UNITED STATES
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 QUARTERLY PERIOD ENDED SEPTEMBER 30, 2006
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE EXCHANGE ACT
FOR THE TRANSITION PERIOD FROM ____________ TO ____________
COMMISSION FILE NUMBER __________________
INTERLOTTO INTERNATIONAL HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Nevada 20-5159915
(State of Incorporation) (IRS Employer Identification No.)
468 Queen Street East, Suite 202, Toronto, Ontario M5A 1T7
(Address of principal executive offices)
Registrant's telephone number, including area code: (416) 500-3282
Indicate by check mark whether the issuer: (1) has 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 registrant was required to file such
reports), and (2)has been subject to such filing requirements for the past 90
days. Yes |x| No |_|
As of September 30, 2006, there were 300,000 shares of registrant's Common Stock
outstanding.
Transitional Small Business Disclosure Format
(Check one): Yes |_| No |x|
ITEM 1. FINANCIAL STATEMENTS
BASIS OF PRESENTATION
The accompanying reviewed financial statements are presented in accordance with
U.S. generally accepted accounting principles for interim financial information
and the instructions to Form 10-QSB and item 310 under subpart A of Regulation
S-B. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting only of
normal occurring accruals) considered necessary in order to make the financial
statements not misleading, have been included. Operating results for the three
months ended September 30, 2006 are not necessarily indicative of results that
may be expected for the year ending June 30, 2007. The financial statements are
presented on the accrual basis.
Interlotto International Holdings, Inc. (A Development Stage Enterprise)
September 30, 2006
Table of Contents
- --------------------------------------------------------------------------------
Page
Financial Statements
Balance Sheet 2
Statement of Earnings and Deficit 3
Statement of Cash Flows 4
Statement of Stockholders' Deficiency 5
Notes to Financial Statements 6-8
INTERLOTTO INTERNATIONAL HOLDINGS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
AS AT SEPTEMBER 30, 2006
(Unaudited)
ASSETS
CASH $ 94
INCORPORATION COSTS 885
---------------
$ 979
===============
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
DUE TO SHAREHOLDER $ 9,897
---------------
SHARE CAPITAL (note 4)
Common stock
100,000,000 shares authorized
300,000 shares issued and outstanding 300
Deficit (9,218)
---------------
(8,918)
---------------
$ 979
===============
APPROVED BY THE BOARD
- ------------------------------
- ------------------------------
The accompanying notes are an integral part of these financial statements
INTERLOTTO INTERNATIONAL HOLDINGS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF EARNINGS AND DEFICIT
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2006
(Unaudited)
For the three Accumulated
months ended during the
September 30, 2006 development stage
------------- -------------
REVENUE -- --
------------- -------------
OPERATING EXPENSES
Bank charges $ 170 $ 170
Travel and promotion 1,006 1,006
Professional fees 8,042 8,042
------------- -------------
9,218 9,218
------------- -------------
NET LOSS $ (9,218) $ (9,218)
DEFICIT AT BEGINNING OF PERIOD -- --
------------- -------------
DEFICIT AT END OF PERIOD $ (9,218) $ (9,218)
============= =============
BASIC EARNINGS PER SHARE
Weighted average shares outstanding 300,000 300,000
Net loss per share basic and diluted $ (0.031) $ (0.031)
============= =============
There are no issued securities considered to be dilutive as at September 30,
2006
The accompanying notes are an integral part of these financial statements
INTERLOTTO INTERNATIONAL HOLDINGS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2006
(Unaudited)
For the three Accumulated
months ended during the
September 30, 2006 development stage
-------------- --------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (9,218) $ (9,218)
-------------- --------------
Net cash used in operating activities (9,218) (9,218)
-------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES
Incorporation costs 885 885
-------------- --------------
885 885
-------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES -- --
Issue of shares -- 300
Proceeds from shareholder loans 9,897 9,897
-------------- --------------
Net cash provided by financing activities 9,897 10,197
-------------- --------------
NET INCREASE IN CASH AND CASH EQUIVALENTS (206) 94
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 300 --
-------------- --------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 94 $ 94
============== ==============
The accompanying notes are an integral part of these financial statements
INTERLOTTO INTERNATIONAL HOLDINGS,
INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2006
(Unaudited)
Share Capital Accumulated
Shares Amount Deficit Total
-------------------------------------------------------------
Shares issued on incorporation 300,000 $ 300 $ 300
Net loss for the period ended June 30, 2006 -- --
Net loss for the period ended Sept. 30, 2006 $ (9,218) $ (9,218)
-------------------------------------------------------------
Balance September 30, 2006 300,000 $ 300 $ (9,218) $ (8,918)
=============================================================
The accompanying notes are an integral part of these financial statements
INTERLOTTO INTERNATIONAL HOLDINGS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
AS AT SEPTEMBER 30, 2006
(Unaudited)
NOTE 1. GENERAL ORGANIZATION AND BUSINESS
Interlotto International Holdings, Inc. was incorporated under the laws of the
state of Nevada on June 29, 2006. The company is considered a development stage
enterprise and is in the process of raising capital with the purpose of engaging
in a merger or acquisition.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES
Accounting policies and procedures are listed below. The company has adopted a
December 31 fiscal year end.
Accounting Basis
The Company has not earned any revenue from limited principal operations.
Accordingly, the Company's activities have been accounted for as those of a
"Development Stage Enterprise" as set forth in Financial Accounting Standards
Board Statement No. 7 ("SFAS 7"). Among the disclosures required by SFAS 7 are
that the Company's financial statements be identified as those of a development
stage company, and that the statements of earnings, retained earnings and
stockholders' equity and cash flows disclose activity since the date of the
Company's inception.
We have prepared the financial statements in accordance with accounting
principles generally accepted in the United States of America (GAAP).
Cash and Cash Equivalents
The Company considers all highly liquid investments with original maturities of
three months or less as cash equivalents. As of September 30, 2006 the company
had no cash or cash equivalent balances in excess of the federally insured
amounts. The Company's policy is to invest excess funds in only well capitalized
financial institutions.
Earnings per Share
The Company adopted the provisions of SFAS No. 128, "Earnings per Share." SFAS
No. 128 requires the presentation of basic and diluted earnings per share
("EPS"). Basic EPS is computed by dividing income available to common
stockholders by the weighted-average number of common shares outstanding for the
period. Diluted EPS includes the potential dilution that could occur if options
or other contracts to issue common stock were exercised or converted.
The Company has not issued any options or warrants or similar securities since
inception.
Stock Based Compensation
As permitted by Statement of Financial Accounting Standards ("SFAS") No. 148,
"Accounting for Stock-Based Compensation--Transition and Disclosure", which
amended SFAS 123 ("SFAS 123"), "Accounting for Stock-Based Compensation", the
Company has elected to continue to follow the intrinsic value method in
accounting for its stock-based employee compensation arrangements as defined by
Accounting Principles Board Opinion ("APB") No. 25, "Accounting for Stock Issued
to Employees", and related Interpretations including "Financial Accounting
Standards Board Interpretations No. 44, Accounting for Certain Transactions
Involving Stock Compensation", and interpretation of APB No. 25. At September
30, 2006 the Company has not formed a Stock Option Plan and has not issued any
options.
Dividends
The Company has not yet adopted any policy regarding the payment of dividends.
No dividends have been paid during the period shown.
Income Taxes
The provision for income taxes is the total of the current taxes payable and the
net of the change in the deferred income taxes. Provision is made for the
deferred income taxes where differences exist between the period in which
transactions affect current taxable income and the period in which they enter
into the determination of net income in the financial statements.
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America 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 revenue and expenses during
the reporting period. Actual results could differ from those estimates.
Goodwill
Goodwill is created when we acquire a business. It is calculated by deducting
the fair value of the net assets acquired from the consideration given and
represents the value of factors that contribute to greater earning power, such
as a good reputation, customer loyalty or intellectual capital.
We assess goodwill of individual subsidiaries for impairment in the fourth
quarter of every year, and when circumstances indicate that goodwill might be
impaired.
Research and Development
The Company accounts for research and development costs in accordance with the
Financial Accounting Standards Board's Statement of Financial Accounting
Standards No. 2 ("SFAS 2"), "Accounting for Research and Development Costs".
Under SFAS 2, all research and development costs must be charged to expense as
incurred. Accordingly, internal research and development costs are expensed as
incurred. Third-party research and developments costs are expensed when the
contracted work has been performed or as milestone results have been achieved.
Company-sponsored research and development costs related to both present and
future products are expensed in the period incurred.
Revenue Recognition
Revenue for services provided is recognized over the period to which the service
contract relates.
Comprehensive Income
Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive
Income" (SFAS 130), establishes standards for reporting and display of
comprehensive income, its components and accumulated balances. Comprehensive
income is defined to include all changes in equity except those resulting from
investments by owners and distributions to owners. Among other disclosures, SFAS
130 requires that all items that are required to be recognized under current
accounting standards as components of comprehensive income be reported in a
financial statement that is displayed with the same prominence as other
financial statements. The Company has no items of comprehensive income to
report.
NOTE 3. RECENTLY ISSUED ACCOUNTING STANDARDS
Management does not believe that any recently issued but not yet adopted
accounting standards will have a material effect on the Company's results of
operations or on the reported amounts of its assets and liabilities upon
adoption.
NOTE 4. STOCKHOLDERS' EQUITY
Common Stock:
On incorporation June 29, 2006 the Company issued 300,000 shares of its common
stock for $ 300 and credited share capital for $ 300.
NOTE 5. PROVISION FOR INCOME TAXES
The Company provides for income taxes under Statement of Financial Accounting
Standards NO. 109, Accounting for Income Taxes. SFAS No. 109 requires the use of
an asset and liability approach in accounting for income taxes. Deferred tax
assets and liabilities are recorded based on the differences between the
financial statement and tax bases of assets and liabilities and the tax rates in
effect when these differences are expected to reverse.
SFAS No. 109 requires the reduction of deferred tax assets by a valuation
allowance if, based on the weight of available evidence, it is more likely than
not that some or all of the deferred tax assets will not be realized. The
provision for income taxes is comprised of the net changes in deferred taxes
less the valuation account plus the current taxes payable as shown in the chart
below.
NOTE 6. GOING CONCERN
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplates continuation of the
Company as a going concern. The Company operations are in the development stage,
and the Company has generated no income since inception.
CERTIFICATION
I, xxxxxx hereby certify that I have prepared the accompanying unaudited
financial statements and notes hereto, and that these financial statements and
accompanying notes present fairly, in all material respects, the financial
position of the issuer and the results of its operations and cash flows for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America, consistently applied.
- -------------------
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Plan of Operation
- ---------------------
The Registrant is continuing its efforts to locate a merger Candidate for the
purpose of a merger. It is possible that the registrant will be successful in
locating such a merger candidate and closing such merger. However, if the
registrant cannot effect a non-cash acquisition, the registrant may have to
raise funds from a private offering of its securities under Rule 506 of
Regulation D. There is no assurance the registrant would obtain any such equity
funding.
Results of Operation
- -------------------------
The Company did not have any operating income from inception (June 29, 2006)
through September 30, 2006, the registrant recognized a net loss of $9,218.
Expenses from inception were comprised of costs mainly associated with legal,
accounting and office.
Liquidity and Capital Resources
- --------------------------------------
At September 30, 2006 the Company had no capital resources and will rely upon
the issuance of common stock and additional capital contributions from
shareholders to fund administrative expenses pending acquisition of an operating
company.
Management anticipates seeking out a target company through solicitation. Such
solicitation may include newspaper or magazine advertisements, mailings and
other distributions to law firms, accounting firms, investment bankers,
financial advisors and similar persons, the use of one or more World Wide
Websites and similar methods. No estimate can be made as to the number of
persons who will be contacted or solicited. Management may engage in such
solicitation directly or may employ one or more other entities to conduct or
assist in such solicitation. Management and its affiliates will pay referral
fees to consultants and others who refer target businesses for mergers into
public companies in which management and its affiliates have an interest.
Payments are made if a business combination occurs, and may consist of cash or a
portion of the stock in the Company retained by management and its affiliates,
or both.
The Company and or shareholders will supervise the search for target companies
as potential candidates for a business combination. The Company and or
shareholders may pay as their own expenses any costs incurred in supervising the
search for a target company. The Company and or shareholders may enter into
agreements with other consultants to assist in locating a target company and may
share stock received by it or cash resulting from the sale of its securities.
ITEM 3. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Our Chief Executive Officer and Chief Financial Officer (collectively the
"Certifying Officers") maintain a system of disclosure controls and procedures
that is designed to provide reasonable assurance that information, which is
required to be disclosed, is accumulated and communicated to management in a
timely way. Under the supervision and with the participation of management, the
Certifying Officers evaluated the effectiveness of the design and operation of
our disclosure controls and procedures (as defined in Rule [13a-14(c)/15d-14(c)]
under the Exchange Act) within 90 days prior to the filing date of this report.
Based upon that evaluation, the Certifying Officers concluded that our
disclosure controls and procedures are effective in timely way of alerting them
to material information relative to our company required to be disclosed in our
periodic filings with the SEC.
(a) Changes in internal controls.
Our Certifying Officers have indicated that there were no significant changes in
our internal controls or other factors that could significantly affect such
controls subsequent to the date of his evaluation, and there were no such
control actions with regard to significant deficiencies and material weaknesses.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is currently not a party to any pending legal proceedings and no
such action by, or to the best of its knowledge, against the Company has been
threatened.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. Defaults Upon Senior Securities
None
ITEM 4. Submission of Matters to a Vote of Security Holders
No matter was submitted during the quarter ending September 30, 2006, covered by
this report to a vote of the Company's shareholders, through the solicitation of
proxies or otherwise.
ITEM 5. Other Information
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
31.1 Certification pursuant to Section 302 of Sarbanes Oxley
Act of 2002
32.1 Certification pursuant to Section 906 of Sarbanes Oxley
Act of 2002
(b) Reports of Form 8-K
None
SIGNATURES
IN ACCORDANCE with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
INTERLOTTO INTERNATIONAL HOLDINGS, INC.
Date: December 22, 2006 By: /s/ Julius Csurgo
-------------------------
Julius Csurgo
Chief Executive Officer and
Chief Financial Officer and
Duly Authorized Officer
EXHIBIT INDEX
31.1 Certification of Chief Executive Officer
32.1 Certification of Chief Executive Officer and Chief Financial Officer
32.2 Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.