U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the quarterly period ended June 30, 2001.
[ ] Transition report under Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from ------------ to ------------.
Commission file number 000-28889
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FAR REACH HOLDINGS, LTD.
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(Exact name of small business issuer as
specified in its charter)
Nevada 33-0885763
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(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
44489 Town Center Way, #D415 Palm Desert, CA 92260
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(Address of principal executive offices)
(760) 773-9227
Issuer's telephone number
(Former name, former address and former fiscal year, if changed since
last report.)
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practical date: June 30, 2001 2,000,000
Transitional Small Business Disclosure Format (check one). Yes ; No X
PART I
Item 1. Financial Statements
INDEPENDENT ACCOUNTANT'S REPORT
Far Reach Holdings, Ltd.
(A Development Stage Company)
We have reviewed the accompanying balance sheet of Far Reach Holdings,
Ltd. (A Development Stage Company) as of June 30, 2001 and December 31, 2000,
and the related statements of operations for the three and six months ended June
30, 2001 and 2000 and cash flows for the six month periods ended June 30, 2001
and 2000. These financial statements are the responsibility of the Company's
management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statement taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications
that should be made to the accompanying financial statements for them to be in
conformity with generally accepted accounting principles.
Respectfully submitted
\s\ Robison, Hill & Co.
----------------------------
Certified Public Accountants
Salt Lake City, Utah
August 16, 2001
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FAR REACH HOLDINGS, LTD.
(A Development Stage Company)
BALANCE SHEETS
(Unaudited)
June 30, December 31,
2001 2000
------------------ ------------------
ASSETS
Cash $ -- $ --
================== ==================
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts Payable $ 1,107 $ 671
Accrued expenses - -
------------------ ------------------
Total Liabilities 1,107 671
------------------ ------------------
Stockholders' Equity
Common Stock, Par value $.001
Authorized 100,000,000 shares,
Issued 2,000,000 shares at June 30, 2001
and December 31, 2000 2,000 2,000
Paid-In Capital 3,990 2,590
Deficit Accumulated During the
Development Stage (5,897) (4,061)
Retained Deficit (1,200) (1,200)
------------------ ------------------
Total Stockholders' Equity (1,107) (671)
------------------ ------------------
Total Liabilities and Stockholders' Equity $ -- $ --
================== ==================
See accompanying notes and accountants' report
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FAR REACH HOLDINGS, LTD.
(A Development Stage Company)
STATEMENT OF OPERATIONS
(Unaudited)
Cumulative
since
For the Three Months For the Six Months June 5, 1999
Ended Ended Inception of
June 30, June 30, Development
-------------------------------- --------------------------------
2001 2000 2001 2000 Stage
---------------- --------------- ---------------- --------------- -----------------
Revenues $ -- $ -- $ -- $ -- $ --
---------------- --------------- ---------------- --------------- -----------------
Expenses
Selling, general and
administrative expenses 1,818 - 1,836 1,450 5,897
---------------- --------------- ---------------- --------------- -----------------
Loss Before Taxes (1,818) - (1,836) (1,450) (5,897)
Income taxes - - - - -
---------------- --------------- ---------------- --------------- -----------------
Net Income (Loss) $ (1,818)$ -- $ (1,836)$ (1,450)$ (5,897)
================ =============== ================ =============== =================
Basic & Diluted loss
Per Share $ -- $ -- $ -- $ --
================ =============== ================ ===============
See accompanying notes and accountants' report
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FAR REACH HOLDINGS, LTD.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
(Unaudited)
Cumulative
since
June 5, 1999
For the Six Months Ended inception of
June 30, development
-------------------------------------
2001 2000 stage
----------------- ------------------ -------------------
Cash Flows from Operating Activities:
Net Loss $ (1,836) $ (1,450)$ (5,897)
Issuance of Common Stock for Services - - 1,000
Increase (Decrease) in Accounts Payable 436 - 907
----------------- ------------------ -------------------
Net cash used in operating activities (1,400) (1,450) (3,990)
----------------- ------------------ -------------------
Cash Flows from Investing Activities:
Net cash provided by investing activities - - -
----------------- ------------------ -------------------
Cash Flows from Financing Activities:
Capital Contributed by Shareholder 1,400 1,450 3,990
Issuance of Common Stock - - -
----------------- ------------------ -------------------
Net cash provided by
financing activities 1,400 1,450 3,990
----------------- ------------------ -------------------
Net change in cash and cash equivalents - - -
Cash and cash equivalents
at beginning of period - - -
----------------- ------------------ -------------------
Cash and cash equivalents at end of period $ -- $ -- $ --
================= ================== ===================
Supplemental Disclosure of Cash Flow
Information:
Cash paid during the year for:
Interest $ -- $ -- $ --
Franchise and income taxes $ -- $ -- $ --
Supplemental Disclosure of Non-Cash Investing
and Financing Activities: None
See accompanying notes and accountants' report
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FAR REACH HOLDINGS, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001
(Unaudited)
NOTE 1 - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
This summary of accounting policies for Far Reach Holdings, Ltd. (a
development stage company) is presented to assist in understanding the Company's
financial statements. The accounting policies conform to generally accepted
accounting principles and have been consistently applied in the preparation of
the financial statements.
Interim Reporting
The unaudited financial statements as of June 30, 2001 and for the six
month period then ended reflect, in the opinion of management, all adjustments
(which include only normal recurring adjustments) necessary to fairly state the
financial position and results of operations for the six months. Operating
results for interim periods are not necessarily indicative of the results which
can be expected for full years.
Organization and Basis of Presentation
The Company was incorporated under the laws of the State of Nevada on
May 23, 1996. The Company ceased all operating activities during the period from
May 23, 1996 to June 5, 1999 and was considered dormant. Since June 5, 1999, the
Company is in the development stage, and has not commenced planned principal
operations.
Nature of Business
The Company has no products or services as of June 30, 2001. The
Company was organized as a vehicle to seek merger or acquisition candidates. The
Company intends to acquire interests in various business opportunities, which in
the opinion of management will provide a profit to the Company.
Cash and Cash Equivalents
For the purpose of reporting cash flows, the Company considers all
highly liquid debt instruments purchased with maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.
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FAR REACH HOLDINGS, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001
(Unaudited)
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Pervasiveness of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles required 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.
Loss per Share
The reconciliations of the numerators and denominators of the basic
income (loss) per share computations are as follows:
Per-Share
Income Shares Amount
------ ------ ------
(Numerator) (Denominator)
For the Three Months Ended June 30, 2001
Basic Income per Share
Income to common shareholders $ (1,818) 2,000,000 $ --
================== =================== ==================
For the Three Months Ended June 30, 2000
Basic Loss per Share
Loss to common shareholders $ -- 1,000,000 $ --
================== =================== ==================
For the Six Months Ended June 30, 2001
Basic Income per Share
Income to common shareholders $ (1,836) 2,000,000 $ --
================== =================== ==================
For the Six Months Ended June 30, 2000
Basic Loss per Share
Loss to common shareholders $ (1,450) 1,000,000 $ --
================== =================== ==================
The effect of outstanding common stock equivalents are anti-dilutive
for June 30, 2001 and 2000 and are thus not considered.
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FAR REACH HOLDINGS, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001
(Unaudited)
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Concentrations of Credit Risk
The Company has no significant off-balance-sheet concentrations of
credit risk such as foreign exchange contracts, options contracts or other
foreign hedging arrangements.
NOTE 2 - INCOME TAXES
As of June 30, 2001, the Company had a net operating loss carryforward
for income tax reporting purposes of approximately $7,000 that may be offset
against future taxable income through 2021. Current tax laws limit the amount of
loss available to be offset against future taxable income when a substantial
change in ownership occurs. Therefore, the amount available to offset future
taxable income may be limited. No tax benefit has been reported in the financial
statements, because the Company believes there is a 50% or greater chance the
carryforwards will expire unused. Accordingly, the potential tax benefits of the
loss carryforwards are offset by a valuation allowance of the same amount.
NOTE 3 - DEVELOPMENT STAGE COMPANY
The Company has not begun principal operations and as is common with a
development stage company, the Company has had recurring losses during its
development stage.
NOTE 4 - COMMITMENTS
As of June 30, 2001 all activities of the Company have been conducted
by corporate officers from either their homes or business offices. Currently,
there are no outstanding debts owed by the company for the use of these
facilities and there are no commitments for future use of the facilities.
NOTE 5 - STOCK SPLIT
On November 11, 1999 the Board of Directors authorized 1,000 to 1 stock
split, changed the authorized number of shares to 100,000,000 shares and the par
value to $.001 for the Company's common stock. As a result of the split, 999,000
shares were issued. All references in the accompanying financial statements to
the number of common shares and per-share amounts for 2000 have been restated to
reflect the stock split.
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FAR REACH HOLDINGS, LTD.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2001
(Unaudited)
NOTE 6 - STOCK ISSUED
During October of 2000, the Board of Directors authorized the issuance
of 1,000,000 shares of stock to its sole officer and director for services
performed.
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Item 2. Management's Discussion and Analysis or Plan of Operation
General
This discussion should be read in conjunction with Management's Discussion
and Analysis of Financial Condition and Results of Operations in the Company's
annual report on Form 10-KSB for the year ended December 31, 2000.
Results of Operations
For the quarter ended June 30, 2001 compared to the same period in 2000
are not necessarily indicative of the results that may be expected for the year
ended December 31, 2001.
The Company had no sales or sales revenues for the six months ended
June 30, 2001 or 2000. The Company had no costs of sales revenues for the six
months ended June 30, 2001 or 2000. The Company had general and administrative
expenses of $1,836 for the six month period ended June 30, 2001 and $1,450 for
the same period in 2000.
The Company recorded net loss of $1,836 for the six months ended June
30, 2001 compared to $1,450 loss for the same period in 2000.
Capital Resources and Liquidity
At June 30, 2001, the Company had total current assets of $0 and total
assets of $0 as compared to $0 current assets and $0 total assets at December
31, 2000. The Company had a net working capital deficit of $1,107 and $671 at
June 30, 2001 and December 31, 2000.
Net stockholders' deficit in the Company was $1,107 and $671 as of June
30, 2001 and December 31, 2000.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None.
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
On August 1, 2001, the Company accepted David Sitko's resignation from
his positions and nominated Gina Zapara as the new President, Secretary and Sole
director.
Item 6. Exhibits and Reports on Form 8-K
The Company has not filed a Form 8-K during the three months ended June
30, 2001.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
FAR REACH HOLDINGS, LTD.
(Registrant)
DATE: August 20, 2001 By: /s/ Gina Zapara
---------------- ------------------------------
Gina Zapara
President, Chief Finance Officer and
Director
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