SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended: January 31, 2009
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ________________ to __________________
Commission File Number: 333-143630
TECHS LOANSTAR, INC.
______________________________________________________
(Exact name of registrant as specified in its charter)
Nevada 20-4682058
_______________________________ ___________________
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
112 North Curry Street
Carson City, Nevada, 89703
________________________________________
(Address of principal executive offices)
(775) 284-3770
____________________________________________________
(Registrant's telephone number, including area code)
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 such filing
requirements for the past 90 days.
Yes [X] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in
rule 12b-2 of the Exchange Act). Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: As of February 17, 2009, the
registrant had 40,400,000 shares of common stock, $0.001 par value, issued and
outstanding.
TECHS LOANSTAR, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED FINANCIAL STATEMENTS
JANUARY 31, 2009
(UNAUDITED)
CONDENSED BALANCE SHEETS
CONDENSED STATEMENTS OF OPERATIONS
CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
CONDENSED STATEMENTS OF CASH FLOWS
CONDENSED NOTES TO FINANCIAL STATEMENTS
2
TECHS LOANSTAR, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEETS
(UNAUDITED)
January 31, 2009 April 30, 2008
_______________________________________________________________________________________________________________________________
ASSETS
CURRENT ASSETS
Cash $ 5 $ 198
Prepaid Expenses - -
_______________________________________________________________________________________________________________________________
Total Assets 5 198
===============================================================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accrued expenses 7,575 9,528
Shareholders Loan 14,773 1,167
_______________________________________________________________________________________________________________________________
Total Liabilities 22,348 10,695
_______________________________________________________________________________________________________________________________
STOCKHOLDERS' EQUITY (DEFICIT)
Capital stock
Authorized
300,000,000 shares of common stock, $0.001 par value,
Issued and outstanding
40,400,000 shares of common stock 40,400 40,400
Additional paid-in capital (17,900) (17,900)
Deficit accumulated during the development stage (44,843) (32,997)
_______________________________________________________________________________________________________________________________
Total Stockholders' Equity (22,343) (10,497)
_______________________________________________________________________________________________________________________________
Total Liabilities and Stockholders' Equity $ 5 $ 198
===============================================================================================================================
The accompanying notes are an integral part of these financial statements
3
TECHS LOANSTAR, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
CUMULATIVE FROM
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS INCEPTION
ENDED ENDED ENDED ENDED (APRIL 7, 2006)
JANUARY 31, 2009 JANUARY 31, 2008 JANUARY 31, 2009 JANUARY 31, 2008 TO JANUARY 31, 2009
__________________________________________________________________________________________________________________________________
REVENUE $ - $ - $ - $ - $ -
__________________________________________________________________________________________________________________________________
OPERATING EXPENSES
Office and general $ 148 (3,391) $ (2,990) $ (5,137) $ (13,937)
Professional fees (5,000) (2,500) (8,856) (8,400) (30,906)
__________________________________________________________________________________________________________________________________
LOSS FROM OPERATIONS $ (4,852) $ (5,891) $ (11,846) $ (13,537) $ (44,843)
PROVISION FOR INCOME TAX $ - $ - $ - $ - $ -
NET LOSS $ (4,852) $ (5,891) $ (11,846) $ (13,537) $ (44,843)
==================================================================================================================================
BASIC AND DILUTED LOSS PER
COMMON SHARE $ 0.00 $ 0.00 $ 0.00 $ 0.00
==================================================================================================================================
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING -
BASIC AND DILUTED 40,000,000 35,468,624 40,000,000 35,468,624
==================================================================================================================================
The accompanying notes are an integral part of these financial statements.
4
TECHS LOANSTAR, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FROM INCEPTION (APRIL 7, 2006) TO JANUARY 31, 2009
(UNAUDITED)
Deficit
Accumulated
Additional Share During the
Paid-in Subscription Development
Common Stock Capital Receivable Stage Total
_______________________________________________________________________________________
Number of shares Amount
___________________________________________________________________________________________________________________________________
Balance, April 7,2006 - $ - $ - $ - $ - $ -
Common stock issued at $0.001 per share on 28,000,000 28,000 (21,000) (7,000) - -
April 21, 2006 to President
Net loss for the year ended April 30, 2006
(Audited) - - - - (1,279) (1,279)
___________________________________________________________________________________________________________________________________
Balance, April 30, 2006 (Audited) 28,000 (21,000) (7,000) (1,279) (1,279)
___________________________________________________________________________________________________________________________________
Proceeds received from share subscriptions - - - 7,000 - 7,000
receivable
Common stock issued at $0.005 per share. 12,400,000 12,400 3,100 - - 15,500
(May 1, 2006 to April 30, 2007)
Net Loss for the year ended April 30,2007
(Audited) - - - - (9,867) (9,867)
___________________________________________________________________________________________________________________________________
Balance, April 30, 2007 (Audited) 40,400,000 $ 40,400 $ (17,900) - (11,146) 11,354
___________________________________________________________________________________________________________________________________
Net Loss for the year ended April 30,2008
(Audited) - - - - (21,851) (21,851)
___________________________________________________________________________________________________________________________________
Balance, April 30, 2008 (Audited) 40,400,000 $ 40,400 $ (17,900) (32,997) (10,497)
___________________________________________________________________________________________________________________________________
Net loss for the period ended
January 31, 2009 - - - - (11,846) (11,846)
___________________________________________________________________________________________________________________________________
Balance, January 31, 2009 40,400,000 $ 40,400 $ (17,900) $ - $ (44,843) $ (22,343)
===================================================================================================================================
The accompanying notes are an integral part of these financial statements.
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TECHS LOANSTAR, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Cumulative
results of
operations from
Nine months Nine months inception (April
ended ended 7, 2006) to
January 31, 2009 January 31, 2008 January 31, 2009
__________________________________________________________________________________________________________________________
OPERATING ACTIVITIES
Net loss $ (11,846) $ (13,537) $ (44,843)
Changes in operating assets and liabilities
Prepaid Expenses - 2,500 -
Accrued Liabilities (1,954) 4,457 7,575
__________________________________________________________________________________________________________________________
NET CASH FROM OPERATING ACTIVITIES (13,800) (6,580) (37,268)
__________________________________________________________________________________________________________________________
FINANCING ACTIVITIES
Proceeds from sale of common stock - - 22,500
Shareholders Loan 13,607 - 14,773
__________________________________________________________________________________________________________________________
NET CASH FROM FINANCING ACTIVITIES 13,607 - 37,273
__________________________________________________________________________________________________________________________
NET INCREASE (DECREASE) IN CASH (193) (6,580) 5
CASH, BEGINNING 198 11,954 -
__________________________________________________________________________________________________________________________
CASH, ENDING $ 5 $ 5,374 $ 5
==========================================================================================================================
Supplemental cash flow information:
Cash paid for:
Interest $ - $ - $ -
Income Taxes $ - $ - $ -
==========================================================================================================================
NON-CASH ACTIVITIES
Stock issued for services - - -
Stock issued for accounts payable - - -
Stock issued for notes payable - - -
Stock issued for convertible debentures and interest - - -
Convertible debentures issued for services - - -
Warrants issued - - -
Stock issued for penalty on default of convertible debenture - - -
Note payable issued for finance charges - - -
Forgiveness of not payable and accrued interest - - -
Stock issued for investment. - - -
The accompanying notes are an integral part of these financial statements.
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TECHS LOANSTAR, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
JANUARY 31, 2009
_______________________________________________________________________________
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying financial statements have been prepared by the Company without
audit. In the opinion of management, all adjustments (which include only normal
recurring adjustments) necessary to present fairly the financial position,
results of operations, and cash flows at January 31, 2009, and for all periods
presented herein, have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's April 30, 2008
audited financial statements. The results of operations for the periods ended
January 31, 2009 and 2008 are not necessarily indicative of the operating
results for the full years.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles in the United States of America applicable to a going
concern which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. The Company has not yet
established an ongoing source of revenues sufficient to cover its operating
costs and allow it to continue as a going concern. The ability of the Company to
continue as a going concern is dependent on the Company obtaining adequate
capital to fund operating losses until it becomes profitable. If the Company is
unable to obtain adequate capital, it could be forced to cease operations.
In order to continue as a going concern, the Company will need, among other
things, additional capital resources. Management's plan is to obtain such
resources for the Company by obtaining capital from management and significant
shareholders sufficient to meet its minimal operating expenses and seeking
equity and/or debt financing. However management cannot provide any assurances
that the Company will be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent upon its
ability to successfully accomplish the plans described in the preceding
paragraph and eventually secure other sources of financing and attain profitable
operations. The accompanying financial statements do not include any adjustments
that might be necessary if the Company is unable to continue as a going concern.
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ITEM 2: MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Overview
This interim report contains forward looking statements relating to our
Company's future economic performance, plans and objectives of management for
future operations, projections of revenue mix and other financial items that are
based on the beliefs of, as well as assumptions made by and information
currently known to our management. The words "expects", "intends", "plans",
"believes", "anticipates", "may", "could", "should" and other similar
expressions and variations thereof are intended to identify forward-looking
statements. The cautionary statements set forth in this section are intended to
emphasize that actual results may differ materially from those contained in any
forward looking statement.
The following discussion should be read in conjunction with our financial
statements and related notes included elsewhere in this report.
Techs Loanstar, Inc. ("Techs Loanstar," "the Company," "us", "our" or "we,") was
incorporated in the State of Nevada as a for-profit company on April 7, 2006. We
are a development-stage company formed to enter into the loan management
services industry with proprietary loan management software applications that we
intend to procure. The Company proposes to provide low cost, user friendly data
base applications for the growing payday and equity loan industry.
Techs Loanstar will compete with traditional loan management software developers
by offering a range of consulting services and customized data base applications
to pay-day and equity loan businesses.
The Company has not generated any revenues from inception nor during the fiscal
quarter ended January 31, 2009. As of the fiscal quarter ended January 31, 2009
we had $5 of cash on hand. We incurred operating expenses of $4,852 comprised of
professional fees and office and general expenses. In the fiscal quarter ended
January 31, 2008 we incurred operating expenses of $5,891 also made up of
professional fees and office and general expenses. Since inception, Techs
Loanstar has incurred operating losses of $44,843.
Plan of Operation
We anticipate that our current cash and cash equivalents and cash generated from
operations, if any, will be insufficient to satisfy our liquidity requirements
for at least the next 12 months. We will require additional funds and the
Company will seek to sell additional capital through private equity placements,
debt securities or seek alternative sources of financing. If we are unable to
secure additional financing, we may be required to reduce the scope of our
business plan, which could harm our business, financial condition and operating
results.
Over the next 12 month period we must raise capital and start the staged
procurement of our loan management software systems that we intend to license in
stages and expand and enhance over time and as our business develops.
As our first step we plan to acquire open source data base applications that we
can customize to suite a wide variety of financing businesses, such as pay-day
and equity loan, leasing and finance companies. The cost of customizing theses
application is estimated to cost $7,000.
The next stage is procuring the e-commerce transaction software required in
advance of client functionality that will enable the purchase of our products
and services over the Internet at an estimated cost of $4,000.
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In the final stage expect to procure client functionality modules to augment the
loan management data base systems with a call center, website integration, data
conversion, internet lead integration and accounting file auto export services,
estimated to cost $8,000. During this stage we will continue work on the client,
transaction and administration modules and other data base functionality.
During this period we also intend to initiate our marketing activities to
attract prospective clients from a large number of North American pay-day and
equity loan businesses. Our marketing plan includes identifying and initiating
contact with pay-day and equity loan providers, participating in finance
industry trade shows, placing advertisements in trade magazines and on-line
journals and contacting finance industry associations. The execution of the
marketing plan is estimated to cost $15,000.
If we can complete these stages and we receive a positive reaction from our
potential customers in the form of firm purchase orders, we will attempt to
raise money through a private placement, public offering or long-term loans to
purchase additional functionality for our loan management software.
At present, our sole officer and director has invested $7,000 and a total of 31
others have invested a further $15,500 through the purchase of common shares of
the company. Our sole officer and director has also invested a further $14,773
in the way of shareholder loans. At the present time, we have not made any
arrangements to raise additional cash. If we are unable to raise capital, we
will either suspend development and marketing operations until we do raise the
cash or cease operations entirely.
If we are unable to complete any phase of our software procurement or marketing
efforts because we don't have enough money, we will cease our development and
marketing operations until we raise money. Attempting to raise capital after
failing in any phase of our software procurement plan would be difficult. As
such, if we cannot secure additional proceeds we will have to cease operations
and investors would lose their entire investment.
Management does not plan to hire additional employees at this time. Our sole
officer and director will be responsible for the initial product sourcing. Once
the company is ready to begin its Internet marketing, it will hire an
independent consultant to build our web site. The Company also intends to hire
sales representatives initially on a commission only basis to keep
administrative overhead to a minimum.
Off Balance Sheet Arrangements.
As of the date of this Quarterly Report, the current funds available to the
Company will not be sufficient to continue operations. The cost to establish the
Company and begin operations is estimated to be approximately $24,000 over the
next twelve months and the cost of maintaining our reporting status is estimated
to be $14,000 over this same period. The officer and director, Mr. Pizzacalla
has undertaken to provide the Company with operating capital to sustain our
business over the next twelve month period as the expenses are incurred in the
form of a non-secured loan. However, there is no contract in place or written
agreement securing this agreement. Management believes that if the Company
cannot raise sufficient revenues or maintain its reporting status with the SEC
it will have to cease all efforts directed towards the Company. As such, any
investment previously made would be lost in its entirety.
Other than the above described situation the Company does not have any
off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on the Company's financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that are material to investors.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Securities
Act of 1934 and are not required to provide the information under this item.
Item 4T. CONTROLS AND PROCEDURES
Our management is responsible for establishing and maintaining adequate internal
control over financial reporting. Internal control over financial reporting is
defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange
Act of 1934 as a process designed by, or under the supervision of, the company's
principal executive and principal financial officers and effected by the
company's board of directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
accounting principles generally accepted in the United States of America and
includes those policies and procedures that:
- - Pertain to the maintenance of records that in reasonable detail accurately
and fairly reflect the transactions and dispositions of the assets of the
company;
- - Provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with accounting
principles generally accepted in the United States of America and that
receipts and expenditures of the company are being made only in accordance
with authorizations of management and directors of the company; and
- - Provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of the company's assets that
could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate. All internal control systems,
no matter how well designed, have inherent limitations. Therefore, even those
systems determined to be effective can provide only reasonable assurance with
respect to financial statement preparation and presentation. Because of the
inherent limitations of internal control, there is a risk that material
misstatements may not be prevented or detected on a timely basis by internal
control over financial reporting. However, these inherent limitations are known
features of the financial reporting process. Therefore, it is possible to design
into the process safeguards to reduce, though not eliminate, this risk.
As of January 31, 2009 management assessed the effectiveness of our internal
control over financial reporting based on the criteria for effective internal
control over financial reporting established in Internal Control--Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission ("COSO") and SEC guidance on conducting such assessments. Based on
that evaluation, they concluded that, during the period covered by this report,
such internal controls and procedures were not effective to detect the
inappropriate application of US GAAP rules as more fully described below. This
was due to deficiencies that existed in the design or operation of our internal
controls over financial reporting that adversely affected our internal controls
and that may be considered to be material weaknesses.
The matters involving internal controls and procedures that our management
considered to be material weaknesses under the standards of the Public Company
10
Accounting Oversight Board were: (1) lack of a functioning audit committee due
to a lack of a majority of independent members and a lack of a majority of
outside directors on our board of directors, resulting in ineffective oversight
in the establishment and monitoring of required internal controls and
procedures; (2) inadequate segregation of duties consistent with control
objectives; and (3) ineffective controls over period end financial disclosure
and reporting processes. The aforementioned material weaknesses were identified
by our Chief Executive Officer in connection with the review of our financial
statements as of January 31, 2009.
Management believes that the material weaknesses set forth in items (2) and (3)
above did not have an effect on our financial results. However, management
believes that the lack of a functioning audit committee and the lack of a
majority of outside directors on our board of directors results in ineffective
oversight in the establishment and monitoring of required internal controls and
procedures, which could result in a material misstatement in our financial
statements in future periods.
In an effort to remediate the identified material weaknesses and other
deficiencies and enhance our internal controls, we have initiated, or plan to
initiate, the following series of measures:
We will create a position to segregate duties consistent with control objectives
and will increase our personnel resources and technical accounting expertise
within the accounting function when funds are available to us. And, we plan to
appoint one or more outside directors to our board of directors who shall be
appointed to an audit committee resulting in a fully functioning audit committee
who will undertake the oversight in the establishment and monitoring of required
internal controls and procedures such as reviewing and approving estimates and
assumptions made by management when funds are available to us.
Management believes that the appointment of one or more outside directors, who
shall be appointed to a fully functioning audit committee, will remedy the lack
of a functioning audit committee and a lack of a majority of outside directors
on our Board.
We will continue to monitor and evaluate the effectiveness of our internal
controls and procedures and our internal controls over financial reporting on an
ongoing basis and are committed to taking further action and implementing
additional enhancements or improvements, as necessary and as funds allow.
There was no change in our internal controls over financial reporting that
occurred during the period covered by this report, which has materially
affected, or is reasonably likely to materially affect, our internal controls
over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is not a party to any pending legal proceedings, and no such
proceedings are known to be contemplated.
No director, officer, or affiliate of the issuer and no owner of record or
beneficiary of more than 5% of the securities of the issuer, or any security
holder is a party adverse to the small business issuer or has a material
interest adverse to the small business issuer.
ITEM 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities
Act of 1934 and are not required to provide the information under this item.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
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
31.1 Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer
31.2 Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer*
32.1 Section 1350 Certification of Chief Executive Officer
32.2 Section 1350 Certification of Chief Financial Officer**
* Included in Exhibit 31.1
** Included in Exhibit 32.1
SIGNATURES
Pursuant to the requirements of the Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
TECHS LOANSTAR, INC.
By: /s/ GARY PIZZACALLA
________________________________________
Gary Pizzacalla
President, Secretary Treasurer,
Principal Executive Officer,
Principal Financial Officer and Director
Dated: March 9, 2009
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