Folkup Development 10K 2018 Annual report

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 November 30, 2018

[ ] 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: 333-216921

FOLKUP DEVELOPMENT INC.

(Exact name of registrant as specified in its charter)

Nevada

(State or Other Jurisdiction of Incorporation or Organization)

32-0499929

IRS Employer Identification Number

3799

Primary Standard Industrial Classification Code Number

Mileve Maric Ajnstajn 72,

Novi Beograd, Republic of Serbia 11070

Tel. (315) 359-5955

Email: folkupdevelopment@gmail.com

(Address and telephone number of principal executive offices)

None

Securities registered under Section 12(b) of the Exchange Act

None

Securities registered under Section 12(g) of the Exchange Act

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o 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 Exchange Act. Yes o 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 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. Yes x No o

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 o No x

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”, “non-accelerated filer”, “emerging growth company” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o

Accelerated filer o

Non-accelerated filer o

Emerging growth company o

Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o Nox

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 3,800,000 common shares issued and outstanding as of November 30, 2018.

TABLE OF CONTENTS


		Page

PART I

Item 1.	Description of Business.	4
Item 1A.	Risk Factors.	6
Item 1B.	Unresolved Staff Comments.	6
Item 2	Properties.	6
Item 3.	Legal proceedings.	6
Item 4.	Mine Safety Disclosures.	6

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.	8
Item 8.	Financial Statements and Supplementary Data.	8
Item 9.	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure.	18
Item 9A (T).	Controls and Procedures	18
Item 9B.	Other Information.	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, and Director Independence.	22
Item 14.	Principal Accounting Fees and Services.	23

PART IV

Item 15.	Exhibits	23

Signatures

PART I

Item 1. Description of Business

Forward-looking statements

Statements made in this Form 10-K that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. 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.

Financial information contained in this report and in our financial statements is stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.

DESCRIPTION OF BUSINESS

We aim to deliver our products and services as follows, to lease and sell to our customers’ certain items or means of what we refer to as eco-transport. These items are commonly known under the names: a segway, a gyro-scooter or a self-balanced two-wheeled scooter, a self-balanced mono-wheeled scooter and a two-wheeled hoverboard. We expect our products and services to be demanded by establishments or enterprises or events, for instance, conferences held in large facilities, or touristic agencies and other establishments or organizations that face the problem of covering large distances by employees or visitors of theirs.

Our business address was provided by our registered agent and located at Mileve Maric Ajnstajn 72, Novi Beograd, Republic of Serbia 11070. Our telephone number is (315) 359-5955. Our plan of operation is forward-looking and there is no assurance that we will ever reach profitable operations. We are a development stage company and have generated $6,279 in revenue as for the year ended November 30, 2018. It is likely that we will not be able to achieve profitability and would be forced to cease operations due to the lack of funding.

Business

We are a company currently undergoing the stage of development. We plan to sell or lease means of ecological urban transportation to companies arranging events, such as exhibitions of any kind or conferences, where these means mentioned above can be used by the spectators to move around the facilities. We also expect medium sized production companies to lease our equipment for their employees to move around the warehouses or around the territory where it doesn't violate safety rules. Construction companies may lease or obtain our equipment to provide with it monitoring committees or authorities arriving with inspection, as well as superintendant workers. We expect that the use of ecological means of transportation may help employees of business entities or customers of event organizations to become more mobile, or to be able to cover larger distances in shorter terms of time. At an event occasion these items of transportation can also be used in additional advertising purposes to attract wider group of customers by being up-to-date or as advertising means, with promotional stickers being placed on them. At the same time, inspecting authorities may be able to complete their task of inspection in less amount of time, thus becoming more effective. We plan to offer our services to airports, where they will be able to lease those units to passengers who are in a rush to their terminals, the ones who want to avoid the fatigue after covering large distances between terminals, or the ones with troubles to walk. We also hope that hospitals may turn to us, as in some cases there are patients with restricted mobility who do not require a wheelchair but still face difficulties to walk. Those who did not suffer brain disorders and maintain their balance might use gyro transportation to move around the hospital territory or facilities. Amusement parks may acquire such means of transportation to lease them to their visitors. We expect our gyro vehicles to be demanded by the touristic companies that arrange city tours, thus creating an alternative to walking tours and bus tours. To make our interaction with customers more effective we plan to grant every customer a free training course on how to drive the gyro vehicles and maintain them, what issues may happen due to misuse and how to prevent them, as well as fix minor issues. As an additional service we might collect the sold items to be repaired and find the licensed repair shop on behalf of our customers, while providing a substitute unit instead.

Customers

We expect our potential customers to be business entities performing jobs at, or providing services at, or maintaining the services or premises of museums, exhibition centres, trade centres, shopping malls, entertainment centres, amusement parks, local parks, construction sites, hospitals or airports. We also may lease the gyro-transportation units to groups of individuals if they apply for it.

Marketing

Our steps are likely to be as follows:

- organize free exhibitions and workshops for potential customers;

- take part in the exhibitions and workshops that our potential customers may have interest in;

- to pay for the web banners on the websites where our potential customers might see our advertisement.

- to release printed advertisement in magazines.

- to order shooting of promotional videos from advertising agencies.

- to pay for the SEO (search engine optimization), which helps us to take place in the top of search inquiries.

- branding the gyro-vehicles to the needs of customers, by placing stickers or painting the colors to match the brand identity;

During our marketing campaign we plan to highlight the ability to be more mobile and efficient and to demonstrate this we plan to invite guest stars to take part in our promotional videos.

Competition

We believe that narrowing to a very certain groups of customers, by which we mean small or medium business entities, can help us to target them more precisely. Understanding the needs of our customers will help us to avoid storing a huge amount of various transportation models, but only a few varieties. The same types of gyro vehicles can be shipped to museums, exhibition centres and airports, whereas a second different type will meet the needs of construction sites, warehouses and small factories. The third sort of vehicles will suit the needs of open space establishments like parks.

Revenue

We expect to have two main income streams: the money that we are likely to receive after:

a) selling or

b) leasing the eco-transportation units.

Insurance

We do not maintain any insurance and do not intend to maintain insurance in the future. Because we do not have any insurance, if we are made a party of a products liability action, we may not have sufficient funds to defend the litigation. If that occurs a judgment could be rendered against us that could cause us to cease operations.

Employees; Identification of Certain Significant Employees.

We are a startup company and currently do not have employees other than, Milena Topolac Tomovic, our sole officer and director. We intend to hire employees on an as needed basis.

Offices

Our business address is at Mileve Maric Ajnstajn 72, Novi Beograd, Republic of Serbia 11070. This address was provided by our registered agent service. We do not pay any lease and there is no agreement to pay any lease in the future. Our telephone number is (315) 359-5955.

Government Regulation

We will be required to comply with all regulations, rules, and directives of governmental authorities and agencies applicable to our business in any jurisdiction which we would conduct activities. We do not believe that regulation will have a material impact on the way we conduct our business.

Item 1A. Risk Factor

Not applicable to smaller reporting companies.

Item 1B. Unresolved Staff Comments

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 know of no legal proceedings to which we are a party or to which any of our property is the subject which are pending, threatened or contemplated or any unsatisfied judgments against us.

Item 4. Mine Safety Disclosures

Not applicable.

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 not quoted on the OTC Bulletin Board at this time. 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 November 30, 2018, no shares of our common stock have traded.

Number of Holders

As of November 30, 2018, the 3,800,000 issued and outstanding shares of common stock were held by a total of 41 shareholder of record.

Dividends

No cash dividends were paid on our shares of common stock during the fiscal year ended November 30, 2018 and 2017.

Recent Sales of Unregistered Securities

The Company has 75,000,000, $0.001 par value shares of common stock authorized.

On November 15, 2016 the Company issued 3,000,000 shares of common stock to a director for cash proceeds of $3,000 at $0.001 per share.

During October 2017, the Company issued 85,000 shares of common stock for cash proceeds of $2,550 at $0.03 per share.

During December 2017, the Company issued 240,000 shares of common stock for cash proceeds of $7,200 at $0.03 per share.

During January 2018, the Company issued 60,000 shares of common stock for cash proceeds of $1800 at $0.03 per share.

During February 2018, the Company issued 175,000 shares of common stock for cash proceeds of $5,250 at $0.03 per share.

During April 2018, the Company issued 240,000 shares of common stock for cash proceeds of $7,200 at $0.03 per share.

There were 3,800,000 shares of common stock issued and outstanding as of November 30, 2018.

Purchase of our Equity Securities by Officers and Directors

On November 15, 2016, the Company offered and sold 3,000,000 restricted shares of common stock to our president and director, Milena Topolac Tomovic, for a purchase price of $0.001 per share, for aggregate offering proceeds of $3,000, pursuant to Section 4(2) of the Securities Act of 1933 as he is a sophisticated investor and is in possession of all material information relating to us. Further, no commissions were paid to anyone in connection with the sale of these shares and general solicitation was not made to anyone.

Other Stockholder Matters

None.

Item 6. Selected Financial Data

Not applicable to smaller reporting companies.

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 for the year ended November 30, 2018 and November 30, 2017:

Revenue and cost of goods sold

For the year ended November 30, 2018 and November 30, 2017 the Company generated total revenue of $6,279 and $19,700.

Operating expenses

Total operating expenses for the year ended November 30, 2018 and November 30, 2017 were $17,485 and $20,424. The operating expenses for the year ended November 30, 2018 included purchases of $4,395; bank charges of $559; depreciation expense of $240; legal fees of $2,150; audit fees of $7,750; professional fees of $2,391. The operating expenses for the year ended November 30, 2017 included purchases of $11,755; bank charges of $219; depreciation expense of $180; legal fees of $1,500; audit fees of $5,400; professional fees of $1,370.

Net Loss

The net loss for the year ended November 30, 2018 and November 30, 2017 was $11,206 and $724 accordingly.

Liquidity and Capital Resources and Cash Requirements

At year ended November 30, 2018, the Company had cash of $33,388 ($12,679 as of November 30, 2017). Furthermore, the Company had a working capital profit of $13,448 (profit of $2,964 as of November 30, 2017). The increase in working capital is attributed to sale of stock.

During the year ended November 30, 2018, the Company used $8,986 of cash in operating activities due to its net loss, increase in accounts receivable of $2,415, increase in accounts payable of $4,395 and depreciation of $240.

During the year ended November 30, 2018 the Company used no cash in investing activities.

During the year ended November 30, 2018, the Company generated $29,695 of cash in financing activities.

During the year ended November 30, 2017, the Company used $544 of cash in operating activities due to its net and depreciation of $180.

During the year ended November 30, 2017 the Company used $1,200 of cash in investing activities.

During the year ended November 30, 2017, the Company generated $11,370 of cash in financing activities.

We cannot guarantee that we will manage to sell all the shares required. We will attempt to raise the necessary funds to proceed with all phases of our plan of operation.

As of the date of this report, the current funds available to the Company will not be sufficient to continue maintaining a reporting status. The Company’s sole officer and director, Milena Topolac Tomovic, has concluded a verbal agreement with the FOLKUP DEVELOPMENT INC. in order to fund completion of the registration process and to maintain the reporting status with SEC.

Our auditors have issued a “going concern” opinion, meaning that there is substantial doubt we can continue as an on-going business for the next twelve months unless we obtain additional capital. Our only sources for cash at this time are investments by others in this offering, selling our paper dung products and loans from our director. We must raise cash to implement our plan and stay in business.

Management believes that current trends toward lower capital investment in start-up companies pose the most significant challenge to the Company’s success over the next year and in future years. Additionally, the Company will have to meet all the financial disclosure and reporting requirements associated with being a publicly reporting company. The Company’s management will have to spend additional time on policies and procedures to make sure it is compliant with various regulatory requirements, especially that of Section 404 of the Sarbanes-Oxley Act of 2002. This additional corporate governance time required of management could limit the amount of time management has to implement is business plan and impede the speed of its operations.

Limited operating history; need for additional capital

There is no historical financial information about us upon which to base an evaluation of our performance. We are in a start-up stage of operations and have generated limited revenues since inception. We cannot guarantee that we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.

Off-Balance Sheet Arrangements

The Company does not have any off balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Not applicable to smaller reporting companies.

Item 8. Financial Statements and Supplementary Data

FOLKUP DEVELOPMENT INC.

FINANCIAL STATEMENTS

YEARS ENDED NOVEMBER 30, 2018 AND NOVEMBER 30, 2017

Table of Contents

		Page
Report of Independent Registered Public Accounting Firm		14
Balance Sheets as of November 30, 2018 and November 30, 2017		15
Statements of Operations for the year ended November 30, 2018 and November 30, 2017		16
Statement of Changes in Stockholders’ Equity as of November 30, 2018 and November 30, 2017		17
Statements of Cash Flows for the year ended November 30, 2018 and November 30, 2017		18
Notes to Financial Statements		19

Report of Independent Registered Public Accounting Firm

To,

The Board of Directors and Shareholders,

Folkup Development Inc.

72 Mileve Maric Ajnstajn

Novi Beograd-11070

Serbia

Opinion on the Financial Statements

We have audited the accompanying balance sheet of Folkup Development Inc. (“the Company”) as of November 30, 2018 and as of November 30, 2017 together with the related statements of operations, changes in shareholders’ deficit, and cash flows for the year then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of November 30, 2018, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

Consideration of the Company’s Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has a negative working capital, and has not yet received significant revenue from sales to cover its operating costs, and has incurred significant losses since inception. These factors raise substantial doubt about the Company’s ability to continue as a going concern in a reasonable period of time. Management’s plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, 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.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

For Bharat Parikh & Associates

Chartered Accountants

/s/Bharat Parikh

CA Bharat Parikh

(Senior Managing Partner)

We have served as the Company’s auditor since 2016

Place: - HQ, Vadodara, GJ, India

Date: - 02/02/2019

FOLKUP DEVELOPMENT INC.

Balance sheet

AS OF NOVEMBER 30, 2018

(Audited)

ASSETS		November 30, 2018	November 30, 2017
Current Assets
Cash and cash equivalents	$	33,388	12,679
Accounts Receivable		2,415	-
Total Current Assets	$	35,803	12,679
Fixed Assets
Equipment, net	$	780	1,020
Total Fixed Assets	$	780	1,020

Total Assets	$	36,583	13,699

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Current Liabilities
Accounts Payable		4,395	-
Related Party Loans		17,960	9,715
Total Current Liabilities	$	22,355	9,715

Total Liabilities	$	22,355	9,715

Stockholder’s Equity
Common stock, par value $0.001; 75,000,000 shares authorized, 3,800,000 and 3,085,000 shares issued and outstanding accordingly		3,800	3,085
Additional paid in capital		23,200	2,465
Accumulated deficit		(12,772)	(1,566)
Total Stockholder’s Equity	$	14,228	3,984

Total Liabilities and Stockholder’s Equity	$	36,583	13,699

See accompanying notes, which are an integral part of these financial statements

FOLKUP DEVELOPMENT INC.

Statement of operations

AS OF NOVEMBER 30, 2018

(Audited)

		Year ended November 30, 2018	Year ended November 30, 2017
Revenues		6,279	19,700
Gross Profit	$	6,279	19,700

OPERATING EXPENSES
General and Administrative Expenses		17,485	20,424
TOTAL OPERATING EXPENSES		(17,485)	(20,424)

NET INCOME (LOSS) FROM OPERATIONS		(11,206)	(724)

PROVISION FOR INCOME TAXES		-	-

NET INCOME (LOSS)	$	(11,206)	(724)

NET LOSS PER SHARE: BASIC AND DILUTED	$	(0.00)	(0.00)

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED		3,656,726	3,008,151

See accompanying notes, which are an integral part of these financial statements

FOLKUP DEVELOPMENT INC.

Statement of changes in stockholder’s equity

AS OF NOVEMBER 30, 2018

(Audited)

	Common Stock		Additional Paid-in	Deficit Accumulated during the Development	Total Stockholders’
	Shares	Amount	Capital	Stage	Equity

Balance, November 30, 2016	3,000,000	$ 3,000	$ -	$ (842)	$ 2,158
Shares issued	85,000	85	2,465	-	2,550

Net loss for the period ended November 30, 2017	-	-	-	(724)	(724)

Balance, November 30, 2017	3,085,000	$ 3,085	$ 2,465	$ (1,566)	$ 3,984
Shares issued	715,000	715	20,735	-	21,450

Net loss for the period ended November 30, 2018	-	-	-	(11,206)	(11,206)

Balance, November 30, 2018	3,800,000	$ 3,800	$ 23,200	$ (12,772)	$ 14,228

The accompanying notes are an integral part of these statements.

FOLKUP DEVELOPMENT INC.

Statement of cash flows

AS OF NOVEMBER 30, 2018

(Audited)

	Year ended November 30, 2018	Year ended November 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period	$ (11,206)	$ (724)
Adjustments to reconcile net loss to net cash (used in) operating activities:
Accounts Receivable	(2,415)	-
Accounts Payable	4,395	-
Accumulated Depreciation	240	180
CASH FLOWS USED IN OPERATING ACTIVITIES	(8,986)	(544)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of equipment	-	(1,200)
CASH FLOWS PROVIDED BY INVESTING ACTIVITIES	-	(1,200)

CASH FLOWS FROM FINANCING ACTIVITIES
Related Party Loans	8,245	8,820
Capital Stock	21,450	2,550
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES	29,695	11,370

NET INCREASE IN CASH	20,709	9,626

Cash, beginning of period	12,679	3,053

Cash, end of period	$ 33,388	$ 12,679

SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$ 0	$ 0
Income taxes paid	$ 0	$ 0

See accompanying notes, which are an integral part of these financial statements

FOLKUP DEVELOPMENT INC.

Notes to the audited financial statements

NOVEMBER 30, 2018

Note 1 – ORGANIZATION AND NATURE OF BUSINESS

FOLKUP DEVELOPMENT INC. (“the Company”, “we”, “us” or “our”) was incorporated in the State of Nevada on July 5, 2016. We aim to deliver our services as follows, to lease and sell to our customers certain items or means of what we refer to as eco-transport. These items are commonly known under the names: a segway, a gyro-scooter or a self-balanced two-wheeled scooter, a self-balanced mono-wheeled scooter and a two-wheeled hoverboard. We expect our services to be demanded by establishments or enterprises or events, for instance, conferences held in large facilities. The business location is in Beograd, Republic of Serbia.

Note 2 – GOING CONCERN

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern. The Company generated $6,279 in revenues for the year ended November 30, 2018. The Company currently has loses and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. Management evaluates that lack of revenues can affect to the entity’s ability to meet its obligations. The ability of the Company to mitigate the conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern is dependent on management’s plans, which include further implementation of its business plan. The Company intends to position itself so that it will be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.

Note 3 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES

Basis of presentation

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America. The Company’s yearend is November 30.

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.

Cash and Cash Equivalents

The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $33,388 of cash as of November 30, 2018 and $12,679 as of November 30, 2017.

Depreciation, Amortization, and Capitalization

The Company records depreciation and amortization when appropriate using straight-line balance method over the estimated useful life of the assets. We estimate that the useful life of sport equipment is five years. Expenditures for maintenance and repairs are charged to expense as incurred. Additions, major renewals and replacements that increase the property's useful life are capitalized. Property sold or retired, together with the related accumulated depreciation is removed from the appropriated accounts and the resultant gain or loss is included in net income.

Customer Deposits

A customer deposit is an amount paid by a customer to a company prior to the company providing it with goods or services. The company receiving the money has an obligation to provide the goods or services to the customer or to return the money. As of November 30, 2018 the Company had $0 in customer deposits and $0 as of November 30, 2017.

FOLKUP DEVELOPMENT INC.

Notes to the unaudited financial statements

NOVEMBER 30, 2018

Accounts Payable

Accounts Payable discloses a liability to a creditor, carried on open account, usually for purchases of goods and services. The Company had $4,395 in accounts payable as of November 30, 2018 and $0 as of November 30, 2017.

Fair Value of Financial Instruments

AS topic 820 "Fair Value Measurements and Disclosures" establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.

These tiers include:

Level 1:

defined as observable inputs such as quoted prices in active markets;

Level 2:

defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and

Level 3:

defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying value of cash and the Company’s loan from shareholder approximates its fair value due to their short-term maturity.

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.

Basic Income (Loss) Per Share

The Company computes income (loss) per share in accordance with FASB ASC 260 “Earnings per Share”. Basic loss per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. As of November 30, 2018 and November 30, 2017 there were no potentially dilutive debt or equity instruments issued or outstanding.

Revenue Recognition

The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. For the year ended November 30, 2018 the Company has generated $6,279 revenue.

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

We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company.

Note 4 – FIXED ASSETS

As of November 30, 2018 the Company purchased 2 monowheels for $1,200.

FOLKUP DEVELOPMENT INC.

Notes to the unaudited financial statements

NOVEMBER 30, 2018

Note 5 – LOAN FROM DIRECTOR

As of November 30, 2018, our sole director has loaned to the Company $17,960. This loan is unsecured, non-interest bearing and due on demand. The balance due to the director was $17,960 as of November 30, 2018.

Note 6 – COMMON STOCK