|
Condensed Statements of Cash Flows
|
|
(Expressed in US dollars)
|
|
|
|
Three months
ended
February 28,
2014
$
|
|
|
Three months
ended
February 28,
2013
$
|
|
|
Accumulated from September 14, 2010 (Date of Inception) to
February 28,
2014
$
|
|
|
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
(14,093
|
)
|
|
|
(19,316
|
)
|
|
|
(104,828
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment loss on mineral property
|
|
|
–
|
|
|
|
–
|
|
|
|
5,000
|
|
|
Expense paid by related party
|
|
|
–
|
|
|
|
–
|
|
|
|
3,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepaid expenses
|
|
|
–
|
|
|
|
1,095
|
|
|
|
–
|
|
|
Accounts payable and accrued liabilities
|
|
|
8,493
|
|
|
|
1,120
|
|
|
|
11,108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Cash Used In Operating Activities
|
|
|
(5,600
|
)
|
|
|
(17,101
|
)
|
|
|
(85,306
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of mineral property
|
|
|
–
|
|
|
|
–
|
|
|
|
(5,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Cash Used In Investing Activities
|
|
|
–
|
|
|
|
–
|
|
|
|
(5,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from related party
|
|
|
–
|
|
|
|
117
|
|
|
|
62,312
|
|
|
Repayments to related party
|
|
|
–
|
|
|
|
–
|
|
|
|
(7,711
|
)
|
|
Proceeds from issuance of common shares
|
|
|
–
|
|
|
|
–
|
|
|
|
50,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Cash Provided by Financing Activities
|
|
|
–
|
|
|
|
117
|
|
|
|
104,155
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in Cash
|
|
|
(5,600
|
)
|
|
|
(16,984
|
)
|
|
|
13,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash – Beginning of Period
|
|
|
19,449
|
|
|
|
41,878
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash – End of Period
|
|
|
13,849
|
|
|
|
24,894
|
|
|
|
13,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash investing and financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effects of forward stock split
|
|
|
–
|
|
|
|
–
|
|
|
|
240,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest paid
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
Income tax paid
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
(The accompanying notes are an integral part of these condensed financial statements)
Lingas Ventures, Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
(Expressed in US dollars)
(unaudited)
|
1.
|
Nature of Operations and Continuance of Business
|
Lingas Resources Inc. (the “Company”) was incorporated in the state of Nevada on September 14, 2010. The Company is a development stage company, as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915,
Development Stage Entities
, and is a mineral exploration company with the purpose of acquiring and developing mineral properties
.
Going Concern
These financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As of February 28, 2014, the Company has not recognized any revenue, has a working capital deficit of $54,828, and has an accumulated deficit of $104,828. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
|
2.
|
Summary of Significant Accounting Policies
|
The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is November 30.
The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at February 28, 2014, and for all periods presented herein, have been made.
It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in the Company's November 30, 2013 audited financial statements. The results of operations for the periods ended February 28, 2014 and 2013 are not necessarily indicative of the operating results for the full years.
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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. The Company regularly evaluates estimates and assumptions related to the deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.
Lingas Ventures, Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
(Expressed in US dollars)
(unaudited)
|
2.
|
Summary of Significant Accounting Policies
(continued)
|
|
|
c)
|
Cash and cash equivalents
|
The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.
|
|
d)
|
Basic and Diluted Net Loss per Share
|
The Company computes net loss per share in accordance with ASC 260,
Earnings per Share
. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of February 28, 2014 and November 30, 2013, the Company did not have any potentially dilutive shares.
Pursuant to ASC 820,
Fair Value Measurements and Disclosures
, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:
Level 1
Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
Level 2
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 3
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.
The Company’s financial instruments consist principally of cash, accounts payable and accrued liabilities, and amounts due to related parties. Pursuant to ASC 820, the fair value of our cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.
Lingas Ventures, Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
(Expressed in US dollars)
(unaudited)
|
2.
|
Summary of Significant Accounting Policies
(continued)
|
ASC 220,
Comprehensive Income
, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As of February 28, 2014 and November 30, 2013, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.
|
|
g)
|
Impairment of Long-Lived Assets
|
The Company evaluates the recoverability of long-lived assets and the related estimated remaining lives at each balance sheet date. The Company records an impairment or change in useful life whenever events or changes in circumstances indicate that the carrying amount may not be recoverable or the useful life has changed.
|
|
h)
|
Foreign Currency Translation
|
The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated in accordance with ASC 830
Foreign Currency Translation Matters,
using the exchange rate prevailing at the balance sheet date. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income. The Company has not, to the date of these financials statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.
|
|
i)
|
Recent Accounting Pronouncements
|
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
Lingas Ventures, Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
(Expressed in US dollars)
(unaudited)
|
3.
|
Related Party Transactions
|
|
|
a)
|
At February 28, 2014, the Company owed $57,569 (November 30, 2013 - $57,569) to the former President and Director of the Company. The amounts owing are unsecured, non-interest bearing, and due on demand.
|
We have evaluated subsequent events through the date of issuance of the financial statements, and did not have any material recognizable subsequent events with the exception of the following:
|
|
a)
|
On March 19, 2014, John Ngitew and Grace Parinas, the principals shareholders of the Company, entered into a Stock Purchase Agreement which provided for the sale of 145,000,000 shares of common stock of the Company (the “Purchased Shares”) to Eric Hagen (49,000,000 shares); Jonathan Hunt (48,000,000 shares) and Steven Brandt (48,000,000 shares). The consideration paid for the Purchased Shares, which represent 50% of the issued and outstanding share capital of the Company on a fully-diluted basis, was $21,750. As part of the agreement, John Ngitew forgave $57,569 of amounts owed to him in addition to assuming responsibility of all outstanding accounts payable and accrued liabilities of $11,108
|
|
|
b)
|
On March 21, 2014, John Ngitew resigned as President and Director of the Company, and the Company appointed Eric Hagen as the new President and Director of the Company.
|
|
|
c)
|
On March 31, 2014, Eric Hagen, Jonathan Hunt and Steve Brandt, the sole officers and directors of the Company, were each issued 19,000 shares of common stock, with a fair value of $5,700 based on the closing trading price of the Company’s common stock, in consideration for services performed.
|
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Forward-Looking Statements
Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words “expects,” “anticipates,” “intends,” “believes” and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in the sections “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should carefully review the risks described in this Annual Report on Form 10-K and in other documents we file from time to time with the Securities and Exchange Commission (“SEC”). You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.
Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.
All references in this Form 10-Q to the “Company,” “Lingas Ventures,” “we,” “us,” or “our” are to Lingas Ventures, Inc.
Plan of Operation
On March 19, 2014, John Ngitew and Grace Parinas, the principals shareholders of Lingas Ventures, Inc. (the “Company”), entered into a Stock Purchase Agreement which provided for the sale of 145,000,000 shares of common stock of the Company (the “Purchased Shares”) to Eric Hagen (49,000,000 shares); Jonathan Hunt (48,000,000 shares) and Steven Brandt (48,000,000 shares) (collectively, the “Purchaser”). The consideration paid for the Purchased Shares, which represent 50% of the issued and outstanding share capital of the Company on a fully-diluted basis, was $21,750. The source of the cash consideration for the Purchased Shares was personal funds of the Purchasers. In connection with the transaction, Mr. Ngitew released the Company from all debts owed to him.
As a result of the change in control, management of the Company will be focusing on various opportunities in the recreational and medical marijuana industry.
Our auditors have issued a going concern opinion on our audited financial statements for the year ended November 30, 2013. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay for our expenses. This is because we have not generated any revenues and no sales are yet possible. There is no assurance we will ever reach this point. Accordingly, we must raise sufficient capital from sources. Our only other source for cash at this time is investments by others. We must raise cash to stay in business. In response to these problems, management intends to raise additional funds through public or private placement offerings. As of February 28, 2014, our company had no cash on hand.
RESULTS OF OPERATIONS
Working Capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets
|
|
|
13,849
|
|
|
|
19,449
|
|
|
Current Liabilities
|
|
|
68,677
|
|
|
|
60,184
|
|
|
Working Capital (Deficit)
|
|
|
(54,828
|
)
|
|
|
(40,735
|
)
|
Cash Flows
|
|
|
Three months ended
February 28,
2014
$
|
|
|
Three months ended
February 28,
2013
$
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows used in Operating Activities
|
|
|
(5,600
|
)
|
|
|
(17,101
|
)
|
|
Cash Flows from Financing Activities
|
|
|
-
|
|
|
|
117
|
|
|
Net Increase (decrease) in Cash During Period
|
|
|
(5,600
|
)
|
|
|
(16,984
|
)
|
Operating Revenues
For the period from September 14, 2010 (date of inception) to February 28, 2014, the Company did not earn any operating revenues.
Operating Expenses and Net Loss
During the three months ended February 28, 2014, the Company incurred operating expenses of $14,093 compared to $19,316 for the three months ended February 28, 2013. The decrease in operating expenses was attributed to limited amounts of cash flow for the Company which limited the amount of transactions incurred during the period.
For the three months ended February 28, 2014 and 2013, the Company had a loss per share of $nil.
Liquidity and Capital Resources
As at February 28, 2014, the Company had cash and total assets of $13,849 compared with $19,449 as at November 30, 2013. The decrease in cash and total assets were attributed to the use of available financing for operating costs as the Company did not raise any proceeds from financing activities during the period.
During the three months ended February 28, 2014, the Company did not have any equity transactions.
We will require capital and estimate that within the next 12 months we will need approximately $1,000,000. We cannot be certain that the required additional financing will be available or available on terms favorable to us. If additional funds are raised by the issuance of our equity securities, such as through the issuance and exercise of warrants, then existing stockholders will experience dilution of their ownership interest. If adequate funds are not available or not available on acceptable terms, we may be unable to fund our operations.
Cashflow from Operating Activities
During the three months ended February 28, 2014, the Company used
$5,600 of cash for operating activities compared with $17,101 during the three months ended February 28, 2013. The decrease in cash used for operating activities was due to the fact that the Company had limited transactions during the period.
Cashflow from Investing Activities
During the three months ended February 28, 2014 and 2013, the Company did not have any investing activities.
Cashflow from Financing Activities
During the three months ended February 28, 2014, the Company did not have any financing activities. During the three months ended February 28, 2013, the Company received proceeds of $117 from a related party.
Going Concern
We have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities. For these reasons, our auditors stated in their report on our audited financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing.
Future Financings
We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.
Off-Balance Sheet Arrangements
We have no significant 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 are material to stockholders.
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.
Recently Issued Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
As a “smaller reporting company”, we are not required to provide the information required by this Item.
Item 4. Controls and Procedures.
Management’s Report on Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.
As of the end of the quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president (our principal executive officer, principal financial officer and principle accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal controls over financial reporting that occurred during the quarter ended February 28, 2014, that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.
PART II – OTHER INFORMATION
Item 1. Legal Proceedings.
We know of no material, existing or pending legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder, is an adverse party or has a material interest adverse to our interest.
Item 1A. Risk Factors.
As a “smaller reporting company”, we are not required to provide the information required by this Item.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On March 31, 2014, Eric Hagen, Jonathan Hunt and Steve Brandt, the sole officers and directors of the Company, were each issued 19,000 shares of common stock of the Company in consideration for services performed. The issuance and sale of shares of common stock by the Company to Messrs. Hagen, Hunt and Brandt was made without registration under the Securities Act of 1933, as amended (the “Act”), or the securities laws of the applicable state, in reliance on the exemptions provided by Section 4(2) of the Act and Regulation D promulgated thereunder.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
None.
Item 6. Exhibits.
The following exhibits are included as part of this report:
|
Exhibit No.
|
|
Description
|
|
|
|
|
|
31.1
|
|
Rule 13(a)-14(a)/15(d)-14(a) Certification of Principal Executive Officer
|
|
31.2
|
|
Rule 1350 Certification of Principal Financial Officer
|
|
32.1
|
|
Rule 13(a)-14(a)/15(d)-14(a) Certification of Principal Executive Officer
|
|
32.2
|
|
Rule 1350 Certification of Principal Financial Officer
|
|
|
|
|
|
101.INS **
|
|
XBRL Instance
|
|
101.SCH **
|
|
XBRL Taxonomy Extension Schema
|
|
101.CAL **
|
|
XBRL Taxonomy Extension Calculations
|
|
101.DEF **
|
|
XBRL Taxonomy Extension Definitions
|
|
101.LAB **
|
|
XBRL Taxonomy Extension Labels
|
|
101.PRE **
|
|
XBRL Taxonomy Extension Presentation
|
** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
LINGAS VENTURES, INC.
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
|
Dated: April 25, 2014
|
By:
|
/s/ Eric Hagen
|
|
|
|
|
Eric Hagen
|
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
Dated: April 25, 2014
|
By:
|
/s/ Steve Brandt
|
|
|
|
|
Steve Brandt
|
|
|
|
|
Treasurer and Vice President
|
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
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