UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2017
or
| ¨ | 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 333-205271
| Zev Ventures, Inc. |
| (Exact name of registrant as specified in its charter) |
| Nevada | 38-3926700 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
| 500C Grand St., Apartment 3G, New York NY | 10002 |
| (Address of principal executive offices) | (Zip Code) |
| Registrant’s telephone number, including area code | (631) 418-7044 |
| (Former name, former address and former fiscal year, if changed since last report) |
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 such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
x Yes¨ No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 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).
x Yes¨ 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” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer¨ | Accelerated filer¨ |
| Non-accelerated filer¨ (Do not check if a smaller reporting company) | Smaller reporting companyx |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).¨ Yesx No
As of March 31, 2017, the Registrant has 2,000,000 shares of common stock outstanding.
TABLE OF CONTENTS
i
PART I – FINANCIAL INFORMATION
ZEV VENTURES, INC.
INTERIM FINANCIAL STATEMENTS
(unaudited)
for the nine months ended March 31, 2017
| F-1 |
BALANCE SHEETS
(in US Dollars)
March 31 2017 | December 31, 2016 | |||||||
| (Unaudited) | ||||||||
| $ | $ | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | 548 | 2,382 | ||||||
| Account receivable | 301 | 1,818 | ||||||
| Inventory | 5,832 | 1,460 | ||||||
| Total current assets | 6,681 | 5,660 | ||||||
| TOTAL ASSETS | 6,681 | 5,660 | ||||||
| LIABILITIES AND STOCKHOLDER’S EQUITY (DEFICIT) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | 11,375 | 8,000 | ||||||
| Loan from related party | 57,553 | 52,503 | ||||||
| Total Liabilities | 68,928 | 60,503 | ||||||
| Stockholder’s Equity (Deficit) | ||||||||
| Common stock, $0.0001 par value, 75,000,000 shares authorized 3,000,000 shares issued and outstanding as of March 31, 2017 and December 31, 2016 | 300 | 300 | ||||||
| Accumulated deficit | (62,547 | ) | (55,143 | ) | ||||
| Total Stockholder's Deficit | (62,247 | ) | (54,843 | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY (DEFICIT) | 6,681 | 5,660 | ||||||
The accompanying notes are an integral part of these financial statements.
| F-2 |
STATEMENT OF OPERATIONS
(in US Dollars)
(Unaudited)
Three months ended March 31, | ||||||||
| 2017 | 2016 | |||||||
| Revenue | 5,512 | 741 | ||||||
| Cost of sales | (12,422 | ) | (1,124 | ) | ||||
| (6,910 | ) | (383 | ) | |||||
| General and administrative:- | ||||||||
| Professional fees | ||||||||
| - Auditors’ fees | 2,500 | 2,500 | ||||||
| - Legal fees | 3,000 | 3,000 | ||||||
| Filing fees | 875 | - | ||||||
| Miscellaneous fees | 36 | - | ||||||
| Other costs | 105 | 2 | ||||||
| Total operating expenses | (6,516 | ) | (2,752 | ) | ||||
| Net loss | (7,404 | ) | (3,135 | ) | ||||
| Net loss per common share - basic and diluted: | ||||||||
| Net loss per share attributable to common stockholders | (0.00 | ) | (0.00 | ) | ||||
| Weighted-average number of common shares outstanding | 3,000,000 | 3,000,000 | ||||||
The accompanying notes are an integral part of these financial statements.
| F-3 |
STATEMENT OF CASH FLOWS
(Unaudited)
Three months ended March 31, | ||||||||
| 2017 | 2016 | |||||||
| $ | $ | |||||||
| Cash Flows from Operating Activities | ||||||||
| Net loss | (7,404 | ) | (3,135 | ) | ||||
| Changes in operating assets and liabilities | ||||||||
| Inventory | (4,372 | ) | (1,415 | ) | ||||
| Account receivable | 1,517 | - | ||||||
| Account payable and accrued expenses | 3,375 | 2,000 | ||||||
| 520 | 585 | |||||||
| Net cash used by operating activities | (6,884 | ) | (2,550 | ) | ||||
| Cash Flows from Investing Activities | - | - | ||||||
| Cash Flows from Financing Activities | ||||||||
| Loan from related party | 5,050 | - | ||||||
| Net cash earned from financing activities | 5,050 | - | ||||||
| Increase/ (Decrease) in cash and cash equivalents | (1,834 | ) | (2,550 | ) | ||||
| Cash and cash equivalents at beginning of the year | 2,382 | 5,174 | ||||||
| Cash and cash equivalents at end of the year | 548 | 2,624 | ||||||
The accompanying notes are an integral part of these financial statements.
| F-4 |
NOTES TO THE INTERIM FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION
Zev Ventures Inc. (the “Company”) is a Nevada Corporation, incorporated under the laws of the State of Nevada on December 22, 2014. The Company's business plan involves purchasing tickets online for popular sport's events and reselling them through online marketplaces.
Basis of Presentation
The Company maintains its accounting records on an accrual basis in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”).
These financial statements are presented in US dollars.
Fiscal Year End
The Corporation has adopted a fiscal year end of December 31.
Unaudited Interim Financial Statements
The interim financial statements of the Company as of March 31, 2017, and for the periods then ended are unaudited. However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Company’s financial position as of March 31, 2017, and the results of its operations and its cash flows for the period ended March 31, 2017. These results are not necessarily indicative of the results expected for the calendar year ending December 31, 2017. The accompanying financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in the United States. Refer to the Company’s audited financial statements as of December 31, 2016, filed with the SEC, for additional information, including significant accounting policies.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies are set out below, these policies have been consistently applied to the period presented, unless otherwise stated:
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 or revenues and expenses during the reporting period. Actual results could differ from those estimates.
Going concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. As at March 31, 2017 the Company has a deficit from operations of $62,547 and has not earned sufficient revenues to cover operating costs and has a working capital deficit of $62,247. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the year ending December 31, 2017.
The ability of the Company to emerge from the development stage is dependent upon, among other things, obtaining additional financing to continue operations, and development of its business plan. In response to these problems, management intends to raise additional funds through public or private placement offerings.
These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
| F-5 |
Cash and cash equivalents
Cash and equivalents include investments with initial maturities of three months or less. The Company maintains its cash balances at credit-worthy financial institutions that are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000.
Inventory
The Company purchases online tickets to sporting events that are held as inventory. Inventories are presented at the lower of cost or net realizable value and are expensed through cost of sales when sold. The company plans to utilize the specific identification method of accounting for inventory since each ticket is identifiable by a unique ticket number and is easy to track from purchase up to sale. As at March 31, 2017 the Company has $5,832 in inventories.
Property, plant and equipment
The Company does not own any property, plant and equipment.
Accounts Payable and Accrued Expenses
Accounts payable and accrued expenses are carried at amortized cost and represent liabilities for goods and services provided to the Company prior to the end of the financial year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services.
Revenue Recognition
The Company recognizes revenue when all of the following have occurred: persuasive evidence of an agreement with the customer exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable and collectability of the selling price is reasonably assured.
The Company recognizes revenue when the online sale has been processed as delivery has occurred, the selling price has been determined and proceeds have been collected.
Cost of Sales
Cost of sales consists of the cost of merchandise sold to customers.
Income Taxes
Income taxes are accounted for in accordance with ASC Topic 740, "Income Taxes." Under the asset and liability method, deferred tax assets and liabilities are recognized for the future consequences of differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases (temporary differences). Deferred tax assets and liabilities are measured using tax rates expected to apply to taxable income in the years in which those temporary differences are recovered or settled. Valuation allowances for deferred tax assets are established when it is more likely than not that some portion or all of the deferred tax assets will not be realized.
Earnings per Share
The Company computes net loss per share in accordance with ASC 260, "Earnings Per Share" ASC 260 requires presentation of both basic and diluted earnings per share ("EPS") on the face of the income statement. Basic EPS is calculated by dividing the profit or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to common shareholders and the weighted average number of common shares outstanding for the effects of all potential dilutive common shares, which comprise options granted to employees. As March 31, 2017, the Company had no potentially dilutive shares.
| F-6 |
Fair Value of Financial Instruments
The Company measures assets and liabilities at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level.
The following are the hierarchical levels of inputs to measure fair value:
- Level 1: Quoted prices in active markets for identical instruments;
- Level 2: Other significant observable inputs (including quoted prices in active markets for similar instruments);
- Level 3: Significant unobservable inputs (including assumptions in determining the fair value of certain investments).
NOTE 3 – LOAN FROM RELATED PARTY
| March 31, | December 31, | |||||||
| 2017 | 2016 | |||||||
| (Unaudited) | ||||||||
| $ | $ | |||||||
| Loan from related party | 57,553 | 52,503 | ||||||
The above loan is unsecured, bears no interest and has no set terms of repayment. This loan is repayable on demand.
NOTE 4 – STOCKHOLDER’S DEFICIT
Common Stock
On December 22, 2014, the Company issued 3,000,000 shares of common stock to the director of the Company at a price of $0.0001 per share, for $300 cash.
NOTE 5 – INCOME TAXES
The benefit for income taxes for the periods ended March 31, 2017 and December 31, 2016 differ from the amount which would be expected as a result of applying the statutory tax rates to the losses before income taxes due primarily to changes in the valuation allowance to fully reserve net deferred tax assets.
Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income.
| F-7 |
The components of these differences are as follows:
| March 31, | March 31, | |||||||
| 2017 | 2016 | |||||||
| (Unaudited) | ||||||||
| $ | $ | |||||||
| Net tax loss carry-forwards | (7,404 | ) | 3,135 | |||||
| Statutory rate | 15 | % | 15 | % | ||||
| Expected tax recovery | 1,111 | 470 | ||||||
| Change in valuation allowance | (1,111 | ) | (470 | ) | ||||
| Income tax provision | - | - | ||||||
| March 31, | December 31, | |||||||
| 2017 | 2016 | |||||||
| (Unaudited) | ||||||||
| $ | $ | |||||||
| Components of deferred tax assets: | ||||||||
| Non capital tax loss carry forwards | 9,382 | 8,271 | ||||||
| Less: valuation allowance | (9,382 | ) | (8,271 | ) | ||||
| Net deferred tax asset | - | - | ||||||
The Company has provided a valuation allowance against the full amount of the deferred tax asset due to management’s uncertainty about its realization. As of March 31, 2017 the Company had approximately $62,547 in tax loss carryforwards that can be utilized future periods to reduce taxable income, and expire by the year 2037.
NOTE 6 – RELATED PARTY TRANSACTIONS
Details of transactions between the Corporation and related parties are disclosed below.
The following entities have been identified as related parties:
Zev Turetsky Director and greater than 10% stockholder
The following balances exist with related parties:
| March 31, | December 31, | |||||||
| 2017 | 2016 | |||||||
| (Unaudited) | ||||||||
| $ | $ | |||||||
| Loan from related party | 57,553 | 52,503 | ||||||
From time to time, the president and stockholder of the Company provides advances to the Company for its working capital purposes. These advances bear no interest and are due on demand.
NOTE 7 – SUBSEQUENT EVENTS
In accordance with ASC 855-10, Company management reviewed all material events through the date of this report and determined that there are no additional material subsequent events to report.
| F-8 |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management’s Discussion and Analysis 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,” “will,” “should” 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 Form 10-Q. 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. We undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events, or otherwise.
Our financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.
In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to "common stock" refer to the common shares in our capital stock.
As used in this Quarterly Report, the terms “we,” “us,” “Company,” “our” and “Spirit” mean Zev Ventures, Inc., unless otherwise indicated.
THERE IS SUBSTANTIAL UNCERTAINTY ABOUT OUR ABILITY TO CONTINUE OUR OPERATIONS AS A GOING CONCERN.
Results of Operations
Our results of operations are presented below:
Results of Operations for the three months ended March 31, 2017 and 2016.
Revenue for the three months ended March 31, 2017and 2016 was $5,512 and $741.
Total Operating expenses for the three months ended March 31, 2017and 2016 was $6,516 and $2,752.
Liquidity and Capital Resources
As of March 31, 2017 we had $548 in cash and $6,681 in total assets, and $68,928 in total liabilities as compared to $2,382 in cash, and $5,660 in total assets, and $60,503 in total liabilities as of December 31, 2016.
We are dependent on our revenues for cash flow, as we have minimized cash flow requirements through equity or debt financing. However, as we intend to expand operations, it is likely that we will require cash flow from financing in the future which could affect our ability to become cash flow positive.
For the three months ending March 31, 2017 net cash of (6,884) was provided by operating activities, compared to net cash of $(2,550) provided by operating activities for the three months ending March 31, 2016.
During the three months ending March 31, 2017, net cash of $5,050 was provided by financing activities compared to net cash of $-0- for the three months ending March 31, 2016.
Off-Balance Sheet Arrangements
We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.
Inflation
The amounts presented in the financial statements do not provide for the effect of inflation on our operations or financial position. The net operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.
| 1 |
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, as such, are not required to provide the information under this item.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
As required by Rule 13a-15(e), our management has carried out an evaluation, with the participation and under the supervision of Zev Turetsky our President and Principal Accounting Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as of March 31, 2017. Based upon, and as of the date of this evaluation, Zev Turetsky determined that our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
During the fiscal quarter ended March 31, 2017, there were no changes in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
| 2 |
From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm business. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse affect on our business, financial condition or operating results.
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide the information under this item.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable to our operations.
None.
| Exhibit No. | Exhibit Description | |
| 3.1 | Articles of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Form S-1 filed with the SEC on December 29, 2014) | |
| 3.2 | Bylaws of the Company (incorporated by reference to Exhibit 3.2 to the Form S-1 filed with the SEC on December 29, 2014) | |
| 31.1 | Certification of the Chief Executive and Financial Officer required under Rule 13a-14(a)/15d-14(a) of the Exchange Act | |
| 32.1 | Certification of the Chief Executive and Financial Officer required under Section 1350 of the Exchange Act | |
| 101 INS | XBRL Instance Document | |
| 101 SCH | XBRL Taxonomy Schema | |
| 101 CAL | XBRL Taxonomy Extension Calculation Linkbase | |
| 101 DEF | XBRL Taxonomy Extension Definition Linkbase | |
| 101 LAB | XBRL Taxonomy Extension Label Linkbase | |
| 101 PRE | XBRL Taxonomy Extension Presentation Linkbase |
| 3 |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Zev Ventures, Inc. | |
| Date: May 22, 2017 | By: /s/ Zev Turetsky |
| Name: Zev Turetsky | |
Title: President |
| 4 |