The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has incurred significant losses and experienced negative cash flow from operations since inception. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
The Company's principal business objective for the next twelve months and beyond
such time will be to achieve long-term growth potential through a combination
with a business rather than immediate, short-term earnings. The Company will not
restrict its potential candidate target companies to any specific business,
industry or geographical location and, thus, may acquire any type of business.
The Company believes that its existing cash resources will not be sufficient to
sustain operations during the next twelve months. The Company's management plans
to engage in very limited activities without incurring any significant
liabilities that must be satisfied in cash until a source of funding is secured.
Mr.
On
-6- Table of ContentsCLANCY CORP. NOTES TO THE FINANCIAL STATEMENTSApril 30, 2020
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION.
The accompanying unaudited financial statements have been prepared in accordance
with the
Fiscal year end
The Company's yearend is
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles 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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Income Taxes
Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws.
A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.
Revenue Recognition
The Company recognizes revenue in accordance with
Basic Income (Loss) Per Share
The Company computes income (loss) per share in accordance with FASB ASC
260 "Earnings per Share". Basic loss per share is computed by dividing net
income (loss) available to common shareholders by the weighted average number of
outstanding common shares during the period. Diluted income (loss) per share
gives effect to all dilutive potential common shares outstanding during the
period. Dilutive loss per share excludes all potential common shares if their
effect is anti-dilutive. As of
Comprehensive Income
The Company follows FASB ASC 220 in reporting comprehensive income. Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income. Since the Company has no items of other comprehensive income, comprehensive loss is equal to net loss.
-7- Table of ContentsCLANCY CORP. NOTES TO THE FINANCIAL STATEMENTSApril 30, 2020
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Financial Instruments
The Company's financial instruments consist of loans from related party. The carrying amount of this financial instrument approximates its fair value due to its relatively short maturity
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Recently Adopted Accounting Pronouncements
In
Recently Issued Accounting Pronouncements Not Yet Adopted
As of
NOTE 4 - COMMITMENTS AND CONTINGENCIES
The Company has entered into a one-year rental agreement for a
On
Due to the adoption of the new lease standard under the optional transition
method which allows the entity to apply the new lease standard at the adoption
date, the Company has capitalized the present value of the minimum lease
payments commencing
As of
There are no other material operating leases. The Company has elected not to recognize right-of-use assets and lease liabilities arising from short-term leases.
Future minimum lease payments under the operating lease as ofApril 30, 2020 are: 2020 8,680 2021 6,480 2022 5,940 Total Lease payments 21,060 Less imputed interest 3,109 Total 17,951 Total lease expense under operating leases for the three and nine months endedApril 30, 2020 was$0 . -8- Table of ContentsCLANCY CORP. NOTES TO THE FINANCIAL STATEMENTSApril 30, 2020
NOTE 5 - LOAN FROM DIRECTOR
Immediately prior to
NOTE 6- INCOME TAXES
Income tax expense was
As of
There is no income tax benefit for the losses for the three and nine months
ended
As a result of the change of control, the net operating loss will be limited from that date forward.
-9- Table of Contents
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Forward-Looking Statements
Certain statements made in this quarterly report on Form 10-Q are "forward-looking statements" in regard to the plans and objectives of management for future operations. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the registrant to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. The Company's plans and objectives are based, in part, on assumptions involving the continued expansion of business. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the Company believes its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance the forward-looking statements included in this quarterly report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the registrant or any other person that the objectives and plans of the registrant will be achieved.
Substantial risks exist with respect to an investment in the Company. These
risks include but are not limited to, those factors discussed in our Annual
Report on Form 10-K for the fiscal year ended
? We have incurred significant losses and expect to incur future losses; ? Our current financial condition and immediate need for capital; ? Potential significant dilution resulting from the issuance of new securities for any funding, debt conversion or any business combination; and ? We are a "penny stock" company. Description of Business
Effective
On
-10- Table of Contents
? the forward split of the Company's issued and outstanding common stock,
par value, on thirty (30) post-split shares for a one (1) pre-split share
basis applicable to stockholders of record as of
? The increase of the Company's authorized shares of common stock,
value, from 75,000,000 to 345,000,000.
The Corporate Actions were adopted by written consent of our sole Director, Mr. Gaoyang Liu,
on
All shares disclosed in the financial statements and notes to the financial statements have been retroactively adjusted for the 30 for 1 forward split.
On
In connection with the transaction,
On
On
The Company is a shell company as defined in Rule 504 of the Securities Act of 1933, as amended (the "Act"). Our principal business objective for the next 12 months and beyond such time will be to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings. The Company will not restrict our potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business.
The Company currently does not engage in any business activities that provide cash flow. During the next twelve months we anticipate incurring costs related to: (i) filing Securities Exchange Act of 1942 ("Exchange Act") reports, and (ii) investigating, analyzing and consummating an acquisition. -11- Table of Contents
We believe we will be able to meet these costs through deferral of fees by
certain service providers and additional amounts, as necessary, to be loaned to
or invested in us by our stockholders, management or other investors. As of
The Company may consider acquiring a business which has recently commenced operations, is a developing company in need of additional funds for expansion into new products or markets, is seeking to develop a new product or service, or is an established business which may be experiencing financial or operating difficulties and is in need of additional capital. In the alternative, a business combination may involve the acquisition of, or merger with, a company which does not need substantial additional capital but which desires to establish a public trading market for its shares while avoiding, among other things, the time delays, significant expense, and loss of voting control which may occur in a public offering.
Our management has not entered into any agreements with any party regarding a business combination. Any target business that is selected may be a financially unstable company or an entity in its early stages of development or growth, including entities without established records of sales or earnings. In that event, we will be subject to numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, we may effect a business combination with an entity in an industry characterized by a high level of risk, and, although our management will endeavor to evaluate the risks inherent in a particular target business, there can be no assurance that we will properly ascertain or assess all significant risks. Our management anticipates that it will likely be able to effect only one business combination, due primarily to our limited financing and the dilution of interest for present and prospective stockholders, which is likely to occur as a result of our management's plan to offer a controlling interest to a target business in order to achieve a tax-free reorganization. This lack of diversification should be considered a substantial risk in investing in us, because it will not permit us to offset potential losses from one venture against gains from another.
We will not acquire or merge with any entity which cannot provide audited
financial statements at or within a reasonable period of time after closing of
the proposed transaction. We are subject to all the reporting requirements
included in the Exchange Act. Included in these requirements is our duty to file
audited financial statements as part of our Form 8-K to be filed with the
A business combination with a target business will normally involve the transfer to the target business of the majority of our common stock, and the substitution by the target business of its own management and board of directors.
The Company anticipates that the selection of a business combination will be complex and extremely risky. Because of general economic conditions, rapid technological advances being made in some industries and shortages of available capital, our management believes that there are numerous firms seeking the perceived benefits of becoming a publicly traded corporation. Such perceived benefits of becoming a publicly traded corporation include, among other things, facilitating or improving the terms on which additional equity financing may be obtained, providing liquidity for the principals of and investors in a business, creating a means for providing incentive stock options or similar benefits to key employees, and offering greater flexibility in structuring acquisitions, joint ventures and the like through the issuance of stock. Potentially available business combinations may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.
-12- Table of Contents
The Company's ability to continue as a going concern is dependent upon its ability to develop additional sources of capital, locate and complete a merger with another company and ultimately achieve profitable operations. No assurances can be given that the Company will be successful in locating or negotiating with any target company.
Results of Operations
No revenue has been generated by the Company during the three and nine months
ended
For the three months ended
During the three months ended
For the nine months ended
During the nine months ended
Liquidity and Capital Resources
As of
The following is a summary of the Company's cash flows provided by (used in) operating, investing, and financing activities for the nine months endedApril 30, 2020 and 2019: Nine Nine Months Ended Months Ended April 30, April 30, 2020 2019Net Cash Used in Operating Activities from Continuing Operating Activities $ (52,016 ) $ -Net Cash Used in Operating Activities from Discontinued Operations (net) $ -$ (10,678 ) Total Net Cash Used in Operating Activities $ (52,016 )$ (10,678 ) Net Cash Provided by Financing Activities $ 54,457 $ - Net Cash Provided by Financing Activities from Discontinued Operations (net) $ -$ 10,200
Total Net Cash Provided by Financing Activities $ 54,457
Net Change in Cash $ 2,441$ (478 ) -13- Table of Contents Operating Activities
During the nine months ended
Financing Activities
During the nine months ended
The Company is dependent upon the receipt of capital investment or other financing to fund its ongoing operations and to execute its business plan of seeking a combination with a private operating company. In addition, the Company is dependent upon certain related parties to provide continued funding and capital resources. No assurances can be given that the Company will be successful in locating or negotiating with any target company or that the related parties will continue to fund the Company's working capital needs. As a result, there is substantial doubt about the Company's ability to continue as a going concern.
Off-Balance Sheet Arrangements
The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's 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
None.
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