EXHIBIT 99.2
VOCTRAIN PTY. LTD.
INDEX TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS
MARCH 31, 2019
TABLE OF CONTENTS
Page | |
Balance Sheets | 2 |
Statements of Operations and Other Comprehensive Loss | 3 |
Statements of Cash Flows | 4 |
Notes to the Unaudited Financial Statements | 5 |
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Balance Sheets
(Unaudited)
March 31, | December 31, | |||||||
2019 | 2018 | |||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 151,464 | $ | 135,333 | ||||
Prepaid and other current assets | 102,150 | 125,283 | ||||||
Total Current Assets | 253,614 | 260,615 | ||||||
Plant and equipment, net | 9,675 | 10,053 | ||||||
Total Non-Current Assets | 9,675 | 10,053 | ||||||
TOTAL ASSETS | $ | 263,289 | $ | 270,668 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities | ||||||||
Accounts payables | $ | - | $ | - | ||||
Accrued liabilities and other payable | 84,995 | 74,395 | ||||||
Borrowings | 14,160 | 14,725 | ||||||
Tax payable | 13,522 | 13,411 | ||||||
Total Current Liabilities | 112,677 | 102,531 | ||||||
TOTAL LIABILITIES | 112,677 | 102,531 | ||||||
Stockholders’ Equity | ||||||||
Share capital | 156,300 | 156,300 | ||||||
Accumulated other comprehensive income | (17,227 | ) | (18,658 | ) | ||||
Accumulated deficit | 11,539 | 30,495 | ||||||
Total Stockholders’ Equity | 150,612 | 168,137 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 263,289 | $ | 270,668 |
The notes are an integral part of these unaudited financial statements.
2 |
Statements of Operations and Other Comprehensive Loss
(Unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2019 | 2018 | |||||||
Revenues | $ | 88,060 | $ | 36,308 | ||||
Cost of revenues | - | - | ||||||
Gross profit | 88,060 | 36,308 | ||||||
Operating expenses | ||||||||
General and administrative | (105,735 | ) | (95,976 | ) | ||||
Total operating expenses | (105,735 | ) | (95,976 | ) | ||||
Loss from operations | (17,675 | ) | (59,668 | ) | ||||
Finance costs | (1,281 | ) | (1,415 | ) | ||||
Loss before provision for income taxes | $ | (18,956 | ) | $ | (61,083 | ) | ||
Provision for income taxes | - | - | ||||||
Net loss | (18,956 | ) | (61,083 | ) | ||||
$ | $ | |||||||
Other comprehensive income / (expense) | 1,431 | (1,059 | ) | |||||
Comprehensive expense | $ | (17,525 | ) | $ | (62,142 | ) | ||
Basic and diluted loss per share of common stock | (0.09 | ) | (0.31 | ) | ||||
Weighted average number of shares of common stock outstanding | 200,000 | 200,000 |
The notes are an integral part of these unaudited financial statements.
3 |
Statements of Cash Flows
(Unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2019 | 2018 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Loss before provision for income taxes | $ | (18,956 | ) | $ | (61,082 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation | 462 | 1,414 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivables | 947 | (762 | ) | |||||
Prepaid and other current assets | 23,262 | 26,263 | ||||||
Accounts payable | (844 | ) | 938 | |||||
Accrued liabilities and other payable | 10,600 | 11,101 | ||||||
Cash generated from / (used in) operations | 15,472 | (22,128 | ) | |||||
Tax refund / (paid) | 110 | (83 | ) | |||||
Net Cash Generated from / (Used in) Operating Activities | 15,582 | (22,211 | ) | |||||
CASH FLOWS FROM INVESTING ACTIVITY: | ||||||||
Purchase of plant and equipment | - | - | ||||||
Net Cash Used in Investing Activity | - | - | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Repayment of borrowings | (565 | ) | (1,681 | ) | ||||
Advances from directors | - | - | ||||||
Net Cash Used in Financing Activities | (565 | ) | (1,681 | ) | ||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 1,114 | (1,605 | ) | |||||
Net increase/(decrease) in cash and cash equivalents | 16,131 | (25,497 | ) | |||||
Cash and cash equivalents, beginning of period | 135,333 | 100,333 | ||||||
Cash and cash equivalents, end of period | $ | 151,464 | $ | 74,836 | ||||
Supplemental cash flow information | ||||||||
Cash paid for interest | $ | - | $ | - | ||||
Cash paid for taxes | $ | - | $ | - |
The notes are an integral part of these unaudited financial statements.
4 |
Notes to the Unaudited Financial Statements
March 31, 2019
Expressed in United States Dollars
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
VocTrain Pty. Ltd. (“we,” “us,” “our,” the “Company,” or “Voctrain”) is a private limited liability company, incorporated in Australia.
The registered office of business of the Company is located at 85 Grand Junction Road Rosewater SA 5013.
VocTrain Pty Ltd is an Australian company incorporated under the Australian Securities & Investment Commission and is a Registered Training Organization (RTO No. 6194) approved by the Australian Skills Quality Authority (“ASQA”). Established in 1999, VocTrain Pty Ltd trading as Quality Automotive Training (QAT) offers a wide array of accredited Automotive programs to help meet the needs of employers and apprentices/trainees working in the Automotive Retail, Service and Repair industry. VocTrain Pty Ltd is an Approved WorkReady Training Provider in South Australiaand Vocational Education and Training (VET) Pre-qualified Supplier (PQS) under the User Choice Program in Queensland.
For additional information, please visit:https://www.qat.edu.au.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Financial Statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Financial Statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States and presented in United States dollars.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.
Foreign Currency Translation and Re-measurement
The Company translates its foreign operations to U.S. dollar in accordance with ASC 830, “Foreign Currency Matters”.
The Company’s functional currency is Australian Dollar (“AUD”) and reporting currency is the U.S. dollar.
The Company’s subsidiaries, whose functional currency is not the U.S. dollar, translate their records into U.S. dollar as follows:
● | Assets and liabilities at the rate of exchange in effect at the balance sheet date | |
● | Equities at historical rate | |
● | Revenue and expense items at the average rate of exchange prevailing during the period |
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Financial Instruments
The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, other receivable, prepaid expenses and deposits, amount due from related parties, accounts payable and accrued liabilities, deferred revenue and due to related parties. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments.
Property and equipment
Fixed assets are recorded at cost. Depreciation is calculated using reducing balance method over the estimated useful lives of the assets. The useful lives are as follows:
Office equipment | 4 - 7 years | |||
Motor vehicles | 5.3 years |
Maintenance and repairs are charged to operations as incurred. Expenditures which substantially increase the useful lives of the related assets are capitalized. When properties are disposed of, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reported in the period the transaction takes place.
Accounting for the impairment of long-lived assets
The long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. It is reasonably possible that these assets could become impaired as a result of technology or other industry changes. Determination of recoverability of assets to be held and used is by comparing the carrying amount of an asset to future net undiscounted cash flows to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. During the three months ended March 31, 2018 and 2017, the Company did not impair any long-lived assets.
Revenue Recognition
Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services.
The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
● | identify the contract with a customer; | |
● | identify the performance obligations in the contract; | |
● | determine the transaction price; | |
● | allocate the transaction price to performance obligations in the contract; and | |
● | recognize revenue as the performance obligation is satisfied. |
The Company records revenue at point in time which is recognized upon goods delivered or services rendered.
Income Taxes and Deferred Taxes
Tax expense in profit or loss comprises current and deferred tax. Current tax and deferred tax are recognized in profit or loss except to the extent that it relates to a business combination or items recognized directly in equity or other comprehensive income.
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Income Taxes and Deferred Taxes (Continued)
Deferred tax is recognized using the liability method for all temporary differences between the carrying amounts of assets and liabilities in the statement of financial position and their tax bases. Deferred tax is not recognized for the temporary differences arising from the initial recognition of goodwill, the initial recognition of assets and liabilities in a transaction which is not a business combination and that affects neither accounting nor taxable profit or loss. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the end of the reporting period.
Recent Accounting Pronouncements
Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.
NOTE 3 - GOING CONCERN
The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet had sufficient revenues to cover its operating cost, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.
There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
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NOTE 4 - PREPAID AND OTHER CURRENT ASSETS
Prepaid expense and other current assets at March 31, 2019 and December 31, 2018 consist of the following
March 31, | December 31, | |||||||
2019 | 2018 | |||||||
Other receivables and deposits | $ | 102,150 | $ | 125,283 |
NOTE 5 - PLANT AND EQUIPMENT
Plant and equipment at March 31, 2019 and December 31, 2018 consist of the following:
March 31, | December 31, | |||||||
2019 | 2018 | |||||||
Cost: | ||||||||
Office equipment | 29,304 | 28,993 | ||||||
Motor Vehicles | $ | 24,511 | $ | 24,250 | ||||
Total cost | 53,815 | 53,243 | ||||||
Less: accumulated depreciation | (44,140 | ) | (43,190 | ) | ||||
Plant and equipment, net | $ | 9,675 | $ | 10,053 |
During the three months ended March 31, 2019 and 2018, the Company recorded depreciation of $462 and $1,414 respectively.
NOTE 6 – ACCOUNTS PAYABLE
Accounts payable at March 31, 2019 and December 31, 2018 were $Nil and $Nil, respectively, and consisted of trade accounts payable. Accounts payable are amounts billed to the Company by suppliers for goods and services in the ordinary course of business. All amounts have short-term repayment terms and vary by supplier.
NOTE 7 - ACCRUED LIABILITIES AND OTHER PAYABLE
The Company’s accounts payable and accrued liabilities consist of the followings:
March 31, | December 31, | |||||||
2019 | 2018 | |||||||
Other payables and accrued expenses | $ | 84,995 | $ | 74,395 |
NOTE 8 - BORROWINGS
Borrowings represents hire purchase amounted to $14,160 as at March 31, 2019 (2018 : $14,725).
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NOTE 9 - STOCKHOLDERS’ EQUITY
The capitalization of the Company consists of the following classes of capital stock as of March 31, 2019:
Ordinary shares
The Company has authorized share capital of AUD 200,000. The Holders of ordinary shares are entitled to receive dividends as declared from time to time, and are entitled to one vote per share at meetings of the Company.
During the period ended March 31, 2019, there were no share issuances. As at March 31, 2019 and December 31, 2018, the Company had 200,000 common shares issued and outstanding.
The Company has no stock option plan, warrants or other dilutive securities.
NOTE 10 – INCOME TAXES
The Company provides for income taxes under ASC 740, “Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. It also requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
The Company’s operating in Malaysia is subject to the Malaysian Profits Tax at a standard income tax rate of 18% on the assessable income arising in Malaysia during its tax year.
NOTE 11 - SUBSEQUENT EVENTS
Management has evaluated subsequent events through the date these financial statements were available to be issued. Based on our evaluation no material events have occurred that require disclosure.
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