Forward Looking Statements

This section and other parts of this Form 10-K/A annual report includes "forward-looking statements", that involves risks and uncertainties. All statements other than statements of historical facts, included in this Form 10-K/A that address activities, events, or developments that we expect or anticipate will or may occur in the future, including such things as future capital expenditures (including the amount and nature thereof), business strategy and measures to implement strategy, competitive strength, goals, expansion and growth of our business and operations, plans, references to future success, reference to intentions as to future matters, and other such matters are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments as well as other factors that we believe are appropriate in the circumstances. However, whether actual results and developments will conform to our expectations and predictions is subject to a number of risks, uncertainties, and other factors, many of which are beyond our control.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Moreover, we do not assume responsibility for the accuracy and completeness of such forward-looking statements. We are under no duty to update any of the forward-looking statements after the date of this report to conform such statements to actual results.





Overview

Cannonau Corp. (the "Company", "we", or "us") was incorporated under the laws of the State of Nevada on April 3, 2007. The purpose of the Company is to serve as a vehicle to effect a merger, exchange of capital stock, asset acquisition, or other business combination with a domestic or foreign private business. The company has minimal operation. The Company has a December 31 year end. As of December 31, 2021, the issued and outstanding shares of common stock totaled 241,815,632.

Certain statements contained below are forward-looking statements (rather than historical facts) that are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.




We are considered a start-up corporation. Our auditors have issued a going
concern opinion in the financial statements for the year ended December 31,
2021.



RESULTS OF OPERATIONS



Working Capital



                           December 31,     December 31,
                               2021             2020
Current Assets                $    8,757       $    19,338
Current Liabilities              261,043           168,159
Working Capital (Deficit)   $   (252,286 )   $    (148,821 )



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Cash Flows



                                                December 31,      December 31,
                                                    2021              2020

Cash Flows from (used in) Operating Activities $ (136,724) $ (80,628) Cash Flows from (used in) Financing Activities 136,702

           80,722

Net Increase (decrease) in Cash During Period $ 21 $ 94

YEAR ENDED DECEMBER 31, 2021 COMPARED TO YEAR ENDED DECEMBER 31, 2020





REVENUES

We have generated revenues of $6,180 and $1,835 for the years ended December 31, 2021 and 2020.

OPERATIONS AND ADMINISTRATIVE EXPENSES

Operating expenses for the year ended December 31, 2021 were $150,050 compared with $86,788 for the year ended December 31, 2020. The increase in operating expenses for 2021 consisted of an increase in general and administrative expenses for the year ended December 31, 2021of $26,065 from $13,932 for the year ended December 31, 2020; a decrease in compensation and benefits to $49,468 for the year ended December 31, 2021 from $60,680 for the year ended December 31, 2020; and an increase in legal and professionals of $29,344 from $12,176 for the year ended December 31, 2020 and an increase of consultancy services cost of $45,173 in the year ended December 31 2021 as compared to $0 in the year ended December 31, 2020.

During the year ended December 31, 2021, the Company recorded a net loss of $148,638, compared with net loss of $86,533 for the year ended December 31, 2020.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31, 2021, the Company's cash balance was $143 compared to cash balance of $164 as at December 31, 2020. As of December 31, 2021, the Company's total assets were $8,757 compared to total assets of $19,338 as at December 31, 2020. The decrease in total assets for the year ended December 31, 2021 as compared to the year ended December 31, 2020 consisted of reduction $21 in cash balance, an increase in accounts receivables of $5,032 and decrease in inventory for the year ended December 31, 2021 of $15,592 from $19,174 for the year ended December 31, 2020.

As of December 31, 2021, the Company had total liabilities of $261,043 compared with total liabilities of $168,159 at December 31, 2020. The increase in total liabilities for the year ended December 31, 2021 consisted of an increase in accounts payable for the year ended December 31, 2021 of $18,681 from $17,326 for the year ended December 31, 2020; and an increase in due to related party for the year ended December 31, 2021 of $91,529 from $150,833 for the year ended December 31, 2020.

As of December 31, 2021, the Company has a working capital of ($252,286) compared with working capital of ($148,821) at December 31, 2020.

Cashflow from Operating Activities

During the year ended December 31, 2021 the Company used ($136,724) of cash for operating activities compared to ($80,628) of cash used by operating activities during the year ended December 31, 2020. The increase in net cash used in operating activity for the year ended December 31, 2021 consisted of an increase in net loss for the year ended December 31, 2021 of $(148,638) from ($86,533) for the year ended December 31, 2020; an increase in account receivables of ($5,032); decrease in inventory for the year ended December 31, 2021 of $15,592 from ($8,130) for the year ended December 31, 2020; and an increase in accounts payable and accrued liabilities for the year ended December 31, 2021 of $1,355 from $14,035 for the year ended December 31, 2020.


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Cashflow from Financing Activities

During the years ended December 31, 2021 the Company's net cash provided by financing activity was $136,702 compared to $80,722 cash provided by financing for year ended December31, 2020. The increase in net cash provided by financing activity for the year ended December 31, 2021 consisted of an increase in proceeds from related party for the year ended December 31, 2021 of $91,529 (net) from $80,722 (net) for the year ended December 31, 2020; and an increase due to issuance of common stock for the year ended December 31, 2021of 45,173 from $0 for the year ended December 31, 2020.





Subsequent Developments



None



Going Concern

We have not attained profitable operations and are dependent upon the continued financial support from our shareholders, the ability to raise equity or debt financing, and the attainment of profitable operations from our future business. These factors raise substantial doubt regarding our ability to continue as a going concern.

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.





CONTRACTUAL OBLIGATIONS

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide this information.





CRITICAL ACCOUNTING POLICIES

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.





Stock Based Compensation

We account for share-based compensation at fair value. Stock based compensation cost for stock options granted to employees, board members and service providers is determined at the grant date using an option pricing model. The value of the award that is ultimately expected to vest is recognized as expensed on a straight-line basis over the requisite service period. During the year ended December 31, 2021 & 2020, no stock compensation was issued.

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