We have limited operations and are not currently generating any revenues from
our business operations. Our independent registered public accounting firm has
issued a going concern opinion for the year ended December 31, 2020. This means
that our auditors believe there is substantial doubt that we can continue as an
on-going business for the next 12 months. We do not anticipate generating
significant revenues until we acquire a business, are acquired by an existing
business or develop a business organically. Accordingly, we must raise
additional cash from sources other than operations.
We presently are exploring other such sources of funding, including raising
funds through a public offering, a private placement of securities, debt or a
combination of the foregoing. If we are unable to raise additional capital, we
will either have to suspend operations until we do raise the cash or cease
operations entirely.
The following discussion should be read in conjunction with our Financial
Statements and the notes thereto and the other information included in this
Annual Report as filed with the SEC on Form 10-K.
Overview
Our original business plan was to become a commercial FM radio broadcaster.
Subsequently, following a change in control, we changed our business plan and
intended to become a medical and spa company with a focus on Asia. However,
after consultation with our professional and business advisors in the United
States and the People's Republic of China, management decided during the third
quarter of 2014 that this would no longer be our plan of operations. Our plan of
operations is to evaluate various industries, and geographic and market
opportunities. This may take the form of acquiring a business, being acquired by
an existing business or developing a business organically. Any such efforts may
require significant capital, which we currently lack. There is no assurance that
any such opportunity will become available. There is also no assurance that, if
any opportunity becomes available, we will have the financial and other
resources available to take advantage of such opportunity, since we have
extremely limited liquidity. Through September 30, 2021, we had no revenues or
operations.
Results of Operations
The Three and Nine Months Ended September 30, 2021 Versus Three and Nine Months
Ended September 30, 2020
Revenues. As of September 30, 2021, we had not generated any revenues.
Operating Expenses. For the three months ended September 30, 2021, total
operating expenses amounted to $9,320 as compared to $6,565 for the three months
ended September 30, 2020, an increase of $2,755 or 42.0%. For the nine months
ended September 30, 2021, total operating expenses amounted to $30,318 as
compared to $25,516 for the nine months ended September 30, 2020, an increase of
$4,802 or 18.8%. Since inception, our operating expenses primarily consisted of
fees and expenses related to complying with our ongoing SEC reporting
requirements, which have consisted of accounting fees, transfer agent fees, and
filing fees etc.
Other expenses. During the three months ended September 30, 2021 and 2020, we
recorded $6,154 and $5,395, respectively, in imputed interest expenses related
to advances outstanding to related party. During the nine months ended September
30, 2021 and 2020, we recorded $17,638 and $16,134, respectively, in imputed
interest expenses related to advances outstanding to related party. These
imputed interests were recorded in our financial statements under additional
paid-in capital.
Net Loss. During the three months ended September 30, 2021 and 2020, we had a
net loss of $15,474 and $11,960, respectively. During the nine months ended
September 30, 2021 and 2020, we had a net loss of $47,956 and $41,650,
respectively.
Liquidity and Capital Resources
As of September 30, 2021, we had $24,381 in cash, while, we had liabilities of
$323,869, and had a working capital deficit of $288,821. We expect to incur
continued losses during 2021, possibly even longer.
For the nine months ended September 30, 2021 and 2020, net cash used in
operating activities amounted to $37,323 and $28,540, respectively. We expect to
require working capital of approximately $50,000 over the next 12 months to meet
our financial obligations.
For the nine months ended September 30, 2021 and 2020, net cash provided by
financing activities amounted to $55,762 and $28,540, respectively. For the nine
months ended September 30, 2021, we received proceeds from loans from officer of
$37,513 and received proceeds from sale of common stock of $24,000, offset by
repayment made for loans from officer of $5,751. For the nine months ended
September 30, 2020, we received proceeds from loans from officer of $28,540,
received proceeds from sale of common stock of $29,411, offset by repayment made
for loans from officer of $29,411.
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We have not generated any revenues from operations to date. It is not likely
that we will generate any revenue until at least a business combination has been
consummated. Even following a business combination, there is no guarantee that
any revenues will be generated or that any revenues will be sufficient to meet
our expenses. We may consider a business combination with a target company which
itself has recently commenced operations, is a developing company in need of
additional funds for expansion into new products or markets, is seeking to
develop one or more new products or services, or is an established business
which may be experiencing financial or operating difficulties and is in need of
additional capital.
The foregoing considerations raise substantial doubt about our ability to
continue as a going concern. We are currently planning on devoting the vast
majority of our efforts to identifying, investigating and conducting due
diligence on target companies; and negotiating, structuring, documenting and
consummating a business combination. Our long-term ability to continue as a
going concern is dependent upon our ability to develop additional sources of
capital, complete a business combination and, thereafter, achieve profitable
operations.
We believe that we will be able to meet these costs through cash on hand and
additional amounts, as may be necessary, to be loaned by or invested in us by
our stockholders, management and/or others. Currently, however, our ability to
continue as a going concern is dependent upon our ability to generate future
profitable operations and/or to obtain the necessary financing to meet our
obligations and repay our liabilities arising from normal business operations
when they come due. Our ability to continue as a going concern is also
dependent on our ability to find a suitable target company and enter into a
business combination. Management's plan includes obtaining additional funds
through a combination of sales of our equity securities before,
contemporaneously with, or following, the consummation of a business
combination; and borrowings, although we do not believe that we will be eligible
to borrow funds from a bank until at least a business combination is
consummated. However, there is no assurance that any additional funding will be
available on terms that are favorable to us or at all.
We currently rely on loans from our sole director and officer, Qiuping Lu. There
is no guarantee that Ms. Lu will continue to lend us funds to meet our expenses
in the future. Currently, we do not have any other arrangements for financing.
We have no assurance that future financing will be available to us on
acceptable terms, or at all. If financing is not available to us on satisfactory
terms or at all, we may be unable to develop operations or meet our expenses.
Additionally, any equity financing in which we might engage would result in
dilution to our existing shareholders.
During the nine months ended September 30, 2021 and 2020, Ms. Lu, the sole
director and officer of us, advanced an aggregate $37,513 and $28,540,
respectively, to us to pay some of our expenses and for working capital
purposes, and we repaid $5,751 and $29,411, respectively, to Ms. Lu. These
advances in the aggregate amounts of $312,869 and $281,107, respectively, at
September 30, 2021 and December 31, 2020, are payable on demand and are
reflected as related party loans on the accompanying balance sheets.
Imputed interest of $6,154 and $5,395 was recorded for the three months ended
September 30, 2021 and 2020, respectively, and the imputed interest was recorded
as interest expense and an increase in additional paid-in capital, respectively.
Imputed interest of $17,638 and $16,134 was recorded for the nine months ended
September 30, 2021 and 2020, respectively, and the imputed interest was recorded
as interest expense and an increase in additional paid-in capital, respectively.
Going Concern Consideration
Our independent registered public accounting firm has issued a going concern
opinion in their audit report dated February 17, 2021, which can be found in our
Annual Report on Form 10-K filed with the SEC on February 17, 2021. This means
that our auditors believe there is substantial doubt that we can continue as an
on-going business for the next 12 months. Our financial statements found within
this Quarterly Report on Form 10-Q and the aforementioned Annual Report on Form
10-K contain additional note disclosures describing the circumstances that lead
to this disclosure by our independent auditors.
Contractual Obligations
As of September 30, 2021, we had no contractual obligations.
Off -Balance Sheet Operations
As of September 30, 2021, we had no off-balance sheet activities or operations.
Critical Accounting Policies
Please refer to Note 2 - Summary of Significant Accounting Policies of our
financial statements accompanying this report.
Recently Issued Accounting Pronouncement
For details of applicable new accounting standards, please, refer to Recent
Accounting Pronouncements in Note 2 of our financial statements accompanying
this report.
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