The financial data discussed below is derived from our audited consolidated
financial statements for the fiscal years ended
Overview
The Company was formed as a limited liability company in the state of
We manufacture, market, and distribute alternative wellness solutions with a mission to build an enterprise solution within the health and wellness industry.
Our objective is to uncover breakthrough, nutrient-rich formulations, using the most effective ingredients and delivery systems available to the nutraceutical industry, and offer alternative wellness solutions that help improve the quality of life. Our distribution strategy includes selling to private label customers, retailers, distributors, and consumers through retail outlets.
Years Ended
We had sales of
Cost of sales was
Gross profit was
General and administrative expenses were
Stock based compensation was
Finance costs were
We incurred a net loss of approximately
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Liquidity and Capital Resources
Historically, the Company's primary cash needs have been related to working capital items, which the Company has largely funded through our revenues, working capital, cash on hand, and proceeds from the issuance of stock.
The Company through its efforts has secured new business and expects to see a surge in its revenue from multiple channels providing the necessary cash flows to support its operations and debt commitments.
Cash Flow Activities
As of
We are continuing our plan to further grow and expand operations and seek sources of capital to pay our contractual obligations as they come due. Management believes that its current operating strategy will provide the opportunity for us to continue as a going concern as long as we are able to obtain additional financing; however, there is no assurance this will occur. The accompanying consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.
Operating Activities
Our cash increased
For the year ended
Investing Activities
For the year ended
Financing Activities
During the year ended
We also received
Critical Accounting Policies and Estimates
In preparing the financial statements in accordance with accounting principles
generally accepted in
The preparation of the financial statements in conformity with
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Estimates are considered to be critical if they meet both of the following criteria: (1) the estimate requires assumptions about material matters that are uncertain at the time the accounting estimates are made, and (2) other materially different estimates could have been reasonably made or material changes in the estimates are reasonably likely to occur from period to period. Our critical accounting estimates include the following:
Revenue Recognition: In general, we record revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. Provision for sales returns will be estimated based on the Company's historical return experience.
Accounts Receivable and Allowance for Doubtful Accounts: Our accounts receivable are stated at estimated net realizable value. Accounts receivable are comprised of balances due from customers net of estimated allowances for uncollectible accounts. In determining collectability, historical trends are evaluated and specific customer issues are reviewed to arrive at appropriate allowances.
Long-Lived Assets: The carrying value of long-lived assets is reviewed annually and on a regular basis for the existence of facts and circumstances that may suggest impairment. If indicators of impairment are present, we determine whether the sum of the estimated undiscounted future cash flows attributable to the long-lived asset in question is less than its carrying amount. If less, we measure the amount of the impairment based on the amount that the carrying value of the impaired asset exceeds the discounted cash flows expected to result from the use and eventual disposal of the impaired assets.
Derivative Financial Instrument: The Company evaluates its convertible debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be accounted for. The result of this accounting treatment is that under certain circumstances the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value measurement is recorded in the statement of operations as other income or expense. Upon conversion or exercise of the convertible note containing an embedded derivative instrument is marked to fair value at the conversion date and that the fair value is reclassified to equity. The shares issued upon conversion of this note are recorded at their fair value with a gain or loss recognition as applicable.
Equity instruments that are initially classified as equity that become subject to reclassification under this accounting standard are reclassified to liabilities at the fair value of the instruments on the reclassification date/
Share-Based Compensation: We record share-based compensation in accordance with FASB ASC 718, Stock Compensation. FASB ASC 718 requires that the cost resulting from all share-based transactions are recorded in the financial statements over the respective service periods. It establishes fair value as the measurement objective in accounting for share-based payment arrangements and requires all entities to apply a fair-value-based measurement in accounting for share-based payment transactions with employees. FASB ASC 718 also establishes fair value as the measurement objective for transactions in which an entity acquires goods or services from non-employees in share-based payment transactions.
Off-Balance Sheet Arrangements
We have not entered into any transaction, agreement or other contractual arrangement with an entity unconsolidated with us under whom we have:
? An obligation under a guarantee contract. ? A retained or contingent interest in assets transferred to the unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to such entity for such assets. ? Any obligation, including a contingent obligation, under a contract that would be accounted for as a derivative instrument. ? Any obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held by us and material to us where such entity provides financing, liquidity, market risk or credit risk support to, or engages in leasing, hedging or research and development services with us.
We do not have any off-balance sheet arrangements or commitments that have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material, other than those which may be disclosed in this Management's Discussion and Analysis of Financial Condition and the audited Consolidated Financial Statements and related notes.
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