| Significant Accounting Policies | NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES
OF CONSOLIDATION The consolidated financial statements include
the financial statements of its wholly-owned subsidiary, Photozou Koukoku. Intercompany transactions are eliminated. BASIS OF PRESENTATION The accompanying unaudited consolidated financial
statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC,
including the instructions to Form 10-Q and Regulation S-X. In the opinion of the management of the Company, all adjustments, which
are of a normal recurring nature, necessary for a fair statement of the results for the nine months period, have been made. Results
for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year.
When used in these notes, the terms “Company”, “we”, “us” or “our” mean the Company.
Certain information and note disclosure normally included in financial statements prepared in accordance with generally accepted
accounting principles in the United States of America has been omitted from these statements pursuant to such accounting principles
and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should
be read in conjunction with our consolidated financial statements for the year ended November 30, 2018, included in our Form 10-K.
All periods presented have been updated for the common control merger disclosed in below causing the prior period presentation
to be restated to reflect the merger. USE
OF ESTIMATES The presentation
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 disclosures of contingent assets and liabilities as of the date
of the financial statements and the reported amounts of revenue and expenses during the reporting periods. The most significant
estimates and assumptions made by management include going concern, allowance for doubtful accounts, valuation allowance on deferred
income tax, inventory obsolescence and sales allowance. Operating results in the future could vary from the amounts derived from
management's estimates and assumptions. RELATED
PARTY TRANSACTION The Company
accounts for related party transactions in accordance with ASC 850 ("Related Party Disclosures"). A related party is
generally defined as (i) any person that holds 10% or more of the Company's securities and their immediate families, (ii) the Company's
management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or
(iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to
be a related party transaction when there is a transfer of resources or obligations between related parties. The Company conducts
business with its related parties in the ordinary course of business. Transactions
involving related parties cannot be presumed to be carried out on an arm's-length basis, as the requisite conditions of competitive,
free market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the
related party transactions were consummated on terms equivalent to those that prevail in arm's-length transactions unless such
representations can be substantiated. CASH
EQUIVALENTS The Company
considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. ACCOUNTS
RECEIVABLE AND CREDIT POLICIES Accounts
receivable are recognized and carried at the original invoice amount less allowance for any uncollectible amounts. An estimate
for doubtful accounts is made when collection of the full amount is no longer probable. Bad debts are written off as incurred.
If there is a claim for a defect of product after within four days after arrival of goods, the Company shall accept a goods return. INVENTORY Inventory,
consisting of used cameras, are primarily accounted for using the specific identification method, and are valued at the lower of
cost or market value. This valuation requires the Company to make judgments, based on currently-available information, about the
likely method of disposition, such as through sales to individual customers, returns to product vendors, or liquidations, and expected
recoverable values of each disposition category. As of
August 31, 2019 and November 30, 2018, the Company held inventory comprised solely of used cameras in the amount of $35,624 and
$10,740. The purchase of inventory of cameras was 100% handled by Mr. Takaharu Ogami, who under contract buys and sells all cameras. PROPERTY,
PLANT AND EQUIPMENT Property,
plant and equipment are stated at cost less depreciation and impairment loss. The initial cost of the assets comprises its purchase
price and any directly attributable costs of bringing the asset to its working condition and location for its intended use. Depreciation
is calculated using the straight-line method over the shorter of the estimated useful life of the respective assets as follows:
computer software developed or acquired for internal use, 2 to 5 years; computer equipment, 2 to 5 years; buildings and improvements,
5 to 15 years; leasehold improvements, 2 to 10 years; and furniture and equipment, 1 to 5 years. Significant
improvements are capitalized when it is probable that the expenditure resulted in an increase in the future economic benefits expected
to be obtained from the use of the asset beyond its originally assessed standard of performance. When improvements are made to
real property and those improvements are permanently affixed to the property, the title to those improvements automatically transfers
to the owner of the property. The lessee’s interest in the improvements is not a direct ownership interest but rather it
is an intangible right to use and benefit from the improvements during the term of the lease. The Company uses the straight-line
method over the shorter of the estimated useful life of the asset or the lease term. In accordance
with ASC Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that
the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss
when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment
is measured as the difference between the asset’s estimated fair value and its book value. For the nine months ended August
31, 2019 and 2018, the Company did not record any impairment charges on long-lived assets. Routine
repairs and maintenance are expensed when incurred. Gains and losses on disposal of fixed assets are recognized in the income
statement based on the net disposal proceeds less the carrying amount of the assets. FOREIGN CURRENCY TRANSLATION The Company maintains its books and record
in its local currency, Japanese YEN (“JPY”), which is a functional currency as being the primary currency of the economic
environment in which its operation is conducted. Transactions denominated in currencies other than the functional currency are
translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities
denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange
rates at the balance sheet dates. The resulting exchange differences are recorded in the statements of operations. The reporting currency of the Company is the
United States Dollars (“US$”) and the accompanying consolidated financial statements have been expressed in US$. In
accordance with ASC Topic 830-30, “Translation of Financial Statement”, assets and liabilities of the Company whose
functional currency is not US$ are translated into US$, using the exchange rate on the balance sheet date. Revenues and expenses
are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements
are recorded as a separate component of accumulated other comprehensive income within the statements of shareholders’ equity. Translation of amounts from the local currency
of the Company into US$1 has been made at the following exchange rates:
August 31, 2019 August 31, 2018
Current JPY: US$1 exchange rate 106.29 101.02
Average JPY: US$1 exchange rate 109.63 109.77 COMPREHENSIVE
INCOME OR LOSS ASC Topic
220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income or loss, its components
and accumulated balances. Comprehensive income or loss as defined includes all changes in equity during a period from non-owner
sources. Accumulated comprehensive income, as presented in the accompanying consolidated statements of shareholders’ equity
consists of changes in unrealized gains and losses on foreign currency translation. REVENUE
RECOGNITION AND
DEFERRED REVENUE For the
period ended August 31, 2018, the Company applies paragraph 605-10-S99-1 of the FASB Accounting Standards Codification for revenue
recognition. The Company will recognize revenue when it is realized or realizable and earned. The Company considers revenue realized
or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the
product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and
(iv) collectability is reasonably assured. The Company provides the warranty for the delivery of its service. If the Company cannot
deliver its service to customers successfully, the Company retry its operation until the delivery is completed. Starting December 1, 2018 the Company adopted
ASC 606 - Revenue from contracts with Customers: (1) identify the contract with a customer; (2) identify the performance obligations
in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the
contract; and (5) recognize revenue when each performance obligation is satisfied. Revenue
for used cameras is recognized when the cameras are delivered to the customer. In case of the service for the photo contest, the
Company applies the percentage of completion method and unfinished part of collected cash is accounted as a deferred revenue. Disaggregated revenue of the Company is as
follows:
For the three months Percentage of For the nine months Percentage of
ended total revenues ended total revenues
August 31, 2019 August 31, 2019
Revenue from cameras sold $ 107,387 93.7% 213,133 91.0%
Service revenues 7,170 6.3% 21,070 9.0%
Total 114,557 100% 234,203 100% NET
LOSS PER COMMON SHARE Net income
per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per share
is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted
net loss per share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding
shares of common stock during each period. There were no potentially dilutive shares outstanding as of August 31, 2019 and 2018. INCOME
TAX The Company
follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and
liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.
Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases
of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred
tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will
not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in
the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities
of a change in tax rates is recognized in the Statements of Operations in the period that includes the enactment date. The Company
adopted section 740-10-25 of the FASB Accounting Standards Codification ("Section 740-10-25"). Section 740-10-25 addresses
the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial
statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more
likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits
of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest
benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. CONCENTRATION OF CREDIT RISKS Financial
instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents
and accounts receivable. The Company places its cash and cash equivalents with financial institutions. The Company does not require
collateral or other security to support financial instruments subject to credit risks. With respect to trade receivables, the Company
routinely assesses the financial strength of its customers and, as a consequence, believes that the receivable credit risk exposure
is limited. RECENT
ACCOUNTING PRONOUNCEMENTS In May
2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (ASC 606)” and issued subsequent amendments
to the initial guidance or implementation guidance between August 2015 and November 2017 within ASU 2015-04, ASU 2016-08, ASU 2016-10,
ASU 2016-12, ASU 2016-20, ASU 2017-13, and ASU 2017-14 (collectively, including ASU 2014-09, “ASC 606”). Under ASC
606, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects
the consideration which the entity expects to receive in exchange for those goods or services. In addition, the standard requires
disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. ASC
606 is effective for fiscal years and interim periods within those years beginning after December 15, 2017, and early adoption
is permitted for periods beginning after December 15, 2016. The Company elected to adopt the new standard effective December 1,
2018. The
guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method),
or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application
(modified retrospective method). The Company elected adopting the standard using the modified retrospective method. The Company
has identified its revenue streams and assessed each for the impacts. The Company has adopted Topic 606, which has not had a material
impact in the timing or amount of revenue recognized, including the presentation of revenues in the Company’s consolidated
statements of income and comprehensive loss. The impact from the cumulative effect adjustment has been immaterial and the impact
has been immaterial to the consolidated financial statements for the full fiscal year 2019. |
