UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURUTIES EXCHANGE ACT OF 1934
For the fiscal year ended October 31, 2008
Commission File Number 333-142324
WIRED ASSOCIATES SOLUTIONS INC.
(Exact name of registrant as specified in its charter)
NEVADA
(State or other jurisdiction of incorporation or organization)
14205 SE 36th Street
Suite 100, # 172
Bellevue, WA 98006
(Address of principal executive offices, including zip code)
(425) 675-4242
(Telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to section 12(g) of the Act:
Common Stock, $.001 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]
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 if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
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 [ ]
As of February 25, 2009 the registrant had 1,950,000 shares of common stock
issued and outstanding. No market value has been computed based upon the fact
that no active trading market had been established as of February 25, 2009.
WIRED ASSOCIATES SOLUTIONS INC.
TABLE OF CONTENTS
Page No.
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Part I
Item 1. Business 3
Item 1A. Risk Factors 5
Item 2. Properties 8
Item 3. Legal Proceedings 8
Item 4. Submission of Matters to a Vote of Securities Holders 8
Part II
Item 5. Market for Registrant's Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities 8
Item 6. Selected Financial Data 10
Item 7. Management's Discussion and Analysis of Financial Condition
and Plan of Operation 11
Item 8. Financial Statements 12
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 26
Item 9A. Controls and Procedures 26
Part III
Item 10. Directors and Executive Officers 28
Item 11. Executive Compensation 29
Item 12. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters 31
Item 13. Certain Relationships and Related Transactions 32
Item 14. Principal Accounting Fees and Services 32
Part IV
Item 15. Exhibits 33
Signatures 33
2
PART I
FORWARD LOOKING STATEMENTS
Some of the statements contained in this Form 10-K that are not historical facts
are "forward-looking statements" which can be identified by the use of
terminology such as "estimates," "projects," "plans," "believes," "expects,"
"anticipates," "intends," or the negative or other variations, or by discussions
of strategy that involve risks and uncertainties. We urge you to be cautious of
the forward-looking statements, that such statements, which are contained in
this Form 10-K, reflect our current beliefs with respect to future events and
involve known and unknown risks, uncertainties and other factors affecting our
operations, market growth, services, products and licenses. No assurances can be
given regarding the achievement of future results, as actual results may differ
materially as a result of the risks we face, and actual events may differ from
the assumptions underlying the statements that have been made regarding
anticipated events.
All written forward-looking statements made in connection with this Form 10-K
that are attributable to us, or persons acting on our behalf, are expressly
qualified in their entirety by these cautionary statements. Given the
uncertainties that surround such statements, you are cautioned not to place
undue reliance on such forward-looking statements.
ITEM 1. BUSINESS
We were incorporated in the State of Nevada in the United States of America on
February 14, 2003. We are a development stage company, whose original business
plan was web development, specializing in the design, creation and marketing of
cost effective Internet products. We have not had any significant development of
our business nor have we received any revenue since the year ended October 31,
2004. Due to the lack of results in our attempt to implement our original
business plan, management determined it was in the best interests of the
shareholders to look for other potential business opportunities that might be
available to the Company.
Management has begun the process of analyzing the various alternatives that may
be available to ensure the survival of the company and to preserve our
shareholder's investment. This may include additional sources of financing to
continue in the website development industry, or a change of business plan. At
this stage in our operations, we believe either course is acceptable, as our
operations have not been profitable and our future prospects for our original
business plan are not promising.
STATUS OF PUBLICLY ANNOUNCED NEW PRODUCTS OR SERVICES
We currently have no new publicly announced products or services.
COMPETITION
We currently do not compete with any other companies.
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SOURCES AND AVAILABILITY OF RAW MATERIALS
We do not currently have any sources or need for raw materials.
DEPENDENCE ON ONE OR A FEW MAJOR CUSTOMERS
We are not dependent on one or a few major customers.
PATENTS, TRADEMARKS, LICENSES, AGREEMENTS OR CONTRACTS
We do not currently have a need for any patents, trademarks, licenses,
agreements or contracts. As our new business plan is formulated management will
assess the needs for any of these. We own the domain name wiredassociates.com.
NEED FOR GOVERNMENT APPROVAL FOR ITS PRODUCTS OR SERVICES
We are not required to apply for or have any government approval for our
products or services.
RESEARCH AND DEVELOPMENT ACTIVITIES AND COSTS
We have spent no time on specialized research and development activities, and
have no plans to undertake any research or development in the future.
COMPLIANCE WITH ENVIRONMENTAL LAWS
We are not aware of any environmental regulations that could directly affect our
operations, but no assurance can be given that environmental regulations will
not, in the future, have a material adverse impact on our business.
NUMBER OF EMPLOYEES
At the present time, the company has no employees other than its officer and
director, Jacqueline Wood, who devotes her time as needed to the Company's
business. We intend to add staff as needed, as we expand operations and resume
full time design in our office.
BANKRUPTCY OR SIMILAR PROCEEDINGS
There has been no bankruptcy, receivership or similar proceeding.
REORGANIZATIONS, PURCHASES OR SALES OF ASSETS
There have been no material reclassifications, mergers, consolidations, or
purchase or sale of a significant amount of assets not in the ordinary course of
business.
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REPORTS TO SECURITIES HOLDERS
We provide an annual report that includes our audited financial information to
our shareholders upon written request. We also make our financial information
equally available to any interested parties or investors through compliance with
the disclosure rules of the Securities Exchange Act of 1934. We are subject to
disclosure filing requirements including filing a Form 10-K annually and Form
10-Q quarterly. In addition, we will file Form 8-K and other proxy and
information statements from time to time as required. We do not intend to
voluntarily file the above reports in the event our obligation to file such
reports is suspended under the Exchange Act.
The public may read and copy any materials that we file with the Securities and
Exchange Commission, ("SEC"), at the SEC's Public Reference Room at 100 F Street
NE, Washington, DC 20549. The public may obtain information on the operation of
the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC
maintains an Internet site (http://www.sec.gov) that contains reports, proxy and
information statements, and other information regarding issuers that file
electronically with the SEC.
ITEM 1A. RISK FACTORS
1. WE ARE A DEVELOPMENT STAGE COMPANY WITH A LIMITED OPERATING HISTORY AND THERE
IS SUBSTANTIAL DOUBT ABOUT THE COMPANY'S ABILITY TO CONTINUE AS A GOING CONCERN,
THEREFORE INVESTMENT IN OUR COMPANY INVOLVES A HIGH DEGREE OF RISK. We are in
our organizational and development stages and have generated no revenue. Any
investment in our company involves a high degree of risk. A prospective investor
should, therefore, be aware that in the event we are not successful in our
business plans, any investment in our shares may be lost and we may be faced
with the possibility of liquidation.
2. WE CANNOT OFFER ANY ASSURANCE AS TO OUR FUTURE FINANCIAL RESULTS. We were
incorporated and in existence from February 14, 2003, and have had limited
revenues since inception. However, due to the lack of results in our attempt to
implement our original business plan, management determined it was in the best
interests of the shareholders to look for other potential business opportunities
that might be available to the Company. Currently, we are still analyzing
various business alternatives and there can be no assurance that a suitable
business will be developed or we will be successful. We face all the risks
inherent in a relatively new business and there can be no assurance that our
activities will be successful and/or result in any profits.
3. WE DO NOT HAVE ANY ADDITIONAL SOURCE OF FUNDING FOR OUR BUSINESS PLANS. Other
than the shares offered by our SB-2 offering, no other source of capital has
been identified or sought. As a result we do not have an alternate source of
funds should the funds from our offering be insufficient. There is no assurance
that any financing will be available or if available, on terms that will be
acceptable to us. If we do find an alternative source of capital, the terms and
conditions of acquiring such capital may result in dilution and the resultant
lessening of value of the shares of stockholders. If we are not successful in
securing revenue or funding, we will be faced with several options: 1. abandon
our business plans, cease operations and go out of business; 2. continue to seek
alternative and acceptable sources of capital; or 3. bring in additional capital
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that may result in a change of control. In the event of any of these
circumstances an investor could lose a substantial part or all of their
investment.
4. IF WE OBTAIN ADDITIONAL FINANCING THROUGH EQUITY, EXISTING STOCKHOLDERS MAY
SUFFER SUBSTANTIAL DILUTION. There are still 48,050,000 shares of Common Stock
which the Board of Directors has the authority to issue. The issuance of any
such shares to persons other than the current investors will reduce the amount
of control held by the current investors and may result in a dilution of the
book value of their shares. There are presently no commitments, contracts or
intentions to issue any additional shares to any persons.
5. WE CAN OFFER NO ASSURANCE THAT AN ACTIVE MARKET FOR OUR SECURITIES WILL
EXIST. There is currently no active trading in our Common Stock and there is no
assurance that an active trading market in our Shares will ever develop.
Accordingly, there is a very high risk that our Shares may not be able to be
resold in the future.
6. WE DO NOT ANTICIPATE OFFERING CASH DIVIDENDS. No cash dividends have been
declared or paid on the shares of our Common Stock to date, nor is it
anticipated that any such dividends will be declared or paid to stockholders in
the foreseeable future. It is currently anticipated that any income received
from operations will be reinvested and devoted to our future operations and/or
to expansion.
7. FUTURE SALES OF SHARES CURRENTLY RESTRICTED PURSUANT TO RULE 144 COULD HAVE A
DEPRESSIVE EFFECT ON THE PRICE OF THE COMPANY'S STOCK. 1,000,000 shares of
"restricted" Common Stock has been issued in consideration for proprietary
rights, business plans, organizational services and expenses and cash in the
amount of $2,500, or $.0025 per share, and 150,000 shares in the amount of
$15,000, or $0.10 per share. All of the shares are held by persons who served as
officers, directors and/or control persons of the company and who hold such
shares as "restricted securities", as that term is defined in Rule 144
promulgated under the Securities Act of 1933, as amended. However, these
securities held by officers, directors and/or control persons may only be sold
in compliance with Rule 144 which provides, in essence, that officers and
directors and others holding restricted securities (such as those described
above) may each sell, in brokerage transactions, an amount equal to 1% of the
company's total outstanding Common Stock every three (3) months. In addition,
Rule 144 provides that shares must not be sold until they have been held for a
period of at least six (6) months from the date they were fully paid for. The
possible sale of these restricted securities under Rule 144 may, in the future,
have a depressive effect on the price of the company's Common Stock in any
public market which may develop, assuming there is such a market, of which there
can be no assurance.
8. WE HAVE A VERY SMALL MANAGEMENT TEAM AND THE LOSS OF ANY MEMBER OF OUR TEAM
MAY PREVENT US FROM IMPLEMENTING OUR BUSINESS PLAN IN A TIMELY MANNER. Our
future performance will be substantially dependent on the continued services of
our officer and director. Future performance also will depend on our ability to
retain and motivate new officers and key employees. We currently have only one
executive officer and the loss of her services could harm our proposed business
operations. We do not have long-term employment agreements with our key
personnel and we do not maintain any "key person" life insurance policies.
Future success also will depend on the ability to attract, train, retain and
motivate other highly skilled technical, managerial, marketing and customer
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support personnel. Competition for these personnel is intense and we may be
unable to successfully attract, integrate or retain sufficiently qualified
personnel.
9. WE MAY BE LIABLE TO DAMAGES FOR THE INDEMNIFICATION OF OUR OFFICERS AND
DIRECTORS. We have investigated the cost of insurance against liabilities
arising out of the negligence of our officers and directors and/or deficiencies
in any of our business operations. Based on our lack of current revenues, we
have determined that the cost of such insurance is excessive at this time.
Accordingly, we have not obtained such insurance and would have to satisfy any
such liabilities out of our assets. Any such liability which might arise could
be substantial and may exceed our assets.
Our By-Laws provide for indemnification to officers and directors to the fullest
extent permitted under Nevada law; however, insofar as indemnification for
liabilities arising under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons, it is the opinion of the Securities
and Exchange Commission that such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable.
10. THE LIQUIDITY OF OUR COMMON STOCK IS RESTRICTED UNDER PENNY STOCK
REGULATIONS. Our common stock currently trades below $5.00 per share, we will be
subject to the penny stock regulations. If our shares are subject to the penny
stock regulations, the market liquidity in them could be adversely affected
because the rules require broker-dealers to make a special suitability
determination for the purchaser and have received the purchaser's written
consent prior to the sale. This makes it more difficult administratively for
broker-dealers to buy and sell stock subject to the penny stock regulations on
behalf of their customers. Consequently, the regulations may affect the ability
of broker-dealers to sell our shares and may affect the ability of holders to
sell them in the secondary market.
11. CONTROL OVER ALL MATTERS REQUIRING STOCKHOLDER APPROVAL IS HELD BY A SMALL
GROUP OF FORMER DIRECTORS AND OFFICERS Mr. Delbeck, a former officer and
director of the company owns 650,000 shares of company common stock and Mr.
Brown, a former officer and director owns 500,000 shares of company common
stock, which together represents 62% of the outstanding common stock. As a
result, these stockholders exercise control over all matters requiring
stockholder approval, including the election of directors and approval of
significant corporate transactions. This concentration of ownership may have the
effect of delaying or preventing a change in control.
12. WE WILL INCUR ONGOING COSTS AND EXPENSES FOR SEC REPORTING AND COMPLIANCE,
WITHOUT REVENUE WE MAY NOT BE ABLE TO REMAIN IN COMPLIANCE. To be eligible for
quotation on the OTC Electronic Bulletin Board issuers must remain current in
their filings with the SEC. In order for us to remain in compliance we will
require future revenues to cover the cost of these filings, which could comprise
a substantial portion of our available cash resources. If we are unable to
generate sufficient revenues to remain in compliance it may be difficult for
investors to resell any shares.
13. OUR OFFICER AND DIRECTOR CURRENTLY DEVOTES ONLY PART TIME SERVICES TO THE
COMPANY. Jacqueline Winwood, our President, Secretary and Treasurer, currently
devotes as many hours per week as needed to company matters. The responsibility
of developing the company's business and fulfilling the reporting requirements
of a public company all fall upon her. She has had no experience serving as a
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principal accounting officer or principal financial officer in a public company.
We have not formulated a plan to resolve any possible conflict of interest with
her other business activities. In the event she is unable to fulfill any aspect
of her duties to the Company we may experience a shortfall or complete lack of
sales resulting in little or no profits and eventual closure of the business.
ITEM 2. PROPERTIES
We currently lease office space at 14205 SE 36th Street, Suite 100, # 172
Bellevue, WA 98006, for $110 per month. The terms of the lease are on a month to
month basis. The business premises consist of shared common facilities including
reception area, board room and copying room. We feel that the existing office
space is sufficient at this time and feel we will be able to lease additional
office space at the same location as our needs grow. We currently have no
investment policies as they pertain to real estate, real estate interests or
real estate mortgages. There are currently no restrictions on the amount of
assets used to invest in real estate.
ITEM 3. LEGAL PROCEEDINGS
We are not currently a party to any legal proceedings, and we are not aware of
any pending or potential legal actions.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the fiscal year
ended October 31, 2008.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Our common stock is listed for quotation on the Over-the-Counter Bulletin Board
under the symbol "WRDS". To date there has not been an active trading market.
PENNY STOCK RULES
The Securities and Exchange Commission has also adopted rules that regulate
broker-dealer practices in connection with transactions in penny stocks. Penny
stocks are generally equity securities with a price of less than $5.00 (other
than securities registered on certain national securities exchanges or quoted on
the Nasdaq system, provided that current price and volume information with
respect to transactions in such securities is provided by the exchange or
system).
Our shares are considered penny stock under the Securities and Exchange Act. The
shares will remain penny stocks for the foreseeable future. The classification
of penny stock makes it more difficult for a broker-dealer to sell the stock
into a secondary market, which makes it more difficult for a purchaser to
liquidate his/her investment. Any broker-dealer engaged by the purchaser for the
purpose of selling his or her shares in us will be subject to Rules 15g-1
through 15g-10 of the Securities and Exchange Act. Rather than creating a need
to comply with those rules, some broker-dealers will refuse to attempt to sell
penny stock.
8
The penny stock rules require a broker-dealer, prior to a transaction in a penny
stock not otherwise exempt from those rules, to deliver a standardized risk
disclosure document, which:
- contains a description of the nature and level of risk in the market
for penny stock in both public offerings and secondary trading;
- contains a description of the broker's or dealer's duties to the
customer and of the rights and remedies available to the customer with
respect to a violation of such duties or other requirements of the
Securities Act of 1934, as amended;
- contains a brief, clear, narrative description of a dealer market,
including "bid" and "ask" price for the penny stock and the
significance of the spread between the bid and ask price;
- contains a toll-free telephone number for inquiries on disciplinary
actions;
- defines significant terms in the disclosure document or in the conduct
of trading penny stocks; and
- contains such other information and is in such form (including
language, type, size and format) as the Securities and Exchange
Commission shall require by rule or regulation;
The broker-dealer also must provide, prior to effecting any transaction in a
penny stock, to the customer:
- the bid and offer quotations for the penny stock;
- the compensation of the broker-dealer and its salesperson in the
transaction;
- the number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the
market for such stock; and
- monthly account statements showing the market value of each penny
stock held in the customer's account.
In addition, the penny stock rules require that prior to a transaction in a
penny stock not otherwise exempt from those rules; the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements will have the effect of reducing the trading
activity in the secondary market for our stock because it will be subject to
these penny stock rules. Therefore, stockholders may have difficulty selling
their securities.
SHARES AVAILABLE UNDER RULE 144
There are currently 1,150,000 shares of common stock that are considered
restricted securities under Rule 144 of the Securities Act of 1933. All
1,150,000 shares are held by affiliates, as that term is defined in Rule
144(a)(1). Under Rule 144, such shares cannot be publicly sold until such a time
as the company ceases to be considered a shell company. The securities can be
resold only through a resale registration statement, unless certain conditions
are met. These conditions are:
1. the issuer of the securities has ceased to be a shell company;
2. the issuer is subject to the reporting requirements of section 13 or
15(d) of the Exchange Act;
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3. the issuer has filed all reports and other materials required to be
filed by section 13 or 15(d) of the Exchange Act, as applicable,
during the preceding 12 months, other than Form 8-K reports; and
4. one year has elapsed since the issuer has filed current "Form 10
information" with the Commission reflecting its status as an entity
that is no longer a shell company.
If these conditions are satisfied, then the securities can be sold subject to
all other applicable Rule 144 conditions, which include:
1. There must be adequate current information about the issuer of the
securities before the sale can be made. This generally means that the
issuer has complied with the periodic reporting requirements of the
Exchange Act.
2. A volume restriction of the greater of 1% or the average reported
weekly trading volume during the four weeks preceding the filing a
notice of sale on Form 144.
3. The sales must be handled in all respects as routine trading
transactions, and brokers may not receive more than a normal
commission. Neither the seller nor the broker can solicit orders to
buy the securities.
4. The seller must file a notice with the SEC on Form 144 if the sale
involves more than 5,000 shares or the aggregate dollar amount is
greater than $50,000 in any three-month period. The sale must take
place within three months of filing the Form and, if the securities
have not been sold, an amended notice must be filed.
HOLDERS
As of October 31, 2008, we have 1,950,000 Shares of $0.001 par value common
stock issued and outstanding held by 27 shareholders of record.
The stock transfer agent for our securities is Holladay Stock Transfer, 2939 N.
67th Place, Scottsdale, Arizona 85251, telephone (480)481-3940.
DIVIDENDS
We have never declared or paid any cash dividends on our common stock. For the
foreseeable future, we intend to retain any earnings to finance the development
and expansion of our business, and we do not anticipate paying any cash
dividends on its common stock. Any future determination to pay dividends will be
at the discretion of the Board of Directors and will be dependent upon then
existing conditions, including our financial condition and results of
operations, capital requirements, contractual restrictions, business prospects,
and other factors that the board of directors considers relevant.
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
There were no purchases of shares of our common stock by us or any affiliated
purchasers during the year ended October 31, 2008.
ITEM 6. SELECTED FINANCIAL DATA
N/A
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
We have generated $11,412 in revenues since inception and have incurred $101,240
in expenses through October 31, 2008.
The following table provides selected financial data about our company for the
years ended October 31, 2008 and 2007.
Balance Sheet Data: 10/31/08 10/31/07
------------------- -------- --------
Cash $ 395 $ 199
Total assets $ 395 $ 199
Total liabilities $ 18,723 $ 12,632
Shareholders' equity $(18,328) $(12,433)
For the years ended October 31, 2008 and 2007, respectively, we had no revenues
and $25,895 and $10,869 in expenses. We received our initial funding of $2,500
through the sale of common stock to our officers and directors who purchased
1,000,000 shares of our common stock at $0.0025 per share on February 14, 2003.
During June 2003, we sold 700,000 common shares at a per share price of $0.05 to
25 non-affiliated private investors for proceeds of $35,000. On March 23, 2007
we sold 100,000 common shares at a per share price of $0.10 to a director of the
company for proceeds of $10,000. On August 1, 2007 we issued 50,000 common stock
shares at a per share price of $0.10 to a director of the company for expenses
he paid on behalf of the company. During the year ended October 31, 2008 we
completed our offering pursuant to a Registration Statement on Form SB-2 filed
with the Securities and Exchange Commission, issuing 100,000 shares of common
stock at $0.20 per share for $20,000.
LIQUIDITY AND CAPITAL RESOURCES
Our cash balance at October 31, 2008 was $395, with $18,723 in outstanding
liabilities. Total expenditures over the next 12 months are expected to be
approximately $20,000. We are a development stage company and have only
generated $11,412 in revenue since inception (February 14, 2003) to October 31,
2008.
We cannot continually incur operating losses in the future and have decided that
we can no longer continue with our business operations as detailed in our
original business plan because of a lack of revenues and available financial
resources.
Our auditors have expressed their substantial doubt about our ability to
continue as a going concern. Our ability to continue as a going concern is
dependent upon our ability to generate future profitable operations and/or to
obtain the necessary financing to meet our obligations and repay our liabilities
arising from normal business operations when they come due. Our management has
no formal plan in place to address this concern but considers that we will be
able to obtain additional funds by equity financing and/or related party
advances, however there is no assurance of additional funding being available.
PLAN OF OPERATION
Our plan of operation for the next twelve months is for management to continue
the process of analyzing the various alternatives that may be available to
ensure the survival of the company and to preserve our shareholder's investment.
This may include additional sources of financing to continue in the website
development industry, or a change of business plan.
We do not intend to purchase any significant property or equipment, nor incur
any significant changes in employees during the next 12 months.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements.
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ITEM 8. FINANCIAL STATEMENTS
[LETTERHEAD OF BDO DUNWOODY LLP]
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders,
Wired Associates Solutions Inc.
(A Development Stage Company)
We have audited the accompanying balance sheets of Wired Associates Solutions
Inc. (the "Company", a Development Stage Company) as of October 31, 2008 and
2007 and the related statements of operations and comprehensive loss, cash flows
and stockholders' equity (deficiency) for the years ended October 31, 2008 and
2007 and for the period from February 14, 2003 (Date of Inception) to October
31, 2008. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits. We did not audit the financial statements of the
Company for the period from February 14, 2003 (Date of Inception) to October 31,
2006. Such statements are included in the cumulative inception to October 31,
2008 totals of the statements of operations, cash flows and stockholders' equity
(deficiency) and reflect a net loss of 59% of the related cumulative totals.
Those consolidated financial statements were audited by other auditors whose
report has been furnished to us and our opinion, insofar as it relates to
amounts for the period from February 14, 2003 (Date of Inception) to October 31,
2006 included in the cumulative totals, is based solely upon the report of the
other auditors.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform an audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits and the report of
other auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the report of other auditors, these
financial statements referred to above present fairly, in all material respects,
the financial position of Wired Associates Solutions Inc. as of October 31, 2008
and 2007 and the results of its operations and its cash flows for the years then
ended and for the period from February 14, 2003 (Date of Inception) to October
31, 2008, in conformity with accounting principles generally accepted in the
United States of America.
The accompanying financial statements referred to above have been prepared
assuming that the Company will continue as a going concern. As discussed in Note
1 to the financial statements, the Company is in the development stage, has not
yet achieved profitable operations, has an accumulated deficit of $89,828 at
October 31, 2008, incurred a net loss of $25,895 for the year then ended and is
dependent on its ability to raise capital from shareholders or other sources to
meet its obligations and repay its liabilities arising from normal business
operations when they come due. These factors, along with other matters as set
forth in Note 1, raise substantial doubt that the Company will be able to
continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
/s/ BDO Dunwoody LLP
- --------------------------------
Chartered Accountants
Vancouver, Canada
February 23, 2009
BDO Dunwoody LLP is a Limited Liability Partnership registered in Ontario
12
[LETTERHEAD OF AMISANO HANSON]
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders,
Wired Associates Solutions Inc.
(A Development Stage Company)
We have audited the accompanying statements of operations and comprehensive
loss, stockholders' equity (deficiency) and cash flows of Wired Associates
Solutions Inc. for the period from February 14, 2003 (Date of Inception) to
October 31, 2006. These financial statements are the responsibility of the
company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States of America). Those standards require
that we plan and perform an audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audit provide a reasonable basis for our opinion.
In our opinion, these financial statements referred to above present fairly, in
all material respects the results of Wired Associates Solutions Inc.'s
operations and its cash flows for period from February 14, 2003 (Date of
Inception) to October 31, 2006, in conformity with accounting principles
generally accepted in the United States of America.
The accompanying financial statements referred to above have been prepared
assuming that the company will continue as a going concern. As discussed in Note
1 to the financial statements, the company is in the development stage, has no
not yet achieved profitable operations and is dependent on its ability to raise
capital from shareholders or other sources to sustain operations. These factors,
along with other matters as set forth in Note 1, raise substantial doubt that
the company will be able to continue as a going concern. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
Vancouver, Canada /s/ Amisano Hanson
December 5, 2006 -------------------------------
Chartered Accountants
750 West Pender Street, Suite 604 Telephone: 604-689-0188
Vancouver Canada Facsimile: 604-689-9773
V6C 2T7 E-MAIL: amishan@telus.net
13
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
BALANCE SHEETS
October 31, 2008 and 2007
(Stated in US Dollars)
2008 2007
-------- --------
ASSETS
Current
Cash $ 395 $ 199
======== ========
LIABILITIES
Current
Accounts payable and accrued liabilities $ 7,155 $ 6,064
Advances payable - Notes 3 and 5 11,568 6,568
-------- --------
18,723 12,632
-------- --------
SHAREHOLDERS' DEFICIENCY
Common stock, $0.001 par value
50,000,000 shares authorized
1,950,000 (2007: 1,850,000) shares outstanding 1,950 1,850
Additional paid-in capital 69,550 49,650
Deficit accumulated during the development stage (89,828) (63,933)
-------- --------
(18,328) (12,433)
-------- --------
$ 395 $ 199
======== ========
Nature of Operations and Ability to Continue as a Going Concern - Note 1
SEE ACCOMPANYING NOTES
14
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
for the years ended October 31, 2008 and 2007 and
for the period February 14, 2003 (Date of Inception) to October 31, 2008
(Stated in US Dollars)
February 14, 2003
(Date of
Years ended Inception) to
October 31, October 31,
2008 2007 2008
---------- ---------- ----------
(Cumulative)
Income $ -- $ -- $ 11,412
---------- ---------- ----------
Expenses
Accounting and audit fees 18,783 6,064 45,406
Bank charges 152 190 921
Communications - Note 5 -- 45 4,373
Consulting fees -- -- 12,125
Filing fees 3,012 2,754 7,288
Foreign exchange -- -- 649
Legal fees -- 1,500 2,000
Office and miscellaneous - Note 5 2,408 -- 8,148
Rent - Note 5 1,540 316 11,956
Website costs -- -- 5,124
Write-down of prepaid expense -- -- 3,250
---------- ---------- ----------
25,895 10,869 101,240
---------- ---------- ----------
Net loss and comprehensive loss for the period $ (25,895) $ (10,869) $ (89,828)
========== ========== ==========
Basic and diluted loss per share $ (0.01) $ (0.01)
========== ==========
Weighted average number of shares outstanding 1,875,137 1,775,617
========== ==========
SEE ACCOMPANYING NOTES
15
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
for the years ended October 31, 2008 and 2007
and for the period February 14, 2003 (Date of Inception) to October 31, 2008
(Stated in US Dollars)
February 14, 2003
(Date of
Years ended Inception) to
October 31, October 31,
2008 2007 2008
-------- -------- --------
(Cumulative)
Cash Flows from (used in) Operating Activities
Net loss for the period $(25,895) $(10,869) $(89,828)
Changes in non-cash working capital balance
related to operations:
Accounts payable and accrued liabilities 1,091 (3,936) 7,155
-------- -------- --------
(24,804) (14,805) (82,673)
-------- -------- --------
Cash Flows from Financing Activity
Advances payable 5,000 (60) 11,568
Issuance of shares 20,000 15,000 71,500
-------- -------- --------
25,000 14,940 83,068
-------- -------- --------
Increase in cash during the period 196 135 395
Cash, beginning of the period 199 64 --
-------- -------- --------
Cash, end of the period $ 395 $ 199 $ 395
======== ======== ========
SEE ACCOMPANYING NOTES
16
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY)
for the period February 14, 2003 (Date of Inception) to October 31, 2008
(Stated in US Dollars)
Deficit
Accumulated
Common Shares Additional During the
---------------------- Paid-in Development
Number Par Value Capital Stage Total
------ --------- ------- ----- -----
Capital stock subscribed pursuant to
subscription agreement, for cash
February, 2003 - at $0.0025 1,000,000 $ 1,000 $ 1,500 $ -- $ 2,500
Pursuant to an offering memorandum,
for cash June, 2003 - at $0.05 700,000 700 34,300 -- 35,000
Less: share issue costs -- -- (1,000) -- (1,000)
Net loss for the period -- -- -- (4,597) (4,597)
--------- ------- -------- --------- ---------
Balance, October 31, 2003 1,700,000 1,700 34,800 (4,597) 31,903
Net loss for the year -- -- -- (22,399) (22,399)
--------- ------- -------- --------- ---------
Balance, October 31, 2004 1,700,000 1,700 34,800 (26,996) 9,504
Net loss for the year -- -- -- (16,897) (16,897)
--------- ------- -------- --------- ---------
Balance, October 31, 2005 1,700,000 1,700 34,800 (43,893) (7,393)
Net loss for the year -- -- -- (9,171) (9,171)
--------- ------- -------- --------- ---------
Balance, October 31, 2006 1,700,000 1,700 34,800 (53,064) (16,564)
Capital stock subscribed pursuant to
subscription agreement, for cash
March and August, 2007 - at $0.10 150,000 150 14,850 -- 15,000
Net loss for the year -- -- -- (10,869) (10,869)
--------- ------- -------- --------- ---------
Balance, October 31, 2007 1,850,000 1,850 49,650 (63,933) (12,433)
Capital stock subscribed pursuant to
subscription agreement, for cash
January, 2008 - at $0.20 100,000 100 19,900 -- 20,000
Net loss for the year -- -- -- (25,895) (25,895)
--------- ------- -------- --------- ---------
Balance, October 31, 2008 1,950,000 $ 1,950 $ 69,550 $ (89,828) $ (18,328)
========= ======= ======== ========= =========
SEE ACCOMPANYING NOTES
17
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 1 Nature of Operations and Ability to Continue as a Going Concern
The Company is a development stage company whose business is web
development, specializing in the design, creation and marketing of cost
effective Internet products. The Company commenced operations on February
14, 2003, the inception date of the Company. The Company has not undertaken
any significant development of its business nor has it received any revenue
since the year ended October 31, 2004. Management of the Company is now
considering other potential business opportunities that might be available
to the Company. The Company was incorporated in the State of Nevada in the
United States of America.
These financial statements have been prepared in accordance with generally
accepted accounting principles applicable to a going concern, which assumes
that the Company will be able to meet its obligations and continue its
operations for its next fiscal year. Realization values may be
substantially different from carrying values as shown and these financial
statements do not give effect to adjustments that would be necessary to the
carrying values and classification of assets and liabilities should the
Company be unable to continue as a going concern. At October 31, 2008, the
Company had not yet achieved profitable operations, has accumulated losses
of $89,828 since its inception, has a working capital deficiency of $18,328
and expects to incur further losses in the development of its business, all
of which casts substantial doubt about the Company's ability to continue as
a going concern. The Company's ability to continue as a going concern is
dependent upon its ability to generate future profitable operations and/or
to obtain the necessary financing to meet its obligations and repay its
liabilities arising from normal business operations when they come due.
Management has no formal plan in place to address this concern but
considers that the Company will be able to obtain additional funds by
equity financing and/or related party advances, however there is no
assurance of additional funding being available.
Note 2 Summary of Significant Accounting Policies
The financial statements of the Company have been prepared in accordance
with generally accepted accounting principles in the United States of
America. Because a precise determination of many assets and liabilities is
dependent upon future events, the preparation of financial statements for a
period necessarily involves the use of estimates, which have been made
using careful judgement. Actual results may vary from these estimates.
The financial statements have, in management's opinion, been properly
prepared within the framework of the significant accounting policies
summarized below:
18
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 2 Summary of Significant Accounting Policies - (cont'd)
Development Stage
The Company is a development stage company as defined in Statement of
Financial Accounting Standards ("SFAS") No. 7 "Accounting and Reporting by
Development Stage Enterprises" as it is devoting substantially all of its
efforts to establish a new business and planned principal operations have
not commenced.
Income Taxes
In June 2006, the Financial Accounting Standards Board ("FASB") issued FASB
Interpretation No. 48, "Accounting for Uncertainty in Income Taxes". The
interpretation clarifies the accounting for uncertainty in income taxes
recognized in a company's financial statements in accordance with Statement
of Financial Accounting Standards No. 109, "Accounting for Income Taxes".
Specifically, the pronouncement prescribes a recognition threshold and a
measurement attribute for the financial statement recognition and
measurement of a tax position taken or expected to be taken in a tax
return. The interpretation also provides guidance on the related
derecognition, classification, interest and penalties, accounting for
interim periods, disclosure and transition of uncertain tax position. The
interpretation is effective for fiscal years beginning after December 15,
2006. Effective November 1, 2007, the Company adopted the provisions of FIN
48. Based on the Company's assessment of FIN 48, as at November 1, 2007,
there was no significant impact on the results of operations or financial
position and required no adjustment to the opening balance sheet accounts.
Basic and Diluted Loss Per Share
The Company reports basic loss per share in accordance with the SFAS No.
128, "Earnings Per Share". Basic loss per share is computed using the
weighted average number of shares outstanding during the period. Diluted
loss per share has not been provided as the Company has no potential common
shares.
Revenue Recognition
The Company recognizes revenue when it is realized or realizable and
earned. The Company considers revenue realized or realizable and earned
when it has persuasive evidence of an arrangement, the services have been
provided to the client, the sales price is fixed or determinable, and
collectibility is reasonably assured. The Company reduces revenue for
estimated client returns and other allowances.
19
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 2 Summary of Significant Accounting Policies - (cont'd)
Financial Instruments
The carrying value of the Company's financial instruments consisting of
cash, accounts payable and accrued liabilities and advances payable
approximates their fair value due to the short-term nature of these
instruments. Unless otherwise noted, it is management's opinion that the
Company is not exposed to significant interest, currency or credit risks
arising from these financial instruments.
Website Costs
The Company recognizes the costs incurred in the development of the
Company's website in accordance with EITF 00-2 "Accounting for Website
Development Costs" and, with provisions of AICPA Statement of Position No.
98-1, "Accounting for the Costs of Computer Software Developed or Obtained
for Internal Use." Accordingly, direct costs incurred during the
application stage of development are capitalized and amortized over the
estimated useful life. Fees incurred for website hosting are expensed over
the period of the benefit. Costs of operating a website are expensed as
incurred.
New Accounting Standards
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements".
This Statement defines fair value as used in numerous accounting
pronouncements, establishes a framework for measuring fair value in
generally accepted accounting principles and expands disclosure related to
the use of fair value measures in financial statements. The Statement is to
be effective for fiscal years beginning on or after November 15, 2007;
however, earlier application is encouraged. The Company has adopted this
standard effective November 1, 2007. There was no material impact on its
financial position or results of operations.
In September 2006, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 108 ("SAB 108"). Due to diversity in practice
among registrants, SAB 108 expressed SEC staff views regarding the process
by which misstatements in financial statements are evaluated for purposes
of determining whether financial statement restatement is necessary. SAB
108 is effective for fiscal years ending after November 15, 2006, and early
application is encouraged. SAB 108 did not have a material impact on its
financial position or results from operations.
20
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 2 Summary of Significant Accounting Policies - (cont'd)
New Accounting Standards - (cont'd)
On February 15, 2007, the FASB issued SFAS No. 159 "The Fair Value Option
for Financial Assets and Financial Liabilities". This Statement establishes
presentation and disclosure requirements designed to facilitate comparisons
between companies that choose different measurement attributes for similar
types of assets and liabilities. SFAS No. 159 is effective for the
Company's financial statements issued in the first fiscal year that begins
after November 15, 2007. The Company has adopted this standard effective
November 1, 2007. There was no material impact on its financial position or
results of operations.
In December 2007, FASB issued Statement No. 141 (Revised 2007), Business
Combinations ("SFAS 141(R)") and SFAS No. 160, Accounting and Reporting of
Non-controlling Interests in Consolidated Financial Statements, an
amendment of ARB No. 51 ("SFAS 160"). These statements will significantly
change the financial accounting and reporting of business combination
transactions and non-controlling (or minority) interests in consolidated
financial statements. SFAS 141(R) requires companies to: (i) recognize,
with certain exceptions, 100% of the fair values of assets acquired,
liabilities assumed, and non-controlling interests in acquisitions of less
than a 100% controlling interest when the acquisition constitutes a change
in control of the acquired entity; (ii) measure acquirer shares issued in
consideration for a business combination at fair value on the acquisition
date; (iii) recognize contingent consideration arrangements at their
acquisition-date fair values, with subsequent changes in fair value
generally reflected in earnings; (iv) with certain exceptions, recognize
pre-acquisition loss and gain contingencies at their acquisition-date fair
values; (v) capitalize in-process research and development ("IPR&D") assets
acquired; (vi) expense, as incurred, acquisition-related transaction costs;
(vii) capitalize acquisition-related restructuring costs only if the
criteria in SFAS No. 146, Accounting for Costs Associated with Exit or
Disposal Activities , are met as of the acquisition date; and (viii)
recognize changes that result from a business combination transaction in an
acquirer's existing income tax valuation allowances and tax uncertainty
accruals as adjustments to income tax expense. SFAS 141(R) is required to
be adopted concurrently with SFAS 160 and is effective for business
combination transactions for which the acquisition date is on or after the
beginning of the first annual reporting period beginning on or after
December 15, 2008. Early adoption of these statements is prohibited. The
Company does not expect the adoption of these statements to have a material
impact on its future results of operations or financial position.
21
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 2 Summary of Significant Accounting Policies - (cont'd)
New Accounting Standards - (cont'd)
In March 2008, the FASB issued SFAS No. 161 ("SFAS 161"), "Disclosures
about Derivative Instruments and Hedging Activities". SFAS 161 requires
companies with derivative instruments to disclose information that should
enable financial-statement users to understand how and why a company uses
derivative instruments, how derivative instruments and related hedged items
are accounted for under FASB Statement No. 133 "Accounting for Derivative
Instruments and Hedging Activities" and how derivative instruments and
related hedged items affect a company's financial position, financial
performance and cash flows. SFAS 161 is effective for financial statements
issued for fiscal years and interim periods beginning after November 15,
2008. The adoption of this statement is not expected to have a material
effect on the Company's future financial position or results of operations.
In April 2008, the FASB issued FSP No. 142-3, "Determination of the Useful
Life of Intangible Assets" ("FSP 142-3"). FSP 142-3 amends the factors an
entity should consider in developing renewal or extension assumptions used
in determining the useful life of recognized intangible assets under FASB
Statement No. 142, "Goodwill and Other Intangible Assets". This new
guidance applies prospectively to intangible assets that are acquired
individually or with a group of other assets in business combinations and
asset acquisitions. FSP 142-3 is effective for financial statements issued
for fiscal years and interim periods beginning after December 15, 2008.
Early adoption is prohibited. The adoption of this statement is not
expected to have a material effect on the Company's financial statements.
In May 2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally
Accepted Accounting Principles". SFAS 162 identifies the sources of
accounting principles and the framework for selecting the principles to be
used in the preparation of financial statements of non-governmental
entities that are presented in conformity with generally accepted
accounting principles in the United States. It is effective 60 days
following the SEC's approval of the Public Company Accounting Oversight
Board amendments to AU Section 411, "The Meaning of Present Fairly in
Conformity With Generally Accepted Accounting Principles". The adoption of
this statement is not expected to have a material effect on the Company's
financial statements.
22
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 2 Summary of Significant Accounting Policies - (cont'd)
New Accounting Standards - (cont'd)
In May 2008, FASB issued FASB Staff Position ("FSP") APB 14-1, "Accounting
for Convertible Debt Instruments That May Be Settled in Cash upon
Conversion (Including Partial Cash Settlement)" ("FSP APB 14-1"). FSP APB
14-1 clarifies that convertible debt instruments that may be settled in
cash upon either mandatory or optional conversion (including partial cash
settlement) are not addressed by paragraph 12 of APB Opinion No. 14,
"Accounting for Convertible Debt and Debt issued with Stock Purchase
Warrants." Additionally, FSP APB 14-1 specifies that issuers of such
instruments should separately account for the liability and equity
components in a manner that will reflect the entity's nonconvertible debt
borrowing rate when interest cost is recognized in subsequent periods. FSP
APB 14-1 is effective for financial statements issued for fiscal years
beginning after December 15, 2008, and interim periods within those fiscal
years. The Company intends to adopt FSP APB 14-1 beginning in the first
quarter of fiscal year 2010, and this standard must be applied on a
retrospective basis. The adoption of this statement is not expected to have
a material effect on the Company's financial statements.
Note 3 Advances payable - Note 5
Advances payable are due to a former director and a former consultant of
the Company and are unsecured, non-interest bearing and due on demand.
Note 4 Income Taxes
The Company's income tax expense (benefit) for the years ended October 31,
2008 and 2007 differed from the United States statutory rates:
Years ended October 31,
2008 2007
------- -------
Effective tax rate 34% 34%
======= =======
Statutory rate applied to loss before income taxes $(8,800) $(3,700)
Change in valuation allowance 8,800 3,700
------- -------
Income tax expense $ -- $ --
======= =======
23
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 4 Income Taxes - (cont'd)
The following table summarizes the significant components of the Company's
deferred tax assets:
2008 2007
-------- --------
Deferred tax assets
Net operating loss carryforwards $ 30,500 $ 21,700
Less: valuation allowance for deferred tax asset (30,500) (21,700)
-------- --------
$ -- $ --
======== ========
The amount taken into income as deferred tax assets must reflect that
portion of the income tax loss carryforwards that is more-likely-than-not
to be realized from future operations. The Company has chosen to provide an
allowance of 100% against all available income tax loss carryforwards,
regardless of their time of expiry.
No provision for income taxes has been provided in these financial
statements due to the net loss. At October 31, 2008, the Company has net
operating loss carryforwards, which expire on various dates commencing in
2023, totalling $89,828, the benefit of which has not been recorded in the
financial statements.
Uncertain Tax Positions
On November 1, 2007, the Company adopted FASB Interpretation No. 48,
"Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 prescribes
a recognition threshold and measurement attribute for the recognition and
measurement of tax positions taken or expected to be taken in income tax
returns. FIN 48 also provides guidance on de-recognition of income tax
assets and liabilities, classification of current and deferred income tax
assets and liabilities, and accounting for interest and penalties
associated with tax positions.
The Company files income tax returns in the U.S. federal jurisdiction,
various state and foreign jurisdictions. The Company's tax returns are
subject to tax examinations by U.S. federal and state tax authorities, or
examinations by foreign tax authorities until respective statue of
limitation. It is subject to tax examinations by tax authorities for all
taxation years commencing on or after 2003.
Based on the management's assessment of FIN 48, it was concluded that the
adoption of FIN 48, as of November 1, 2007, had no significant impact on
the Company's results of operations or financial position, and required no
adjustment to the opening balance sheet accounts. The year-end analysis
supports the same conclusion, and the Company does not have an accrual for
uncertain tax positions as of October 31, 2008. As a result, tabular
reconciliation of beginning and ending balances would not be meaningful. If
interest and penalties were to be assessed, we would charge interest to
interest expense, and penalties to other operating expense. It is not
anticipated that unrecognized tax benefits would significantly increase or
decrease within 12 months of the reporting date.
24
WIRED ASSOCIATES SOLUTIONS INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
October 31, 2008 and 2007
(Stated in US Dollars)
Note 4 Income Taxes - (cont'd)
The Company is in arrears on filing its statutory income tax returns and is
therefore has estimated the expected amount of loss carry forwards
available once the outstanding returns are filed. The Company expects to
have net operating loss carry-forwards for income tax purposes available to
offset future taxable income.
Note 5 Related Party Transactions
The Company has incurred the following transactions with a company with a
common director:
February 14, 2003
(Date of
Inception) to
Years ended October 31, October 31,
2008 2007 2008
-------- -------- --------
Communications $ -- $ -- $ 2,240
Office and miscellaneous -- -- 3,410
Rent -- -- 9,200
-------- -------- --------
$ -- $ -- $ 14,850
======== ======== ========
Included in advances payable is $5,000 due to a former director of the
Company
Note 6 Comparative Figures
Certain of the prior year's figures have been reclassified to conform with
current period classification.
25
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Management is responsible for establishing and maintaining adequate internal
control over financial reporting and for the assessment of the effectiveness of
those internal controls. As defined by the SEC, internal control over financial
reporting is a process designed by our principal executive officer/principal
financial officer, who is also the sole member of our Board of Directors, to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of the financial statements in accordance with U. S.
generally accepted accounting principles.
As of the end of the period covered by this report, we carried out an
evaluation, under the supervision and with the participation of our chief
executive officer (who is also our principal financial and accounting officer),
of the effectiveness of the design and operation of our disclosure controls and
procedures. Based on this evaluation, our chief executive officer and chief
financial officer concluded that our disclosure controls and procedures were not
effective because we identified material weaknesses in our internal control over
financial reporting.
MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
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:
1. Pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of the
assets of the company;
2. 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
3. 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.
26
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 October 31, 2008 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, the Company has 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 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 October 31, 2008.
Management believes that the material weaknesses set forth in items (2) and (3)
above did not have a material 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.
This annual report does not include an attestation report of the Corporation's
registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by the
Corporation's registered public accounting firm pursuant to temporary rules of
the SEC that permit the Corporation to provide only the management's report in
this annual report.
27
MANAGEMENT'S REMEDIATION INITIATIVES
Management is committed to improving its internal controls and will (1) continue
to use third party specialists to address shortfalls in staffing and to assist
the Company with accounting and finance responsibilities, (2) increase the
frequency of independent reconciliations of significant accounts which will
mitigate the lack of segregation of duties until there are sufficient personnel
and (3) may consider appointing outside directors and audit committee members in
the future.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
There was no change in our internal controls over financial reporting that
occurred during the period covered by this report that has materially affected,
or is reasonably likely to materially affect, our internal controls over
financial reporting.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS
Our directors are elected by the stockholders to a term of one year and serves
until his or her successor is elected and qualified. Our officers are appointed
by the Board of Directors to a term of one year and serves until his or her
successor is duly elected and qualified, or until he or she is removed from
office. The Board of Directors has no nominating, auditing or compensation
committees.
The name, address, age and position of our officer and director is set forth
below:
Name and Address Age Position(s)
---------------- --- -----------
Jacqueline Winwood 37 President, CEO
14205 SE 36th Street Secretary, Treasurer
Suite 100, #172 CFO & Director
Bellevue, WA 98006
The person named above has held her offices/positions since September 12, 2008
and is expected to hold said offices/positions until the next annual meeting of
our stockholders. The officer and director is our only officer, director,
promoter and control person.
BACKGROUND INFORMATION ABOUT OUR OFFICER AND DIRECTOR
Jacqueline Winwood has been the CEO, CFO, Director, President, Secretary and
Treasurer of the company since September 12, 2008. Ms. Winwood has been working
as a hotel manager for the Earl of Doncaster hotel since 1996. Prior to that she
first worked as a manager and then an owner of a woman's retail fashion store.
Ms. Winwood also currently owns, develops, and manages a number or commercial,
residential, and leisure real estate properties.
28
Ms. Winwood also is affiliated with the following associations:
Member of Copley and Nether Hall Traders Forum
September 2004 - present
Member of Doncaster Town Centre Renaissance Team
September 2004 - present
Member of Doncaster Tourism Steering Group
August 2002 - Present
Member of the Institute of Hospitality (formally HCIMA) The recognized institute
for Hospitality Management Professionals October 2000 - Present
CODE OF ETHICS
Our board of directors adopted our code of ethical conduct that applies to all
of our employees and directors, including our principal executive officer,
principal financial officer, principal accounting officer or controller, and
persons performing similar functions.
We believe the adoption of our Code of Ethical Conduct is consistent with the
requirements of the Sarbanes-Oxley Act of 2002.
Our Code of Ethical Conduct is designed to deter wrongdoing and to promote:
* Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
* Full, fair, accurate, timely and understandable disclosure in reports
and documents that we file or submit to the Securities & Exchange
Commission and in other public communications made by us;
* Compliance with applicable governmental laws, rules and regulations;
* The prompt internal reporting to an appropriate person or persons
identified in the code of violations of our Code of Ethical Conduct;
and
* Accountability for adherence to the Code.
ITEM 11. EXECUTIVE COMPENSATION
Our current officers and directors receive no compensation. The current Board of
Directors is comprised solely of Ms. Winwood.
29
Change in
Pension
Value and
Non-Equity Nonqualified
Incentive Deferred All
Name and Plan Compen- Other
Principal Stock Option Compen- sation Compen-
Position Year Salary Bonus Awards Awards sation Earnings sation Totals
- ------------ ---- ------ ----- ------ ------ ------ -------- ------ ------
Jacqueline 2008 0 0 0 0 0 0 0 0
Winwood,
President,
CEO and
Director
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
Option Awards Stock Awards
----------------------------------------------------------------- ----------------------------------------------
Equity
Incentive
Equity Plan
Incentive Awards:
Plan Market or
Awards: Payout
Equity Number of Value of
Incentive Number Unearned Unearned
Plan Awards; of Market Shares, Shares,
Number of Number of Number of Shares Value of Units or Units or
Securities Securities Securities or Units Shares or Other Other
Underlying Underlying Underlying of Stock Units of Rights Rights
Unexercised Unexercised Unexercised Option Option That Stock That That That
Options (#) Options (#) Unearned Exercise Expiration Have Not Have Not Have Not Have Not
Name Exercisable Unexercisable Options (#) Price Date Vested(#) Vested Vested Vested
- ---- ----------- ------------- ----------- ----- ---- --------- ------ ------ ------
Jacqueline 0 0 0 0 0 0 0 0 0
Winwood
DIRECTOR COMPENSATION
Change in
Pension
Value and
Fees Non-Equity Nonqualified
Earned Incentive Deferred
Paid in Stock Option Plan Compensation All Other
Name Cash Awards Awards Compensation Earnings Compensation Total
---- ---- ------ ------ ------------ -------- ------------ -----
Jacqueline 0 0 0 0 0 0 0
Winwood
There are no current employment agreements between the company and its executive
officer. The officer and director of the company does not intend to receive cash
remuneration or salaries for her efforts unless and until our business
30
operations are successful, at which time salaries and other remuneration will be
established by the Board of Directors, as appropriate.
None of our officers, directors, advisors or key employees is currently party to
employment agreements with the company. We have no pension, health, annuity,
bonus, insurance, stock options, profit sharing or similar benefit plans;
however, we may adopt such plans in the future. There are presently no personal
benefits available for directors, officers or employees of the company.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information on the ownership of Wired Associates
Solutions' voting securities by officers, directors and major shareholders as
well as those who own beneficially more than five percent of our common stock as
of the date of this report:
Name and Address Approximate
of Beneficial Number of Date Consideration Percent
Owner (1) Shares Acquired Paid of Ownership
--------- ------ -------- ---- ------------
Jacqueline Winwood 0 -- -- 0%
All Officers and 0 0%
Directors as a Group
- ----------
Scott Delbeck 500,000 02-14-03 $.0025/Share 35%
14205 SE 36th Street or $1,250
Suite 100, # 172 100,000 03-23-07 $.10/Share
Bellevue WA 98006 or $10,000
50,000 08-01-07 $.10/Share
or $5,000
Roy Brown 500,000 02-14-03 $.0025/Share 27%
14205 SE 36th Street or $1,250
Suite 100, # 172
Bellevue, WA 98006
FUTURE SALES BY EXISTING STOCKHOLDERS
All of the shares listed above are restricted securities, as that term is
defined in Rule 144 of the Rules and Regulations of the SEC promulgated under
the Act. Under Rule 144, such shares can be publicly sold, subject to volume
restrictions and certain restrictions on the manner of sale, commencing six
months after their acquisition. Any sale of shares held by the existing
stockholders (after applicable restrictions expire) may have a depressive effect
on the price of our common stock in any market that may develop, of which there
can be no assurance. Our principal shareholders do not have any current plans to
sell their shares.
31
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On February 14, 2003, a total of 1,000,000 shares of Common Stock were issued to
Mr. Delbeck and Mr. Brown, officers and directors of the company at the time, in
exchange for organizational services and expenses, proprietary rights, business
plans and cash in the amount of $2,500 U.S., or $.0025 per share. In March 2007
we received $10,000 from Mr. Delbeck who purchased 100,000 shares of our common
stock at $0.10 per share. In August 2007 Mr. Delbeck was issued 50,000 shares of
our common stock at $0.10 for expenses he paid on behalf of the company. All of
such shares are "restricted" securities, as that term is defined by the
Securities Act of 1933, as amended, and are held by former officers and
directors of the Company. (See item 1A "Continued Control by Principal
Stockholders" and Item 5 "Shares Available Under Rule 144".)
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
For the year ended October 31, 2008, the total fees charged to the company for
audit services, including quarterly reviews, were $18,783, for audit-related
services were $Nil, for tax services were $Nil and for other services were $Nil.
The total fees charged to the Company for audit services were $6,064 and for
non-audit services were $Nil during the year ended October 31, 2007.
32
PART IV
ITEM 15. EXHIBITS
The following exhibits are included with this filing:
Exhibit
Number Description
------ -----------
3(i) Articles of Incorporation*
3(ii) Bylaws*
31 Sec. 302 Certification of CEO and CFO
32 Sec. 906 Certification of CEO and CFO
- ----------
* Included in our original SB-2 filing under Commission File Number
333-142324.
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized, on February 10, 2010.
Wired Associates Solutions Inc.
/s/ Jacqueline Winwood
----------------------------------------------------------
By: Jacqueline Winwood
(Principal Executive Officer, Principal Financial Officer,
Principal Accounting Officer & Director)
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
dates stated.
/s/ Jacqueline Winwood
----------------------------------------------------------
By: Jacqueline Winwood
(Principal Executive Officer, Principal Financial Officer,
Principal Accounting Officer & Director)
February 10, 2010
33