UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 2014
Commission file number 333-182970
WEBFOLIO INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
Villa 210, Perla Marina Complex
Carretera Sosua - Cabarete
Cabarete, Puerto Plata
Republica Dominicana, 57000
web.folio@yahoo.com
(Address of principal executive offices, including zip code)
(860) 331-8186
(Telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the last 90 days. YES [X] NO [ ]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). YES [X] NO [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer, "accelerated filer,"
"non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the
Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). 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: 6,000,000 shares as of April 9, 2014
ITEM 1. FINANCIAL STATEMENTS
WEBFOLIO, INC
(A Development Stage Company)
Balance Sheets
--------------------------------------------------------------------------------
February 28, May 31,
2014 2013
-------- --------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 7,567 $ 6,410
-------- --------
TOTAL CURRENT ASSETS 7,567 6,410
-------- --------
TOTAL ASSETS $ 7,567 $ 6,410
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY(DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 994 $ 780
Loan from shareholder 11,588 5,088
-------- --------
TOTAL CURRENT LIABILITIES 12,582 5,868
-------- --------
TOTAL LIABILITIES 12,582 5,868
-------- --------
STOCKHOLDERS' EQUITY (DEFICIT)
130,000,000 common shares at par value of $0.0001 Common stock,
($0.001 par value, 75,000,000 shares authorized; 6,000,000 shares
issued and outstanding at February 28, 2014 and 5,000,000 at
May 31, 2013 respectively 600 500
Additional paid-in capital 19,400 9,500
Deficit accumulated during the development stage (25,015) (9,458)
-------- --------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (5,015) 542
-------- --------
TOTAL LIABILITITES & STOCKHOLDERS' EQUITY (DEFICIT) $ 7,567 $ 6,410
======== ========
See Notes to Financial Statements
2
WEFOLIO, INC.
(A Development Stage Company)
Statements of Operations (Unaudited)
--------------------------------------------------------------------------------
Inception
Three Months Three Months Nine Months Nine Months May 16, 2011
Ended Ended Ended Ended Through
February 28, February 28, February 28, February 28, February 28,
2014 2013 2014 2013 2014
---------- ---------- ---------- ---------- ----------
REVENUES
Revenues $ -- $ -- $ -- $ -- $ --
---------- ---------- ---------- ---------- ----------
TOTAL REVENUES -- -- --
OPERATING COSTS
Professional expenses 2,005 500 10,250 2,250 13,000
General and Administative 1,639 1,930 5,307 3,905 11,708
---------- ---------- ---------- ---------- ----------
TOTAL OPERATING COSTS 3,644 2,430 15,557 6,155 24,708
---------- ---------- ---------- ---------- ----------
OTHER INCOME AND EXPENSE
Exchange gain (loss) -- (1) -- (137) (307)
---------- ---------- ---------- ---------- ----------
TOTAL OTHER INCOME AND EXPENSE -- (1) -- (137) (307)
---------- ---------- ---------- ---------- ----------
NET INCOME (LOSS) $ (3,644) $ (2,431) $ (15,557) $ (6,292) $ (25,015)
========== ========== ========== ========== ==========
BASIC EARNINGS PER SHARE $ (0.00) $ (0.00) $ (0.00) $ (0.00)
========== ========== ========== ==========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 5,788,889 5,000,000 5,260,073 5,000,000
========== ========== ========== ==========
See Notes to Financial Statements
3
WEBFOLIO, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
--------------------------------------------------------------------------------
Inception
Nine Months Nine Months May 16, 2011
Ended Ended Through
February 28, February 28, February 28,
2014 2013 2014
-------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(15,557) $ (6,292) $(25,015)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Changes in operating assets and liabilities:
Accounts payable 214 685 994
-------- -------- --------
NET CASH USED IN OPERATING ACTIVITIES (15,343) (5,607) (24,021)
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
NET CASH USED IN INVESTING ACTIVITIES -- -- --
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from shareholder loans 6,500 4,871 11,588
Issuance of common stock for cash 10,000 -- 20,000
-------- -------- --------
NET CASH PROVIDED BY FINANCING ACTIVITIES 16,500 4,871 31,588
-------- -------- --------
NET CHANGE IN CASH 1,157 (736) 7,567
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 6,410 8,916 --
-------- -------- --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 7,567 $ 8,180 $ 7,567
======== ======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ -- $ -- $ --
======== ======== ========
Income Taxes $ -- $ -- $ --
======== ======== ========
See Notes to Financial Statements
4
WEBFOLIO INC.
(A Development Stage Company)
Notes to Financial Statements (unaudited)
February 28, 2014
--------------------------------------------------------------------------------
1. NATURE OF OPERATIONS
WEBFOLIO INC. ("The Company") was incorporated in the State of Delaware on May
16, 2011 to engage in the creation and development of an online service
primarily to help real estate investors more effectively manage their properties
and potential buyers. The Company is in the development stage with no revenues
and a limited operating history.
GOING CONCERN CONSIDERATION
These financial statements have been prepared assuming that the Company will
continue as a going concern, which contemplates, among other things, the
realization of assets and the satisfaction of liabilities in the normal course
of business. The Company has incurred cumulative net losses of $25,015 since its
inception and requires capital for its contemplated operational and marketing
activities to take place. The Company's ability to raise additional capital
through the future issuances of common stock is unknown. The obtainment of
additional financing, the successful development of the Company's contemplated
plan of operations, and its transition, ultimately, to the attainment of
profitable operations are necessary for the Company to continue operations. The
ability to successfully resolve these factors raise substantial doubt about the
Company's ability to continue as a going concern.
Future issuances of the Company's equity or debt securities will be required in
order for the Company to continue to finance its operations and continue as a
going concern. The Company's present revenues are insufficient to meet operating
expenses. The financial statements do not include any adjustments that may
result from the outcome of these aforementioned uncertainties.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INTERIM FINANCIAL STATEMENTS AND BASIS OF PRESENTATION
The accompanying unaudited interim financial statements and related notes have
been prepared in accordance with accounting principles generally accepted in the
United States of America ("U.S. GAAP") for interim financial information, and
with the rules and regulations of the United States Securities and Exchange
Commission (the "SEC") set forth in Article 8 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by U.S. GAAP
for complete financial statements. The unaudited interim financial statements
furnished reflect all adjustments (consisting of normal recurring accruals)
which are, in the opinion of management, necessary to a fair statement of the
results for the interim periods presented. Unaudited interim results are not
necessarily indicative of the results for the full fiscal year. These financial
statements should be read in conjunction with the financial statements of the
Company for the year ended May 31, 2013 and notes thereto contained in our 10-K
Annual Report filed on October 17, 2013.
BASIS OF PRESENTATION
The financial statements of the Company have been prepared in accordance with
generally accepted accounting principles in the United States of America and are
presented in US dollars. The Company's fiscal year end is May 31.
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid investments with original maturity of
three months or less to be cash equivalents.
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USE OF ESTIMATES AND ASSUMPTIONS
The preparation of financial statements in conformity with generally accepted
accounting principles requires that management makes 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 period. Actual results
could differ from those estimates.
FOREIGN CURRENCY TRANSLATION
The financial statements are presented in United States dollars. In accordance
with ASC 830, "Foreign Currency Matters", foreign denominated monetary assets
and liabilities are translated into their United States dollar equivalents using
foreign exchange rates which prevailed at the balance sheet date. Revenue and
expenses are translated at average rates of exchange during the year. Gains or
losses resulting from foreign currency transactions are included in results of
operations.
DEVELOPMENT STAGE COMPANY
The Company complies with Financial Accounting Standards Codification ("ASC")
915 and Securities and Exchange Commission Act Guide 7 for its characterization
of the Company as development stage enterprise.
FINANCIAL INSTRUMENT
Fair value measurements are determined based on the assumptions that market
participants would use in pricing an asset or liability. ASC 820-10 establishes
a hierarchy for inputs used in measuring fair value that maximizes the use of
observable inputs and minimizes the use of unobservable inputs by requiring that
the most observable inputs be used when available. FASB ASC 820 establishes a
fair value hierarchy that prioritizes the use of inputs used in valuation
methodologies into the following three levels:
Level 1: Quoted prices (unadjusted) for identical assets or liabilities in
active markets. A quoted price in an active market provides the most reliable
evidence of fair value and must be used to measure fair value whenever
available.
Level 2: Significant other observable inputs other than Level 1 prices such as
quoted prices for similar assets or liabilities; quoted prices in markets that
are not active; or other inputs that are observable or can be corroborated by
observable market data.
Level 3: Significant unobservable inputs that reflect a reporting entity's own
assumptions about the assumptions that market participants would use in pricing
an asset or liability. For example, level 3 inputs would relate to forecasts of
future earnings and cash flows used in a discounted future cash flows method.
The recorded amounts of financial instruments, including cash equivalents,
accounts payable and loan from shareholder, approximate their market values as
of February 28, 2014.
INCOME TAXES
The Company follows the accrual method of accounting for income taxes. Under
this method, deferred income tax assets and liabilities are recognized for the
estimated tax consequences attributable to differences between the financial
statement carrying values and their respective income tax basis (temporary
differences). The effect on the deferred income tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date. At February 28, 2014, a full deferred tax asset valuation
allowance has been provided and no deferred tax asset has been recorded.
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BASIC AND DILUTED NET INCOME (LOSS) PER SHARE
The Company computes net income (loss) per share in accordance with ASC 260,
"Earnings per Share" which requires presentation of both basic and diluted
earnings per share (EPS) on the face of the income statement. Basic EPS is
computed by dividing net income (loss) available to common shareholders
(numerator) by the weighted average number of common shares outstanding
(denominator) during the period. Diluted EPS gives effect to all dilutive
potential common shares outstanding during the period including stock options,
using the treasury stock method, and convertible preferred stock, using the
if-converted method. In computing diluted EPS, the average stock price for the
period is used in determining the number of shares assumed to be purchased from
the exercise of stock options or warrants. Diluted EPS excludes all dilutive
potential common shares if their effect is anti-dilutive.
RECENT ACCOUNTING PRONOUNCEMENTS
In February, 2010, the FASB issued ASU No. 2010-09, which is included in the
Codification under ASC 855, SUBSEQUENT EVENTS ("ASC 855"). This update removes
the requirement for an SEC filer to disclose the date through which subsequent
events have been evaluated and become effective for interim and annual reporting
periods beginning January 1, 2010. The adoption of this guidance did not have a
material impact on the Company's financial statements.
In January, 2010, the FASB issued ASU No. 2010-06, which is included in the
Codification under ASC 820, FAIR VALUE MEASUREMENTSAND DISCLOSURES ("ASC 820").
This update requires the disclosure of transfers between the observable input
categories and activity in the unobservable input category for fair value
measurements. The guidance also requires disclosures about the inputs and
valuation techniques used to measure fair value and become effective for interim
and annual reporting periods beginning January 1, 2010. The adoption of this
guidance did not have a material impact on the Company's financial statements.
The Company does not expect the adoption of recently issued accounting
pronouncements to have any significant impact on the Company's results of
operations, financial position or cash flow. As new accounting pronouncements
are issued, the Company will adopt those that are applicable under the
circumstances.
3. RELATED PARTY TRANSACTIONS
Mr. James Aikens, President of the Company, provides management and office
premises to the Company for no compensation. Mr. Robin Thompson, a director and
former officer of the company, will not be paid for any underwriting services
that he performed on behalf of the Company with respect to the Company's S-1
offering. He will also not receive any interest on any funds that he has
advanced to the Company. Mr. Thompson has advanced funds to the Company as of
February 28, 2014 in the amount of $11,588.
4. COMMON SHARES
The stockholders' equity section of the Company contains the following classes
of capital stock as of February 28, 2014: Common Stock, $0.0001 par value:
130,000,000 shares authorized; 6,000,000 shares issued and outstanding
In December, 2011, the Company issued 5,000,000 common shares of the company at
par value of $.002 to Robin Thompson, a Director and former officer, for net
cash proceeds of $10,000.
In December, 2013, the Company issued a total of 1,000,000 shares of common
stock to 25 individuals for cash in the amount of $0.01 per share for a total of
$10,000.
At February 28, 2014 there are total of 6,000,000 common shares of the Company
issued and outstanding.
7
5. INCOME TAXES
The Company follows ASC 740. Deferred income taxes reflect the net effect of (a)
temporary difference between carrying amounts of assets and liabilities for
financial purposes and the amounts used for income tax reporting purposes, and
(b) net operating loss carry-forwards. No net provision for refundable Federal
income tax has been made in the accompanying statement of loss because no
recoverable taxes were paid previously. Similarly, no deferred tax asset
attributable to the net operating loss carry-forward has been recognized, as it
is not deemed likely to be realized.
At February 28, 2014, the Company had an unused net operating loss carry-forward
of $25,015 that is available to offset future taxable income; the loss
carry-forward will start to expire in 2030.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
FORWARD LOOKING STATEMENTS
Some of the statements contained in this Form 10-Q 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-Q, 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-Q
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.
RESULTS OF OPERATIONS
On February 12, 2014, we received the resignation of Robin Thompson as our sole
officer. Mr. Thompson continues to serve as a Director of the Company.
On February 12, 2014, James Aikens was appointed President, Secretary,
Treasurer, Chief Executive Officer, Chief Financial Officer, Secretary and
Director of our Company.
We are still in our development stage and have generated no revenues to date.
We have incurred $25,015 in operating expenses from inception through February
28, 2014. These expenses primarily consisted of costs related to organizational
fees, i.e. forming the Delaware Company and filing the extra provincial license
documents to operate in Alberta, costs related to the preparation of the
Registration Statement, including the audit, SEC fees and EDGAR filing.
The following table provides selected financial data about our Company for the
period from the date of incorporation through February 28, 2014. For detailed
financial information, see the financial statements included in this report.
9
Balance Sheet Data: 02/28/2014
------------------- ----------
Cash $ 7,567
Total assets $ 7,567
Total liabilities $ 12,582
Stockholder's equity $ (5,015)
During the time while we were waiting for funding from our recent offering
Management focused on development that could be achieved without substantial
cash flow. We completed our offering of 1,000,000 shares of common stock to 25
individuals for cash in the amount of $10,000 in December 2013. At this point we
have mapped out the primary areas of functionality the service will offer
including basic high-level, wire frame sketches of screens. We have reviewed
hosting services and selected the Google App Engine as our deployment target.
This decision also led us to decide to use the database services offered through
the Google App Engine platform. We've generated initial domain, service and
controller class designs that will be easily supported by our selected platform
and installed an open-source code editor that will help simplify our integration
and deployment activities. We reviewed freely available open-source libraries
that supply functionality we intend to use. Additionally we've also determined
where and how we will keep our code repositories. On the marketing front, we
have vetted our concept and planned functionality through a number of part time
and full time real estate investors to further refine the planned service
offering.
Other than the sale of shares in our recent offering, no other source of capital
has been identified. As the Company was unable to obtain full funding in our
offering, we will be forced to extend our target dates, reduce planned
functionality and spend more time dealing with the development and maintenance
of marketing content and processes. If we experience a shortfall in operating
capital our director has verbally agreed to advance the Company funds in a
limited operations scenario.
Our net loss for the three months ended February 28, 2014 was $3,644. Our net
loss for the three months ended February 28, 2013 was $2,431.
Our net loss for the nine months ended February 28, 2014 was $15,557. Our net
loss for the nine months ended February 28, 2013 was $6,292. Our net loss from
inception (May 16, 2011) through February 28, 2014 was $25,015.
As of February 28, 2014, there is a total of $11,588 in advances payable that is
owed by the company to Robin Thompson, a director, for expenses that he has paid
on behalf of the company. The advances payable are interest free and payable on
demand.
Cash provided by financing activities from inception through the period ended
February 28, 2014 was $16,500.
On December 1, 2011 the Company issued a total of 5,000,000 shares of common
stock to Mr. Thompson for cash at $0.002 per share for a total of $10,000.
10
We completed our offering of 1,000,000 shares of common stock to 25 individuals
for cash in the amount of $10,000 in December 2013.
LIQUIDITY AND CAPITAL RESOURCES
At February 28, 2014 we had $7,567 in cash and there were outstanding
liabilities of $12,582. Our director(s) have verbally agreed to continue to loan
the company funds for operating expenses in a limited scenario, but he has no
legal obligation to do so.
PLAN OF OPERATION
Now that we have completed only a portion of our Company's $50,000 budget, we
will be forced to operate at a minimal level and to extend our target dates
until we receive additional financing.
Our specific business plan for the next twelve months will include the
following:
During the next twelve months, we will begin initial programming of the Home and
Buyers List navigation pages, which includes actual programming instructions in
developing content pages for use for our web-based application. However, the
buyer/listing feature that will match the buyer's property specifications
profiled on the Buyer's List with the properties owned by the investor on the
Property List will be delayed until the Company receives additional funding.
We believe we will be able to operate at a minimal level for the next 12 months
to cover corporate and filing expenses, provide limited marketing, and begin
initial programming of the Home and Buyers List navigations pages.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements that have or are reasonably
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 that is material to investors.
ITEM 4. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Management maintains "disclosure controls and procedures," as such term is
defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the
"Exchange Act"), that are designed to ensure that information required to be
disclosed in our Exchange Act reports is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission rules and forms, and that such information is accumulated and
communicated to management, including our Chief Executive Officer and Chief
Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure.
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In connection with the preparation of this quarterly report on Form 10-Q, an
evaluation was carried out by management, with the participation of the Chief
Executive Officer and the Chief Financial Officer, of the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Exchange Act) as of February 28, 2014.
Based on that evaluation, management concluded, as of the end of the period
covered by this report, that our disclosure controls and procedures were
effective in recording, processing, summarizing, and reporting information
required to be disclosed, within the time periods specified in the Securities
and Exchange Commission's rules and forms.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
As of the end of the period covered by this report, there have been no changes
in the internal controls over financial reporting during the quarter ended
February 28, 2014, that materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting subsequent to
the date of management's last evaluation.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS
The following exhibits are included with this quarterly filing. Those marked
with an asterisk and required to be filed hereunder, are incorporated by
reference and can be found in their entirety in our Registration Statement on
Form S-1, filed under SEC File Number 333-182970, at the SEC website at
www.sec.gov:
Exhibit No. Description
----------- -----------
3.1 Articles of Incorporation*
3.2 Bylaws*
31.1 Sec. 302 Certification of Principal Executive Officer
31.2 Sec. 302 Certification of Principal Financial Officer
32.1 Sec. 906 Certification of Principal Executive Officer
32.2 Sec. 906 Certification of Principal Financial Officer
101 Interactive data files pursuant to Rule 405 of Regulation S-T
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Webfolio Inc.
Registrant
Date April 14, 2014 By /s/ James Aikens
----------------------------------------
James Aikens
(Principal Executive Officer,
Principal Financial Officer,
Principal Accounting Officer & Director)
Date April 14, 2014 By /s/ Robin Thompson
----------------------------------------
Robin Thompson
(Director)
13