Item 1
. Financial Statements
SICHUAN LEADERS PETROCHEMICAL COMPANY
BALANCE SHEETS
As of September 30, 2016
(unaudited)
and December 31, 2015
(All amounts shown in U.S. Dollars)
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September 30,
2016
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December 31,
2015
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(unaudited)
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ASSETS
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|
|
|
|
|
|
Current Assets:
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|
|
|
|
|
|
Cash and Cash Equivalents
|
|
$
|
28,769
|
|
|
$
|
68,381
|
|
Prepaid Expenses
|
|
|
7,649
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|
|
|
3,849
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|
Total Current Assets
|
|
|
36,418
|
|
|
|
72,230
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|
Total Assets:
|
|
|
36,418
|
|
|
|
72,230
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|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
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Current Liabilities:
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|
|
|
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|
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Accounts Payable
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|
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5,989
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|
|
|
66
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|
Interest Payable
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|
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15,613
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|
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8,263
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|
Loans from Shareholder
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110,000
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|
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110,000
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|
Total Current Liabilities
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|
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131,602
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|
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|
118,329
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|
Total Liabilities
|
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131,602
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|
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|
118,329
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|
|
|
|
|
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Stockholders' Equity:
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|
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|
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Common Stock; $0.01 per share par value; 5,000,000,000 shares authorized; and
30,755,000 and 30,755,000 issued and outstanding at September 30, 2016 and
December 31, 2015, respectively.
|
|
|
307,550
|
|
|
|
307,550
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|
Additional Paid in Capital
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|
|
(68,566
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)
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|
|
(68,566
|
)
|
Accumulated Deficit
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|
|
(334,168
|
)
|
|
|
(285,083
|
)
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Total Stockholders’ Deficit
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|
|
(95,184
|
)
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|
|
(46,099
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)
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|
|
|
|
|
|
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Total Liabilities and Stockholders' Deficit
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$
|
36,418
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$
|
72,230
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The accompanying notes are an integral part of these unaudited financial statements.
SICHUAN LEADERS PETROCHEMICAL COMPANY
STATEMENTS OF OPERATIONS
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Nine Months Ended
September 30,
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Three Months Ended
September 30,
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|
|
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2016
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2015
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2016
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2015
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|
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(unaudited)
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(unaudited)
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|
(unaudited)
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(unaudited)
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Revenue:
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$
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-
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$
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-
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$
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-
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$
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-
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|
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Operating Expenses:
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General and Administrative - Related Party
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17,968
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31,935
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5,989
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3,921
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|
General and Administrative
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23,767
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19,706
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7,120
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6,391
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|
Operations Loss
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(41,735
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)
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|
(51,641
|
)
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|
(13,109
|
)
|
|
|
(10,312
|
)
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|
|
|
|
|
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Other Income (Expense)
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Interest Expense – Related Party
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(7,350
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)
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(5,795
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)
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2,468
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|
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(2,469
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)
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Net Loss
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(49,085
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)
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(57,436
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)
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(15,577
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)
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(12,781
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)
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Basic and Diluted Net (Loss) per share:
|
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(0.00
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)
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(0.00
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)
|
|
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(0.00
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)
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|
|
(0.00
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)
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Weighted average number of shares outstanding; Basic and Diluted
|
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30,755,000
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|
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30,755,000
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|
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30,755,000
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|
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30,755,000
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|
The accompanying notes are an integral part of these unaudited financial statements.
SICHUAN LEADERS PETROCHEMICAL COMPANY
STATEMENTS OF CASH FLOWS
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Nine Months Ended
September 30,
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2016
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2015
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(unaudited)
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(unaudited)
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Cash Flows from Operating Activities:
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|
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Net Loss
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|
$
|
(49,085
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)
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|
$
|
(57,436
|
)
|
Adjustments to reconcile net loss to net cash (used in) provided by operations:
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Changes in Operating Assets and Liabilities:
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Accounts Payable
|
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5,923
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|
|
|
2,000
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Accrued Expenses: Interest Payable
|
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|
7,350
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|
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|
-
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Prepaid Expenses
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|
|
(3,800
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)
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|
|
(2,062
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)
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Net Cash Flows Used in Operating Activities:
|
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|
(39,612
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)
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(57,498
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)
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C
ash Flows from Financing Activities:
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Loans from (to) Related Party
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-
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110,000
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Net Cash Provided by Financing Activities
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-
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110,000
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Change in Cash and Cash Equivalents:
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(39,612
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)
|
|
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52,502
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Cash and Cash Equivalents, Beginning of Period
|
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68,381
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23,092
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Cash and Cash Equivalents, End of Period
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$
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28,769
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$
|
75,594
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Supplemental Cash Flow Information:
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Cash paid for interest
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-
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-
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Cash paid for taxes
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|
-
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|
|
-
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|
The accompanying notes are an integral part of these unaudited financial statements.
SICHUAN LEADERS PETROCHEMICAL COMPANY
NOTES TO FINANCIAL STATEMENTS
For the Nine Months Ended September 30, 2016 and 2015
(Unaudited)
NOTE 1.
NATURE OF
BUSINESS
Organization
Sichuan Leaders Petrochemical Company (“we,” “us,” “our” or the “Company”), formally known as Quality Wallbeds, Inc., was incorporated under the laws of the State of Florida on June 29, 2000. From our inception through May 2013, we have provided quality space saving custom home furniture and closet organizing systems to the general public. We offered our services to people and companies needing assistance in the organization of their living/work space. In May 2013, our Board of Directors (the “Board”) determined that to continue to protect and increase shareholder value, it would be to the advantage, welfare and best interests of our shareholders to consider alternative corporate strategies to generate new business revenue for the Company. The Board proposed that we pursue opportunities in Asia to acquire companies in the wholesale and resale of products in the automotive oil industry. To facilitate this action, the Board voted to dispose of all of our assets related to the retail operation of the wall bed products. This action was approved on May 21, 2013 by shareholders representing 87% of our issued and outstanding shares of common stock.
NOTE 2. GOING CONCERN
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company had no ongoing business or other source of income and incurred a net loss of ($49,085) for the nine month period ended September 30, 2016. These factors raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time.
The Company is currently evaluating acquisitions and other business opportunities. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. No assurance can be given that the Company will be successful in these efforts.
NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included. In the opinion of management there have been no changes to the Company’s significant accounting policies, referred to in the audited consolidated financial statements and footnotes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, filed March 1, 2016. All Amounts referenced in these Financial Statements and this Report are in US Dollars unless otherwise stated.
In the opinion of management, all adjustments consisting of normal recurring adjustments necessary for a fair statement of (a) the result of operations for the nine month period ended September 30, 2016 and 2015; (b) the financial position at September 30, 2016; and (c) cash flows for the nine month period ended September 30, 2016 and 2015, have been made. Management believes that these estimates are reasonable and have been discussed with the Board of Directors; however, actual results could differ from those estimates. Operating results for the nine month period ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ended December 31, 2016.
NOTE 4
.
COMMITMENTS AND CONTINGENCIES
Related Party
The controlling shareholders have pledged support to fund continuing operations, as necessary. From time to time, the Company is dependent upon the continued support of these parties, through temporary advances or through arrangements of their personal credit. However, there is no written commitment to this effect.
Commencing January 1, 2016, the company renewed the one year agreement with AF Ocean Investment Management Company to provide management services to the Company. The Company pays AF Ocean Investment Management Company $1,996 per month.
The amounts and terms of the above transactions may not necessarily be indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent third parties.
The Company does not have employment contracts with its key employees, including the officers of the Company.
Leases And Facility
Our office is located at 3904 US Hwy 301 N Ellenton, FL 34222. The office space is rented by the Service Provider, and the Company pays a monthly management fee to them for services provided which includes the company’s rent. We share the office with the Service Provider and ChinAmerica Andy Movie Entertainment Media Co. The service provider pays rent in the amount of $400 per month.
NOTE 5. SUBSEQUENT EVENTS
On May 31, 2017, the Company entered into a transactional agreement with VentureVest Capital (VentureVest) in a consulting capacity to assist in bringing the Company’s delinquent filings current. VentureVest has offered to loan the Company an estimated amount of $19,000, and has agreed to accept promissory notes for each issuance of funds on the date the transfer of funds takes place. Furthermore, the Company has agreed that VentureVest will have the exclusive right to represent the Company and to locate a buyer for the common stock owned by Mr. Fan.
On May 31, 2017, VentureVest has agreed to accept the 1
st
convertible Promissory Note for the total amount of $6,000. These convertible promissory notes will be issued at a rate of $0.05 per share.
On November 10, 2016, Chairman Andy Fan agreed to accept shares in the amount of 12,670,000 in exchange for cancelling the debt totaling $126,700 which includes $110,000 plus interest of $16,700, incurred commencing in February, 2015.
ITEM 2
. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of financial condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in this report. This discussion contains forward-looking statements that involve risks, uncertainties and assumptions. See “Cautionary Note Regarding Forward-Looking Statements.” Our actual results could differ materially from those anticipated in the forward-looking statements as a result of certain factors discussed elsewhere in this report.
Overview
Sichuan Leaders Petrochemical Company (“we,” “us,” “our” or the “Company”) was incorporated in the State of Florida on June 29, 2000 under the name Quality Wallbeds, Inc. In December 2012, we changed our name in anticipation of new business opportunities. From our inception through May 2013, we provided quality space saving custom home furniture and closet organizing systems to the general public. We discontinued our wall bed operations on May 21, 2013.
We are exploring various opportunities, including the petrochemical field, to determine our best strategic business direction. Since the change in the business model, current management has seen a direct impact on our revenues. Future cash flows, if any, are impossible to predict at this time. We may raise cash from sources other than our operations. Our only other source for cash at this time is investments by others in the Company or our sole director and executive officer, Andy Z. Fan. Any change in our strategic business direction may take years to complete and future cash flows, if any, are impossible to predict at this time.
Results of Operations
The following tables provide a comparison of a summary of our results of operations for the six and three month period ended September 30, 2016 and 2015
Results of Operations for the Nine month period Ended September 30, 2016 and 2015.
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|
Nine Months Ended
September 30,
|
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
% Change
|
|
Revenue
|
|
$
|
-
|
|
|
|
|
|
|
0
|
%
|
General and Administrative Expense – Related Party
|
|
|
17,968
|
|
|
|
31,935
|
|
|
|
44
|
%
|
General and Administrative Expense
|
|
|
23,767
|
|
|
|
19,706
|
|
|
|
-21
|
%
|
Loss from Operations
|
|
|
(41,735
|
)
|
|
|
(51,641
|
)
|
|
|
20
|
%
|
Other Income and (Expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense – Related Party
|
|
|
(7,350
|
)
|
|
|
(5,795
|
)
|
|
|
-27
|
%
|
Net Loss
|
|
$
|
(49,085
|
)
|
|
|
(57,436
|
)
|
|
|
15
|
%
|
Revenue from Operations
For the nine month period ended September 30, 2016 and September 30, 2015, total revenue was $0 as we have not commenced revenue generating operations following the discontinuance of our Florida wall bed operation in May 2013.
General and Administrative Expenses
– Related Party
For the nine month period ended September 30, 2016 and September 30, 2015, related party operating expenses were $17,968 and $31,935, respectively. The decrease in expenses between the two periods is directly related to the reduction of management fees paid to the Service Provider. Due to the nominal work load needed by the Service Provider the contract was renewed on January 1, 2016, and both parties agreed the management fee would be reduced to $1,996 per month as compared to $6,350 per month during the nine month period ended September 30, 2015.
General and Administrative Expenses
For the nine month period ended September 30, 2016 and September 30, 2015, general and administrative expenses were $23,767 and $19,706, respectively, which consist of those expenses related to the current operations of the Company. The increase in expenses between the two periods related to an increase in our costs to file our periodic reports via EDGAR, and our increase in auditor fees.
Net Income (Loss)
As a result of the factors described above, there was a net loss of ($49,085) and ($57,436) for the nine month period ended September 30, 2016 and 2015, respectively.
Results of Operations for the Three Month Period Ended September 30, 2016 and 2015.
|
|
Three Months Ended
September 30,
|
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
% Change
|
|
Revenue
|
|
$
|
-
|
|
|
|
|
|
|
0
|
%
|
General and Administrative Expense – Related Party
|
|
|
5,989
|
|
|
|
3,921
|
|
|
|
53
|
%
|
General and Administrative Expense
|
|
|
7,120
|
|
|
|
6,391
|
|
|
(12
|
%)
|
Loss from Operations
|
|
|
(13,109
|
)
|
|
|
(10,312
|
)
|
|
|
28
|
%
|
Other Income and (Expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense – Related Party
|
|
|
2,468
|
|
|
|
(2,469
|
)
|
|
|
2
|
%
|
Net Loss
|
|
$
|
(15,577
|
)
|
|
|
(12,781
|
)
|
|
|
-22
|
%
|
Revenue from Operations
For the three month period ended September 30, 2016 and September 30, 2015, total revenue was $0 as we have not commenced revenue generating operations following the discontinuance of our Florida wall bed operation in May 2013.
General and Administrative Expenses
– Related Party
For the three month period ended September 30, 2016 and September 30, 2015, related party operating expenses were $5,989 and $3,921, respectively. The increase in expenses between the two periods is directly related to the increase in auditor costs.
General and Administrative Expenses
For the three month period ended September 30, 2016 and September 30, 2015, general and administrative expenses were $7,120 and $6,391, respectively, which consist of those expenses related to the current operations of the Company.
Net Income (Loss)
As a result of the factors described above, there was a net loss of ($15,577) and ($12,781) for the three month period ended September 30, 2016 and 2015, respectively.
Liquidity and Capital Resources
General.
At September 30, 2016, we had cash and cash equivalents of $28,769. We have historically met our cash needs through cash flows from operating activities. However, since the discontinuation of our Florida wall bed operation the controlling shareholders have pledged to continue their support to fund the continuing operations, as necessary. Our cash requirements are generally for general and administrative activities. We have raised capital through officer loans during the previous fiscal year. We believe that our cash balance is not sufficient to finance our cash requirements for expected operational activities, capital improvements and therefore we will require additional funding through officer loans.
In the event we are unable to generate sufficient funds to continue our business efforts or if we are pursued by a larger company for a business combination, we will analyze all strategies to continue the Company and maintain or increase shareholder value. Under these circumstances, we would consider a merger, acquisition, joint venture, strategic alliance, a roll-up, or other business combination for the purposes of continuing the business and maintaining or increasing shareholder value. Management believes its responsibility to maintain shareholder value is of paramount importance, which means we should consider the aforementioned alternatives in the event funding is not available on favorable terms to us when needed.
Operating activities
Our continuing operating activities used cash of ($39,612) and $57,498 for the nine month period ended September 30, 2016 and 2015, respectively.
Investing Activities
We neither generated nor used funds in continuing investing activities during the nine month period ended month period ended September 30, 2016 or 2015.
Financing activities
Cash provided in our financing activities was $0 for the nine month period ended September 30, 2016, compared to cash provided of $110,000 during the comparable period in 2015. During the nine month period ended September 30, 2015, the majority shareholder loaned the company $110,000, that has since been repaid.
Going Concern
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We had no ongoing business or other source of income and incurred a net loss of ($49,085) for the nine month period ended September 30, 2016. Due to the Company’s limited liquid resources, recurring losses from operations and the Company’s need to raise additional capital, all raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.
We are currently evaluating acquisitions and other business opportunities. The ability to continue as a going concern is dependent upon us generating profitable operations in the future and/or obtaining the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due. No assurance can be given that we will be successful in these efforts.
Inflation
Inflation does not materially affect our business or the results of our operations.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements.
Critical Accounting Policies
We prepare our financial statements in accordance with generally accepted accounting principles of the United States (“GAAP”). GAAP represents a comprehensive set of accounting and disclosure rules and requirements. The preparation of our financial statements 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 period. Our actual results could differ from those estimates. We use historical data to assist in the forecast of our future results. Deviations from our projections are addressed when our financials are reviewed on a monthly basis. This allows us to be proactive in our approach to managing our business. It also allows us to rely on proven data rather than having to make assumptions regarding our estimates.
Recent Accounting Pronouncements
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company financial statements.