VERIFY SMART CORP. - FORM 10-Q

Attached files

file	filename
EX-32.1 - SECTION 906 CERTIFICATION - VERIFY SMART CORP.	ex32-1.txt
EX-31.1 - SECTION 302 CERTIFICATION - VERIFY SMART CORP.	ex31-1.txt

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q

[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the quarterly period ended September 30, 2010

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the transition period from ______________ to ______________

Commission File Number 333-136492

VERIFY SMART CORP.
(Exact name of registrant as specified in its charter)

Nevada 20-5005810
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)

57 Montague Street, Brooklyn NY 11201
(Address of principal executive offices)

718 855 7136
(Registrant's telephone number, including area code)

N/A
(Former name, former address and former fiscal year,
if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] YES [ ] NO

Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Website, if any, every Interactive Data File required to
be submitted and posted pursuant to Rule 405 of Regulation S-K (ss.229.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a small reporting company. See
the definitions of "large accelerated filer", "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act

Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act [X] YES [ ] NO

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be
filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. [ ] YES [ ] NO

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

52,787,000 common shares issued and outstanding as of November 11, 2010

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

These financial statements have been prepared by Verify Smart Corp. without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission ("SEC"). Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been omitted in accordance with such SEC rules and
regulations. In the opinion of management, the accompanying statements contain
all adjustments necessary to present fairly the financial position of our
company as of September 30, 2010, and our results of operations, and our cash
flows for the three month period ended September 30, 2010. The results for these
interim periods are not necessarily indicative of the results for the entire
year. The accompanying financial statements should be read in conjunction with
the financial statements and the notes thereto filed as a part of our company's
Form 10-K.

VERIFY SMART CORP
(A Development Stage Company)
BALANCE SHEET
(Unaudited)

Sept. 30, June 30,
2010 2010
------------ ------------

ASSETS

Current Assets
Cash $ 2,728 $ 9,728
Prepaid expenses 185,137 212,570
------------ ------------
187,865 222,298
Other Assets 0 26,563
------------ ------------

$ 187,865 $ 248,861
============ ============

LIABILITIES

Current Liabilities
Accounts payable $ 11,266 $ 20,289
Loan payable 114,999 111,999
------------ ------------
126,265 132,288
============ ============

Shareholders' Equity
Common stock,$0.001 par value, 240,000.000 authorized;
52,785,0000 issued and outstanding 52,215 52,215
Additional Paid-In Capital 1,378,907 1,378,907
Accumulated Deficit (1,369,522) (1,314,549)
------------ ------------
61,600 116,573
------------ ------------
$ 187,865 $ 248,861
============ ============

The accompanying notes are an integral part of these statements

VERIFY SMART CORP
(A Development Stage Company)
STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
(Unaudited)

Three Months Ended
----------------------------------- Inception to
Sept. 30, Sept. 30, Sept. 30,
2010 2009 2010
------------ ------------ ------------

REVENUES $ -- $ -- $ --
------------ ------------ ------------

EXPENSES
General and administrative 247 31,180 81,462
Professional fees 730 17,831 95,970
Management fees 53,996 476,496 1,185,372
------------ ------------ ------------
54,973 525,507 1,362,804
------------ ------------ ------------
(LOSS) FROM OPERATIONS
Interest expense 0 0 212
Exchange gain (loss) 0 (3,191) 6,506
------------ ------------ ------------
0 (3,191) 6,718
------------ ------------ ------------
NET LOSS (54,973) (522,316) (1,369,522)

ACCUMULATED DEFICIT - OPENING (1,314,549) (523,785) 0
------------ ------------ ------------

ACCUMULATED DEFICIT - ENDING $ (369,522) $ (046,101) $ (1,369,522)
============ ============ ============

Net (loss) per share 0.00 (0.01)
============ ============

Weighted average shares outstanding 52,785,000 61,578,261
============ ============

The accompanying notes are an integral part of these statements

VERIFY SMART CORP
(A Development Stage Company)
STATEMENT OF CASH FLOWS
(Unaudited)

Three Months Ended
----------------------------------- Inception to
Sept. 30, Sept. 30, Sept. 30,
2010 2009 2010
----------- ----------- -----------

OPERATING ACTIVITIES
Net income (loss) $ (54,973) $ (528,698) $(1,362,577)
Cash provided by (used)
Stock-based compensation -- 439,412 1,133,957
Changes in
Prepaid expenses 53,996 10,626 53,996
Accounts payable (9,023) 55,691 11,266
----------- ----------- -----------
Net cash used in operations (10,000) (22,969) (163,358)
----------- ----------- -----------

FINANCING ACTIVITIES
Issuance of common stock -- -- $ 52,215
Share issue costs -- -- $ (1,128)
Proceeds from loan payable 3,000 22,969 114,999
----------- ----------- -----------
Net cash from financing 3,000 22,969 166,086
----------- ----------- -----------

INCREASE (DECREASE) IN CASH (7,000) 0 2,728

Cash, beginning of period 9,728 9,728 0
----------- ----------- -----------

CASH END OF PERIOD $ 2,728 $ 9,728 $ 2,728
=========== =========== ===========

The accompanying notes are an integral part of these statements

Verify Smart Corp.
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)

NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS

Verify Smart Corp. (the "Company")) was incorporated under the laws of the State
of Nevada on May 31, 2006. The Company was originally formed to engage in the
acquisition, exploration and development of natural resource properties.
Effective March 25, 2009, the Company entered into a joint venture agreement
with Verified Capital Corp. and Verified Transactions Corp. relating to the
formation and operation of a joint venture corporation that will sell internet
security software for credit card fraud prevention (Note 11).

Effective March 19, 2009, the Company changed the name from Treasure
Explorations Inc. to Verify Smart Corp.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING

These financial statements and related notes are presented in accordance with
accounting principles generally accepted in the United States, and are expressed
in US dollars. The Company has elected a June 30 year-end.

BASIC AND DILUTED NET INCOME (LOSS) PER SHARE

The Company computes net loss per share in accordance with ASC 260 EARNINGS PER
SHARE which 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
income (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.

CASH EQUIVALENTS

The Company considers all highly liquid instruments with maturity of three
months or less at the time of issuance to be cash equivalents.

USE OF ESTIMATES AND ASSUMPTIONS

Verify Smart Corp.
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)

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. Actual results could differ from those estimates.

INCOME TAXES

Income taxes are provided in accordance with ASC 740 ACCOUNTING FOR INCOME
TAXES. A deferred tax asset or liability is recorded for all temporary
differences between financial and tax reporting and net operating loss
carryforwards. Deferred tax expense (benefit) results from the net change during
the year of deferred tax assets and liabilities.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion or all of the deferred
tax assets will not be realized. Deferred tax assets and liabilities are
adjusted for the effects of changes in tax laws and rates on the date of
enactment.

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2009, FASB issued ASC 855, SUBSEQUENT EVENTS, which establishes general
standards of for the evaluation, recognition and disclosure of events and
transactions that occur after the balance sheet date. Although there is new
terminology, the standard is based on the same principles as those that
currently exist in the auditing standards. The standard, which includes a new
required disclosure of the date through which an entity has evaluated subsequent
events, is effective for interim or annual periods ending after June 15, 2009.
The adoption of ASC 855 did not have a material effect on the Company's
financial statements. Refer to Note 13.

In June 2009, the FASB issued guidance now codified as ASC 105, GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES as the single source of authoritative accounting
principles recognized by the FASB to be applied by nongovernmental entities in
the preparation of financial statements in conformity with U.S. GAAP, aside from
those issued by the SEC. ASC 105 does not change current U.S. GAAP, but is
intended to simplify user access to all authoritative U.S. GAAP by providing all
authoritative literature related to a particular topic in one place. The
adoption of ASC 105 did not have a material impact on the Company's financial
statements, but did eliminate all references to pre-codification standards. The
Company has implemented all new accounting pronouncements that are in effect and
that may impact its financial statements and 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.

Verify Smart Corp.
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)

NOTE 3. GOING CONCERN

The accompanying financial statements are presented on a going concern basis.
The Company had limited operations during the period from May 31, 2006 (date of
inception) to September 30, 2010 and generated a cumulative net loss of
$1,369,522. This condition raises substantial doubt about the Company's ability
to continue as a going concern. Because the Company is currently in the
development stage, management believes that the company's current cash and cash
equivalents of $2,728 is sufficient to cover the expenses they will incur during
the next twelve months in a limited operations scenario or until they raise
additional funding.

NOTE 4. LOAN PAYABLE

At September 30, 2010, the Company owes $114,999 (June 30, 2010 -$111,999) loans
from an unrelated party.

NOTE 5. WARRANTS AND OPTIONS

There are no warrants or options outstanding to acquire any additional shares of
common stock.

NOTE 6. RELATED PARTY TRANSACTIONS

The officers and directors of the Company may, in the future, become involved in
other business opportunities as they become available, they may face a conflict
in selecting between the Company and their other business opportunities. The
Company has not formulated a policy for the resolution of such conflicts.

NOTE 7. INCOME TAXES

As of September 30, 2010, the Company had operating loss carry forwards of
$1,369,522. Realization of the resulting deferred tax assets is dependent upon
sufficient future taxable income during the period that deductible temporary
differences and carryforwards are expected to be available to reduce taxable
income. As the achievement of required future taxable income is uncertain, the
Company recorded no deferred tax benefit.

NOTE 8. NET OPERATING LOSSES

As of September 30, 2009, the Company has a net operating loss carryforwards of
approximately $1,369,522. Net operating loss carryforwards expires twenty years
from the date the loss was incurred.

Verify Smart Corp.
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)

NOTE 9. STOCK TRANSACTIONS

Transactions, other than employees' stock issuance, are in accordance with ASC
718, Compensation - STOCK COMPENSATION. Thus issuances shall be accounted for
based on the fair value of the consideration received. Transactions with
employees' stock issuance are in accordance with ASC 718. These issuances shall
be accounted for based on the fair value of the consideration received or the
fair value of the equity instruments issued, or whichever is more readily
determinable.

On March 19, 2009 the Company effected a 15 for 1 forward split of its issued
and outstanding share capital such that every one share of common stock issued
and outstanding prior to the split was exchanged for fifteen post-split shares
of common stock. The Company's post-split authorized capital increased to
250,000,000 shares of common stock with a par value of $0.001 per share. All
share amounts have been retroactively adjusted for all periods presented.

On March 25, 2009, the Company issued 750,000 shares of common stock at a fair
value of $0.75 per share, amounting to $562,500, pursuant to a consulting
agreement.

On March 30, 2009, the Company issued 100,000 shares of common stock at a fair
value of $0.75 per share, amounting to $75,000, pursuant to a consulting
agreement.

On April 9, 2009, the Company issued 15,000 shares of common stock at a fair
value of $2.05 per share, amounting to $30,750, pursuant to a consulting
agreement.

On May 1, 2009, the Company issued 100,000 shares of common stock at a fair
value of $1.34 per share, amounting to $134,000, pursuant to a consulting
agreement.

On May 27, 2009, the Company issued 10,000 shares of common stock at $1.25 per
share for cash proceeds of $12,500. The Company paid finders' fee of $1,128
(Cdn$1,250) in connection with the private placement.

On June 1, 2009, the Company issued 50,000 shares of common stock at a fair vale
$1 per share, amounting to $50,000, pursuant to a consulting agreement.

On July 14, 2009, the Company enter a consulting service agreement and issued
50,000 shares of restricted common stock at a fair vale $0.53 per share,
amounting to $26,500 as compensation.

On August 15, 2009, the Company completed a private placement and issued 500,000
shares of common stock to Black Diamond Investment Group ("Black Diamond") at
$0.50 per share for cash proceeds of $250,000. The consulting agreement was

Verify Smart Corp.
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)

entered between Black Diamond and Verify Smart Corp, a private company located
in British Virgin Island. Accordingly, these shares were issued in error. The
shares are being returned to treasury for cancellation and the correct share
issuance will take place from the private. The Company has treated the shares as
unissued.

On August 14, 2009, the Company enter a consulting service agreement and issued
1,000,000 shares of common stock at a fair vale $0.425 per share, amounting
$425,000 as compensation.

As of September 30, 2010 the Company had 52,785,000 shares of common stock
issued and outstanding.

NOTE 10. STOCKHOLDERS' EQUITY

The stockholders' equity section of the Company contains the following classes
of capital stock as of September 30, 2010: Common stock, $ 0.001 par value:
250,000,000 shares authorized; 52,785,000 shares issued and outstanding.

NOTE 11. JOINT VENTURE AGREEMENT

Effective March 25, 2009, the Company entered into a joint venture agreement
with Verified Capital Corp. and Verified Transactions Corp. relating to the
formation and operation of a joint venture corporation that will sell internet
security software for credit card fraud prevention.

Upon the satisfaction of customary closing conditions, the Company will
contribute an aggregate of $5,000,000 to the joint venture corporation, payable
as to $2,000,000 by May 1, 2009 and $3,000,000 by July 1, 2009, for a 70%
interest in the joint venture corporation.

By amendment of May 19, 2009, the companies have agreed that all obligations of
the Joint Venture agreement have been deemed to have occurred and the agreement
is in full force in good standing. In addition to the foregoing, Verified
Transactions Corp. will grant to the joint venture corporation a 25 year
worldwide exclusive license to market and sell Verified Transaction Corp.'s
internet security software and all other internet business of whatsoever nature
and including all future developments of such business for a 25 % interest in
the joint venture corporation. Verified Capital Corp. will be granted a 5%
interest in joint venture corporation upon the transfer of certain assets.

Upon the closing of the joint venture agreement, the Company is the operator of
the joint venture corporation and will contract with Verified Capital Corp. to
be the sub-operator.

As of September 30, 2010, the joint venture corporation has not yet been formed.

Verify Smart Corp.
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)

NOTE 12. COMMITMENTS

a) On March 30, 2009, the Company entered into a consulting agreement with New
Vision Consulting Corporation wherein New Vision has agreed to provide certain
consulting services to the Company. As compensation under the agreement, the
Company agreed to issue 1,000,000 restricted shares of common stock. As further
compensation for services to be rendered, New Vision shall receive an additional
500,000 restricted common shares prior to July 31, 2009. The agreement expires
on September 30, 2009. On May 19, 2009, the Company issued 1,000,000 restricted
shares of common stock at a fair value of $750,000 to New Vision for services to
be provided over a six month period. On July 15, 2009, the consulting agreement
was terminated as New Vision was unable or unwilling to perform the services.
The Company asked for return the issued shares for cancellation (Note 13(a)).

b) On June 1, 2009, the Company entered into a consulting agreement with David
Karpa wherein David Karpa has agreed to provide certain consulting services to
the Company. As compensation under the agreement, the Company agreed to issue
50,000 restricted shares of common stock. The agreement expires on November 30,
2009. On June 1, 2009, the Company issued 50,000 restricted shares of common
stock at a fair value of $50,000 to David Karpa for services to be provided over
a six month period. As at June 30, 2010, $50,000 was recognized as a consulting
expense.

c) On July 14, 2009, the Company entered into a consulting agreement with Wei
Cheng wherein Wei Cheng has agreed to provide certain consulting services to the
Company. As compensation under the agreement, the Company agreed to issue 50,000
restricted shares of common stock. The agreement expired on January 14, 2010. On
August 15, 2009, the Company issued 50,000 restricted shares of common stock at
a fair value of $26,500 to Wei Cheng for agreeing to enter into this agreement.
The Company shall also provide Cheng 50,000 shares of common stock, released in
increments of 12,500 shares at the end of each 60 day period, commencement upon
the agreement date. At March 31, 2010, $26,500 was recognized as consulting
expense and $53,000 was canceled on June 30, 2010.

d) On August 14, 2009, the Company entered into a consulting agreement with
Cohen Independent Group ("Cohen") wherein Cohen has agreed to provide certain
consulting services to the Company. As compensation under the agreement, the
Company agreed to issue 1,000,000 restricted shares of common stock. The
agreement expires on August 14, 2011. On September 14, 2009, the Company issued
1,000,000 restricted shares of common stock at a fair value of $425,000 to Cohen
for services to be provided over two year periods. As at September 30, 2010,
$185,137 is included in prepaid expenses and will be recognized over the
remaining term of the consulting agreement.

Verify Smart Corp.
(A Development Stage Company)
Notes to the Financial Statements
(Unaudited)

e) On September 22, 2009, the Company entered into a compensation agreement with
AMG Group Inc. ("AMG') wherein AMG has agreed to provide certain consulting
services to the company. The agreement expires on September 22, 2011.

In consideration of the consulting services provided by AMG, the Company hereby
agrees to pay AMG the compensation as follows:

i) asset acquisition, merger, or other value acquisition or disposition(the
"Event") - the Company will pay within 30 days of closing of such an Event an
amount equal to, at AMG' election, 5% in cash or 10% in common stock with the
stock priced at the weighted average stock price for the year, on the stated
value of the Event or, failing contractual value, the fair market value of the
Event;
ii) card issuers or internet users - the Company will pay to AMG an amount
of 10% of cash flow received by the Company (less direct third party costs) from
bank, and any other business paying the Company based on card use or internet
use of the Company's products for the first five years and 5% thereafter for an
additional five years. For the first institution of in excess of one million
cards signed, the Company will pay AMG one million common shares of the Company.
iii) the Company shall pay AMG a monthly fee of $5,000 starting July 1,
2010 and pre-approved expenses.

f) The Company entered in to a five year office lease agreement effective May 1,
2009. Under the terms of the lease, the Company is required to make payments of
approximately $7,170 per month (342,000 Philippine pesos) for rent and operating
costs. Future minimum payments are as follows:

2011 87,170
2012 90,851
2013 94,716
2014 56,803
---------

$ 329,540
=========

NOTE 13. SUBSEQUENT EVENTS

Pursuant to ASC 855, the Company has evaluated all events or transactions that
occurred from September 30, 2010 through November 11, 2010, the date of issuance
of the unaudited financial statements. During this period, the Company did not
have any material recognizable subsequent events.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

FORWARD-LOOKING STATEMENTS

This quarterly report contains forward-looking statements. These statements
relate to future events or our future financial performance. In some cases, you
can identify forward-looking statements by terminology such as "may", "should",
"expects", "plans", "anticipates", "believes", "estimates", "predicts",
"potential" or "continue" or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown
risks, uncertainties and other factors, that may cause our or our industry's
actual results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements to conform these statements to actual results.

Our unaudited financial statements are stated in United States dollars and are
prepared in accordance with United States Generally Accepted Accounting
Principles. The following discussion should be read in conjunction with our
financial statements and the related notes that appear elsewhere in this
quarterly report. The following discussion contains forward-looking statements
that reflect our plans, estimates and beliefs. Our actual results could differ
materially from those discussed in the forward looking statements. Factors that
could cause or contribute to such differences include, but are not limited to,
those discussed below and elsewhere in this quarterly report.

In this quarterly report, unless otherwise specified, all dollar amounts are
expressed in United States dollars. All references to "common stock" refer to
the common shares in our capital stock.

As used in this quarterly report, the terms "we", "us", "our", "our company" and
"Verify" mean Verify Smart Corp., unless otherwise stated.

CORPORATE OVERVIEW

The address of our principal executive office 57 Montague Street, Brooklyn NY
11201. Our telephone number is 718 855 7136

Effective March 19, 2009, we effected a fifteen (15) for one (1) forward stock
split of our authorized and issued and outstanding common stock. and the
reduction of our authorized common stock As a result, our authorized capital has
changed to 250,000,000 shares of common stock with a par value of $0.001 and our
issued and outstanding shares have increased from 4,000,000 shares of common
stock to 60,000,000 shares of common stock.

Also effective March 19, 2009, we have changed our name from "Treasure
Explorations Inc." to "Verify Smart Corp".

The name change and forward stock split became effective with the
Over-the-Counter Bulletin Board at the opening for trading on March 24, 2009
under the new stock symbol "VSMR".

We have not been involved in any bankruptcy, receivership or similar proceeding.

GENERAL OVERVIEW

We were incorporated in the state of Nevada on May 31, 2006. Since our
incorporation, we had been in the business of the exploration and development of
a mineral property in New Westminster, Simalkameen Mining Division of British
Columbia, consisting of 336 hectares included with 16 mineral title cells. Our
property was without known reserves and our program was exploratory in nature.
We completed the Phase 1 exploration program in our property, the results of
which were not promising and did not justify further expense. Because we were
not successful in our exploration program, we abandoned the mineral claims and
focused on the identification of suitable businesses with which to enter into a
business opportunity or business combination.

Effective March 19, 2009, we effected a fifteen (15) for one (1) forward stock
split of our authorized and issued and outstanding common stock. As a result,
our authorized capital has changed to 250,000,000 shares of common stock with a
par value of $0.001 and our issued and outstanding shares have increased from
4,000,000 shares of common stock to 60,000,000 shares of common stock.

Also effective March 19, 2009, we have changed our name from "Treasure
Explorations Inc." to "Verify Smart Corp". The change of name was approved by
our directors and a majority of our shareholders.

On March 25, 2009, we entered into a joint venture agreement with Verified
Capital Corp. and Verified Transactions Corp. relating to the formation and
operation of a joint venture corporation that will sell internet security
software for credit card fraud prevention. Upon the satisfaction of customary
closing conditions, we will earn a 70% interest in the joint venture.

We were required to contribute $2,000,000 by May 1, 2009, of which $250,000 will
be paid to Verified Transactions Corp. as a license fee. Until such time as we
have raised the $2,000,000, we will not be entitled to receive any revenue from
the joint venture corporation. We were further required to contribute $3,000,000
to the joint venture by July 1, 2009, of which $500,000 will be paid to Verified
Transactions Corp. as a license fee. As of the date of this report, we have not
yet contributed the $2,000,000 owed to the joint venture. A joint venture
corporation has not been formed, and as per the joint venture agreement we are
the operator of the joint venture corporation. We have contracted the operator
rights to Verified Capital Corp. as the sub-operator.

By amendment agreement of May 19, 2009, the Companies have agreed to a mutual
understanding and agreement that the Joint Venture has been satisfactorily
performed by our company and that we have performed the required financial
obligations of Section 5.01 through both fund raising and joint venture cost

sharing and accordingly, VSC's obligations of Section 5.01 are fully satisfied,
the Joint Venture agreement is in full force and effect in good standing and
VSC's revenue sharing right to 70% of the Joint Venture's revenue commences the
date of the amendment agreement.

Pursuant to the joint venture agreement, Verified Transactions Corp. has
provided to the joint venture an exclusive world-wide license to use, sell and
sub-license its internet security software and all other internet business of
such nature and including all future development of such business.

The term of the license is for a period of 25 years with an option to renew for
an additional 25 years for a payment of $5,000,000. In consideration for the
granting of the license, Verified Transactions Corp. will receive the license
fees disclosed above, 10% of the revenue of the joint venture to a maximum of
$1,250,000 and a 3% royalty on the gross revenue of the joint venture.

We have the right to acquire all of Verified Capital Corp.'s interest in the
joint venture and all of Verified Transactions Corp.'s interest in the joint
venture , excluding the royalty as set out in the joint venture agreement, at
market value at the earlier of the joint venture generating $100 million in
aggregate revenue per year with a minimum net margin of 25% or 5 years. Market
value shall be determined by an agreed valuator or, failing agreement, we may
hire a top-five chartered accountancy firm to prepare a market value report and,
absent material error of standard calculation, such report shall be final.

Pursuant to the terms of the joint venture agreement, we have agreed to permit
and have the right to tender to all shareholders and creditors of each of
Verified Capital Corp. and Verified Transactions Corp. to convert their debts
and shares into shares of our company on a one for one basis subject to our
company raising the $2,000,000 (as set out above) and the joint venture earning
gross cash flow of not less than $100,000 per week.

Under the license, Ralph Santos will receive a 10% carried equity interest in
the Gateway internet business of the joint venture corporation. Mr. Santos is
also a significant equity owner in Verified Transactions Corp. and Verified
Capital Corp.

Effective June 5, 2009, we entered into an agreement with Ellick Corporation to
provide our VerifyGateway, VeriSmart Card and VerifyNgo suite of services. As
part of this agreement, Ellick Corp. will provide our company with Voice Over
Internet Protocol (VOIP) and Contact Centre capabilities in Manila.

Effective June 11, 2009, we entered into an agreement with Crown Mutual
Corporation to provide our VerifyGateway and VerifyNgo suite of services.

Effective June 19, 2009, we entered into an agreement with BetED Corporation to
provide our VerifyGateway and VerifyNgo suite of services.

On September 29, 2009, we signed a Beta Agreement with OneWorld Connections,
Inc. to integrate all four of our applications for possible integration into all
levels of it's worldwide businesses.

On October 7, 2009, we signed a Letter of Intent with iMobile Interactive of New
Jersey for iMobile to provide CDN (Content Delivery Network) and SMS (Short
Message Service (text)) solutions to Verify Smart in more than 160 countries.

On October 8, 2009, we signed a Letter of Intent with iPay Commerce Ventures
Inc. (IPCV), a subsidiary of the Intellectual Property Ventures Group
Corporation, a listed company on the Philippine Stock Exchange to initiate a
two-stage integration of our VerifyTransfer platform.

On October 21, 2009, we signed a Memorandum of Understanding with Mr. Theodore
"Teddy" Permadi Rachmat of Indonesia. The Memorandum of Understanding outlines
the terms of an agreement between Mr. Rachmat and Verify Smart to form a joint
venture company to introduce our technology to financial institutions,
businesses and economic development groups in Southeast Asia.

DESCRIPTION OF THE JOINT VENTURE BUSINESS

The joint venture business will market and sell its licensed software which
provides a comprehensive solution to credit card fraud by addressing the
security needs of consumer clients, credit card companies, banks and merchants
through instant verification that is inexpensive to implement and simple to use.

The software operates through the use of a cellular phone for secured
verification of monetary transactions. The software has been developed to
include debit card purchases, internet purchases, ATM, passport and mortgage
verification.

We have also entered into preliminary discussions with Verified Capital Corp.
wherein we would acquire either the assets or outstanding shares of common stock
of Verified Capital Corp. The parties will jointly determine the optimum
structure for the acquisition in order to best satisfy tax planning, regulatory
and other considerations, including mutually agreed upon performance based
milestones.

The acquisition contemplated by the preliminary discussions is subject to the
fulfillment of certain conditions precedent, due diligence and the negotiation
of a definitive agreement. Under the terms of the agreement Prime Interactive
will be providing the following services to our company:

* Web and Mobile Application Development
* Data Centre infrastructure servicing Europe and located in Slovakia
* Marketing access to a legacy worldwide customer base of 130,000
* Marketing access to established European Financial Industry vertical

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2010 AND 2009

We have not generated any revenue since inception and are dependent upon
obtaining financing to pursue our business activities. For these reasons, our
auditors believe that there is substantial doubt that we will be able to
continue as a going concern.

As of September 30, 2010, our total assets were $435,613 and our total
liabilities were $187,865. We had a working capital surplus of $61,600. Our
financial statements report a net loss of $54,973 for the three months ended
September 30, 2010, and a net loss of $1,369,522 for the period from May 31,
2006 (inception) to September 30, 2010.

GOING CONCERN

Due to the uncertainty of our ability to meet our current operating and capital
expenses, in their report on the annual financial statements for the year ended
June 30, 2010, our independent auditors included an explanatory paragraph
regarding concerns about our ability to continue as a going concern.

We anticipate that additional funding will be required in the form of equity
financing from the sale of our common stock. At this time, we cannot provide
investors with any assurance that we will be able to raise sufficient funding
from the sale of our common stock or through a loan from our directors to meet
our obligations over the next twelve months. We do not have any arrangements in
place for any future debt or equity financing.

CONTRACTUAL OBLIGATIONS

As a "smaller reporting company", we are not required to provide tabular
disclosure obligations.

OFF-BALANCE SHEET ARRANGEMENTS

We have no 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 is material to stockholders.

CRITICAL ACCOUNTING POLICIES

BASIS OF ACCOUNTING

The Company's financial statements are prepared using the accrual method of
accounting. We have elected a June 30, year-end.

BASIC AND DILUTE NET INCOME (LOSS) PER SHARE

Our company computes net loss per share in accordance with ASC 260 Earnings Per
Share which 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
income (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.

CASH EQUIVALENTS

We consider all highly liquid investments purchased with an original maturity of
three months or less to be cash equivalents.

USE OF ESTIMATES AND ASSUMPTIONS

The preparation of the 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 of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

INCOME TAXES

Income taxes are provided in accordance with ASC 740 Accounting for Income
Taxes. A deferred tax asset or liability is recorded for all temporary
differences between financial and tax reporting and net operating loss
carryforwards. Deferred tax expense (benefit) results from the net change during
the year of deferred tax assets and liabilities.

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2009, FASB issued ASC 855, Subsequent Events, which establishes general
standards of for the evaluation, recognition and disclosure of events and
transactions that occur after the balance sheet date. Although there is new
terminology, the standard is based on the same principles as those that
currently exist in the auditing standards. The standard, which includes a new
required disclosure of the date through which an entity has evaluated subsequent
events, is effective for interim or annual periods ending after June 15, 2009.
The adoption of ASC 855 did not have a material effect on our company's
financial statements. Refer to Note 13.

In June 2009, the FASB issued guidance now codified as ASC 105, Generally
Accepted Accounting Principles as the single source of authoritative accounting
principles recognized by the FASB to be applied by nongovernmental entities in
the preparation of financial statements in conformity with U.S. GAAP, aside from

those issued by the SEC. ASC 105 does not change current U.S. GAAP, but is
intended to simplify user access to all authoritative U.S. GAAP by providing all
authoritative literature related to a particular topic in one place. The
adoption of ASC 105 did not have a material impact on our company's financial
statements, but did eliminate all references to pre-codification standards. Our
company has implemented all new accounting pronouncements that are in effect and
that may impact our financial statements and does not believe that there are any
other new accounting pronouncements that have been issued that might have a
material impact on our financial position or results of operations.

ITEM 3. QUANTITATIVE DISCLOSURES ABOUT MARKET RISKS.

As a "smaller reporting company", we are not required to provide the information
required by this Item.

ITEM 4(T). 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, chief executive officer
and chief financial officer (who is acting as our principal executive officer,
principal financial officer and principle accounting officer) to allow for
timely decisions regarding required disclosure.

As of September 30, 2010, the end of our quarter covered by this report, we
carried out an evaluation, under the supervision and with the participation of
our president, chief executive officer and chief financial officer (who is
acting as 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, chief executive officer and chief financial officer (who is acting as
our principal executive officer, principal financial officer and principle
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 our quarter ended September 30, 2009 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 or beneficial shareholder, is an
adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS.

Our business operations are subject to a number of risks and uncertainties,
including, but not limited to those set forth below:

WE HAVE A LIMITED OPERATING HISTORY, AND IT IS DIFFICULT TO EVALUATE OUR
FINANCIAL PERFORMANCE AND PROSPECTS. THERE IS NO ASSURANCE THAT WE WILL ACHIEVE
PROFITABILITY OR THAT WE WILL NOT DISCOVER PROBLEMS WITH OUR BUSINESS MODEL.

We have a limited operating history. As such, it is difficult to evaluate our
future prospects and performance, and therefore we cannot ensure that we will
operate profitably in the future.

WE HAVE LIMITED FUNDS AVAILABLE FOR OPERATING EXPENSES. IF WE DO NOT OBTAIN
FUNDS WHEN NEEDED, WE WILL HAVE TO CEASE OUR OPERATIONS.

Currently, we have limited operating capital. As of September 30, 2010, our cash
available was approximately $2,733. In the foreseeable future, we expect to
incur significant expenses if we acquire and develop our new business. We may be
unable to locate sources of capital or may find that capital is not available on
terms that are acceptable to us to fund our additional expenses. There is the
possibility that we will run out of funds, and this may affect our operations
and thus our profitability. If we cannot obtain funds when needed, we may have
to cease our operations.

WE DEPEND ON ATTRACTING AND RETAINING QUALIFIED EMPLOYEES, THE FAILURE OF WHICH
COULD RESULT IN A MATERIAL DECLINE IN OUR REVENUES.

We intend to become a provider of identity protection/secured transaction
services. Our revenues and future growth will depend on our ability to attract
and retain qualified employees. This is especially crucial to our proposed
business, as these employees will generate revenue by providing the services
that are the staple product that we offer. We may face difficulties in
recruiting and retaining sufficient numbers of qualified employees because the
market may not have enough of such personnel. In addition, we compete with other

companies for qualified employees. If we are unable to retain such employees, we
could face a material decline in our revenue.

U.S. INVESTORS MAY EXPERIENCE DIFFICULTIES IN ATTEMPTING TO ENFORCE JUDGMENTS
BASED UPON U.S. FEDERAL SECURITIES LAWS AGAINST US AND OUR NON-U.S. RESIDENT
DIRECTORS.

All of our operations and our assets are located outside the United States and
some of our directors and officer are foreign citizens. As a result, it may be
difficult or impossible for U.S. investors to enforce judgments of U.S. courts
for civil liabilities against any of our individual directors or officers.

RISKS RELATING TO OUR COMMON SHARES

TRADING ON THE OTC BULLETIN BOARD MAY BE VOLATILE AND SPORADIC, WHICH COULD
DEPRESS THE MARKET PRICE OF OUR COMMON SHARES AND MAKE IT DIFFICULT FOR OUR
SHAREHOLDERS TO RESELL THEIR SHARES.

Our common shares are quoted on the OTC Bulletin Board service. Trading in
shares quoted on the OTC Bulletin Board is often thin and characterized by wide
fluctuations in trading prices, due to many factors that may have little to do
with our operations or business prospects. This volatility could depress the
market price of our common shares for reasons unrelated to operating
performance. Moreover, the OTC Bulletin Board is not a stock exchange, and
trading of securities on the OTC Bulletin Board is often more sporadic than the
trading of securities listed on a quotation system like Nasdaq or a stock
exchange like Amex. Accordingly, shareholders may have difficulty reselling any
of the shares.

OUR SHARE IS A PENNY STOCK. TRADING OF OUR SHARE MAY BE RESTRICTED BY THE SEC'S
PENNY STOCK REGULATIONS WHICH MAY LIMIT A SHAREHOLDER'S ABILITY TO BUY AND SELL
OUR SHARES.

Our share is a penny stock. The Securities and Exchange Commission has adopted
Rule 15g-9 which generally defines "penny stock" to be any equity security that
has a market price (as defined) less than $5.00 per share or an exercise price
of less than $5.00 per share, subject to certain exceptions. Our securities are
covered by the penny stock rules, which impose additional sales practice
requirements on broker-dealers who sell to persons other than established
customers and "accredited investors". The term "accredited investor" refers
generally to institutions with assets in excess of $5,000,000 or individuals
with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or
$300,000 jointly with their spouse. The penny stock rules require a
broker-dealer, prior to a transaction in a penny stock not otherwise exempt from
the rules, to deliver a standardized risk disclosure document in a form prepared
by the SEC which provides information about penny stocks and the nature and
level of risks in the penny stock market. The broker-dealer also must provide
the customer with current bid and offer quotations for the penny stock, the
compensation of the broker-dealer and its salesperson in the transaction and
monthly account statements showing the market value of each penny stock held in
the customer's account. The bid and offer quotations, and the broker-dealer and
salesperson compensation information, must be given to the customer orally or in
writing prior to effecting the transaction and must be given to the customer in

writing before or with the customer's confirmation. In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise exempt
from these rules; the broker-dealer must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchaser's written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the shares that are subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities. We believe that the penny stock rules discourage investor interest
in and limit the marketability of our common shares.

FINRA SALES PRACTICE REQUIREMENTS MAY ALSO LIMIT A SHAREHOLDER'S ABILITY TO BUY
AND SELL OUR SHARE.

In addition to the "penny stock" rules promulgated by the Securities and
Exchange Commission, the Financial Industry Regulatory Authority, or FINRA, has
adopted rules that require that in recommending an investment to a customer, a
broker-dealer must have reasonable grounds for believing that the investment is
suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customer's financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, the FINRA believes that there is a high probability that
speculative low priced securities will not be suitable for at least some
customers. The FINRA requirements make it more difficult for broker-dealers to
recommend that their customers buy our common shares, which may limit your
ability to buy and sell our share.

TRENDS, RISKS AND UNCERTAINTIES

We have sought to identify what we believe to be the most significant risks to
our business, but we cannot predict whether, or to what extent, any of such
risks may be realized nor can we guarantee that we have identified all possible
risks that might arise. Investors should carefully consider all of such risk
factors before making an investment decision with respect to our common shares.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Effective August 14, 2009, we issued 1,000,000 restricted shares of our common
stock to one U.S. person (as that term is defined in Regulation S of the
Securities Act of 1933) relying upon Rule 506 of Regulation D of the Securities
Act of 1933.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

Exhibits required by Item 601 of Regulation S-K

Exhibit
Number Description
------ -----------

(3) ARTICLES OF INCORPORATION AND BY-LAWS

3.1 Articles of Incorporation (incorporated by reference from our
Registration Statement on Form SB-2 filed on August 10, 2006)

3.2 Bylaws (incorporated by reference from our Registration Statement on
Form S-1 filed on July 21, 2008)

3.3 Certificate of Change (incorporated by reference from our Current
Report on Form 8-K filed on March 26, 2009)

3.4 Certificate of Amendment (incorporated by reference from our Current
Report on Form 8-K filed on March 26, 2009)

(10) MATERIAL CONTRACTS

10.1 Joint Venture Agreement among Verified Capital Corp., Verified
Transactions Corp. and our company dated effective March 25, 2009
(incorporated by reference from our Current Report on Form 8-K filed
on March 26, 2009)

10.2 Consulting Agreement with Cohen Independent Research Group
(incorporated by reference from our Current Report on Form 8-K filed
on September 22, 2009)

10.3 Compensation Agreement with AMG Group Inc. (incorporated by reference
from our Current Report on Form 8-K filed on October 1, 2009)

(31) RULE 13A-14(D)/15D-14(D) CERTIFICATIONS

31.1* Section 302 Certification of Principal Executive Officer and Principal
Financial Officer.

(32) SECTION 1350 CERTIFICATIONS

32.1* Section 906 Certification of Principal Executive Officer and Principal
Financial Officer.

* Filed herewith

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

VERIFY SMART CORP.
(Registrant)

November 15, 2010 /s/ Tony Cinotti
-----------------------------
Tony Cinotti
Director

Attached files

VERIFY SMART CORP. Reports

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