Starco Brands (STCB) 10-Q 15 May 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 15, 2019
Document And Entity Information
Entity Registrant Name	Starco Brands, Inc.
Entity Central Index Key	0001539850
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		159,090,914
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2019
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Ex Transition Period	false

CONDENSED BALANCE SHEETS (Unaud

CONDENSED BALANCE SHEETS (Unaudited) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Current Assets:
Cash	$ 8,243	$ 721
Accounts receivable	19,254	17,504
Prepaid and other expenses	22,611	25,974
Total Current Assets	50,108	44,199
Right of use lease asset, operating, net	113,658
Deposit	3,500	3,500
Total Assets	167,266	47,699
Current Liabilities:
Accounts payable	192,272	171,954
Other payable and accruals	284,884	280,914
Accrued compensation	48,450	45,850
Lease obligation	37,460
Loan payable - related party	395,543	373,346
Notes payable	16,805	26,731
Total Current Liabilities	975,414	898,795
Lease obligation - noncurrent portion	76,539
Total Liabilities	1,051,953	898,795
Stockholders' (Deficit):
Common Stock, par value $0.001 300,000,000 shares authorized, 159,090,914 and 159,090,914 shares issued and outstanding, respectively	159,091	159,091
Additional paid in capital	15,541,855	15,530,155
Accumulated deficit	(16,585,633)	(16,540,342)
Total Stockholders' Deficit	(884,687)	(851,096)
Total Liabilities and Stockholders' Deficit	$ 167,266	$ 47,699

CONDENSED BALANCE SHEETS (Una_2

CONDENSED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	159,090,914	159,090,914
Common stock, shares outstanding	159,090,914	159,090,914

CONDENSED STATEMENTS OF OPERATI

CONDENSED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Revenues	$ 61,263	$ 763
Operating Expenses:
Compensation expense	46,720	86,466
Professional fees	21,757	75,890
General and administrative	35,296	81,484
Total operating expenses	103,773	243,840
Loss from operations	(42,510)	(243,077)
Other Income (Expense):
Interest expense	(8,031)	(7,981)
Interest income		30
Other income	5,250	3,000
Total other expense	(2,781)	(4,951)
Loss before provision for income taxes	(45,291)	(248,028)
Provision for income taxes
Net Loss	$ (45,291)	$ (248,028)
Loss per Share, Basic & Diluted	$ 0	$ 0
Weighted Average Shares Outstanding	159,090,914	56,531,124

STATEMENTS OF STOCKHOLDERS EQUI

STATEMENTS OF STOCKHOLDERS EQUITY (DEFICIT) (Unaudited) - USD ($)	Common Stock	Additional Paid-In Capital	Common Stock to be Issued	Accumulated Deficit	Total
Beginning Balance at Dec. 31, 2017	$ 2,418	$ 14,965,081	$ 600,000	$ (16,098,391)	$ (530,892)
Beginning Balance, Shares at Dec. 31, 2017	2,417,569
Shares issued for service	$ 30,300	(22,119)			8,181
Shares issued for service, Shares	30,300,000
Shares issued to officer and directors for services	$ 117,282	(85,616)			31,666
Shares issued to officer and directors for services, Shares	117,282,442
Contributed services		23,400			23,400
Net Loss for the period				(248,028)	(248,028)
Ending Balance at Mar. 31, 2018	$ 150,000	14,880,746	600,000	(16,346,419)	(715,673)
Ending Balance, Shares at Mar. 31, 2018	150,000,011
Beginning Balance at Dec. 31, 2018	$ 159,091	15,530,155		(16,540,342)	(851,096)
Beginning Balance, Shares at Dec. 31, 2018	159,090,914
Contributed services		11,700			11,700
Net Loss for the period				(45,291)	(45,291)
Ending Balance at Mar. 31, 2019	$ 159,091	$ 15,541,855		$ (16,585,633)	$ (884,687)
Ending Balance, Shares at Mar. 31, 2019	159,090,914

CONDENSED STATEMENTS OF CASH FL

CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CASH FLOW FROM OPERATING ACTIVITES:
Net Loss for the Period	$ (45,291)	$ (248,028)
Adjustments to reconcile net loss to net cash used by operating activities:
Stock based compensation		8,181
Stock based compensation - related party		31,666
Contributed services	11,700	23,400
Changes in Operating Assets and Liabilities:
Accounts receivable	(1,749)	4,093
Prepaids & other assets	3,362	14,773
Accounts payable	20,318	22,420
Accrued expenses	6,911	7,617
Net Cash (Used) in Operating Activities	(4,749)	(135,878)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net Cash Used in Investing Activities
CASH FLOWS FROM FINANCING ACTIVITIES:
Advances from a related party	37,197	2,000
Repayment of advances from a related party	(15,000)	(2,000)
Payments on notes payable	(9,926)	(19,831)
Net Cash Provided by Financing Activities	12,271	(19,831)
Net Increase (decrease) in Cash	7,522	(155,709)
Cash at Beginning of Period	721	314,181
Cash at End of Period	8,243	158,472
Cash paid during the year for:
Interest
Income taxes
Supplemental non-cash disclosure:
Establish operating lease right of use asset and related liability	$ 122,825

ORGANIZATION AND DESCRIPTION OF

ORGANIZATION AND DESCRIPTION OF BUSINESS	3 Months Ended
	Mar. 31, 2019
Organization And Description Of Business
ORGANIZATION AND DESCRIPTION OF BUSINESS	NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS Starco Brands, Inc. (the "Company") was incorporated in the State of Nevada on January 26, 2010, to engage in Direct Response marketing of consumer products with the goal of producing sales through television and/or retail. On September 7, 2017 the Company filed an Amendment to the Articles of Incorporation to change the corporate name to Starco Brands, Inc. The Board determined the change of the Company’s name was in the best interests of the Company due to changes in our current and anticipated business operations. In July 2017 the Company entered into a licensing agreement with The Starco Group, located in Los Angeles, California. The Companies pivoted to commercializing novel consumer products manufactured by The Starco Group. The Starco Group is a private label and branded aerosol and liquid fill manufacturer which manufactures DIY/Hardware, paints, coatings and adhesives, household, hair care, disinfectants, automotive, motorcycle, arts & crafts, personal care cosmetics, personal care, FDA, sun care, food, cooking oils, beverage, spirits and wine.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The Company’s unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying unaudited condensed financial statements reflect all adjustments, consisting of only normal recurring items, which, in the opinion of management, are necessary for a fair statement of the results of operations for the periods shown and are not necessarily indicative of the results to be expected for the full year ending December 31, 2019. These unaudited condensed financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. 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 of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates. Reclassifications Certain reclassifications have been made to the prior period financial information to conform to the presentation used in the financial statements for the three months ended March 31, 2019. Recently issued accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. The Company is also evaluating the potential impact of new standards that have been issued but are not yet effective.

GOING CONCERN

GOING CONCERN	3 Months Ended
	Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
GOING CONCERN	NOTE 3 – GOING CONCERN The accompanying unaudited condensed financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has an accumulated deficit of $16,585,633 at March 31, 2019, had a net loss of $45,291 and net cash used in operating activities of $4,749 for the three months ended March 31, 2019. The Company’s ability to raise additional capital through the future issuances of common stock and/or debt financing is unknown. The obtainment of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. These conditions and the ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

ACCOUNTS PAYABLE

ACCOUNTS PAYABLE	3 Months Ended
	Mar. 31, 2019
Payables and Accruals [Abstract]
ACCOUNTS PAYABLE	NOTE 4 – ACCOUNTS PAYABLE A portion of the Company’s accounts payable is the result of chargebacks for product that was not sold by a former customer. The Company also has other payables that are several years old for which management is in discussion with the vendors to settle those liabilities for a lesser amount. March 31, 2019 December 31, 2018 Chargeback $ 3,075 $ 3,075 Aged payables 45,023 45,023 Other vendor payables 144,174 123,856 $ 192,272 $ 171,954

NOTES PAYABLE

NOTES PAYABLE	3 Months Ended
	Mar. 31, 2019
Notes to Financial Statements
NOTES PAYABLE	NOTE 5 – NOTES PAYABLE The Company had two financing loans for its Director and Officer Insurance, both of which expired in the third quarter of 2018 and were replaced with a new single loan. As of March 31, 2019 and December 31, 2018 the loan(s) had a balance of $13,505 and $26,731, respectively. The new loan bears interest at 6.97% and is due within one year. During the fourth quarter of 2018 a third party loaned the Company $3,300 to pay for general operating expenses. The loan is unsecured, non-interest bearing and due on demand.

COMMITMENTS & CONTIGENCIES

COMMITMENTS & CONTIGENCIES	3 Months Ended
	Mar. 31, 2019
Notes to Financial Statements
COMMITMENTS & CONTIGENCIES	NOTE 6 – COMMITMENTS & CONTIGENCIES The Company currently occupies office space in Burbank, California. The Company signed a three-year lease starting January 1, 2016. The lease has been extended for an additional three-year term. Current monthly lease payments are $3,742 with yearly increases. The lease required a deposit of $3,500 which was paid on December 10, 2015. The lease is being accounted for under ASU 2016-02 Leases (Topic 842). The company recorded an initial Right of Use of Asset and Lease Obligation of $122,825. As of March 31, 2019, the Company has accrued rent due of $21,653 and a Lease Obligation of $113,998. Investment Agreement On July 9, 2014, the Board of Directors approved an investment arrangement with an individual. Per the terms of the agreement, the investor transferred $150,000 to the Company for which he was entitled to the following: $1 per unit sold of a fitness product through all retail outlets including online and retail shopping shows until the investment was paid back in full. Once the original investment was recouped the investor shall then receive a 2% royalty in perpetuity on all future retail sales of the fitness product. The investment remains with the Company and is disclosed as an accrued liability on the balance sheet. Since the product for which the investment was intended was never produced this agreement is being renegotiated.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Mar. 31, 2019
Notes to Financial Statements
RELATED PARTY TRANSACTIONS	NOTE 7 – RELATED PARTY TRANSACTIONS During the year ended December 31, 2017, Sanford Lang, the Company’s Chairman and former CEO, advanced the Company $289,821 to pay for general operating expenses. The advances are uncollateralized, require a monthly interest payment of $2,545 and due on demand. On February 26, 2018, the Board approved the issuance of 117,282,442 shares of common stock to its officers and directors for services rendered at a price per share of $0.00027 for total non-cash expense of $31,666. As of March 31, 2019, the Company owed The Starco Group, Inc, (“TSG”) $72,843 for expenses paid by The Starco Group on behalf of the Company for expenses to launch licensed brands. Once royalties exceed $250,000 in the aggregate, TSG will deduct the incurred expenses from the subsequent royalty payments until TSG is paid in full. In addition, the Company owed TSG an additional $32,679 for expenses paid on behalf of the Company or funds advanced to the Company to pay for other operating expenses. During the three months ended March 31, 2019, the Company recognized $61,263 of royalty revenue and had a $19,254 receivable from The Starco Group.

STOCK WARRANTS

STOCK WARRANTS	3 Months Ended
	Mar. 31, 2019
Notes to Financial Statements
STOCK WARRANTS	NOTE 8 – STOCK WARRANTS A summary of the status of the Company’s outstanding stock warrants and changes during the periods is presented below: Shares available to purchase with warrants Weighted Average Price Weighted Average Fair Value Outstanding, December 31, 2017 2,000,000 $ 1.05 $ 0.003 Issued — $ — $ — Exercised — $ — $ — Cancelled — $ — $ — Expired — $ — $ — Outstanding, December 31, 2018 2,000,000 $ 1.05 $ 0.003 Issued — $ — $ — Exercised — $ — $ — Cancelled — $ — $ — Expired — $ — $ — Outstanding, March 31, 2019 2,000,000 $ 1.05 $ 0.003 Exercisable, March 31, 2019 2,000,000 $ 1.05 $ 0.003

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2019
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 9 – SUBSEQUENT EVENTS Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the financial statements were issued and has determined that no material subsequent events exist other then the following. On April 29, 2019, the Board, cancelled 312,500 shares of common stock previously issued for services. The shares were cancelled for non-performance as permitted per the terms of the original service agreement.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
Basis of presentation	Basis of presentation The Company’s unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying unaudited condensed financial statements reflect all adjustments, consisting of only normal recurring items, which, in the opinion of management, are necessary for a fair statement of the results of operations for the periods shown and are not necessarily indicative of the results to be expected for the full year ending December 31, 2019. These unaudited condensed financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.
Use of estimates	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 of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.
Reclassifications	Reclassifications Certain reclassifications have been made to the prior period financial information to conform to the presentation used in the financial statements for the three months ended March 31, 2019.
Recently issued accounting pronouncements	Recently issued accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. The Company is also evaluating the potential impact of new standards that have been issued but are not yet effective.

ACCOUNTS PAYABLE (Tables)

ACCOUNTS PAYABLE (Tables)	3 Months Ended
	Mar. 31, 2019
Payables and Accruals [Abstract]
Schedule of Account Payable	March 31, 2019 December 31, 2018 Chargeback $ 3,075 $ 3,075 Aged payables 45,023 45,023 Other vendor payables 144,174 123,856 $ 192,272 $ 171,954

STOCK WARRANTS (Tables)

STOCK WARRANTS (Tables)	3 Months Ended
	Mar. 31, 2019
Notes to Financial Statements
Schedule of Outstanding Stock Warrants	A summary of the status of the Company’s outstanding stock warrants and changes during the periods is presented below: Shares available to purchase with warrants Weighted Average Price Weighted Average Fair Value Outstanding, December 31, 2017 2,000,000 $ 1.05 $ 0.003 Issued — $ — $ — Exercised — $ — $ — Cancelled — $ — $ — Expired — $ — $ — Outstanding, December 31, 2018 2,000,000 $ 1.05 $ 0.003 Issued — $ — $ — Exercised — $ — $ — Cancelled — $ — $ — Expired — $ — $ — Outstanding, March 31, 2019 2,000,000 $ 1.05 $ 0.003 Exercisable, March 31, 2019 2,000,000 $ 1.05 $ 0.003

GOING CONCERN (Details Narrativ

GOING CONCERN (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Going Concern
Accumulated Deficit	$ 16,585,633		$ 16,540,342
Net Loss	45,291	$ 248,028
Net Cash (Used) in Operating Activities	$ 4,749	$ 135,878

ACCOUNTS PAYABLE (Details)

ACCOUNTS PAYABLE (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Chargeback	$ 3,075	$ 3,075
Aged payables	45,023	45,023
Other vendor payables	144,174	123,856
Account Payable	$ 192,272	$ 171,954

COMMITMENTS & CONTIGENCIES (Det

COMMITMENTS & CONTIGENCIES (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018	Dec. 10, 2015
Commitments Contigencies
Current Lease payment	$ 3,742
Lease required a deposit			$ 3,500
Accured Rent		$ 21,653
Lease Obligation	$ 113,998

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	Feb. 26, 2018	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
General Operating Expenses		$ 35,296	$ 81,484
Common Shares Issued	117,282,442	159,090,914		159,090,914
Common Share, per price	$ 0.00027	$ 0.001		$ 0.001
Non Cash Expenses	$ 31,666
Chairman And Former CEO [Member]
General Operating Expenses			$ 289,821
The Starco Group [Member]
Royalty Revenue		$ 61,263
Account Receivable				$ 19,254

STOCK WARRANTS (Details)

STOCK WARRANTS (Details) - $ / shares	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Shares
Exercisable-end of period (in shares)	2,000,000
Weighted Average Exercise Price
Exercisable-end of period (in dollars per share)	$ 1.05
Stock Warrants [Member]
Shares
Outstanding-beginning of period (in shares)	2,000,000	2,000,000
Issued
Exercised
Forfieted
Expired
Outstanding-end of period (in shares)	2,000,000	2,000,000
Weighted Average Exercise Price
Outstanding-beginning of period (in dollars per share)	$ 1.05	$ 1.05
Issued
Exercised
Forfieted
Expired
Outstanding-end of period (in dollars per share)	1.05	1.05
Weighted Average Fair Value
Outstanding-beginning of period (in dollars per share)	.003	.003
Issued
Exercised
Forfeited
Outstanding-end of period (in dollars per share)	$ .003	$ .003

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - Common Stock - shares	Apr. 29, 2019	Mar. 31, 2018
Shares Cancelled for Non-performance of Serivces		30,300,000
Subsequent Event [Member]
Shares Cancelled for Non-performance of Serivces	312,500