================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[ X ] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the period ended November 30, 2006
[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period to
------------------ -----------------------
Commission File Number 333-119715
----------
Quorum Ventures, Inc.
---------------------------------------------------
(Exact name of Small Business Issuer as specified in its charter)
Nevada Pending
- -------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
- --------------------------------
incorporation or organization)
- ------------------------------
2640 Tempe Knoll Drive
North Vancouver. B.C., Canada V6C 1V5
- ---------------------------------------- ----------------------
(Address of principal executive offices) (Postal or Zip Code)
Issuer's telephone number, including area code: 604-908-0233
---------------------------------
N/A
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) 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 issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days Yes [ ] No [ 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
stock, as of the latest practicable date: 7,050,000 shares of common stock with
par value of $0.001 per share outstanding as of January 12, 2007.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
INTERIM FINANCIAL STATEMENTS
November 30, 2006
(Unaudited)
BALANCE SHEETS
INTERIM STATEMENTS OF OPERATIONS
INTERIM STATEMENTS OF CASH FLOWS
STATEMENT OF STOCKHOLDERS' EQUITY
NOTES TO THE INTERIM FINANCIAL STATEMENTS
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
BALANCE SHEETS
<table>
<caption>
November 30, May 31,
2006 2006
---- ----
(Unaudited) (Audited)
ASSETS
------
<s> <c> <c>
Current Assets
Cash $ 6,175 $ 7,736
Prepaid expense 1,267 1,362
---------------- ---------------
Total assets $ 7,442 $ 9,098
================ ===============
LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------
Current Liabilities
Accounts payable and accrued liabilities $ 7,930 $ 11,681
Due to related party (Note 5) 31,550 19,550
---------------- ---------------
39,480 31,231
---------------- ---------------
Common stock (Note 4)
75,000,000 shares authorized, $0.001 par value,
7,050,000 shares issued and outstanding 7,050 7,050
(May 31, 2006 -7,050,000)
Additional paid-in capital 22,950 22,950
Deficit accumulated during the exploration stage ( 62,038) ( 52,133)
---------------- ----------------
( 32,038) ( 22,133)
---------------- ----------------
Total liabilities and stockholders' deficit $ 7,442 $ 9,098
================ ================
</table>
The accompanying notes are an integral part of these interim financial
statements.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
INTERIM STATEMENTS OF OPERATIONS
(Unaudited)
<table>
<caption>
Three months Three months Six months Six months February 2, 2004
ended ended ended ended (Inception) to
November 30, November 30, November 30, November 30, November 30,
2006 2005 2006 2005 2006
---- ---- ---- ---- ----
<s> <c> <c> <c> <c> <c>
Expenses
Accounting and audit fees $ 3,609 $ 3,669 $ 7,614 $ 5,597 $ 33,151
Bank charges and interest 28 1,160 51 1,178 408
Filing fees 748 1,537 1,240 1,537 4,947
Interest expense - - - - 1,222
Legal fees - 650 - 650 8,650
Mineral property costs - - - - 12,500
Office and general expenses - 160 - 160 160
Transfer agent fees 1,000 - 1,000 - 1,000
------------- ------------ ----------- ------------ --------------
Loss before income taxes (5,385) (7,176) (9,905) (9,122) (62,038)
Provision for income taxes - - - - -
------------- ------------ ----------- ------------ --------------
Net loss $ (5,385) $ (7,176) $ (9,905) $ (9,122) $ (62,038)
============= ============ =========== ============ ==============
Net loss per share, basic and diluted $ (0.00) $ (0.00) $ (0.00) $ (0.00)
============= ============ =========== ============
Weighted average number of shares outstanding 7,050,000 7,050,000 7,050,000 7,050,000
============= ============ =========== ============
</table>
The accompanying notes are an integral part of these interim financial
statements.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
INTERIM STATEMENT OF CASH FLOWS
(Unaudited)
<table>
<caption>
February 2, 2004
(Inception) to
Six months ended November 30, November 30,
2006 2005 2006
---- ---- ----
<s> <c> <c> <c>
Cash Flows From Operating Activities
Net loss $ ( 9,905) $ ( 9,122) $ ( 62,038)
Changes in non cash working capital items
Prepaid expenses 95 - (1,267)
Accounts payable and accrued liabilities ( 3,751) 1,113 7,930
----------------- ------------- ----------------
Net cash used in operations ( 13,561) ( 8,009) ( 55,375)
----------------- ------------- ----------------
Cash Flows From Financing Activities
Proceeds from sale and issuance of common stock - - 30,000
Increase in due to related party 12,000 - 31,550
----------------- ------------- ----------------
Net cash provided by financing activities 12,000 - 61,550
----------------- ------------- ----------------
Net increase (decrease) in cash ( 1,561) ( 8,009) 6,175
Cash, beginning 7,736 15,642 -
----------------- ------------- ----------------
Cash, ending $ 6,175 $ 7,633 $ 6,175
================= ============= ================
Supplemental Cash Flow Information
Cash paid for:
Interest $ - $ - $ -
================= ============= ================
Income taxes $ - $ - $ -
================= ============= ================
</table>
The accompanying notes are an integral part of these interim financial
statements.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIT
Inception (February 2, 2004) to November 30, 2006
<table>
<caption>
Deficit
Accumulated
Additional During the
Common Shares Paid-in Exploration
----------------------------------
Number Amount Capital Stage Total
------ ------ ------- ----- -----
<s> <c> <c> <c> <c> <c>
Common stock issued for cash
- at $0.001 per share, February 2004 5,000,000 $ 5,000 $ - $ - $ 5,000
- at $0.01 per share, March 2004 2,000,000 2,000 18,000 - 20,000
- at $0.10 per share, April 2004 50,000 50 4,950 - 5,000
Net loss - - - ( 14,547) ( 14,547)
------------ -------------- -------------- -------------- -------------
Balance, May 31, 2004 7,050,000 7,050 22,950 ( 14,547) 15,453
Net loss - - - ( 15,553) ( 15,553)
------------ -------------- -------------- -------------- -------------
Balance, May 31, 2005 7,050,000 7,050 22,950 ( 30,100) ( 100)
Net loss - - - ( 22,033) ( 22,033)
------------ -------------- -------------- -------------- -------------
Balance, May 31, 2006 (audited) 7,050,000 7,050 22,950 ( 52,133) ( 22,133)
Net loss - - - ( 9,905) ( 9,905)
------------ -------------- -------------- -------------- -------------
Balance, November 30, 2006 (unaudited) 7,050,000 $ 7,050 $ 22,950 $ ( 62,038) $ ( 32,038)
============ ============== ============== ============== =============
</table>
The accompanying notes are an integral part of these interim financial
statements.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
November 30, 2006
(Unaudited)
Note 1 Nature and Continuance of Operations
------------------------------------
Organization
The Company was incorporated in the State of Nevada on February 2,
2004. The Company's fiscal year end is May 31.
Exploration Stage Activities
The Company has been in the exploration stage since its formation
and has not yet realized any revenues from its planned operations.
It is primarily engaged in the acquisition and exploration of
mining properties. Upon location of a commercial, minable reserve,
the Company expects to actively prepare the site for its
extraction and enter the mine development stage.
The Company has acquired a mineral property located in the North
West Territories, Canada and has not yet determined whether this
property contains reserves that are economically recoverable. The
recoverability of amounts from the property will be dependent upon
the discovery of economically recoverable reserves, confirmation
of the Company's interest in the underlying property, the ability
of the Company to obtain necessary financing to satisfy the
expenditure requirements under the property agreement and to
complete the development of the property and upon future
profitable production or proceeds for the sale thereof.
Going concern
These financial statements have been prepared on a going concern
basis which assumes that the Company will be able to realize its
assets and discharge its liabilities in the normal course of
business. The Company has incurred losses since inception
resulting in an accumulated deficit of $62,038 as of November 30,
2006 and further losses are anticipated in the development of its
business raising substantial doubt about the Company's ability to
continue as a going concern. These financial statements do not
include any adjustments to the amounts and classifications of
assets and liabilities that might be necessary should the Company
be unable to continue as a going concern.
Unaudited Interim Financial Statements
The accompanying unaudited interim financial statements have been
prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Form 10-QSB of Regulation S-B. They may not
include all information and footnotes required by generally
accepted accounting principles for complete financial statements.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
November 30, 2006
(Unaudited)
Note 1 Nature and Continuance of Operations - Cont'd
------------------------------------
Unaudited Interim Financial Statements - Cont'd
However, except as disclosed herein, there have been no material
changes in the information disclosed in the notes to the financial
statements for the period ended May 31, 2006 included in the
Company's 10-KSB filed with the Securities and Exchange
Commission. The interim unaudited financial statements should be
read in conjunction with those financial statements included in
the Form 10-KSB. In the opinion of Management, all adjustments
considered necessary for a fair presentation, consisting solely of
normal recurring adjustments, have been made. Operating results
for the six months ended November 30, 2006 are not necessarily
indicative of the results that may be expected for the year ending
May 31, 2007.
Note 2 Summary of Significant Accounting Policies
------------------------------------------
Basis of Presentation
---------------------
The financial statements of the Company are presented in US
dollars and have been prepared in accordance with United States
generally accepted accounting principles.
Mineral Property
----------------
Mineral property exploration and development costs are expensed as
incurred until such time as economic reserves are quantified. The
Company has considered the guidance under EITF 04-2 and has
determined that capitalization of mineral property acquisition
costs is inappropriate at the current stage of the Company's
mineral property exploration activities. To date, the Company's
mineral interests consist mainly of exploration stage properties.
Furthermore, there is uncertainty as to the Company's ability to
fund the exploration work necessary to determine if the properties
have recoverable reserves or any future economic benefits. As a
result, acquisition costs to date are considered to be impaired
and accordingly, have been written off as mineral property
expenditures.
Use of Estimates and Assumptions
--------------------------------
The preparation of financial statements in conformity with
generally accepted accounting principles in the United States of
America requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and
expenses during the period. Actual results could differ from those
estimates.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
November 30, 2006
(Unaudited)
Note 2 Summary of Significant Accounting Policies - (cont'd)
------------------------------------------
Foreign Currency Translation
----------------------------
The financial statements are presented in United States dollars.
In accordance with Statement of Financial Accounting Standard
("SFAS") No. 52, "Foreign Currency Translation", foreign
denominated monetary assets and liabilities are translated to
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
period. Certain translation adjustments are reported as a separate
component of stockholders' equity, whereas gains or losses
resulting from foreign currency transactions are included in
results of operations.
Income Taxes
------------
A deferred tax asset or liability is recorded for all temporary
differences between financial and tax reporting and net operating
loss carryforwards. Deferred tax expenses (recovery) result from
the net change during the period of deferred tax assets and
liabilities.
Deferred tax assets are reduced by a valuation allowance when, in
the opinion of management, it is more likely than not that some
portion or all of the deferred tax assets will not be realized.
Deferred tax assets and liabilities are adjusted for the effects
of changes in tax laws and rates on the date of enactment.
Stock-based Compensation
------------------------
In December 2004, the FASB issued SFAS No. 123R, "Share-Based
Payment", which replaced SFAS No. 123, "Accounting for Stock-Based
Compensation" and superseded APB Opinion No. 25, "Accounting for
Stock Issued to Employees". In January 2005, the Securities and
Exchange Commission ("SEC") issued Staff Accounting Bulletin
("SAB") No. 107, "Share-Based Payment", which provides
supplemental implementation guidance for SFAS No. 123R. SFAS No.
123R requires all share-based payments to employees, including
grants of employee stock options, to be recognized in the
financial statements based on the grant date fair value of the
award. SFAS No. 123R was to be effective for interim or annual
reporting periods beginning on or after June 15, 2005, but in
April 2005 the SEC issued a rule that will permit most registrants
to implement SFAS No. 123R at the beginning of their next fiscal
year, instead of the next reporting period as required by SFAS No.
123R. The pro-forma disclosures previously permitted under SFAS
No. 123 no longer will be an alternative to financial statement
recognition. Under SFAS No. 123R, the Company must determine the
appropriate fair value model to be used for valuing share-based
payments, the amortization method for compensation cost and the
transition method to be used at date of adoption.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
November 30, 2006
(Unaudited)
Note 2 Summary of Significant Accounting Policies - (cont'd)
------------------------------------------
Stock-based Compensation - (cont'd)
------------------------
The transition methods include prospective and retroactive
adoption options. Under the retroactive options, prior periods may
be restated either as of the beginning of the year of adoption or
for all periods presented. The prospective method requires that
compensation expense be recorded for all unvested stock options
and restricted stock at the beginning of the first quarter of
adoption of SFAS No. 123R, while the retroactive methods would
record compensation expense for all unvested stock options and
restricted stock beginning with the first period restated. The
Company adopted the modified prospective approach of SFAS No. 123R
for the year beginning June 1, 2005. The Company did not record
any compensation expense during the period ended November 30, 2006
as there were no stock options outstanding prior to the adoption
or at November 30, 2006.
Loss Per Share
--------------
Basic net loss per share is computed by dividing net loss
attributable to common stockholders by the weighted average number
of shares outstanding during the period. Diluted net loss per
share takes into consideration shares of common stock outstanding
(computed under basic loss per share) and potentially dilutive
shares of common stock.
Recent Accounting Pronouncements
--------------------------------
In June 2006, the FASB issued FASB Interpretation Number 48,
"Accounting for Uncertainty in Income Taxes - an interpretation of
FASB Statement No. 109." This Interpretation clarifies the
accounting for uncertainty in income taxes recognized in an
enterprise's financial statements in accordance with FASB
Statement No. 109, "Accounting for Income Taxes." This
Interpretation is effective for fiscal years beginning after
December 15, 2006, which for the Company would be fiscal year
beginning June 1, 2007. The Company is currently assessing the
effect of this Interpretation on its financial statements but does
not expect that it will have a material impact on its financial
statements.
In September 2006, the FASB issued SFAS No. 157, "Fair Value
Measures". This Statement defines fair value, establishes a
framework for measuring fair value in generally accepted
accounting principles (GAAP), expands disclosures about fair value
measurements, and applies under other accounting pronouncements
that require or permit fair value measurements. SFAS No. 157 does
not require any new fair value measurements. However, the FASB
anticipates that for some entities, the application of SFAS No.
157 will change current practice. SFAS No. 157 is effective for
financial statements issued for fiscal years beginning after
November 15, 2007, which for the Company would be the fiscal year
beginning June 1, 2008.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
November 30, 2006
(Unaudited)
Note 2 Summary of Significant Accounting Policies - (cont'd)
------------------------------------------
Recent Accounting Pronouncements- (cont'd)
--------------------------------
The Company is currently evaluating the impact of SFAS No. 157 but
does not expect that it will have a material impact on its
financial statements.
In September 2006, the FASB issued SFAS No. 158, "Employers'
Accounting for Defined Benefit Pension and Other Postretirement
Plans." This Statement requires an employer to recognize the over
funded or under funded status of a defined benefit post retirement
plan (other than a multiemployer plan) as an asset or liability in
its statement of financial position, and to recognize changes in
that funded status in the year in which the changes occur through
comprehensive income. SFAS No. 158 is effective for fiscal years
ending after December 15, 2006, which for the Company would be
fiscal year ending May 31, 2007. February 1, 2007. The Company
does not expect that the implementation of SFAS No. 158 will have
any material impact on its financial position and results of
operations.
In September 2006, the SEC issued Staff Accounting Bulletin
("SAB") No. 108, "Considering the Effects of Prior Year
Misstatements when Quantifying Misstatements in Current Year
Financial Statements." SAB No. 108 addresses how the effects of
prior year uncorrected misstatements should be considered when
quantifying misstatements in current year financial statements.
SAB No. 108 requires companies to quantify misstatements using a
balance sheet and income statement approach and to evaluate
whether either approach results in quantifying an error that is
material in light of relevant quantitative and qualitative
factors. SAB No. 108 is effective for periods ending after
November 15, 2006 which for the Company was November 30, 2006. The
adoption of this SAB had no impact on the Company's financial
statements.
Note 3 Mineral Property
----------------
By a mineral property purchase agreement dated April 21, 2004, the
Company acquired a 90% undivided right, title and interest in and
to three mineral claims in Yellowknife, Northwest Territories,
Canada by the payment of $7,500. During the year ended May 31,
2005 the Company incurred mineral exploration expenses of $5,000.
During the year ended May 31, 2006 the Company did not make the
annual payment on one of the claims, as required by the
territorial government, and consequently the title to the minerals
claim lapsed. The remaining claims are held in trust for the
Company by the property vendor. The 90% right interest and title
in and to the claims is transferable to the Company at any time
upon request and is subject to a 2% net smelter return royalty.
<page>
QUORUM VENTURES, INC.
(An Exploration Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
November 30, 2006
(Unaudited)
Note 4 Common Stock
------------
The total number of common shares authorized that may be issued by
the Company is 75,000,000 shares with a par value of one tenth of
one cent ($0.001) per share and no other class of shares is
authorized.
During the year ended May 31, 2004, the Company issued 7,050,000
shares of common stock for total cash proceeds of $30,000.
At November 30, 2006, there were no outstanding stock options or
warrants.
Note 5 Related Party Transactions
--------------------------
As at November 30, 2006, an amount of $31,550 (May 31, 2006:
$19,550) is owing to a director of the Company. The amount is
unsecured, non-interest bearing and has no specified terms of
repayment.
Note 6 Segment Information
-------------------
The Company currently conducts all of its operations in Canada.
<page>
Forward-Looking Statements
- --------------------------
This Form 10-QSB includes "forward-looking statements" within the meaning of the
"safe-harbor" provisions of the Private Securities Litigation Reform Act of
1995. Such statements are based on management's current expectations and are
subject to a number of factors and uncertainties that could cause actual results
to differ materially from those described in the forward-looking statements.
All statements other than historical facts included in this Form, including
without limitation, statements under "Plan of Operation", regarding our
financial position, business strategy, and plans and objectives of management
for the future operations, are forward-looking statements.
Although we believe that the expectations reflected in such forward-looking
statements are reasonable, it can give no assurance that such expectations will
prove to have been correct. Important factors that could cause actual results to
differ materially from our expectations include, but are not limited to, market
conditions, competition and the ability to successfully complete financing.
Item 2. Plan of Operation
- -------------------------
Our plan of operation for the twelve months following the date of this annual
report is to complete the recommended phase one and two exploration programs on
the Upper Ross Lake property consisting of re-sampling of old workings, geologic
mapping, analytical and test surveys. We anticipate that the phase one program
will cost approximately $5,000, while the phase two program will cost
approximately $10,000. To date, we have not commenced exploration on the Upper
Ross Lake property, although we have funded the phase one exploration program.
Phase one will consist of a consulting geologist reviewing and compiling
information regarding previous exploration on the property and the re-sampling
of property that are known to contain gold. The re-sampling will be conducted by
a geologist and his helper. They will gather rock and soil samples from various
property locations and then ship them to a laboratory that will analyze them for
mineral content. The geologist will then analyze the laboratory results in order
to determine which directions, if any, that mineralization trends on the
property and to choose property areas upon which future exploration should
focus. Our directors, Steven Bolton and Bryan Markert, will not be involved in
exploration work on the property.
The objective of the phase one exploration program will be to confirm the
presence of gold in previously sampled areas and to gain an understanding of
where additional mineralization may be discovered on the property. We will use
these results in order to attempt to raise additional financing for our phase
two exploration program.
We will then undertake the phase two work program. This program will also take
approximately one month to complete. It will consist of mapping and reviewing
the results of the phase one exploration program and performing geophysical test
surveys on the claims.
Mapping involves plotting previous exploration data relating to a property on a
map in order to determine the best property locations to conduct subsequent
exploration work.
Geophysical surveying is the search for mineral deposits by measuring the
physical property of near-surface rocks, and looking for unusual responses
<page>
caused by the presence of mineralization. Electrical, magnetic, gravitational,
seismic and radioactive properties are the ones most commonly measured. The
geologist overseeing the phase two exploration program will choose the
appropriate geophysical survey or surveys based on the results of the phase one
program. Our objective of the phase two program will be to determine whether
mineralization discovered on the claims surface may occur beneath the ground. We
will look for high geophysical survey readings in areas of the claims where
surface mineralization exists.
The budget for the phase two program is as follows:
Mapping: $ 2,000.00
Analytical: $ 2,000.00
Geophysical test surveys: $ 6,000.00
-----------
Total Phase II Costs: $10,000.00
We intend to retain Mr. William Timmins, a geological engineer, to undertake the
proposed exploration on the Upper Ross Lake property given his familiarity with
the property area. Mr. Timmins has worked on other mineral exploration projects
in the region of the Upper Ross Lake claims and visited the property during
April 2004. Mr. Timmins has never had and does not have any relationship or
affiliation with us or our management.
We do not have any verbal or written agreement regarding the retention of Mr.
Timmins for this exploration program, though he has indicated that he will be
available to provide his services. We have not executed a formal agreement with
Mr. Timmins because that is not the typical practice in the mineral exploration
sector. The costs of Mr. Timmins's services are included in his phase one and
phase two budgets.
Following receipt of the phase two exploration results, we will ask Mr. Timmins
to prepare a recommendation for further exploration work on the Upper Ross Lake
claims and to provide us with a proposed budget for such work.
We do not expect to earn any revenues from the Upper Ross Lake claim unless and
until we identify economic mineralization. This will likely not occur until we
complete the phase one and two exploration programs, as well as several
successive drill programs. Drill programs involve extracting a long cylinder of
rock from the ground to determine amounts of metals at different depths. Pieces
of the rock obtained, known as drill core, are analysed for mineral content.
This allows us to determine the extent of mineralization below the surface of
the claims. Our objective is to discover sub-surface mineralization in
sufficient quantities to justify operating the claims as a mine. This is
determined by the amount, grade and depth of mineralization discovered, if any.
As well, we anticipate spending an additional $15,000 on professional fees,
including fees payable in connection with the filing of the annual report and
complying with reporting obligations, and general administrative costs.
Total expenditures over the next 12 months are therefore expected to be $30,000.
We will not realize any revenue from our operations in the next 12 months.
Our cash reserves are not sufficient to meet our obligations for the next
twelve-month period. As a result, we will need to seek additional funding in the
near future. We currently do not have a specific plan of how we will obtain such
funding; however, we anticipate that additional funding will be in the form of
equity financing from the sale of our common stock. We may also seek to obtain
<page>
short-term loans from our directors, although no such arrangement has been made.
At this time, we cannot provide investors with any assurance that we will be
able to raise sufficient funding from the sale of our common stock or through a
loan from our directors to meet our obligations over the next twelve months. We
do not have any arrangements in place for any future equity financing. Our
directors have indicated that they are prepared to loan us up to $50,000 for
operations, though they have no obligations in this regard. Such loans would be
unsecured, non-interest bearing loans with no fixed terms of repayment.
If we are unable to raise sufficient capital, we may also consider selling a
portion of the Upper Ross Lake property to a third party in exchange for that
party paying us cash and/or committing to complete a certain amount of
exploration on the property. We have not contacted any third parties regarding
such an arrangement.
Results of Operations For Period Ending November 30, 2006
We did not earn any revenues in the six-month period ended November 30, 2006. We
do not anticipate earning revenues unless we enter into commercial production on
the Upper Ross Lake mineral property, which is doubtful.
We incurred operating expenses in the amount of $9,905 for the six-month period
ended November 30, 2006 consisting of accounting and audit fees of $7,614,
filing fees of $1,240, transfer agent fees of $1,000 and bank charges and
interest of $51.
Our net loss for the three-month period ended November 30, 2006 increased
slightly from the comparative period in fiscal 2005 (2006: $9,905; 2005: $9,122)
primarily due to an increase in accounting and audit fees, as well as transfer
agent fees.
At November 30, 2006, we had total assets of $7,442, consisting of $6,175 in
cash and $1,267 in prepaid expense. At the same date, our liabilities consisted
of accounts payable and accrued liabilities of $7,930 and a loan payable from
one of our directors for $31,550.
We have not attained profitable operations and are dependent upon obtaining
financing to pursue exploration activities. For these reasons our auditors
believe that there is substantial doubt that we will be able to continue as a
going concern.
Item 3 Controls and Procedures
- ------------------------------
Evaluation of Disclosure Controls
We evaluated the effectiveness of our disclosure controls and procedures as of
November 30, 2006. This evaluation was conducted by Steven Bolton, our chief
executive officer and Bryan Markert, our principal accounting officer.
Disclosure controls are controls and other procedures that are designed to
ensure that information that we are required to disclose in the reports we file
pursuant to the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported.
Limitations on the Effective of Controls
<page>
Our management does not expect that our disclosure controls or our internal
controls over financial reporting will prevent all error and fraud. A control
system, no matter how well conceived and operated, can provide only reasonable,
but no absolute, assurance that the objectives of a control system are met.
Further, any control system reflects limitations on resources, and the benefits
of a control system must be considered relative to its costs. These limitations
also include the realities that judgments in decision-making can be faulty and
that breakdowns can occur because of simple error or mistake. Additionally,
controls can be circumvented by the individual acts of some persons, by
collusion of two or more people or by management override of a control. A design
of a control system is also based upon certain assumptions about potential
future conditions; over time, controls may become inadequate because of changes
in conditions, or the degree of compliance with the policies or procedures may
deteriorate. Because of the inherent limitations in a cost-effective control
system, misstatements due to error or fraud may occur and may not be detected.
Conclusions
Based upon their evaluation of our controls, Steven Bolton, our chief executive
officer and Bryan Markert, our principal accounting officer, have concluded
that, subject to the limitations noted above, the disclosure controls are
effective providing reasonable assurance that material information relating to
us is made known to management on a timely basis during the period when our
reports are being prepared. There were no changes in our internal controls that
occurred during the quarter covered by this report that have materially
affected, or are reasonably likely to materially affect our internal controls.
PART II- OTHER INFORMATION
- --------------------------
Item 1. Legal Proceedings
The Company is not a party to any pending legal proceeding. Management is not
aware of any threatened litigation, claims or assessments.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Report on Form 8-K
31.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
We did not file any current reports on Form 8-K during the period.
<page>
SIGNATURES
- ----------
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
January 12, 2007
Quorum Ventures, Inc.
/s/ Steven Bolton
- ------------------------------
Steven Bolton, President