SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10QSB
Quarterly Report under Section 13 or 15(d) of
the Securities Exchange Act of 1934
For Quarter Ended Commission File Number
- - - ----------------- ----------------------
September 30, 2004 000-32063
SHOGI, INC.
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(Exact name of registrant as specified in its charter)
Wyoming 83-0327967
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(State of incorporation) IRS Employer ID Number
P.O. Box 917, 82602
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(Address of principal executive offices) (Zip Code)
None
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(Registrant's Telephone number)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to the filing
requirements for at least the past 90 days.
Yes X No
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Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
840,000 common shares as of September 30, 2004
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
For financial information, please see the financial statements and the
notes thereto, attached hereto and incorporated by this reference.
The financial statements have been prepared by Shogi, Inc. without
audit pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnotes disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted as allowed by such rules and
regulations, and management believes that the disclosures are adequate to make
the information presented not misleading. These financial statements include all
the adjustments which, in the opinion of management, are necessary to a fair
presentation of financial position and results of operations. All such
adjustments are of a normal and recurring nature. These financial statements
should be read in conjunction with the audited financial statements at December
31, 2003, included in the Company's Form 10-SB.
SHOGI, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS FOR THE THREE AND
NINE-MONTHS ENDED SEPTEMBER 30, 2004
(UNAUDITED)
MICHAEL JOHNSON & CO., LLC
Certified Public Accountants
9175 East Kenyon Ave., Suite 100
Denver, Colorado 80237
Michael B. Johnson C.P.A. Telephone: (303) 796-0099
Member: A.I.C.P.A. Fax: (303) 796-0137
Colorado Society of C.P.A.s
ACCOUNTANTS REVIEW REPORT
Board of Directors
Shogi, Inc.
Casper, WY
We have reviewed the accompanying balance sheet for Shogi, Inc. (a development
stage company) for June 30, 2004 and the related statements of operations for
the three and nine-months ended September 30, 2004 and 2003, and for the period
from October 30, 1999 (inception) to September 30, 2004, and cash flows for the
nine-months ended September 30, 2004 and 2003 and for the period from October
30, 1999 (inception) to September 30, 2004, included in the accompanying
Securities and Exchange Commission 10-QSB for the period ended September 30,
2004. 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. The 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 auditing standards generally accepted in the United States, the objective
of which is the expression of an opinion regarding the financial statements
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 accounting principles generally accepted in the United States.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2, conditions
exist which raise substantial doubt about the Company's ability to continue as a
going concern unless it is able to generate sufficient cash flows to meet its
obligations and sustain its operations. Management's plans in regard to these
matters are described in Note 2. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
We have previously audited, in accordance with auditing standards generally
accepted in the United States, the balance sheet as of December 31, 2003, and
the related statements of operations, stockholders' equity (deficit) and cash
flows for the year then ended (not presented herein). In our report dated
December 6, 2004, we expressed an unqualified opinion on those financial
statements. In our opinion, the information set forth in the accompanying
balance sheet as of September 30, 2004, is fairly stated in all material
respects in relation to the balance sheet from which it has been derived.
Michael Johnson & Co, LLC
December 7, 2004
/s/Michael Johnson & Co., LLC
SHOGI, INC.
(A Development Stage Company)
Balance Sheets
(Unaudited)
September 30, December 31,
2004 2003
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ASSETS
Current Assets:
Cash $ - $ -
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Total Current Assets - -
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TOTAL ASSETS $ - $ -
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STOCKHOLDERS' EQUITY
Stockholders' Equity:
Common stock, $.001 par value, 50,000,000 shares 840 840
authorized, 840,000 shares issued and outstanding
Additional Paid-In Capital 1,260 1,260
Deficit accumulated during the
development stage (2,100) (2,100)
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TOTAL STOCKHOLDERS' EQUITY $ - $ -
============== ==============
See Accountants Review Report
SHOGI, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
October 30, 1999
Three-Months Ended Nine-Months Ended (Inception) to
September 30, September 30, September 30,
2004 2003 2004 2003 2004
---- ---- ---- ---- ----
Revenue:
Income $ - $ - $ - $ - $ -
------- ------- ------- ------- --------
Total Income - - - - -
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Costs and Expenses:
Accounting Fees - - - - 1,906
Filing Fees - - - - 211
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Total Operating Expenses - - - - 2,117
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Other Income and Expenses:
Interest Income - - - - 17
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Net Profit (Loss) $ - $ - $ - $ - $ (2,100)
======= ======= ======= ======= ========
Per Share Information:
Weighted average number
of common shares outstanding 840,000 840,000 840,000 840,000
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Net Loss per common share * * * *
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* Less than $.01
See Accountants Review Report
Deficit
COMMON STOCKS Additional Accum. During Total
Paid-In Development Stockholders'
# of Shares Amount Capital Stage Equity
----------- ------ ------- ----- ------
Balance - October 30, 1999 - $ - $ - $ - $ -
Issuance of stock for cash 840,000 840 1,260 - 2,100
Net Loss for Period - - - (1,495) (1,495)
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Balance - December 31, 1999 840,000 840 1,260 (1,495) 605
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Net Loss for Year - - - (99) (99)
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Balance - December 31, 2000 840,000 840 1,260 (1,594) 506
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Net Loss for Year - - - (506) (506)
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Balance - December 31, 2001 840,000 840 1,260 (2,100) -
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Net Loss for Year - - - -
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Balance - December 31, 2002 840,000 840 1,260 (2,100) -
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Net Loss for Year - - - - -
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Balance - December 31, 2003 840,000 840 1,260 (2,100) -
------- ----- ------- -------- ------
Net Loss for Period - - - - -
------- ----- ------- -------- ------
Balance - September 30, 2004 840,000 $ 840 $ 1,260 $ (2,100) $ -
======= ===== ======= ======== ======
See Accountants Review Report
SHOGI, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
Indirect Method
October 30,, 1999
Nine-Months Ended (Inception) to
September 30, September 30,
2004 2003 2004
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Cash Flows from Operating Activities:
Net Loss $ - $ - $ (2,100)
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Net Cash Used in Operating Activities - - (2,100)
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Cash Flows from Financing Activities:
Proceeds from stock issuance - - 2,100
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Net Cash Provided by Financing Activities - - 2,100
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Net Increase in Cash & Cash Equivalents - - -
Beginning Cash & Cash Equivalents - - -
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Ending Cash & Cash Equivalents $ - $ - $ -
===== ===== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest $ - $ - $ -
===== ===== ========
Cash paid for Income Taxes $ - $ - $ -
===== ===== ========
See Accountants Review Report
SHOGI, INC.
Notes to Financial Statements
September 30, 2004
Note 1 - Presentation of Interim Information:
In the opinion of the management of Shogi, Inc., the accompanying unaudited
financial statements include all normal adjustments considered necessary to
present fairly the financial position as of September 30, 2004 and the results
of operations for the three and nine-months ended September 30, 2004 and 2003
and for the period from October 30, 1999 (inception) to September 30, 2004, and
cash flows for the nine-months ended September 30, 2004 and 2003, and for the
period from October 30, 1999 (inception) to September 30, 2004. Interim results
are not necessarily indicative of results for a full year.
The financial statements and notes are presented as permitted by Form 10-QSB,
and do not contain certain information included in the Company's audited
financial statements and notes for the fiscal year ended December 31, 2003.
Note 2 - Going Concern:
The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business.
The Company is in the development state and has not earned any revenue from
operations. The Company's ability to continue as a going concern is dependent
upon its ability to develop additional sources of capital or locate a merger
candidate and ultimately, achieve profitable operations. The accompanying
financial statements do not include any adjustments that might result from the
outcome of these uncertainties. Management is seeking new capital to revitalize
the Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
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OF OPERATIONS
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Cautionary and Forward Looking Statements
In addition to statements of historical fact, this Form 10-QSB contains
forward-looking statements. The presentation of future aspects of Shogi, Inc.
("Shogi, Inc." the "Company" or "issuer") found in these statements is subject
to a number of risks and uncertainties that could cause actual results to differ
materially from those reflected in such statements. Readers are cautioned not to
place undue reliance on these forward-looking statements, which reflect
management's analysis only as of the date hereof. Without limiting the
generality of the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "intend," or "could" or the negative variations thereof or
comparable terminology are intended to identify forward-looking statements.
These forward-looking statements are subject to numerous assumptions, risks
and uncertainties that may cause Shogi, Inc. actual results to be materially
different from any future results expressed or implied by Shogi, Inc. in those
statements. Important facts that could prevent Shogi, Inc. from achieving any
stated goals include, but are not limited to, the following:
Some of these risks might include, but are not limited to, the
following:
(a) volatility or decline of the Company's stock price;
(b) potential fluctuation in quarterly results;
(c) failure of the Company to earn revenues or profits;
(d) inadequate capital to continue or expand its busi-
ness, inability to raise additional capital or financ
-ing to implement its business plans;
(e) failure to achieve a business;
(f) rapid and significant changes in markets;
(g) litigation with or legal claims and allegations by
outside parties;
(h) insufficient revenues to cover operating costs.
There is no assurance that the Company will be profitable, the Company
may not be able to successfully develop, manage or market its products and
services, the Company may not be able to attract or retain qualified executives
and technology personnel, the Company's products and services may become
obsolete, government regulation may hinder the Company's business, additional
dilution in outstanding stock ownership may be incurred due to the issuance of
more shares, warrants and stock options, or the exercise of warrants and stock
options, and other risks inherent in the Company's businesses.
The Company undertakes no obligation to publicly revise these forward-looking
statements to reflect events or circumstances that arise after the date hereof.
Readers should carefully review the factors described in other documents the
Company files from time to time with the Securities and Exchange Commission,
including the Quarterly Reports on Form 10-QSB and Annual Report on Form 10-KSB
filed by the Company in 2002 and any Current Reports on Form 8-K filed by the
Company.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
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of Operations
- ---------------
Results of Operations
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The Company had no revenue or operations for the period. There can be
no assurance that the Company will be able to complete a merger with an
operating company. Due to the lack of a specified business opportunity, the
Company is unable to predict the period for which it can conduct operations.
Comparison of Operating Results for the Three Months Ended September 30, 2004
- ------------------------------------------------------------------------------
and September 30, 2003
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The Company had no revenues for the quarter in 2004 or 2003. The Company
incurred no expenses in the quarter in 2004 or 2003 and had no profit/loss per
share in the period in either quarter.
Comparison of Operating Results for the Nine Months Ended September 30, 2004 and
- ------------------------------------------------------------------------------
September 30, 2003
- --------------------
The Company had no revenues for the nine months ended September 30, 2004
and September 30, 2003. The company incurred no expenses in the period in 2004
compared to none in 2003 in the period.
The net loss in the period in 2004 was none as compared to none in 2003.
The net loss per share for the period was none in 2004 and 2003.
Liquidity and Capital Resources
- ---------------------------------
At September 30, 2004, the Company had no cash or other assets with which
to conduct operations. The lack of liquidity or liquid assets raises substantial
doubt about the Company's ability to continue as a going concern unless it is
able to generate sufficient cash flows to meet its obligations and sustain
operations. To meet required current operating expenses the Company is totally
dependent upon its principal shareholder to advance funds until the Company has
acquired another entity that has sufficient resources to fund the Company's
operations.
Once the Company has identified an appropriate business combination,
lack of existing capital may be a sufficient impediment to prevent its
consummation. And if a business combination is completed, the Company's needs
for additional financing is likely to increase substantially.
NEED FOR ADDITIONAL FINANCING
The Company does not have capital sufficient to meet the Company's cash
needs, including the costs of compliance with the continuing reporting
requirements of the Securities Exchange Act of 1934. The Company will have to
seek loans or equity placements to cover such cash needs. In the event the
Company is able to complete a business combination during this period, lack of
its existing capital may be a sufficient impediment to prevent it from
accomplishing the goal of completing a business combination. There is no
assurance, however, that without funds it will ultimately allow registrant to
carry out its business.
The Company will need to raise additional funds to conduct any business
activities in the next twelve months.
No commitments to provide additional funds have been made by management
or other stockholders. Accordingly, there can be no assurance that any
additional funds will be available to the Company to allow it to cover its
expenses as they may be incurred.
Irrespective of whether the Company's cash assets prove to be
inadequate to meet the Company's operational needs, the Company might seek to
compensate providers of services by issuances of stock in lieu of cash.
"GOING CONCERN" QUALIFICATION
The Company's auditor has issued a "going concern" qualification as part of
his opinion in the Audit Report. There is substantial doubt about the ability of
the Company to continue as a "going concern." The Company has no business,
limited capital, no cash, no other assets, and no capital commitments. The
effects of such conditions could easily be to cause the Company's bankruptcy.
Management hopes to develop its business plan and will need, at which to
seek and obtain funding, via loans or private placements of stock for operations
debt and to provide working capital.
ITEM 3. CONTROLS AND PROCEDURES
a. Evaluation of Disclosure Controls and Procedures:
Disclosure controls and procedures are designed to ensure that information
required to be disclosed in the reports filed or submitted under the Exchange
Act is recorded, processed, summarized and reported, within the time period
specified in the SEC's rules and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed in the reports filed under the Exchange Act
is accumulated and communicated to management, including the Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions
regarding required disclosure. As of September 30, 2004 covered by this report,
the Company carried out an evaluation, under the supervision and with the
participation of the Company's management, including the Company's Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of the Company's disclosure controls and procedures. Based
upon and as of the date of that evaluation, the Chief Executive Officer and
Chief Financial Officer concluded that the Company's disclosure controls and
procedures are effective to ensure that information required to be disclosed in
the reports the Company files and submits under the Exchange Act is recorded,
processed, summarized and reported as and when required.
b. Changes in Internal Control over Financial Reporting:
There were no changes in the Company's internal control over financial reporting
identified in connection with the Company evaluation of these controls as of the
end of the period covered by this report that could have significantly affected
those controls subsequent to the date of the evaluation referred to in the
previous paragraph, including any correction action with regard to significant
deficiencies and material weakness.
Trends: The company expects that the trend of no income and ongoing losses will
continue in the future until a business combination has been made which may
afford revenues and potential cash flows. No assurance can be made that any
such combination will ever occur.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
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The Company is not a party to any pending legal proceedings, and no
such proceedings are known to be contemplated.
Item 2. Change in Securities.
- - - -----------------------------
None
Item 3. Defaults Upon Senior Securities.
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(Not applicable)
Item 4. Submission of Matters to a Vote of Security Holders.
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(Not applicable)
Item 5. Other Information.
- - - --------------------------
(Not applicable)
Item 6. Exhibits and Reports on Form 8-K.
- - - -----------------------------------------
(a) Exhibits - #31 CERTIFICATION PURSUANT TO SECTION
302 OF THE SARBANES OXLEY ACT
#32 CERTIFICATION OF DISCLOSURE PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(b) Reports on Form 8-K
None
SIGNATURES
In accordance with the requirements of the Securities and Exchange Act
of 1934, as amended, the registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
SHOGI, INC.
Date: December 16, 2004
/s/ Ronald A. Shogren
by: ------------------------------
Ronald A. Shogren, President