FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[Mark One]
[X] QUARTERLY REPORT PURSUANT TO SECTIONS 13 OR 15(d) OF THE SECURITIES AND EXC
HANGE ACT OF 1934
For the six months ended: June 30, 1997
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND
EXCHANGE ACT OF 1934
for the transition period from ________ to ________
Commission file number:33-17050-NY
ADVANCED APPEARANCE OF AMERICA, INC.
(Name of small business and its charter)
Nevada 13-3422912
(State of incorporation) (IRS employer Ident. No.)
2900 N.W. 48th Terrace, Suite 411, Ft. Lauderdale, FL. 33319
(address of principle office) (Zip Code)
Issuer's telephone number: (954) 733-5785
Securities registered under Section 12(b) of the Exchange Act:
None
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $.001 par value
(Title of class)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Exchange Act during the past
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 .
Check if there is no disclosure of delinquent filers in response to Item 405
of regulation S-B not contained in this form, and no disclosure will be
contained, to the best of regulation knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this 10-QSB
or amendment to this Form 10-QSB. [X]
State issuer's revenues for its most recent fiscal year. -0-
Since there are no closing bid and asked process of the common stock,
the aggregate market value of the voting stock held by non- affiliates of
the registrant is not determinable. The number of shares outstanding of the
issuer's class of common equity, as of October 20, 1997: 36,670,000.
THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION
27A OF THE SECURITIES ACT OF 1933 AND SECTION 21E OF THE SECURITIES EXCHANGE
ACT OF 1934. ACTUAL RESULTS AND EVENTS COULD DIFFER MATERIALLY FROM THOSE
PROJECTED AS ARESULT OF THE `KNOWN UNCERTAINTIES' AS SET FORTH HEREIN.
PART I
Item 1. Financial Statements
Index to Financial Statements
Page
Independent Auditor's report F-1,2
Financial Statements
Balance Sheets F-3
Statements of Operations/Retained Deficit F-4
Statements of Cash Flows F-5
Notes to Financial Statements F-6,7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Overview
Advanced Appearance of America, Inc. was organized as Nevada corporation
in 1988. There has ben no material development of the small business issuer
in the past three years as the Corporation disbanded approximately eight
years ago. Currently, the Corporation has no tangible assets or tangible
net worth, exclusive of certain period cost and related liabilities. The
Corporation has never been a party to bankruptcy, receivership, or similar
proceeding in its entire existence. In the past three years, the Cor
consolidated, purchased, or sold any part of its business.
The corporation has no current business activity and acts as a public shell
only.
Since 1988, Advanced Appearance of America, Inc., (`The Company'), has not
been engaged in any activities. It is a developmental stage company, which
has incurred net losses of approximately $20,650. The Company expects
operating losses will continue until it acquires or is merged into another
business.
To date, the Company has not yet generated any revenues. The company's
results may vary significantly from period to period depending on several
factors, such as the timing of certain expenses and the progress of the
Company's ability to obtain funding for future acquisitions and mergers.
Results of Operations
Three Months Ended June 30, 1997 and June 30, 1996
General and administrative expenses during the three months ended
June 30, 1997,were $ 1,000 versus $ 0 during the three months ended June 30,
1996. This increase was primarily due to professional fee expenses.
Liquidity and Capital Resources
The Company has financed its operations since inception by receiving loan
proceeds from its majority shareholder.
Known Uncertainties
Developmental Stage Company
The Company is in the developmental stage, and its proposed operations
are subject to the risks inherent in the establishment of a new business
enterprise, including the absence of operating history. The likelihood of the
success of the Company must be considered in light of the problems, expenses,
difficulties, complications and delays frequently encountered in connection
with the formation of a new business and the development of a new business.
The Company has made no sales to date and has accumulated a net deficit
from inception through June 30, 1997. Further, it is likely that additional
losses will be incurred in the future.
Going Concern Qualifications
The report of the Company's independent auditor contains an explanatory
paragraph as to the Company's ability to continue as raising substantial
doubt as to the Company's ability to continue as a going concern. Among the
factors cited by the auditor as raising substantial doubt as to the Company's
ability to continue as a going concern is that the Company has incurred
losses since inception and is expected to continue to incur losses and is in
need of substantial funds. There can be no assurance that the Company will
ever achieve significant revenues or profitable operations.
Financing Requirements
The Company expects that it may be required to seek additional
financing in the future. There can be no assurance that such financing will
be available or available on attractive terms, or such financing would not
result in a substantial dilution of shareholders' interest.
PART II
Other Information
Item 1. Legal Proceedings
The Company is not aware of any legal proceedings, pending or
contemplated, to which the Company is, or would be, a party, or would be, the
subject.
Item 2. Changes In Securities
NONE
Item 3. Defaults Upon Senior Securities
NONE
Item 4. Submission of Matters to a Vote of Security Holders
NONE
Item 5. Other Information
NONE
Item 6. Exhibits and Reports on Form 8-K
Description
Amendment to Articles of Incorporation
Articles of Incorporation (Nevada)- are incorporated by reference to
Exhibit of the Company's Form 10-QSB for the quarter ending June 30, 1997
(SIGNATURE PAGE FOLLOWS)
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, Advanced Appearance of America, Inc. has
duly caused this report to be signed on its behalf by the undersigned,
thereunto authorized,
ADVANCED APPEARANCE OF AMERICA, INC.
By: /s/Edward A. Roth
Edward A. Roth
Chairman of the Board,
Director, and President.
October 20, 1997
MICHAEL J. BONGIOVANNI, P.A., C.P.A.
6529 NORTHWEST 54th COURT
LAUDERHILL, FLORIDA 33319
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
The Board of Directors and Shareholders
Advanced Appearance of America, Inc.
I have audited the accompanying balance sheet of Advanced Appearance of
America, Inc. (a Development Stage Company) as of June 30, 1997 and December
31, 1996, and the related statements of operations and retained deficit and
cash flows for the three and six months ended June 30, 1997 and 1996. These
financial statements are the responsibility of the Company's management. My
responsibility is to express an opinion on these financial stateents based
on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
from material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. I believe that my audit provides
a reasonable basis for my opinion.
In my opinion, the financial statements referred to above, present fairly,
in all material respects, the financial position of Advanced Appearance of
America, Inc. ( a Development Stage Company), as of June 30, 1997 and
December 31, 1996 and the results of its operations and its cash flows for
the three and six months ended June 30, 1997 and 1996 in conformity with
generally accepted accounting principles.
F-1
The Company is in the development stage as of June 30, 1997 and to date has had
no significant operations. Recovery of the Company's assets is dependent on
future events, the outcome of which is indeterminable. In addition,
successful completion of the Company's development program and its
transition, ultimately, to attaining profitable operations is dependent upon
obtaining adequate financing to fulfill its development activities and
achieving a level of sales adequate to support the Company's cost
structure.
The accompanying financial statements have been prepared assuming the company
will continue as a going concern. The Company has suffered losses and has
yet to generate an internal cash flow that raises substantial doubt about
its ability to continue as a going concern. Management's plans in regard to
these matters are described in Note 3. The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
Lauderhill, Florida
October 20, 1997
Michael J. Bongiovanni, P.A.,C.P.A.
F-2
ADVANCED APPEARANCE OF AMERICA, INC..
(a Development Stage Company)
Balance Sheets
ASSETS
June 30,1997 December 31,1996
Current assets:
Cash $ -- $ --
Total assets $ -- $ --
============ ==============
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable and accrued
expenses $14,650 18,650
Stockholder loans 6,000 1,000
Total current liabilities 20,650 19,650
========== ===========
Commitment and contingencies
Stockholders' deficit:
Common stock, par value $.001;
authorized 100,000,000 shares,
issued and outstanding
36,670,000 -- --
Deficit accumulated during
development stage ( 20,650) (19,650)
Total stockholders' deficit 20,650 19,650
$ -- --
============ ============
Seee accompanying notes to the financial statements and
auditor's report
F-3
ADVANCED APPEARANCE OF AMERICA, INC..
(a Development Stage Company)
Statements of Operations
For Three and Six Months Ended June 30,1997 and 1996
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
June 30,1997 June 30,1996 June 30,1997 June 30,199
State filing fees $ 0 $ 0 $ 0 $ 112
Registrar transfer
fees 0 0 0 375
Professional fees 1,000 0 1,000 625
1,000 0 1,000 1,112
Net income/(loss) (1,000) (0) (1,000) (1,112)
Net loss applicable to
common shareholders $(1,000) $ (0) $(1,000) $(1,112)
======== ======== ======== ========
Net loss per common
share:
Weighted average number
of common shares 36,670,000 36,670,000 36,670,000 36,670,000
========== ========== =========== ==========
Primary net loss per
common share $ (.001) $ (0) $ (.00) $ (.0001)
========== ========== ============ ===========
See accompanying notes to the financial statements
and auditor's report.
F-4
ADVANCED APPEARANCE OF AMERICA, INC.
(a Development Stage Company)
Statements of Cash Flows
For Three and Six Months Ended June 30,1997 and 1996
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
June30,1997 June30,1996 June30,1997 June30,1996
Net(loss) $ 0 $ (1,112) $ (1,000) $(1,112)
Net cash used for
operating activities:
Increase in
accounts payable
and accrued
expenses 1,000 1,112 1,000 1,112
Total adjustments 1,000 1,112 1,000 1,112
Net cash used in
operating activities -- -- -- --
Net increase in cash -- -- -- --
Cash and cash
equivalents at
beginning of period -- -- -- --
Cash and cash
equivalents at
end of period $ -- $ -- $ -- $ --
======== ======== ======== ========
Three and Six Months Three and Six Months
Ended June 30,1997 Ended June 30,1996
Supplemental
disclosures of cash
flow information:
Cash paid for
interest $ -- $ --
============== ================
See accompanying notes to the financial statements
and auditor's report.
F-5
ADVANCED APPEARANCE OF AMERICA, INC.
(a Development Stage Company)
Notes to Financial Statements
June 30, 1997 and 1996
(1) BACKGROUND
The Company, ( "Advanced Appearance of America, Inc.") was organized in the
state of Nevada on August 13, 1987 under its original name of Tri-Capital
Corp..On April 12, 1988, a reverse merger was effected between Tri-Capital
Corp. and Advanced Appearance of America, Inc.. Advanced Appearance of
America was formed on April 12, 1988.(see Note 3)
The Company is currently in a development stage and is in the process of
raising additional capital. There is no assurance that the Company will
achieve a profitable level of operations.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) 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 of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
(b) Cash and cash equivalents
Holdings of highly liquid investments with original maturates of three
months or less and investment in money market funds are considered to be
cash equivalents by the Company.
(c) Net loss per share
Net loss per share of common stock is computed by dividing the net loss
applicable to common shareholders by the weighted average number of common
shares outstanding and common stock equivalents.
F-6
ADVANCED APPEARANCE OF AMERICA, INC.
(a Development Stage Company)
Notes to Financial Statements (Continued)
June 30, 1997 and 1996
(3) GOING CONCERN
The Company is currently a development stage company and its continued
existence is dependent upon the Company's ability to resolve its liquidity
problems, principally by obtaining additional debt financing and/or equity
capital. The Company has yet to generate an internal cash flow, and until
the sales begins, the Company is totally dependent upon the debt and equity
funding. As a result of these factors, there exists substantial doubt about
the Company's ability to continue as a going concern. However, management
of the Company is continually negotiating with various outside entities for
additional funding. There is no assurance that the Company will achieve a
profitable level of operations.
F-7