| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis
of Presentation and Principles of Consolidation The
summary of significant accounting policies presented below is designed to assist in understanding the Company’s financial statements.
Such financial statements and accompanying notes represent the Company’s management, responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in
all material respects. We have applied them consistently in preparing the accompanying financial statements. The
results for the three months ended June 30, 2024, and 2023 are not necessarily indicative of the results of operations for the full year.
These financial statements and related footnotes should be read in conjunction with the consolidated financial statements and footnotes
thereto included in the Company’s Annual Report on Form 10K for the year ended December 31, 2023, filed with the Securities and
Exchange Commission on April 10, 2024. Financial
Statement Preparation and Use of Estimates Preparing
financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Cash
and Cash Equivalents Cash
and cash equivalents include Cash on hand, deposits at banking institutions, and all highly liquid short-term investments with original
maturities of 90 days or less. The Company had a cash balance of $ 1,338,247 472,509 Accounts
Receivable Accounts
Receivable primarily represents the amount due from two (2) customers. In some cases, the customer receivables are due immediately on
demand; however, in most cases, the Company offers net 45 terms or n/45, where the payment is due in full 45 days after the invoice’s
date. The Company bases the allowance for doubtful accounts on its assessment of the collectability of customer accounts. The Company
regularly reviews the allowance by considering historical experience, credit quality, the accounts receivable balances’ age, and
economic conditions that may affect a customer’s ability to pay and expected default frequency rates. Trade receivables are written
off at the point when they are considered uncollectible. At
June 30, 2024, and December 31, 2023, the management determined that the allowance for doubtful accounts was $ 624,898 624,898 5,064 27,437 Office
Lease Effective
May 21, 2020, the Company’s new corporate address was 1800 Century Park East, Suite 600, Los Angeles, CA 90067 (“California
Lease”). The Company has signed the California Lease on a month-to-month basis, entitled the Company to use the office and conference
space on a needs-only basis. The new lease payment is $ 229 1,374 1,374 NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Our
typical customers are advertising agencies classified under SIC7319, which advertise with media but perform no creative services (media
buying services such as online traffic from EvaMedia). We also deal with businesses (as described under NAICS 541810) organized to provide
a full range of services (i.e., through in-house capabilities or subcontracting), including advice, creative services, account management,
production of advertising material, media planning, and buying (i.e., placing advertising). The
Company earns revenues from advertisers by signing purchase or insertion orders based on Standard Terms and Conditions for Internet Advertising
for Media Buys One Year or Less, Version 3.0, as defined in 4’s/IAB. Such terms and conditions are intended to offer media companies
and advertising agencies an acceptable standard for conducting business for both parties. When incorporated into an insertion order,
this protocol represents the Company and its customers’ shared understanding of doing business. The Company may also sign additional
documents to cover sponsorships and other arrangements involving content association, integration, and special production. The Company
considers an insertion order with its customers, a binding contract with the customer, or other similar documentation reflecting the
terms and conditions under which it provides products or services. As a result, the Company considers the insertion order persuasive
evidence of an arrangement. Each insertion is specific to the customer, defines each party’s fee schedule, duties, and responsibilities,
and is governed by 4’s/IAB Version 3.0 for renewal and termination terms, confidentiality agreement, dispute resolution, and other
clauses necessary for such contract. The
Company adopted ASU 2014-09 Revenue for insertion/purchase orders, or contract(s) (from now on known as ‘contracts’) received
from customers. The
Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration
the Company expects to receive in exchange for those goods or services as per the contract with the customer. As a result, the Company
accounts for revenue contracts with customers by applying the requirements of Accounting Standards Codification Topic 606, Revenue from
Contracts with Customers (Topic 606), which includes the following steps:
● Identify
the contract(s) and subsequent amendments with the customer.
● Identify
all the performance obligations in the contract and subsequent amendments.
● Determine
the transaction price for completing performance obligations.
● Allocate
the transaction price to the performance obligations in the contract.
● Recognize
the revenue when, or as, the Company satisfies a performance obligation. The
Company adopted ASC 606 using the modified retrospective method applied to all contracts not completed as of January 1, 2018. The Company
presents results for reporting periods beginning after January 1, 2018, under ASC 606, while prior period amounts are reported following
legacy GAAP. In addition to the above guidelines, the Company also considers implementation guidance on warranties, customer options,
licensing, and other topics. The Company considers revenue collectability, methods for measuring progress toward complete satisfaction
of a performance obligation, warranties, customer options for additional goods or services, non-refundable upfront fees, licensing, customer
acceptance, and other relevant categories. The
Company accounts for a contract when the Company and the customer (‘parties’) have approved the contract and are committed
to performing their respective obligations, where each party can identify their rights, obligations, and payment terms; the contract
has commercial substance. The Company will probably collect all of the consideration substantially. Revenue is recognized when performance
obligations are satisfied by transferring control of the promised service to a customer. The Company fixes the transaction price for
goods and services at contract inception. The Company’s standard payment terms are generally net 30 days and, in some cases, due
upon receipt of the invoice. The
Company considers contract modification as a change in the scope or price (or both) of a contract that the parties approve. The parties
describe contract modification as a change order, a variation, or an amendment. A contract modification exists when the parties to the
contract approve a modification that either creates new or changes existing enforceable rights and obligations of the parties to the
contract. The Company assumes a contract modification when approved in writing, by oral agreement, or implied by the customary business
practice of the customer. If the parties to the contract have not agreed on a contract modification, the Company continues to apply the
guidance to the existing contract until the contract modification is approved. The Company recognizes contract modification in various
forms – including but not limited to partial termination, an extension of the contract term with a corresponding price increase,
adding new goods and services to the contract, with or without a corresponding price change, and reducing the contract price without
a change in goods or services promised. NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) For
all its goods and services, at contract inception, the Company assesses the solutions or services, or bundles of solutions and services,
obligated in the contract with a customer to identify each performance obligation within the contract and then evaluate whether the performance
obligations are capable of being distinct and distinct within the context of the contract. Solutions and services that are not capable
of being distinct and distinct within the context of the agreement are combined and treated as a single performance obligation in determining
the allocation and recognition of revenue. For multi-element transactions, the Company allocates the transaction price to each performance
obligation on a relative standalone selling price basis. The Company determines the standalone selling price for each item at the transaction’s
inception involving these multiple elements.
Performance Obligation Types
of Deliverables When
Performance Obligation is Typically Satisfied
Insertion
Order for Online Advertising The
Company sets up the advertising campaign on Eva’s demand-side Platform. It specifies types of ads (banner, search, video, etc.),
place of the campaign (Website, mobile, or ad networks), and target of the ads (demographics, interests, etc.). The
Company recognizes the consulting revenues when the customer receives services over the length of the contract. If the customer pays
the Company in advance for these services, the Company records such payment as deferred revenue until the Company completes the services. The
Company assumes that the goods or services promised in the existing contract will be transferred to the customer to determine the transaction
price. The Company believes the agreement will not be canceled, renewed, or modified; therefore, the transaction price includes only
those the Company has rights to under the present contract. For example, suppose the Company agrees with a customer with an original
term of one year and expects the customer to renew for a second year. In that case, the Company will determine the transaction price
based on the initial one-year period. When choosing the transaction price, the Company first identifies the fixed consideration, including
non-refundable upfront payment amounts. To
allocate the transaction price, the Company allocates an amount that best represents the consideration the entity expects to receive
for transferring each promised good or service to the customer. To meet the allocation objective, the Company allocates the transaction
price to each performance obligation identified in the contract on a relative standalone selling price basis. In determining the standalone
selling price, the Company uses the best evidence of the standalone selling price that the Company charges to similar customers in similar
circumstances. The Company sometimes uses the adjusted market assessment approach to determine the standalone selling price. It evaluates
the market in which it sells the goods or services and estimates the price customers would pay for those goods or services when sold
separately. The
Company recognizes revenue when or as it transfers the promised goods or services in the contract. The Company considers the “transfers”
of the promised goods or services when the customer obtains control of the goods or services. The Company believes a customer “obtains
control” of an asset when, or as, it can directly use and obtain all the remaining benefits from the asset substantially. The Company
recognizes deferred revenue related to services it will deliver within one year as a current liability. The Company presents deferred
revenue related to services that the Company will provide more than one year into the future as a non-current liability. Concentrations
of Credit Risk Financial
instruments that potentially subject the Company to concentrations of credit risk consist principally of Cash. The Company places its
Cash with a major banking institution. The Company did not have cash balances over the Federal Deposit Insurance Corporation limit on
June 30, 2024. NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Legal
Proceedings The
Company discloses a loss contingency if at least there is a reasonable possibility that a material loss has been incurred. The Company
records its best estimate of loss related to pending legal proceedings when the loss is considered probable, and the amount can be reasonably
estimated. The Company can reasonably estimate a range of loss with no best estimate; the Company records the minimum estimated liability.
As additional information becomes available, the Company assesses the potential liability of pending legal proceedings, revises its estimates,
and updates its disclosures accordingly. The Company’s legal costs associated with defending itself are recorded as expenses incurred.
The Company is currently not involved in any litigation. Impairment
of Long-Lived Assets The
Company reviews long-lived assets for impairment following FASB ASC 360, Property, Plant, and Equipment. Long-lived assets are tested
for recoverability whenever events or changes in circumstances indicate that the Company may not recover the carrying amounts. An impairment
charge amount is recognized if and when the asset’s carrying value exceeds the fair value. Provision
for Income Taxes The
provision for income taxes is determined using the asset and liability method. This method calculates deferred tax assets and liabilities
based on the temporary differences between the consolidated financial statement and income tax bases of assets and liabilities using
the enacted tax rates applicable each year. The
Company utilizes a two-step approach to recognizing and measuring uncertain tax positions (“tax contingencies”). The first
step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than
not that the position will be sustained on audit, including resolution of related appeals or litigation processes. The second step is
to measure the tax benefit as the largest amount, more than 50%, is likely to be realized upon ultimate settlement. The
Company considers many factors when evaluating and estimating its tax positions and benefits, which may require periodic adjustments
and may not accurately forecast actual outcomes. The Company includes interest and penalties related to tax contingencies in the provision
of income taxes in the consolidated statements of operations. The Management of the Company does not expect the total amount of unrecognized
tax benefits to change significantly in the next 12 months. Website
and Software Development Costs By
ASC 985-20, Software development costs, including costs to develop software sold, leased, or otherwise marketed, are capitalized after
establishing technological feasibility, if significant. The Company amortizes the Capitalized software development costs using the straight-line
amortization method over the estimated useful life of the application software. By December 2018, the Company completed the activities
(planning, designing, coding, and testing) necessary to establish that it could produce and meet the design specifications of the Eva
Platform and its various components. The Company estimates the useful life of the software to be three ( 3 The
Company includes certain Website and app purchases as part of these capitalized costs. The capitalization of website costs is a significant
portion of the total assets. The Company capitalizes on significant expenses incurred during the application development stage for internal-use
software. The Company does not believe that capitalizing software development costs is material. NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) The
Company accounts for website development costs following Accounting Standards Codification 350-50 “Website Development Costs”
(ASC 350-50). The Company capitalizes on external website development costs (“website costs”), which primarily include:
● third-party
costs related to acquiring domains and developing applications,
● as
well as costs incurred to develop or acquire and customize code for web applications,
● costs
to develop HTML web pages or develop templates and
● costs
to create original graphics for the Website that included the design or layout of each page. The
Company also capitalizes on costs incurred in the website application and infrastructure development; we account for such costs following
ASC 350-50. The Company estimates the useful life of the Website to be three ( 3 Share-based
compensation to employees and non-employees The
Company uses ASC 718 guidance to apply share-based compensation accounting to certain employees and non-employee individuals, such as
outsourced employees, non-employee directors, and consultants performing management functions, are employees or non-employees. The differences
in the accounting for share-based payment awards granted to an employee versus a non-employee relate to the measurement date and recognition
requirements. The Company believes an employee is the one who has the right to exercise sufficient control to establish an employer-employee
relationship based on common law, as illustrated in case law and currently under US Internal Revenue Service (IRS) Revenue Ruling 87-41. Restricted
securities are securities acquired in unregistered, private sales from the Company or an affiliate. The restricted securities require
the owner to follow the US Securities Exchange Commission guidelines defined under Rule 144 - Selling Restricted and Control Securities.
On the other hand, restricted shares issued for consideration other than for goods or employee services are fully paid for immediately.
As a result, the Company has expensed these shares at the time of the contract. There is no vesting period for non-employees. Fair
Value The
Company uses current market values to recognize certain assets and liabilities at a fair value. The fair value is the estimated price
at which an asset can be sold, or a liability settled in an orderly transaction to a third party under current market conditions. The
Company uses the following methods and valuation techniques for deriving fair values: Market
Approach – The market approach uses the prices associated with actual market transactions for similar or identical assets and liabilities
to derive a fair value. Income
Approach – The income approach uses estimated future cash flows or earnings, adjusted by a discount rate representing the time
value of money and the risk of cash flows not being achieved to derive a discounted present value. Cost
Approach – The cost approach uses the estimated cost to replace an asset adjusted for the obsolescence of the existing asset. The
Company ranks the fair value hierarchy of information sources from Level 1 (best) to Level 3 (worst). The Company uses these three levels
to select inputs for valuation techniques:
Level
I Level
2 Level
3
Level
1 is a quoted price for an identical item in an active market on the measurement date. This is the most reliable evidence of fair
value and is used whenever this information is available. Level
2 is directly or indirectly observable inputs other than quoted prices. An example of a Level 2 input is a valuation multiple for
a business unit based on comparable entities’ sales. Level
3 is an unobservable input. It may include the Company’s data, adjusted for other reasonably available information. Examples
of a Level 3 input are an internally generated financial forecast. Basic
and Diluted Income (Loss) per Share The
Company follows ASC 260, Earnings Per Share, to account for earnings per share. Basic earnings per share (“EPS”) calculations
are determined by dividing net loss by the weighted average number of shares of common stock outstanding during the year. Diluted earnings
per share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share
equivalents outstanding. As of June 30, 2024, and December 31, 2023, the Company had 123,052,349 123,052,349 170,220 372,412 Recent
Accounting Pronouncements Other
recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force) and the United States Securities and Exchange
Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated
financial statements. |
