.001 par value common stock authorized.
During the period ended September 30, 2011, the Company issued 1,500,000 shares of common stock at $0.001 per share for total cash proceeds of $1,500.
In March 2012, the Company issued 940,000 shares of common stock at $0.02 per share for total cash proceeds of $18,800.
In April 2012, the Company issued 150,000 shares of common stock at $0.02 per share for total cash proceeds of $3,000.
As of September 30, 2012 there were 2,590,000 shares of common stock issued and outstanding.
F-7
17
ALLIED TECHNOLOGIES GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30, 2012
NOTE 5 – COMMITMENTS AND CONTINGENCIES
The Company neither owns nor leases any real or personal property. An officer has 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.
NOTE 6 – INCOME TAXES
As of September 30, 2012, the Company had net operating loss carry forwards of approximately $44,351 that may be available to reduce future years’ taxable income through 2032. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.
The provision for Federal income tax consists of the following for the periods ended September 30, 2012 and 2011:
| 2012 | 2011 |
Federal income tax benefit attributable to: |
|
|
Current operations | $ 13,694 | $ 1,386 |
Less: valuation allowance | (13,694) | (1,386) |
Net provision for Federal income taxes | $ 0 | $ 0 |
The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows as of September 30, 2012 and 2011:
| 2012 | 2011 |
Deferred tax asset attributable to: |
|
|
Net operating loss carryover | $ 15,080 | $ 1,386 |
Less: valuation allowance | (15,080) | (1,386) |
Net deferred tax asset | $ 0 | $ 0 |
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $44,351 for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.
NOTE 7 – GOING CONCERN
The financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has negative working capital, has received minimal revenue from sales of products or services, and has incurred losses since inception resulting in an accumulated deficit of $44,351 as of September 30, 2012 and further losses are anticipated in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand and loans from directors and or private placement of common stock.
NOTE 8 – SUBSEQUENT EVENTS
In accordance with ASC Topic 855-10, the Company has analyzed its operations subsequent to September 30, 2012 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.
F-8
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ITEM 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
None.
ITEM 9A(T). Controls and Procedures
Management’s Report on Disclosure Controls and Procedures
Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial
Officer, the Company conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting as of September 30, 2012 using the criteria established in “ Internal Control - Integrated Framework ” issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").
A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of September 30, 2012, the Company determined that there were control deficiencies that constituted material weaknesses, as described below.
1) We do not have an Audit Committee – While not being legally obligated to have an audit committee, it is the management’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’s financial statement. Currently the Board of Directors acts in the capacity of the Audit Committee, and does not include a member that is considered to be independent of management to provide the necessary oversight over management’s activities.
2) We did not maintain appropriate cash controls – As of September 30, 2012, the Company has not maintained sufficient internal controls over financial reporting for the cash process, including failure to segregate cash handling and accounting functions, and did not require dual signature on the Company’s bank accounts. Alternatively, the effects of poor cash controls were mitigated by the fact that the Company had limited transactions in their bank accounts.
3) We did not implement appropriate information technology controls – As at September 30, 2012, the Company retains copies of all financial data and material agreements; however there is no formal procedure or evidence of normal backup of the Company’s data or off-site storage of the data in the event of theft, misplacement, or loss due to unmitigated factors.
Accordingly, the Company concluded that these control deficiencies resulted in a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the company’s internal controls.
As a result of the material weaknesses described above, management has concluded that the Company did not maintain effective internal control over financial reporting as of September 30, 2012 based on criteria established in Internal Control—Integrated Framework issued by COSO.
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Changes in Internal Control over Financial Reporting
There has been no change in our internal control over financial reporting identified in connection with our evaluation we conducted of the effectiveness of our internal control over financial reporting as of September 30, 2012, that occurred during our fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management’s report in this annual report.
PART III
ITEM 10. Directors, Executive Officers, Promoters and Control Persons of the Company
DIRECTORS AND EXECUTIVE OFFICERS
The name, address and position of our present officers and directors are set forth below:
Name and Address of Executive Officer and/or Director |
| Age |
| Position |
|
|
|
|
|
Ihar Yaravenka 28A Horbow-Kolonia Zalesie, Poland 21-512 |
| 58 |
| President, Treasurer and Director (Principal Executive, Financial and Accounting Officer) |
Mr. Yaravenka has acted as our sole President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors since our incorporation on September 22, 2011. Mr. Yaravenka owns 100% of the outstanding shares of our common stock. As such, it was unilaterally decided that Mr. Yaravenka was going to be our sole President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors. This decision did not in any manner relate to Mr. Yaravenka’s previous employments. Mr. Yaravenka’s previous experience, qualifications, attributes or skills were not considered when he was appointed as our sole President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors.
Mr. Yaravenka obtained a Bachelor’s degree in Engineering from the Almaty University of Power Engineering and Telecommunications (AUPET) in Almaty, Kazakhstan. After graduation Mr. Ihar Yaravenka has been working for various engineering companies in Kazakhstan, Poland and Europe. In 2001 Mr. Yaravenka accepted position of engineer at Yacht Metal, a Poland-based company, specializing in building of boats and yachts. Mr. Yaravenka is currently employed by Yacht Metal.
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During the past ten years, Mr. Yaravenka has not been the subject to any of the following events:
1. Any bankruptcy petition filed by or against any business of which Mr. Yaravenka was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.
2. Any conviction in a criminal proceeding or being subject to a pending criminal proceeding.
3. An order, judgment, or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting Mr. Yaravenka’s involvement in any type of business, securities or banking activities.
4. Found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Future Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
5. Was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;
6. Was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;
7. Was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
i. Any Federal or State securities or commodities law or regulation; or
ii. Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
iii. Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
8. Was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
AUDIT COMMITTEE
We do not have an audit committee financial expert. We do not have an audit committee financial expert because we believe the cost related to retaining a financial expert at this time is prohibitive. Further, because we have no operations, at the present time, we believe the services of a financial expert are not warranted.
ITEM 11. Executive Compensation
The table below summarizes all compensation awarded to, earned by, or paid to our executive officers by any person for all services rendered in all capacities to us for the fiscal period from our incorporation on September 22, 2011 to September 30, 2012 (our fiscal year end) and subsequent thereto to the date of this prospectus.
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SUMMARY COMPENSATION TABLE
Summary Compensation Table
Name and Principal Position |
| Year |
| Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation ($) | All Other Compensation ($) | Total ($) | ||||||||
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Ihar Yaravenka , President and Treasurer |
| 2011 |
|
| -0- |
| -0- |
| -0- |
| -0- |
| -0- |
| -0- |
| -0- |
| -0- |
2012 | |||||||||||||||||||
There are no current employment agreements between the company and its sole officer. The compensation discussed herein addresses all compensation awarded to, earned by, or paid to our named executive officer. There are no other stock option plans, retirement, pension, or profit sharing plans for the benefit of our officers and directors other than as described herein.
CHANGE OF CONTROL
As of September 30, 2012, we had no pension plans or compensatory plans or other arrangements which provide compensation in the event of a termination of employment or a change in our control.
ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table provides certain information regarding the ownership of our common stock, as of September 30, 2012 and as of the date of the filing of this annual report by:
| • |
| each of our executive officers; |
| • |
| each director; |
| • |
| each person known to us to own more than 5% of our outstanding common stock; and |
| • |
| all of our executive officers and directors and as a group. |
Title of Class |
| Name and Address of Beneficial Owner |
| Amount and Nature of Beneficial Ownership |
| Percentage |
| |
|
|
|
|
|
|
|
| |
Common Stock |
| Ihar Yaravenka 28A Horbow-Kolonia Zalesie, Poland 21-512 |
| 1,500,000 shares of common stock (direct) |
|
| 57.92 | % |
The percent of class is based on 2,590,000 shares of common stock issued and outstanding as of the date of this annual report.
ITEM 13. Certain Relationships and Related Transactions
During the year ended September 30, 2012, we had not entered into any transactions with our sole officer or director, or persons nominated for these positions, beneficial owners of 5% or more of our common stock, or family members of these persons wherein the amount involved in the transaction or a series of similar transactions exceeded the lesser of $120,000 or 1% of the average of our total assets for the last three fiscal years.
ITEM 14. Principal Accountant Fees and Services
During fiscal year ended September 30, 2012, we incurred approximately $7,300 in fees to our principal independent accountants for professional services rendered in connection with the audit of our financial statements and for the reviews of our financial statements.
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ITEM 15. Exhibits
The following exhibits are filed as part of this Annual Report.
Number | Description |
|
|
23.1 | Consent of Silberstein Ungar, PLLC CPAs |
31.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act |
32.1 | Certification of Chief Executive Officer and Chief Financial Officer Under Section 1350 as Adopted Pursuant Section 906 of the Sarbanes-Oxley Act. |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema Document |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
101. DEF | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| ALLIED TECHNOLOGIES GROUP, INC. |
Dated: November 30, 2012 | By: /s/ Ihar Yaravenka |
| Ihar Yaravenka, President and Chief Executive Officer and Chief Financial Officer |
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