U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended January 31, 2001
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[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________________ to ______________________
Commission File No. 000-32089
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FAR GR0UP INC.
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(Name of Small Business Issuer in its Charter)
Washington 91-2023071
- ---------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No)
Suite 210, 580 Hornby Street
Vancouver, British Columbia, Canada V6C 3B6
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(Address of Principal Executive Offices)
(604) 662-7000
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Issuer's Telephone Number
N/A
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(Former Name or Former Address, if changed since last Report)
Check whether the Issuer (1) 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 Company was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
(1) Yes X No (2) Yes X No
--- --- --- ---
(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)
Not applicable
(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 practicable date:
January 31, 2001
Common - 2,600,000 common shares
DOCUMENTS INCORPORATED BY REFERENCE
A description of any "Documents Incorporated by Reference" is contained in Item
6 of this Report.
Transitional Small Business Issuer Format Yes X No
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Financial Statements of the Company required to be filed with this 10-QSB
Quarterly Report were prepared by management and commence on the following page,
together with related Notes. In the opinion of management, the Financial
Statements fairly present the financial condition of the Company.
FAR GROUP INC.
(A Development Stage Company)
INTERIM FINANCIAL STATEMENTS
JANUARY 31, 2001
(Unaudited)
FAR GROUP INC.
(A Development Stage Company)
INTERIM BALANCE SHEET
January 31, April 30,
2001 2000
$ $
(unaudited) (audited)
ASSETS
Current Assets
Cash 4,475 -
- -------------------------------------------------------------------------------------------------------
Total Assets 4,475 -
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued liabilities 1,303
Note payable (Note 4) 35,000 35,000
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Total Liabilities 36,303 35,000
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Contingency (Note 2)
Stockholders' Equity (Deficit)
Common Stock: $0.001 par value; authorized 100,000,000 common shares;
2,600,000 shares issued and outstanding (April 30, 2000 - 1,600,000) 260 160
Additional Paid-in Capital 25,740 15,840
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26,000 16,000
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Preferred Stock: $.0001 par value; authorized 20,000,000 preferred shares;
none issued - -
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Deficit Accumulated During the Development Stage (57,828) (51,000)
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Total Stockholders' Deficiency (31,828) (35,000)
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Total Liabilities and Stockholders' Deficiency 4,475 -
=======================================================================================================
(See accompanying Notes to the Interim Financial Statements)
FAR GROUP INC.
(A Development Stage Company)
INTERIM STATEMENTS OF OPERATIONS
(Unaudited)
Three Nine
Accumulated From Months Months
March 24, 2000 Ended Ended
(Date of Inception) to January 31, January 31,
January 31, 2001 2001 2001
$ $ $
Revenue - - -
- --------------------------------------------------------------------------------------------------
General and administrative expenses 22,828 6,328 6,828
License written-off 35,000 - -
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Net loss (57,828) (6,328) (6,828)
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Net Loss Per Share (Basic and diluted) (0.004) (0.004)
==================================================================================================
Weighted Average Number of Shares
Outstanding 1,600,000 1,600,000
==================================================================================================
(See accompanying Notes to the Interim Financial Statements)
FAR GROUP INC.
(A Development Stage Company)
INTERIM STATEMENTS OF CASH FLOWS
(Unaudited)
For the period
from March 24,
Nine Months 2000 (Date of
Ended Inception) to April
January 31, 30, 2000
2001 (audited)
$ $
Cash Flows From Operating Activities
Net loss (6,828) (51,000)
Items not requiring outlay of cash:
Legal and organizational costs - 16,000
Amortization of license - -
License written-off - 35,000
Changes in operating assets and liabilities:
Accounts payable and accrued liabilities 1,303 -
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Net Cash Used by Operating Activities (5,525) -
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Cash Flows From Financing Activities
Common shares issued 10,000 -
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Increase In Cash 4,475 -
Cash at Beginning of Period - -
- ----------------------------------------------------------------------------------
Cash at End of Period 4,475 -
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Supplemental Disclosures
Interest paid - -
Income tax paid - -
(See accompanying Notes to the Interim Financial Statements)
FAR GROUP INC.
A Development Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
January 31, 2001
(Unaudited)
1. Basis of Presentation
These unaudited interim financial statements have been prepared in
accordance with the instructions to SEC Form 10-QSB. Accordingly, certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such instructions.
These unaudited interim financial statements should be read in conjunction
with the audited financial statements and notes thereto included in the
Company's SB-2 Registration Statement.
In the opinion of the Company's management, all adjustments considered
necessary for a fair presentation of these unaudited interim financial
statements have been included and all such adjustments are of a normal
recurring nature. Operating results for the nine month period ended January
31, 2001 are not necessarily indicative of the results that can be expected
for the year ended April 30, 2001.
2. Nature of Operations and Continuance of Business
FAR Group Inc. herein (the "Company") was incorporated in the State of
Washington, U.S.A. on March 24, 2000. The Company acquired a license to
market and distribute vitamins, minerals, nutritional supplements, and
other health and fitness products in Minnesota, in which the grantor of the
license offers these products for sale from various suppliers on their Web
Site.
The Company is in the development stage. In a development stage company,
management devotes most of its activities in developing a market for its
products. Planned principal activities have not yet begun. The ability of
the Company to emerge from the development stage with respect to any
planned principal business activity is dependent upon its successful
efforts to raise additional equity financing and/or attain profitable
operations. There is no guarantee that the Company will be able to raise
sufficient equity financing or sell any of its products at a profit. There
is substantial doubt regarding the Company's ability to continue as a going
concern.
The Company filed an SB-2 Registration Statement with the U.S. Securities
Exchange Commission which was declared effective on December 7, 2000. The
Company sold and issued 1,000,000 common shares at $0.01 per share for cash
proceeds of $10,000.
3. Summary of Significant Accounting Policies
(a) Year end
The Company's fiscal year end is April 30.
(b) License
The cost to acquire the License was capitalized. The carrying value of
the License is evaluated in each reporting period to determine if
there were events or circumstances which would indicate a possible
inability to recover the carrying amount. Such evaluation is based on
various analyses including assessing the Company's ability to bring
the commercial applications to market, related profitability
projections and undiscounted cash flows relating to each application
which necessarily involves significant management judgment. The
License was written-off to operations as at April 30, 2000 due to the
lack of historical cash flow of Vitaminmineralherb.com. However, it is
the Company's intention to determine if it is economically feasible to
commercially exploit a business plan.
3. Summary of Significant Accounting Policies
(c) Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of
three months or less at the time of issuance to be cash equivalents.
(d) Revenue Recognition
The Company will receive from the Grantor of the license, commissions
of one-half of all the profit on all sales made through the Grantor's
Web Site. The commission revenue will be recognized in the period the
sales have occurred. The Company will report the commission revenue on
a net basis as the Company is acting as an Agent for the Grantor and
does not assume any risks or rewards of the ownership of the products.
This policy is prospective in nature as the Company has not yet
generated any revenue.
(e) 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 periods. Actual results could differ from
those estimates.
(f) Adjustments
These interim unaudited financial statements have been prepared on the
same basis as the annual financial statements and in the opinion of
management, reflect all adjustments, which include only normal
recurring adjustments, necessary to present fairly the Company's
financial position, results of operations and cash flows for the
periods shown. The results of operations for such periods are not
necessarily indicative of the results expected for a full year or for
any future period.
4. License
The Company's asset is a license to market vitamins, minerals, nutritional
supplements and other health and fitness products through the Grantor's Web
Site. The Company desires to market these products to medical
practitioners, alternative health professionals, martial arts studios and
instructors, sports and fitness trainers, other health and fitness
practitioners, school and other fund raising programs and other similar
types of customers in Minnesota. The license was acquired on April 13, 2000
for a term of three years. The Company must pay an annual fee of $500 for
maintenance of the Grantor's Web Site commencing on the anniversary date.
The Grantor of the license retains 50% of the profits.
The Company paid total consideration of $35,000 for the license with a note
payable of $35,000. See Note 5.
The License was written-off to operations as at April 30, 2000 due to the
lack of historical cash flow of Vitaminmineralherb.com. However, it is the
Company's intention to determine if it is economically feasible to
commercially exploit a business plan.
5. Note Payable
The note payable is unsecured, non-interest bearing and is repayable upon
the successful completion of an Initial Public Offering of the common stock
of the Company and sale of all registered shares pursuant to such offering.
As the proceeds from this offering are not sufficient to repay this loan
the President of the Company does not intend to demand repayment until
sufficient funds are in place.
6. Related Party Transaction
The License referred to in Note 4 was assigned to the Company by the sole
director and President of the Company for consideration of the assumption
of a note payable of $35,000. The License was recorded at the transferors
cost of $35,000 which was also fair market value at the time.
The Grantor of the License is not related to the Company.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Plan of Operation
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The Company has not engaged in any material operations or had any revenues from
operations since its inception on March 24, 2000. The Company's plan of
operation for the next 12 months is to determine the feasibility of marketing
the Vitamineralherb products in various markets, and, if the products prove to
be in demand, begin marketing and selling Vitamineralherb products.
During the next 12 months, the Company's only foreseeable cash requirements will
relate to maintaining the Company in good standing and to determine the
feasibility of the Company's business plan of selling Vitamineralherb products
to targeted markets. Additional funds may be advanced by management or
stockholders as loans to the Company. It is impossible to predict the amount of
any such loans or advances. However, any such loans or advances should not
exceed $25,000 and will be on terms no less favourable to the Company than would
be available from a commercial lender in an arm's length transaction.
Results of Operations
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A total of $5,000 was paid, pursuant to a Business Agreement dated January 30,
2001 with Magnum Financial Corp. The Company will receive consulting services in
the area of financing, capitalization, shareholder relations, public market
strategy and broker relations. In particular, Magnum Financial Corp. will file
with all necessary entities the documentation required to request approval for
trading on the over-the-counter Bulletin Board and will pay a further $5,000
upon OTC Bulletin Board listing and $5,000 three weeks after OTC Bulletin Board
Listing. Magnum Financial Corp. will be awarded fees for financing produced at a
rate of 5% of gross proceeds; 2.5% in cash and 2.5% in common shares issued
under Rule 144.
Liquidity
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The Company filed an SB-2 Registration Statement with the U.S. Securities
Exchange Commission which was declared effective on December 7, 2000. The
Company sold and issued 1,000,000 common shares at $0.01 per share for cash
proceeds of $10,000.
The Company had $4,475 of cash on hand at January 31, 2001. Management does not
believe that this will be sufficient to meet its anticipated expenses during the
next 12 months. The Company will have to raise additional funds through sales of
its securities or through loans from stockholders or management.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; not applicable.
Item 2. Changes in Securities.
None; not applicable.
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None; not applicable.
Item 5. Other Information.
None; not applicable.
Item 6. Exhibits and Reports on Form 8-K.
None.
DOCUMENTS INCORPORATED BY REFERENCE
None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
FAR GROUP INC.
Date: February 20, 2001 By: /s/ Frank Roberts
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Frank Roberts, President,
Secretary, Treasurer and
Director
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
this Report has been signed below by the following persons on behalf of the
Company and in the capacities and on the dates indicated:
Date: February 20, 2001 By: /s/ Frank Roberts
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Frank Roberts, President,
Secretary, Treasurer and
Director