| NOTE 1 - ORGANIZATION, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – ORGANIZATION, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Nature of Operations – In the opinion of the Company, the accompanying unaudited condensed interim financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2022, and its results of operations for the three and nine months ended September 30, 2022, and cash flows for the nine months ended September 30, 2022. The condensed balance sheet at December 31, 2021 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. Operating results for the nine month period ended September 30, 2022, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2022. These unaudited condensed interim financial statements have been prepared by management in accordance with generally accepted accounting principles used in the United States of America (“U.S. GAAP”). These unaudited condensed interim financial statements should be read in conjunction with the annual audited financial statements included in the Company’s registration statement on Form S-1 for the year ended December 31, 2021 filed with the Securities and Exchange Commission. This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to U.S. GAAP and have been consistently applied in the preparation of the financial statements. Emerging Growth Company Status · · · · · The Company may take advantage of these provisions until it is no longer an emerging growth company, which will occur on the earliest of (i) the last day of the fiscal year following the fifth anniversary of the Company’s IPO, (ii) the last day of the fiscal year in which it has more than $1.07 billion in annual gross revenue, (iii) the date on which it issues more than $1.0 billion of non-convertible debt over a three-year period and (iv) the date on which it is deemed to be a “large accelerated filer,” as defined in Rule 12b-2 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company has elected to take advantage of each of the exemptions for emerging growth companies. Accordingly, the information that is provided in these financial statements may be different than what other public companies provide. Use of Estimates Fair Value Measurements Fair Values of Financial Instruments Fair Value of Non-financial Assets and Liabilities Concentration of Credit Risk and Accounts Receivable Cash and Cash Equivalents Oil and Gas Properties For oil and natural gas properties subject to amortization, all capitalized costs of oil and gas properties, plus estimated future costs to develop proved reserves, are amortized on the unit-of-production method using estimates of proved reserves as determined by the Company’s independent petroleum engineers. The Company evaluates oil and gas properties for impairment quarterly. As the Company does not currently have any oil and natural gas properties subject to amortization, the Company has not incurred a write down as a result of the ceiling test nor has it incurred any depletion expense to date. For oil and natural gas properties not subject to amortization, evaluates the properties for inclusion in oil and natural gas properties subject to amortization at least annually. Land, Buildings, Equipment and Leasehold Improvements Depreciation of buildings equipment, software and leasehold improvements is calculated using the straight-line method based upon the following estimated useful lives: Leasehold improvements 3-10 years Office equipment and software 3-7 years Equipment 5-10 years Revenue Recognition Revenues from Contracts with Customers (Topic 606) Income Taxes For the three and nine months ended September 30, 2022, the Company recorded a full valuation allowance against the deferred tax asset of $9,573 and $10,144, respectively. As the Company currently has no revenues there is reasonable doubt as to the realizability of this deferred tax asset. With the allowance taken as of December 31, 2021, the Company has a valuation allowance of $10,821. Accounting for Uncertainty in Income Taxes Earnings (Loss) Per Share Major Customers Stock-Based Employee and Non-Employee Compensation Derivative Instruments and Hedging Activities When applicable, the Company records all derivative instruments, other than those that meet the normal purchases and sales exception, on the balance sheet as either an asset or liability measured at fair value. Changes in fair value are recognized currently in earnings unless specific hedge accounting criteria are met. Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires recognition of leased assets and liabilities on the balance sheet and disclosing key information about leasing arrangements. This update is effective for annual periods and interim periods with those periods beginning after December 15, 2021, for public EGC companies like us. The Company adopted this standard using the modified retrospective transition method with the option to recognize a cumulative-effect adjustment at the date of adoption. The Company currently only has a month-to-month lease and so the adoption of this standard did not have a material impact on its financial statements or disclosures. |
