UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended December 31, 2006
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission File Number: 000-32329
ALNILAM CORPORATION
(Exact name of Registrant as specified in charter)
NEVADA 91-2081398
State or other jurisdiction of I.R.S. Employer I.D. No.
incorporation or organization
3857 BIRCH STREET, #606, NEWPORT BEACH, CA 92660
Address of principal executive offices Zip Code
Issuer's telephone number, including area code: (949) 644-0095
Check 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 fling
requirements for the past 90 days.
(1) Yes [X] No [ ] (2) Yes [X] No [ ]
State the number of shares outstanding of each of the Issuer's classes
of common equity as of the latest practicable date: At February 13, 2007,
there were 500,000 shares of the Registrant's Common Stock outstanding.
PART I
ITEM 1. FINANCIAL STATEMENTS
The condensed financial statements 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 footnote disclosures 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 presented not misleading.
In the opinion of the Company, all adjustments, consisting of
only normal recurring adjustments, necessary to present fairly the
financial position of the Company as of December 31, 2006, and the
results of its operations and changes in its financial position from
May 10, 2000, through December 31, 2006, have been made. The results of
its operations for such interim period are not necessarily indicative
of the results to be expected for the entire year. These condensed
financial statements should be read in conjunction with the financial
statements and notes thereto included in the Company's annual report
on Form 10-KSB for the year ended September 30, 2006.
2
Alnilam Corporation
(A Development Stage Company)
Balance Sheet
December September
31, 2006 30, 2006
----------- -----------
(Unaudited)
ASSETS
Current Assets
Cash $ - $ -
---------- ----------
Total Current Assets $ - $ -
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable 37,545 36,795
Interest Payable 10,926 10,412
Note Payable - Related Party (Note 4) 20,560 20,560
---------- ----------
Total Current Liabilities 69,031 67,767
Stockholders' Equity
Common Stock Authorized; 100,000,000 Shares at
$.001 Par Value; 500,000 Shares Issued and
Outstanding 500 500
Capital In Excess of Par Value 9,500 9,500
Deficit Accumulated in the Development Stage (79,031) (77,767)
---------- ----------
Total Stockholders' Equity (69,031) (67,767)
---------- ----------
Total Liabilities & Stockholders' Equity $ - $ -
========== ==========
The accompanying notes are an integral part of these financial statements.
3
Alnilam Corporation
(A Development Stage Company)
Statement of Operations
Accumulated
May 10, 2000
(Inception)
For the Three Months Ended through
December December December
31, 2006 31, 2005 31, 2006
---------- ---------- ----------
Revenue $ - $ - $ -
--------- --------- ---------
Expenses
General &
Administrative 750 565 68,103
--------- --------- ---------
Total Expenses 750 565 68,103
--------- --------- ---------
Income (Loss)
from Operations (750) (565) (68,103)
Other Income (Expenses)
Interest Expense (514) (514) (10,928)
--------- --------- ---------
Total Other
Income (Expenses) (514) (514) (10,928)
--------- --------- ---------
Income (Loss)
Before Taxes (1,264) (1,079) (79,031)
Taxes - - -
--------- --------- ---------
Net Income (Loss) $ (1,264) $ (1,079) $ (79,031)
========= ========= =========
(Loss) Per
Common Share $ (0.00) $ (0.00)
Weighted Average
Shares Outstanding 500,000 500,000
The accompanying notes are an integral part of these financial statements.
4
Alnilam Corporation
(A Development Stage Company)
Statements of Cash Flows
Accumulated
May 10, 2000
(Inception)
For the Three Months Ended through
December 31 December
2006 2005 31, 2006
---------- ---------- ----------
Net Cash Provided by Operating Activities
Net (Loss) $ (1,264) $ (1,079) $ (79,031)
Changes in Operating Assets & Liabilities;
Increase in Accounts/Interest Payable 1,264 1,079 48,471
Increase in Stock Issued for Services - - 2,635
--------- --------- ---------
Net Cash (Used) by Operating Activities - - (27,925)
Net Cash Provided by Investing Activities - - -
--------- --------- ---------
Net Cash Provided by Financing Activities
Issuance of Note Payable for Cash - - 20,560
Stock Issued for Cash - - 7,365
--------- --------- ---------
Net Cash Provided by Financing Activities - - 27,925
--------- --------- ---------
Net Increase (Decrease) in Cash - - -
Cash at Beginning of Year or Period - - -
--------- --------- ---------
Cash at End of Year or Period $ - $ - $ -
========= ========= =========
Supplemental Disclosures
Interest $ - $ - $ -
Taxes - - -
The accompanying notes are an integral part of these financial statements.
5
Alnilam Corporation
(A Development Stage Company)
Notes to Financial Statements
December 31, 2006
NOTE 1 - COMPANY ORGANIZATION
Alnilam Corporation (the "Company") was incorporated under the laws of
the state of Nevada on May 10, 2000, as Alnilam Corporation for the
purpose of seeking and consummating a merger or acquisition with a
business entity organized as a private corporation, partnership, or
sole proprietorship.
The Company is a development stage company as defined in SFAS No. 7.
It is concentrating substantially all of its efforts in raising
capital and developing its business operations in order to generate
significant revenues.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
Cash and Cash Equivalents - The Company considers all highly liquid
investments with an original maturity of three months or less when
purchased to be cash equivalents.
Income (Loss) Per Share - The Computation or income or (loss) per
shares of common stock is based on weighted average number of shares
outstanding at the date of the financial statements.
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 reported period.
Actual results could differ from those estimates.
NOTE 3 - INCOME TAXES
The Company adopted Statement of Financial Standards No. 109
"Accounting for Income Taxes" in the fiscal year ended September 30,
2001.
Statement of Financial Accounting Standards No. 109 "Accounting for
Income Taxes" requires an asset and liability approach for financial
accounting and reporting for income tax purposes. This statement
recognizes (a) the amount of taxes payable or refundable for the
current year and (b) deferred tax liabilities and assets for future
tax consequences of events that have been recognized in the financial
statements or tax returns.
6
Deferred income taxes result from temporary differences in the
recognition of accounting transactions for tax and financial reporting
purposes. There were no temporary differences at December 31, 2006, and
earlier years, no deferred tax liabilities have been recognized.
The Company has cumulative net operating loss carryforwards of
approximately $79,000 at December 31, 2006. No effect has been shown
in the financial statements for the net operating loss carryforwards
as the likelihood of future tax benefit from such net operating loss
carryforwards is not presently determinable. Accordingly, the
potential tax benefits of the net operating loss carryforwards,
estimated based upon current tax rates at December 31, 2006, have
been offset by valuation reserves in the same amount. The net
operating losses begin to expire in 2020.
NOTE 4 - NOTE PAYABLE RELATED PARTY
The Company has issued promissory notes totaling $20,560 to corporations
for which our President and sole director is an officer or director.
The notes are unsecured and carry interest rates of 10% per annum. The
principal and interest of the notes are due and payable upon demand. As of
December 31, 2006, the accrued interest was $10,926.
The Company has the following note payable obligations: December 31,
2006
----------
Related party notes payable, due on demand
accruing interest at a rate of 10% per annum $ 20,560
--------
Total 20,560
Less Current Maturities (20,560)
--------
Total Long-Term Notes Payable $ -
========
NOTE 5 - NEW TECHNICAL PRONOUNCEMENTS
In May 2005, the FASB issued SFAS No. 154, "Account Changes and Error
Corrections." This new standard replaces APB Opinion 20, Accounting Changes,
and FASB No. 3, Reporting Accounting Changes in Interim Financial Statements.
Among other changes, SFAS No. 154 requires that a voluntary change in
accounting principle to be applied retrospectively with all prior period
financial statements presented on a new accounting principle, unless it is
impracticable to do so. SFAS No. 154 also provides that (1) a change in
method of depreciating or amortizing a long-lived non-financial asset be
accounted for as a change in estimate (prospectively) that was effected by a
change in accounting principle, and (2) correction of errors in previously
issued financial statements should be termed a "restatement." The new
standard is
7
effective for accounting changes and correction of errors made in fiscal
years beginning after December 15, 2005. The Company believes the adoption
of the provisions of SFAS No. 154 will not have a material impact on the
financial statements.
In February 2006, the Financial Accounting Standards Board ("FASB") issued
SFAS No. 155, "Accounting for Certain Hybrid Financial Instruments an
amendment of FASB Statements No. 133 and 140" ("SFAS No. 155"). This
Statement permits fair value of remeasurement for any hybrid financial
instrument that contains an embedded derivative that otherwise would require
bifurcation; clarifies which interest-only strips and principal-only strips
are not subject to the requirements of SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities"; establishes a requirement to
evaluate interests in securitized financial assets to identify interests that
are freestanding derivatives or that are hybrid financial instruments that
contain an embedded derivative requiring bifurcation; clarifies that
concentrations of credit risk in the form of subordination are not embedded
derivatives; and amended SFAS No. 140, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities," to
eliminate the prohibition on a qualifying special-purpose entity from holding
a derivative financial instrument that pertains to a beneficial interest
other than another derivative financial instrument. SFAS No. 155 is effective
for all financial instruments acquired, issued, or subject to a remeasurement
(new basis) event occurring after the beginning of an entity's first fiscal
year that begins after September 15, 2006. The Company believes the adoption
of the provisions of SFAS No. 154 will not have a material impact on the
financial statements.
In March 2006, FASB issued SFAS No. 156, "Accounting for Servicing of
Financial Assets which amends FAS No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities" ("SFAS
No. 156"). In a significant change to current guidance, SFAS No. 156 permits
an entity to choose either of the following subsequent measurement methods for
each class of separately recognized servicing assets and servicing
liabilities: (1) Amortization Method or (2) Fair Value Measurement Method.
SFAS No. 156 is effective as of the beginning of an entity's first fiscal
year that begins after September 15, 2006. The Company believes the adoption
of the provisions of SFAS No. 154 will not have a material impact on the
financial statements.
In June 2006 FASB issued Financial Accounting Standards Interpretation
No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48
clarifies the accounting for uncertainty in income taxes recognized in an
enterprises' financial statements in accordance with SFAS No. 109, "Accounting
for Income Taxes" ("SFAS No. 109"). FIN 48 prescribes a recognition threshold
and measurement attributable for the financial statement recognition and
measurement of a tax position taken or expected to be taken in a tax return.
FIN 48 also provides guidance on derecognition, classification, interest and
penalties, accounting in interim periods, disclosures and transitions. FIN 48
is effective for fiscal years beginning after December 15, 2006. The Company
is currently reviewing the effect, if any, FIN 48 will have on its financial
position.
In September 2006, the Securities and Exchange Commission ("SEC") staff
issued Staff Accounting Bulletin No. 108, "Considering the Effects of Prior
Year Misstatements when Quantifying Misstatements in Current Year Financial
Statements" ("SAB No. 108"). SAB No. 108 was issued to provide consistency in
how registrants quantify financial statement
8
misstatements. The Company is required to and will initially apply SAB
No. 108 in connection with the preparation of its annual financial statements
for the year ending December 31, 2006. The Company does not expect the
application of SAB No. 108 to have a material effect on its financial position
and results of operations.
In September 2006, FASB issued SFAS No. 157, "Fair Value Measurements," which
is effective for calendar year companies on January 1, 2008. The statement
defines fair value, establishes a framework for measuring fair value in
accordance with generally accepted accounting principles, and expands
disclosures about fair value measurements. The statement codifies the
definition of fair value as the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. The standard clarifies the principle
that fair value should be based on the assumptions market participants would
use when pricing the asset or liability and establishes a fair value
hierarchy that prioritizes the information used to develop those assumptions.
The Company is currently assessing the potential impacts of implementing this
standard.
In September 2006, the FASB issued SFAS No. 158, "Employers' Accounting for
Defined Benefit Pension and Other Postretirement Plans an amendment of FASB
Statements No. 87, 88, 106 and 132 (R)" ("SFAS No. 158"). SFAS 158 requires
an employer to recognize the funded status of a defined benefit
postretirement plan as an asset or liability in its statement of financial
position and to recognize changes in that funded status in the year in which
the changes occur through comprehensive income. The funded status of a
benefit plan is defined as the difference between the fair value of the plan
assets and the plans benefit obligation. For a pension plan the benefit
obligation is the projected benefit obligation and for any other
postretirement benefit plan, such as a retiree health care plan, the benefit
obligation is the accumulated postretirement benefit obligation. SFAS No. 158
requires an employer to recognize as a component of other comprehensive
income, net of tax, the gains and losses and prior service costs or credits
that arise during the period but that are not recognized as components of net
periodic benefit costs pursuant to SFAS No. 87. SFAS No. 158 also requires an
employer to measure the funded status of a plan as of the date of its
year-end. Additional footnote disclosure is also required about certain
effects on net periodic benefit cost for the next year that arise from the
delayed recognition of gains or losses, prior service costs or credits, and
transition asset or obligation. Except for the year-end measurement
requirement, SFAS No. 158 is effective for the year ending December 31, 2006.
The Company does not anticipate that the adoption of this statement will have
a material effect on its financial condition or operations.
NOTE 6 - GOING CONCERN
The Company has had recurring operating losses since inception and is
dependent upon financing to continue operations. These factors indicate that
the Company may be unable to continue in existence. These financial
statements do not include any adjustments relating to the recoverability and
classification of recorded assets, or the amounts and classification of
liabilities that might be necessary in the event the Company cannot continue
its existence. These financial statements do not include any adjustments
that might result from the outcome of this uncertainty. It is the intent of
the Company to find additional capital funding and/or a profitable business
venture to acquire or merge.
9
NOTE 7 - REVERSE STOCK SPLIT
On February 7, 2005, the Board of Directors approved a resolution to effect a
one-for-two reverse split of the Company's issued and outstanding shares of
common stock. The shareholders approved the reverse stock split on February 8,
2005. The effective date was March 21, 2005. Each share of common stock
issued and outstanding immediately prior to the effective date was
reclassified as and changed into one-half of one share of common stock.
These financial statements reflect the stock split.
The common stock issued pursuant to the reverse stock split is fully paid and
non-assessable. The respective relative voting rights and other rights that
accompany the common stock were not altered by the reverse stock split, and
the common stock continues to have a par value of $0.001 per share.
Consummation of the reverse stock split did not alter the number of our
authorized shares of common stock, which remains at 100,000,000 shares.
NOTE 8 - EARNINGS PER SHARE
The computation of earnings (loss) per share of common stock is based on
the weighted average number of shares outstanding at the date of the
financial statements. The Company did not have any potentially dilutive
options or warrants at December 31, 2006 and 2005.
For the Three Months Ended
Basic/Full Diluted Earnings per Share: December 31
2006 2005
-------- --------
Income (loss) (numerator) (1,264) (1,079)
Shares (denominator) 500,000 500,000
Per Share Amount $(.00) $(.00)
10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION
The Company is a development stage company. Since its inception,
the Company has had no operations. The Company was organized for the
purpose of engaging in any lawful activity permitted under Nevada
state law; however, the Company does not have any significant cash or
other material assets, nor does it have an established source of
revenues sufficient to cover operating costs and to allow it to
continue as a going concern. The Company intends to take advantage of
any reasonable business proposal presented which management believes
will provide the Company and its stockholders with a viable business
opportunity. The board of directors will make the final approval in
determining whether to complete any acquisition, but may submit the
proposal to the shareholders for final approval.
The original shareholders contributed a total of $10,000 in cash
and services as capital contributions for stock of the Company. Since
inception, the Company has borrowed funds from corporations related to
the Company for operating expenses.
Management estimates that the cash requirements for the year
ending September 30, 2007, will be approximately $10,000, if no change
in operations occurs during the year. Management anticipates that any
additional needed funds will be loaned to the Company on the same or
similar terms as those of other loans to the Company. There are no
agreements with any of the companies and no assurance that all or a
portion of these funds will be loaned to the Company. If the Company
is unable to borrow such funds, management will seek other sources of
funding which are currently unknown to management. There is no
assurance that such funding will be available, or that if it is made
available, it could be obtained on terms favorable to the Company.
The investigation of specific business opportunities and the
negotiation, drafting, and execution of relevant agreements,
disclosure documents, and other instruments will require substantial
management time and attention and will require the Company to incur
costs for payment of accountants, attorneys, and others. If a
decision is made not to participate in or complete the acquisition of
a specific business opportunity, the costs incurred in a related
investigation will not be recoverable. Further, even if an agreement
is reached for the participation in a specific business opportunity by
way of investment or otherwise, the failure to consummate the
particular transaction may result in the loss to the Company of all
related costs incurred.
Currently, management is not able to determine the time or
resources that will be necessary to locate and acquire or merge with a
business prospect. There is no assurance that the Company will be
able to acquire an interest in any such prospects, products, or
opportunities that may exist or that any activity of the Company,
regardless of the completion of any transaction, will be profitable.
If and when the Company locates a business opportunity, management of
the Company will give consideration to the dollar amount of that
entity's profitable operations and the adequacy of its working capital
in determining the terms and conditions under which the
11
Company would consummate such an acquisition. Potential business
opportunities, no matter which form they may take, will most likely
result in substantial dilution for the Company's shareholders due to
the likely issuance of stock to acquire such an opportunity.
Off-Balance Sheet Arrangements
Management does not believe the Company has any off-balance sheet
arrangements that have, or are reasonable likely to have, a current or
future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity,
capital expenditures, or capital resources which would be material to
investors.
ITEM 3. CONTROLS AND PROCEDURES
Evaluation of disclosure and controls and procedure
With the participation of management the Company's chief
executive officer and chief financial officer have evaluated the
effectiveness of the design and operation of the Company's disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as amended) as of the end
of the period covered by this quarterly report. Based on that
evaluation the chief executive officer and chief financial officer
have concluded that the Company's disclosure controls and procedures
are designed to ensure that information required to be disclosed by
the Company in the reports that it files or submits under the Exchange
Act is recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms, and are operating in
an effective manner.
Changes in internal controls
There were no changes in the Company's internal control over
financial reporting that have materially affected, or are reasonably
likely to materially affect, the Company's internal control over
financial reporting.
It should be noted that any system of controls, however well
designed and operated, can provide only reasonable and not absolute
assurance that the objectives of the system will be met. In addition,
the design of any control system is based in part upon certain
assumptions about the likelihood of future events. Because of these
and other inherent limitations of control systems, there is only
reasonable assurance that our controls will succeed in achieving their
stated goals under all potential future conditions.
12
PART II
ITEM 6. EXHIBITS
(a) Exhibits.
31.1 Rule 13a-14(a) Certification by Principal Executive Officer
31.2 Rule 13a-14(a) Certification by Principal Financial Officer
32 Section 1350 Certification of Principal Executive Officer
and Principal Financial Officer
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
Alnilam Corporation
Date: February 14, 2007 By: /s/ Eric Bronk
Eric Bronk, President and
Principal Financial and Accounting
Officer
13