United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended September 30, 2001
Commission File Number: 0-30565
KNOWLEDGE NETWORKS, INC.
Nevada 91-2014670
(Jurisdiction of Incorporation) (I.R.S. Employer Identification No.)
24843 Del Prado, Suite 318, Dana Point, CA 92629
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (949) 487-7295
As of September 30, 2001, 71,675,780 shares of common stock were issued and
outstanding.
Transitional Small Business Disclosure Format (check one): yes [ ] no [X]
PART I: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
The financial statements, for the three months and nine months ended
September 30, 2001, included herein have been prepared by the Company, without
audit pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnotes disclosure normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations, although the Company believes that the disclosures are adequate to
make the information not misleading.
The Remainder of this Page is Intentionally left Blank
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KNOWLEDGE NETWORKS, INC.
BALANCE SHEET (UNAUDITED)
September 30, December 31,
2001 2000
--------------------------------------------------------------------------------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash . . . . . . . . . . . . . . . . . . . . . . . . . $ 0 $ 161
Notes Receivable - Officer . . . . . . . . . . . . . . 63,993 63,993
Notes Receivable . . . . . . . . . . . . . . . . . . . 291,040 291,040
------------ ----------
TOTAL CURRENT ASSETS . . . . . . . . . . . . . . . . . 355,033 355,194
------------ ----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . $ 355,033 $ 355,194
============ ==========
LIABILITIES & STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable . . . . . . . . . . . . . . . . . . . $ 672,759 $ 14,009
Notes payable. . . . . . . . . . . . . . . . . . . . . 291,040 291,040
------------ ----------
Total Liabilities. . . . . . . . . . . . . . . . . . . 963,799 305,049
------------ ----------
STOCKHOLDERS' EQUITY
Common Stock, $.001 par value; authorized 100,000,000
shares; issued and outstanding, 71,675,780 shares
and 3,425,777 shares respectively . . . . . . . . . 71,676 3,426
Additional Paid-In Capital . . . . . . . . . . . . . . 176,830 175,080
Accumulated Equity (Deficit) . . . . . . . . . . . . . (857,272) (128,361)
Total Stockholders' Equity . . . . . . . . . . . . . . (608,766) 50,145
------------ ----------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY . . . . . . . $ 355,033 $ 355,194
============ ==========
The accompanying notes are an integral part of these financial statements.
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KNOWLEDGE NETWORKS, INC.
STATEMENTS OF OPERATIONS (UNAUDITED)
for the periods ended September 30, 2000 and 2001
From
Inception on
From July From July From January From January December 16,
1, 2001 to 1, 2000 to 1, 2001 to 1, 2000 to 1998 through
September 30, September 30, September 30,September 30, September 30,
2001 2000 2001 2000 2001
------------ ------------ ------------ ------------ ------------
Revenues. . . . . . . . . . $ 0 $ 12,500 $ 0 $ 22,500 $ 99,683
------------ ------------ ------------ ------------ ------------
Bad debt. . . . . . . . . . 0 0 0 0 11,154
Consulting fees . . . . . . 3,001 12,500 37,036 24,500 218,055
General and Administrative. 260,550 8,345 691,875 14,384 727,746
------------ ------------ ------------ ------------ ------------
Total Expenses. . . . . . . 263,551 20,845 728,911 38,884 956,955
Net Loss from Operations. . (263,551) (8,345) (728,911) (16,384) (857,272)
Net Income (Loss) . . . . . $ (263,551) $ (8,345) $ (728,911) $ (16,384) $ (857,272)
============ ============ ============ ============ ============
Loss per Share. . . . . . . $ (0.01) $ (0.00) $ (0.04) $ (0.00) $ (0.05)
============ ============ ============ ============ ============
Weighted Average
Shares Outstanding. . . 20,713,450 10,361,750 20,713,450 10,361,750 17,163,743
============ ============ ============ ============ ============
The accompanying notes are an integral part of these financial statements.
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KNOWLEDGE NETWORKS, INC.
STATEMENT OF CASH FLOWS (UNAUDITED)
for the periods ended September 30, 2000 and 2001
From
Inception on
From January December 16,
1, 2001 to 1998 through
September 30, September 30,
2001 2000 2001
--------------------------------------------------------------------------------
Operating Activities
Net Income (Loss). . . . . . . . . . . . . . . $(728,911) $(16,384) $(857,272)
Adjustments to reconcile net loss to
net cash provided by operations
Increase in accounts payable . . . . . . . . 658,750 14,013 672,759
Bad debt . . . . . . . . . . . . . . . . . 0 0 11,154
Issuance of stock for services . . . . . . 70,000 0 120,342
---------- --------- ----------
Net cash flows used Operations . . . . . . . . (161) (2,371) (53,017)
Cash flows used in Investment Activities
Cash payments for notes receivable . . . . . . 0 0 (63,993)
---------- --------- ----------
Net Cash used in Investment Activities . . . . 0 0 (63,993)
Cash Flows from Financing Activities
Cash received from notes payable . . . . . . 0 0 0
Cash received from subscriptions receivable. 0 0 9,800
Cash received from spin-off. . . . . . . . . 0 0 3,710
Issuance of stock for cash . . . . . . . . . 0 0 103,500
---------- --------- ----------
Net Cash Flows from Financing Activities . . . 0 0 117,010
Net increase (decrease) in cash. . . . . . . . (161) (2,371) 0
Cash, beginning of period. . . . . . . . . . . 161 3,655 0
---------- --------- ----------
Cash, end of period. . . . . . . . . . . . . . 0 1,284 0
========== ========= ==========
The accompanying notes are an integral part of these financial statements.
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KNOWLEDGE NETWORKS, INC.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 2001
NOTES TO FINANCIAL STATEMENTS
Knowledge Networks, Inc. ("the Company") has elected to omit substantially all
footnotes to the financial statements for the period ended September 30, 2001,
since there have been no material changes (other than indicated in other
footnotes) to the information previously reported by the Company in their Annual
Report filed on Form 10-KSB for the Fiscal year ended December 31, 2000.
COMMON STOCK REVERSE SPLIT
On July 5, 2001, the Board of Directors and Shareholders of the Company approved
a one for ten (1:10) reverse split of its common stock. All presentations of
shareholders' equity are presented as if the forward split had been effect since
inception.
UNAUDITED INFORMATION
The information furnished herein was taken from the books and records of the
Company without audit. However, such information reflects all adjustments which
are, in the opinion of management, necessary to properly reflect the results of
the period presented. The information presented is not necessarily indicative
of the results from operations expected for the full fiscal year.
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ITEM 2. DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
(A) PLAN OF OPERATION FOR THE NEXT TWELVE MONTHS. Our plan of operation is
unchanged from our previous report.
(B) DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
We enjoyed no revenues during the period covered by this report.
PART II: OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS. None.
ITEM 2. CHANGES IN SECURITIES. None.
ITEM 3. DEFAULTS ON SENIOR SECURITIES. None.
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS. None
ITEM 5. OTHER INFORMATION. None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Form 10-Q Report for the Quarter ended September 30, 2001, has been signed below
by the following person on behalf of the Registrant and in the capacity and on
the date indicated.
KNOWLEDGE NETWORKS, INC.
Dated: November 1, 2001 by
/s/Jeffrey A. Harry
Jeffrey A. Harry
Sole Remaining Officer/Director
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