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 September 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 November 14,
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 September 30, 2007, and the
results of its operations and changes in its financial position from
November 17, 1999, through September 30, 2007, have been made. The
results of its operations for such interim period are not necessarily
indicative of the results to be expected for the entire year. These
condensed financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's
annual report on Form 10-KSB for the year ended December 31, 2006.
Cygni Investments, Inc.
(A Development Stage Company)
Balance Sheets
(Unaudited)
September December
30, 2007 31, 2006
Assets
Current Assets
Cash $ - $ -
Total Current Assets $ - $ -
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable $ 39,680 $ 35,847
Interest Payable 18,266 15,899
Note Payable - Related Party 31,563 31,563
Total Current Liabilities 89,509 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 (99,509) (93,309)
Total Stockholders' Equity (Deficit) (89,509) (83,309)
Total Liabilities and Stockholders' Equity $ - $ -
Cygni Investments, Inc.
(A Development Stage Company)
Statements of Operations
(Unaudited)
For the Period
November
17, 1999
(Inception)to
For the Three Months Ended For the Nine Months Ended September 30,
September 30, September 30, September 30, September30, 2007
2007 2006 2007 2006
Revenue
$ - $ - $ - $ - $ -
Expenses
General & Administrative
950 4,314 3,833 5,283 80,994
Total Expenses
950 4,314 3,833 5,283 80,994
Income (Loss) from Operations
(950) (4,314) (3,833) (5,283) (80,994)
Other Income (Expenses)
Interest Expense
(789) (789) (2,367) (1,578) (18,515)
Total Other Income (Expenses)
(789) (789) (2,367) (1,578) (18,515)
Net Income (Loss)
Before Taxes
(1,739) (5,103) (6,200) (6,861) (99,509)
Taxes
- - - - -
Net Income (Loss)
$(1,739) $(5,103) $(6,200) $(6,861) (99,509)
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)
For the Period
November
17, 1999
(Inception)to
For the Nine Months Ended
September 30, September 30,
2007 2006
Cash Flows from Operating Activities
Net Loss
$(6,200) $(6,861) $(99,509)
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Stock Issued for Services
- - 2,285
Increase (Decrease) in Accounts Payable
3,833 5,283 39,680
Increase (Decrease) in Interest Payable
2,367 1,578 18,266
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
September 30, 2007
NOTE 1 - CORPORATE HISTORY
Cygni Investments, Inc. (the Company) was incorporated in Nevada on
November 17, 1999, 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
September 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
September 30,
2007 2006
Basic Earnings per share:
Income (loss) (numerator) $(1,739) $ (5,103)
Shares (denominator) 500,001 500,001
Per share amount $ (.00) $ (.01)
For the Nine Months Ended
September 30,
2007 2006
Basic Earnings per share:
Income (loss) (numerator) $(6,200) $ (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
Instruments an amendment of FASB Statements No. 133 and 140 (SFAS No.
155). This Statement permits fair value of remeasurement for any
hybrid financial instrument that contains an embedded derivative that
otherwise would require bifurcation; clarifies which interest-only
strips and principal-only strips are not subject to the requirements
of SFAS No. 133, Accounting for Derivative Instruments and Hedging
Activities; establishes a requirement to evaluate interests in
securitized financial assets to identify interests that are
freestanding derivatives or that are hybrid financial instruments that
contain an embedded derivative requiring bifurcation; clarifies that
concentrations of credit risk in the form of subordination are not
embedded derivatives; and amended SFAS No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities, to eliminate the prohibition on a qualifying
special-purpose entity from holding a derivative financial instrument
that pertains to a beneficial interest other than another derivative
financial instrument. SFAS No. 155 is effective for all financial
instruments acquired, issued, or subject to a remeasurement (new
basis) event occurring after the beginning of an entity's first fiscal
year that begins after September 15, 2006. The Company believes the
adoption of the provisions of SFAS No. 154 will not have a material
impact on the financial statements.
In March 2006, FASB issued SFAS No. 156, "Accounting for Servicing of
Financial Assets which amends FAS No. 140, Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities"
("SFAS No. 156"). In a significant change to current guidance, SFAS
No. 156 permits an entity to choose either of the following subsequent
measurement methods for each class of separately recognized servicing
assets and servicing liabilities: (1) Amortization Method or (2) Fair
Value Measurement Method. SFAS No. 156 is effective as of the
beginning of an entity's first fiscal year that begins after September
15, 2006. The Company believes the adoption of the provisions of SFAS
No. 154 will not have a material impact on the financial statements.
In June 2006 FASB issued Financial Accounting Standards Interpretation
No. 48, Accounting for Uncertainty in Income Taxes (FIN 48). FIN 48
clarifies the accounting for uncertainty in income taxes recognized in
an enterprises' financial statements in accordance with SFAS No. 109,
Accounting for Income Taxes ("SFAS No. 109"). FIN 48 prescribes a
recognition threshold and measurement attributable for the financial
statement recognition and measurement of a tax position taken or
expected to be taken in a tax return. FIN 48 also provides guidance on
derecognition, classification, interest and penalties, accounting in
interim periods, disclosures and transitions. FIN 48 is effective for
fiscal years beginning after December 15, 2006. The Company is
currently reviewing the effect, if any, FIN 48 will have on its
financial position.
In September 2006, the Securities and Exchange Commission (SEC) staff
issued Staff Accounting Bulletin No. 108, Considering the Effects of
Prior Year Misstatements when Quantifying Misstatements in Current
Year Financial Statements (SAB No. 108). SAB No. 108 was issued to
provide consistency in how registrants quantify financial statement
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 September 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
September 30, 2007
NOTE 3 -INCOME TAXES (continued)
The Company has cumulative net operating loss carryforwards of
approximately $98,000 at September 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 September 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
September 30, 2007 and December 31, 2006:
September 30, December 31,
2007 2006
Deferred tax asset:
Deferred noncurrent tax asset $ 14,926 $ 12,592
Valuation allowance (14,926) (12,592)
Total $ - $ -
The components of Income Tax expense are as follows:
September 30, September 30,
2007 2006
Current Federal Tax - -
Current State Tax - -
Change in NOL benefit (2,334) (1,794)
Change in Allowance 2,334 1,794
$ - $ -
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 September 30, 2007, the
accrued interest associated with the various notes was $18,266.
Cygni Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 2007
NOTE 4 - NOTE PAYABLE RELATED PARTY (continued)
September 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 September 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: November 15, 2007 By: /s/ Carl Suter
Carl Suter, President and
Treasurer (Principal Executive
Officer and Principal
Financial and Accounting
Officer)