UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 2007
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to __________
Commission File Number: 000-31165
CYGNI INVESTMENTS, INC.
(Exact name of Registrant as specified in charter)
NEVADA 88-0442584
State or other jurisdiction of I.R.S.
Employer I.D. No.
incorporation or organization
3857 BIRCH STREET, #606, NEWPORT BEACH, CA 92660
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (949) 644 0095
Check whether the Issuer (1) has filed all reports required to be
filed by section 13 or 15(d) of the Exchange Act during the past
12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such
fling requirements for the past 90 days. (1) Yes [X] No [ ]
(2) Yes [X] No [ ]
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: At
June 30, 2007, there were 500,001 shares of the Registrant's
Common Stock outstanding.
Transitional Small Business Disclosure Format (Check One)
Yes [ ] No [X]
PART I
ITEM 1. FINANCIAL STATEMENTS
The condensed financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company
believes that the disclosures are adequate to make the
information presented not misleading.
In the opinion of the Company, all adjustments, consisting of
only normal recurring adjustments, necessary to present fairly
the financial position of the Company as of June 30, 2007, and
the results of its operations and changes in its financial
position from November 17, 1999, through June 30, 2007, have been
made. The results of its operations for such interim period is
not necessarily indicative of the results to be expected for the
entire year. These condensed financial statements should be read
in conjunction with the financial statements and notes thereto
included in the Company's annual report on Form 10-KSB for the
year ended December 31, 2006.
Cygni Investments, Inc.
(A Development Stage Company)
Balance Sheets
(Unaudited)
June December
30, 2007 31, 2006
Assets
Current Assets
Cash $ - $ -
Total Current Assets $ - $ -
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable $ 38,730 $ 35,847
Interest Payable 17,477 15,899
Note Payable - Related Party
31,563 31,563
Total Current Liabilities 87,770 83,309
Stockholders' Equity
Common Stock 100,000,000 Shares Authorized at
$.001 Par Value; 500,001 Shares Issued &
Outstanding, Retroactively Restated
500 500
Additional Paid in Capital 9,500 9,500
Accumulated Deficit during Development Stage
(97,770) (93,309)
Total Stockholders' Equity (Deficit)
(87,770) (83,309)
Total Liabilities and Stockholders' Equity
$ - $ -
Cygni Investments, Inc.
(A Development Stage Company)
Statements of Operations
(Unaudited)
For the Period
November
17, 1999
For the Three Months Ended For the Six Months Ended(Inception)
June 30, June 30, June 30, June 30, to June 30,
2007 2006 2007 2006 2007
Revenue
$ - $ - $ - $ - $ -
Expenses
General & Administrative
900 1,928 2,883 5,283 80,044
Total Expenses
900 1,928 2,883 5,283 80,044
Income (Loss) from Operations
(900) (1,928) (2,883) (5,283) (80,044)
Other Income (Expenses)
Interest Expense
(789) (789) (1,578) (1,578) (17,726)
Total Other Income (Expenses)
(789) (789) (1,578) (1,578) (17,726)
Net Income (Loss)
Before Taxes
(1,689) (789) (4,461) (6,861) (97,770)
Taxes
- - - - - -
Net Income (Loss)
$(1,689) $(2,717) $(4,461) $(6,861) $(97,770)
Loss per Common Share
$ (.00) $(.01) $(.01) $(.01)
Weighted Average Outstanding Shares
500,001 500,001 500,001 500,001
Cygni Investments, Inc.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
From
(Inception)
November
For the six months ended 17, 1999 to
June, June June
30, 2007 30, 2006 30, 2007
Cash Flows from Operating Activities
Net Loss
$ (1,689) $ (6,861) $ (97,770)
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Stock Issued for Services
- - 2,285
Increase (Decrease) in Accounts Payable
900 5,283 38,730
Increase (Decrease) in Interest Payable
789 1,578 17,477
Net Cash Provided by
Operating Activities
- - (39,278)
Cash Flows from Investing Activities
- - -
Net Cash Provided by
Investing Activities
- - -
Cash Flows from Financing Activities
Issuance of Common Stock for Cash
- - 7,715
Proceeds from Notes Payable
_ - 31,563
Net Cash Provided by
Financing Activities
- - 39,278
Net Increase (Decrease) In Cash
- - -
Cash, Beginning of Period
- - -
Cash, End of Period
$ - $ - $ -
Supplemental Cash Flow Information
Interest
$ - $ - $ -
Income Taxes
- - -
Cygni Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2007
NOTE 1 - CORPORATE HISTORY
Cygni Investments, Inc. (the Company) was incorporated in Nevada
on November 17, 1999, as Cygni Investments, Inc. for the purpose
of seeking and consummating a merger or acquisition with a
business entity organized as a private corporation, partnership,
or sole proprietorship as defined by Statement of Financial
Accounting Standards (SFAS) No. 7.
The Company has yet to fully develop any material income from its
stated primary objective and it is classified as a development
stage company. All income, expenses, cash flows and stock
transactions are reported since the beginning of development
stage.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
Cash and Cash Equivalents - The Company considers all highly
liquid investments with maturities of three months or less to be
cash equivalents.
Earnings (Loss) Per Share - The computation of earnings per share
of common stock is based on the weighted average number of shares
outstanding at the date of the financial statements.
Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect reported
amounts of assets and liabilities, disclosure of contingent
assets and liabilities at the date of the financial statements
and revenues and expenses during the reporting period. In these
financial statements, assets, liabilities and earnings involve
extensive reliance on management's estimates. Actual results
could differ from those estimates.
Fair Value of Financial Instruments- The fair value of the
Company's cash and cash equivalents, accounts payable and accrued
liabilities approximate carrying value based on their effective
interest rates compared to current market prices.
Cygni Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2007
Net Earnings (Loss) Per Share of Common Stock- The computation of
earning (loss) per share of common stock is based on the weighted
average number of shares outstanding at the date of the financial
statements.
For the three months Ended
June 30,
2007 2006
Basic Earnings per share:
Income (loss) (numerator)
$ (1,689) $ (2,717)
Shares (demoninator) 500,001 500,001
Per share amount $(.00) $(.01)
For the six months Ended
June 30,
2007 2006
Basic Earnings per share:
Income (loss) (numerator)
$ (4,461) $ (6,861)
Shares (denominator) 500,001 500,001
Per share amount $(.01) $ (.01)
NOTE 3 - NEW TECHNICAL PRONOUNCEMENTS
In February 2006, the Financial Accounting Standards Board (FASB)
issued SFAS No. 155, Accounting for Certain Hybrid Financial
Instrumentsan amendment of FASB Statements No. 133 and 140 (SFAS
No. 155). This Statement permits fair value of remeasurement for
any hybrid financial instrument that contains an embedded
derivative that otherwise would require bifurcation; clarifies
which interest-only strips and principal-only strips are not
subject to the requirements of SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities; establishes a
requirement to evaluate interests in securitized financial assets
to identify interests that are freestanding derivatives or that
are hybrid financial instruments that contain an embedded
derivative requiring bifurcation; clarifies that concentrations
of credit risk in the form of subordination are not embedded
derivatives; and amended SFAS No. 140, Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of
Liabilities, to eliminate the prohibition on a qualifying
special-purpose entity from holding a derivative financial
instrument that pertains to a beneficial interest other than
another derivative financial instrument. SFAS No. 155 is
effective for all financial instruments acquired, issued, or
subject to a remeasurement (new basis) event occurring after the
beginning of an entity's first fiscal year that begins after
September 15, 2006. The Company believes the adoption of the
provisions of SFAS No. 154 will not have a material impact on the
financial statements.
In March 2006, FASB issued SFAS No. 156, "Accounting for
Servicing of Financial Assets which amends FAS No. 140,
Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities" ("SFAS No. 156"). In a
significant change to current guidance, SFAS No. 156 permits an
entity to choose either of the following subsequent measurement
methods for each class of separately recognized servicing assets
and servicing liabilities: (1) Amortization Method or (2) Fair
Value Measurement Method. SFAS No. 156 is effective as of the
beginning of an entity's first fiscal year that begins after
September 15, 2006. The Company believes the adoption of the
provisions of SFAS No. 154 will not have a material impact on the
financial statements.
In June 2006 FASB issued Financial Accounting Standards
Interpretation No. 48, Accounting for Uncertainty in Income Taxes
(FIN 48). FIN 48 clarifies the accounting for uncertainty in
income taxes recognized in an enterprises' financial statements
in accordance with SFAS No. 109, Accounting for Income Taxes
("SFAS No. 109"). FIN 48 prescribes a recognition threshold and
measurement attributable for the financial statement recognition
and measurement of a tax position taken or expected to be taken
in a tax return. FIN 48 also provides guidance on derecognition,
classification, interest and penalties, accounting in interim
periods, disclosures and transitions. FIN 48 is effective for
fiscal years beginning after December 15, 2006. The Company is
currently reviewing the effect, if any, FIN 48 will have on its
financial position.
In September 2006, the Securities and Exchange Commission (SEC)
staff issued Staff Accounting Bulletin No. 108, Considering the
Effects of Prior Year Misstatements when Quantifying
Misstatements in Current Year Financial Statements (SAB No. 108).
SAB No. 108 was issued to provide consistency in how registrants
quantify financial statement misstatements. The Company is
required to and has applied SAB No. 108 in connection with the
preparation of its annual financial statements for the year
ending December 31, 2006. The Company does not expect the
application of SAB No. 108 to have a material effect on its
financial position and results of operations.
In September 2006, FASB issued SFAS No. 157, Fair Value
Measurements, which is effective for calendar year companies on
January 1, 2008. The statement defines fair value, establishes a
framework for measuring fair value in accordance with generally
accepted accounting principles, and expands disclosures about
fair value measurements. The statement codifies the definition of
fair value as the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. The standard
clarifies the principle that fair value should be based on the
assumptions market participants would use when pricing the asset
or liability and establishes a fair value hierarchy that
prioritizes the information used to develop those assumptions.
The Company is currently assessing the potential impacts of
implementing this standard.
In September 2006, the FASB issued SFAS No. 158, "Employers'
Accounting for Defined Benefit Pension and Other Postretirement
Plans an amendment of FASB Statements No. 87, 88, 106 and 132
(R)" ("SFAS No. 158"). SFAS 158 requires an employer to recognize
the funded status of a defined benefit postretirement plan as an
asset or liability in its statement of financial position and to
recognize changes in that funded status in the year in which the
changes occur through comprehensive income. The funded status of
a benefit plan is defined as the difference between the fair
value of the plan assets and the plans benefit obligation. For a
pension plan the benefit obligation is the projected benefit
obligation and for any other postretirement benefit plan, such as
a retiree health care plan, the benefit obligation is the
accumulated postretirement benefit obligation. SFAS No. 158
requires an employer to recognize as a component of other
comprehensive income, net of tax, the gains and losses and prior
service costs or credits that arise during the period but that
are not recognized as components of net periodic benefit costs
pursuant to SFAS No. 87. SFAS No. 158 also requires an employer
to measure the funded status of a plan as of the date of its
year-end. Additional footnote disclosure is also required about
certain effects on net periodic benefit cost for the next year
that arise from the delayed recognition of gains or losses, prior
service costs or credits, and transition asset or obligation.
Except for the year-end measurement requirement, SFAS No. 158 is
effective for the year ending December 31, 2006. The Company does
not anticipate that the adoption of this statement will have a
material effect on its financial condition or operations.
NOTE 3 -INCOME TAXES
The Company adopted Statement of Financial Accounting Standards
No. 109 Accounting for Income Taxes in the fiscal year ended
December 31, 2000 and has applied the provisions of the statement
to the current year which resulted in no significant adjustment.
Statement of Financial Accounting Standards No. 109 Accounting
for Income Taxes requires an asset and liability approach for
financial accounting and reporting for income tax purposes. This
statement recognizes (a) the amount of taxes payable or
refundable for the current year and (b) deferred tax liabilities
and assets for future tax consequences of events that have been
recognized in the financial statements or tax returns.
Deferred income taxes result from temporary differences in the
recognition of accounting transactions for tax and financial
reporting purposes. There were no temporary differences at June
30, 2007 and earlier years; accordingly, no deferred tax
liabilities have been recognized for all years.
Cygni Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2007
NOTE 3 -INCOME TAXES (continued)
The Company has cumulative net operating loss carryforwards of
approximately $98,000 at June 30, 2007. No effect has been shown
in the financial statements for the net operating loss
carryforwards as the likelihood of future tax benefit from such
net operating loss carryforwards is not presently determinable.
Accordingly, the potential tax benefits of the net operating loss
carryforwards, estimated based upon current tax rates at June 30,
2007 have been offset by valuation reserves in the same amount.
The net operating losses begin to expire in 2019.
The deferred tax asset and the valuation account is as follows at
June 30, 2007 and December 31, 2006:
June 30, December 31,
2007 2006
Deferred tax asset:
Deferred noncurrent tax asset
$ 14,666 $12,592
Valuation allowance
(14,666) (12,592)
Total $ - $ -
The components of Income Tax expense are as follows:
June 30, June 30,
2007 2006
Current Federal Tax
- -
Current State Tax
- -
Change in NOL benefit
(2,074) (1,029)
Change in Allowance
2,074 1,029
_ _
$ - $ -
NOTE 4 - NOTE PAYABLE RELATED PARTY
The Company has issued several promissory notes to various
corporations whose officers and/or directors are shareholders of
the Company. The notes are unsecured, bear an interest rate of
10% per annum and are due and payable on demand. At June 30,
2007, the accrued interest associated with the various notes was
$17,477.
Cygni Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2007
NOTE 4 - NOTE PAYABLE RELATED PARTY (continued)
June 30, December 31,
2007 2006
The Company has the following note payable obligations:
Related party notes payable due on demand, accruing
interest at a rate of 10% per annum
$ 31,563 $ 31,563
Totals $ 31,563 $ 31,563
Less Current Maturities (31,563)
(31,563)
Total Long-Term Notes Payable
$ - $ -
Following are maturities of long-term debt for each of the next
five years:
Year Amount
2007 $ 31,563
2008 -
2009 -
2010 -
2011 -
Thereafter -
Total $ 31,563
NOTE 5 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern
which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. Currently, the
Company has no cash or other material assets, nor does it have an
established source of revenues sufficient to cover any
anticipated operating costs to allow it to continue as a going
concern. It is the intent of the Company to find additional
capital funding and/or a profitable business venture to acquire
or merge.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION
The Company is a development stage company. Since its inception,
the Company has had no operations. The Company was organized for
the purpose of engaging in any lawful activity permitted under
Nevada state law; however, the Company does not have any
significant cash or other material assets, nor does it have an
established source of revenues sufficient to cover operating
costs and to allow it to continue as a going concern. The
Company intends to take advantage of any reasonable business
proposal presented which management believes will provide the
Company and its stockholders with a viable business opportunity.
The board of directors will make the final approval in
determining whether to complete any acquisition, but may submit
the proposal to the shareholders for final approval.
The original shareholders contributed a total of $7,715 in cash
and $2,285 in services as capital contributions for stock of the
Company. Since inception the Company has borrowed funds from
corporations related to the Company for operating expenses.
Management estimates that the cash requirements for the year
ending December 31, 2007, will be approximately $5,000, if no
change in operations occurs during the year. Management
anticipates that any additional needed funds will be loaned to
the Company on the same or similar terms as those of other loans
to the Company. There are no agreements with any of the
companies and no assurance that all or a portion of these funds
will be loaned to the Company. If the Company is unable to
borrow such funds, management will seek other sources of funding
which are currently unknown to management. There is no assurance
that such funding would be available or that if it is made
available, it could be obtained on terms favorable to the
Company.
The investigation of specific business opportunities and the
negotiation, drafting, and execution of relevant agreements,
disclosure documents, and other instruments will require
substantial management time and attention and will require the
Company to incur costs for payment of accountants, attorneys, and
others. If a decision is made not to participate in or complete
the acquisition of a specific business opportunity, the costs
incurred in a related investigation will not be recoverable.
Further, even if an agreement is reached for the participation in
a specific business opportunity by way of investment or
otherwise, the failure to consummate the particular transaction
may result in a loss to the Company of all related costs
incurred.
Currently, management is not able to determine the time or
resources that will be necessary to locate and acquire or merge
with a business prospect. There is no assurance that the Company
will be able to acquire an interest in any such prospects,
products, or opportunities that may exist or that any activity of
the Company, regardless of the completion of any transaction,
will be profitable. If and when the Company locates a business
opportunity, management of the Company will give consideration to
the dollar amount of that entity's profitable operations and the
adequacy of its working capital in determining the terms and
conditions under which the Company would consummate such an
acquisition. Potential business opportunities, no matter which
form they may take, will most likely result in substantial
dilution for the Company's shareholders due to the likely
issuance of stock to acquire such an opportunity.
Off-Balance Sheet Arrangements
Management does not believe the Company has any off-balance sheet
arrangements that have, or are reasonable likely to have, a
current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures, or capital resources which would
be material to investors.
ITEM 3. CONTROLS AND PROCEDURES
Evaluation of disclosure and controls and procedure
The principal executive officer and principal financial officer,
Carl Suter, has concluded, based on his evaluation, as of the end
of the period covered by this report, that the Company's
disclosure controls and procedures (as defined in Rule 13a-15(e)
under the Exchange Act) are (1) effective to ensure that material
information required to be disclosed by us in reports filed or
submitted by us under the Exchange Act is recorded, processed,
summarized, and reported within the time periods specified in the
rules and forms of the Securities and Exchange Commission, and
(2) effective to ensure that information required to be disclosed
by us in such reports filed or submitted by the Company under the
Exchange Act is accumulated and communicated to management of the
Company, including the principal executive officer, to allow
timely decisions regarding required disclosure.
Changes in internal controls
During the last quarter ended June 30, 2007, there were no
changes in the Company's internal control over financial
reporting that have materially affected, or are reasonably likely
to materially affect, the Company's internal control over
financial reporting.
It should be noted that any system of controls, however well
designed and operated, can provide only reasonable and not
absolute assurance that the objectives of the system will be met.
In addition, the design of any control system is based in part
upon certain assumptions about the likelihood of future events.
Because of these and other inherent limitations of control
systems, there is only reasonable assurance that our controls
will succeed in achieving their stated goals under all potential
future conditions.
PART II
OTHER INFORMATION
ITEM 6. EXHIBITS
Exhibits.
31.1 Rule 13a-14(a) Certification by Principal Executive Officer
31.2 Rule 13a-14(a) Certification by Principal Financial Officer
32 Section 1350 Certification of Principal Executive Officer
and Principal Financial Officer
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
Cygni Investments, Inc.
Date: August 13, 2007 By:
/s/ Carl Suter
Carl Suter, President and Treasurer
(Principal Executive Officer and Principal Financial and
Accounting Officer)