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EX-31 - CERTIFICATION UNDER SECTION 302 - Vacation Home Swap, Inc.exhibit31.htm
EX-32 - CERTIFICATION UNDER SECTION 906 - Vacation Home Swap, Inc.exhibit32.htm



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:  

October 31, 2010








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





For the transition period from

___________

to

____________









Commission file number:

333-160311










VACATION HOME SWAP, INC.



(Exact name of registrant as specified in its charter)









Nevada



26-4682636


(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)








112 North Curry Street, Carson City, NV   89703



(Address of principal executive offices)          (Zip Code)









Phone (775) 321-8201



(Registrants telephone number, including area code)





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.


Yes |X| No |_|

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer  [  ]

 Accelerated filer [   ]

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

    Smaller reporting company [X]


Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act).


Yes |X| No |_|

The number of shares outstanding of the Registrant's Common Stock as January 31, 2011 was 10,325,000 shares of common stock, $0.001 par value, issued and outstanding.







1



VACATION HOME SWAP, INC.

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS








Page



Number


PART I FINANCIAL INFORMATION





Item 1

Condensed Financial Statements (Unaudited)

3




Item 2

Managements Discussion and Analysis of Financial Condition and Results of Operations

9




Item 3

Quantitative and Qualitative Disclosures About Market Risk

11




Item 4

Controls and Procedures

11








PART II OTHER INFORMATION





Item 1

Legal Proceedings

13




Item 2

Unregistered Sales of Equity Securities and Use of Proceeds

13




Item 3

Defaults Upon Senior Securities

13




Item 4

(Removed and Reserved)

13




Item 5

Other Information

13




Item 6

Exhibits

13





2










VACATION HOME SWAP, INC.

(A Development Stage Company)


CONDENSED FINANCIAL STATEMENTS


October 31, 2010


Unaudited















CONDENSED BALANCE SHEETS


CONDENSED STATEMENTS OF OPERATIONS


CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)


CONDENSED STATEMENTS OF CASH FLOW


NOTES TO CONDENSED FINANCIAL STATEMENTS



3


VACATION HOME SWAP, INC.

 

(A Development Stage Company)

 











 

CONDENSED BALANCE SHEETS

 

Unaudited

 











 








October 31, 2010


April 30, 2010

 

 

 

 

 

 

 

 

 

 

(Audited)

 











 

ASSETS










CURRENT ASSETS










 

Cash





$


109


$


66

 

TOTAL ASSETS

 

 

 

$

109

$

66

 











 

LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)





 











 

CURRENT  LIABILITIES







 

Accounts payable and accrued liabilities


$

15,300

$

13,218

 

Loans from Related Party

 

 

 

1,610

 

1,200

 

TOTAL CURRENT LIABILITIES

 

 

$

16,910

$

14,418

 











 

STOCKHOLDER'S  EQUITY ( DEFICIT )






 

Capital stock (Note 5)








 

Authorized








 

       75,000,000 shares of common stock, $0.001 par value,





 

Issued and outstanding







 

       10,325,000 shares and 10,000,000 shares of common stock as of October 31and  April 30,2010)

$

10,325

$

10,000

 

       Additional Paid in Capital




6,175


-    

 

Deficit accumulated during the development stage


 

 

 

 

 

(33,301)

 

(24,352)

 

TOTAL STOCKHOLDER'S EQUITY/(DEFICIT)

 

 

 

 

 

$

(16,801)

$

(14,352)

 

TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY/(DEFICIT)

 

 

 

 

 

$

109

$

66

 











 











 











 











 

The accompanying notes are an integral part of these financial statements

 



4


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  VACATION HOME SWAP, INC.

(A Development Stage Company)

 

















 

CONDENSED STATEMENTS OF OPERATIONS

 

Unaudited

 

















 

















 
















Cumulative results

 








Three months


Three months


Six months


Six months


from inception

 








ended


ended


ended


ended


(April 9, 2009) to

 

 

 

 

 

 

 

 

October 31, 2010

 

October 31, 2009

 

October 31, 2010

 

October 31, 2009

 

October 31, 2010

 

REVENUE
















 

















 

Revenues






$

-    

$

-    

$

-    

$

-    

$

-    

 

Total Revenues

 

 

 

 

$

-    

$

-    

$

-    

$

-    

$

-    

 

















 

EXPENSES















 

















 

Office and general





$

300

$

493    

$

1,960

$

1,456

$

7,352

 

Professional Fees






3,500


3,500


7,000


9,513


25,960

 

Total Expenses

 

 

 

 

$

3,800

$

3,993

$

8,960

$

10,969

$

33,312

 

NET OPERATING LOSS







$


(3,800)

$


(3,993)


$


(8,960)


$


(10,969)


$


(33,312)


 

OTHER INCOM (LOSS)

Exchange gain (loss)

 






$


    11


$


-


$


     11


$


-


$


      11


 

NET LOSS

 

 

 

 

$

(3,789)

$

(3,993)

$

(8,949)

$

(10,969)

$

(33,301)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 


 

 

 

 

 











 

BASIC AND DILUTED LOSS PER COMMON SHARE

 






$

-

$

-  

$

-

$

-  



 

WEIGHTED AVERAGE NUMBER OF COMMON

SHARES OUTSTANDING







$

10,325,000

$

10,000,000


10,249,728


10,000,000



 

The accompanying notes are an integral part of these financial statements

 

 

5


 

CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

From inception (March 31, 2009) to October 31, 2010

 

Unaudited

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

Common Stock

 

 

 

 

 

accumulated

 

 

 

 

 

 

 

Additional

 

Share

 

during the

 

 

 

 

 

Number of

 

 

 

Paid-in

 

Subscription

 

development

 

 

 

 

 

shares

 

Amount

 

Capital

 

Receivable

 

stage

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued for cash at $0.001

 

 

 

 

 

 

 

 

 

 

per share on April 30, 2009

10,000,000

$

10,000

$

-   

$

(10,000)

$

-   

$

-   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the period ended

 

 

 

 

 

 

 

 

 

 

April 30, 2009

 

 

 

 

 

 

 

 

 

 

(1,200)

 

(1,200)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, April 30, 2009

 

10,000,000

$

10,000

$

-   

$

(10,000)

$

(1,200)

$

(1,200)

Subscription Receivable on

 

 

 

 

 

 

 

 

 

 

 

October 8, 2009

 

 

 

 

 

 

 

 

10,000

 

 

 

10,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the year ended

 

 

 

 

 

 

 

 

 

 

 

April 30, 2010

 

 

-   

 

-   

 

-   

 

-   

 

(23,152)

 

(23,152)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, April 30, 2010

 

10,000,000

$

10,000

$

-   

$

-   

$

(24,352)

$

(14,352)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued for cash at $0.02

 

 

 

 

 

 

 

 

 

 

per share on June & July, 2010

325,000

 

325

 

6,175

 

 

 

 

 

6,500

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the period ended

 

 

 

 

 

 

 

 

 

 

 

 

October 31, 2010

 

 

-   

 

-   

 

-   

 

-   

 

(8,949)

 

(8,949)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance,  October 31, 2010

 

10,325,000

$

10,325

$

6,175

$

-   

$

(33,301)

$

(16,801)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these financial statements

 


6



VACATION HOME SWAP, INC.

(A Development Stage Company)


CONDENSED STATEMENTS OF CASH FLOW

Unaudited





























Six months


Six months


April 9, 2009







ended


ended


(inception date) to

 

 

 

 

 

 

October 31, 2010


October 31, 2009


October 31, 2010












CASH FLOWS FROM OPERATING ACTIVITIES








Net loss




$

(8,949)

$

(10,969)

$

(33,301)


Adjustment to reconcile net loss to net cash








used in operating activities








 

Increase (decrease) in accrued expenses

$

2,082

$

2,300

$

15,300












NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES








$

(6,867)

$

(8,669)

$

(18,001)












CASH FLOWS FROM FINANCING ACTIVITIES








Proceeds from sale of common stock


6,500


10,000


16,500


Increase in shareholders loan



-    


-    


-    

 

Loan from related party

 

 

410

 

-    

 

1,610

NET CASH PROVIDED BY FINANCING ACTIVITIES

 

 

 

 

 

 


$

6,910

$

10,000

$

18,110












NET INCREASE ( DECREASE) IN CASH

$

43

$

1,331

$

109












CASH, BEGINNING OF PERIOD

 

$

66

$

-    

$

-    












CASH, END OF PERIOD

 

 

$

109

$

1,331

$

109























Supplemental cash flow information and noncash financing activities:





Cash paid for:











Interest

 

 

 

$

-    

$

-    

$

-    













Income taxes

 

 

$

-    

$

-    

$

-    












The accompanying notes are an integral part of these financial statements






7



VACATION HOME SWAP, INC.

(A Development Stage Company)


NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS


October 31, 2010


NOTE 1 CONDENSED FINANCIAL STATEMENTS


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 October 31, 2010, and for all periods presented herein, have been made.


Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Companys April 30, 2010 audited financial statements.  The results of operations for the periods ended October 31, 2010 and the same period last year are not necessarily indicative of the operating results for the full years.




NOTE 2 GOING CONCERN


The Companys financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.


In order to continue as a going concern, the Company will need, among other things, additional capital resources. Managements plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.


The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.









8



VACATION HOME SWAP, INC.

(A Development Stage Company)


NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS


October 31, 2010


NOTE 3 - CAPITAL STOCK


The Companys capitalization is 75,000,000 common shares with a par value of $0.001 per share.  No preferred shares have been authorized or issued.


On April 20, 2009, a director of the Company purchased 10,000,000 shares of the common stock in the Company at $0.001 per share for $10,000.


In June and July 2010 the company issued 325,000 common shares @ $0.02 for subscriptions receivable of $6,500.

The Company has a total of 10,325,000 shares issued and outstanding at October 31, 2010.




Item 2. Management`s Discussion and Analysis of Financial Condition and Results of Operations


This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance.  Forward looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions or words which, by their nature, refer to future events.  You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report.  These forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.


Overview


Vacation Home Swap, Inc. ("Vacation Home Swap", "the Company", our or "we") was incorporated in the State of Nevada as a for-profit company on March 31, 2009.  The Company is a development stage company organized to enter into an Internet-based vacation home swapping company. The company plans to have a website where people can exchange homes for their holidays and travels.


Plan of Operation


The Company has not yet generated any revenue from its operations.  As of the fiscal quarter ended October 31, 2010 we had $109 of cash on hand. We incurred operating expenses in the amount of $3,800 in the quarter ended October 31, 2010. These operating expenses were comprised of professional fees and office and general expenses.


Our current cash holdings will not satisfy our liquidity requirements and we will require additional financing to pursue our planned business activities.  We have registered 4,000,000 of or our



9



common stock for sale to the public.  Our registration statement became effective on April 8, 2010 and we are in the process of seeking equity financing to fund our operations over the next 12 months.  


Management believes that if subsequent private placements are successful, we will generate sales revenue within the following twelve months thereof. However, additional equity financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements.


If Vacation Home Swap is unsuccessful in raising the additional proceeds through a private placement offering it will then have to seek additional funds through debt financing, which would be very difficult for a new development stage company to secure. Therefore, the company is highly dependent upon the success of the anticipated private placement offering described herein and failure thereof would result in Vacation Home Swap having to seek capital from other resources such as debt financing, which may not even be available to the company. However, if such financing were available, because Vacation Home Swap is a development stage company with no operations to date, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing and determine whether the business could sustain operations and growth and manage the debt load. If Vacation Home Swap cannot raise additional proceeds via a private placement of its common stock or secure debt financing it would be required to cease business operations. As a result, investors in Vacation Home Swap common stock would lose all of their investment.


Over the 12 month period starting upon completion of the offering under this registration statement, Vacation Home Swap must raise capital and start its sales. The first stage of our operations over this period is to establish our office and acquire the computer and office equipment we need to begin operations during the initial 60 days after raising enough money to start our business. We believe that it will cost $8,000 to buy and secure the necessary computer equipment. We do not intend to hire employees. Our sole officer and director will handle our administrative duties.


The second stage is to hire consultants to develop the key part of the business: create the website. Our Company`s website will include links to maps, weather information, country habits, local services and stores, community information, information about neighbourhood and special events. Concurrently we intend to purchase a software system to comply with our needs, which the client can add home pictures, videos from his home, indicate through a link the local services and stores nearby, and create an internal inbox for messages received/sent. We believe that it will cost $15,000 initially to have our website operational. The initial operation of the website is anticipated to be ready in 120 days after raising enough money to start our business.


The last stage is our Marketing and Sales campaign. We intend to include advertisements in travel and home design magazine and various Internet search engines; and promote and sell ads into our website along famous coffee shops, outlets, restaurants and bars, technology companies and airline companies. We believe that marketing and sales campaign will cost up to $45,000. We expect to be fully operational within 180 days after raising enough money to start our business.


We do not currently have any employees and management does not plan to hire employees at this time. We do not expect the purchase or sale of any significant equipment and has no current material commitments.







10



Limited Operating History; Need for Additional Capital


There is no historical financial information about us upon which to base an evaluation of our performance. We are a development stage corporation and have not generated any revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources.



Capital Resources


If Vacation Home Swap is unsuccessful in raising the additional proceeds through a private placement offering it will then have to seek additional funds through debt financing, which would be highly difficult for a new development stage company to secure. Therefore, the company is highly dependent upon the success of the anticipated private placement offering and failure thereof would result in Vacation Home Swap having to seek capital from other sources such as debt financing, which may not even be available to the company. However, if such financing were available, because Vacation Home Swap is a development stage company with no operations to date, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing and determine whether the business could sustain operations and growth and manage the debt load. If Vacation Home Swap cannot raise additional proceeds via a private placement of its common stock or secure debt financing it would be required to cease business operations. As a result, investors in Vacation Home Swap common stock would lose all of their investment. 



Off Balance Sheet Arrangement


The company is dependent upon the sale of its common shares to obtain the funding necessary to carry its business plan.  Our President, Donald MacDow has undertaken to provide the Company with operating capital to sustain its business over the next twelve month period, as the expenses are incurred, in the form of a non-secured loan. However, there is no contract in place or written agreement securing these agreements.  Investors should be aware that Mr. MacDow expression is neither a contract nor agreement between him and the company.


Other than the above described situation 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 are material to investors.



Item 3. Quantitative and Qualitative Disclosures about Market Risk


Not required.


Item 4. Controls and Procedures


Evaluation of Disclosure Controls and Procedures




11



Based upon an evaluation of the effectiveness of disclosure controls and procedures, our principal executive and financial officer  has concluded that as of the end of the period covered by this Quarterly Report on Form 10-Q our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act) were not effective.  As reported in our Annual Report on Form 10-K for the year ended April 30, 2010, the Companys principal executive and financial officer has determined that there are material weaknesses in our disclosure controls and procedures.


The material weaknesses in our disclosure control procedures are as follows:


1.           Lack of formal policies and procedures necessary to adequately review significant accounting transactions. The Company utilizes a third party independent contractor for the preparation of its financial statements. Although the financial statements and footnotes are reviewed by our management, we do not have a formal policy to review significant accounting transactions and the accounting treatment of such transactions. The third party independent contractor is not involved in the day to day operations of the Company and may not be provided information from management on a timely basis to allow for adequate reporting/consideration of certain transactions.


2.            Audit Committee and Financial Expert. The Company does not have a formal audit committee with a financial expert, and thus the Company lacks the board oversight role within the financial reporting process.


We intend to initiate measures to remediate the identified material weaknesses including, but not necessarily limited to, the following:


 

 Establishing a formal review process of significant accounting transactions that includes participation of the Chief Executive Officer, the Chief Financial Officer and the Companys corporate legal counsel.


 

 Form an Audit Committee that will establish policies and procedures that will provide the Board of Directors a formal review process that will among other things, assure that management controls and procedures are in place and being maintained consistently.




Changes in Internal Controls over Financial Reporting


As reported in our Annual Report on Form 10-K for the year ended April 30, 2010, management is aware that there a significant deficiency and a material weakness in our internal control over financial reporting and therefore has concluded that the Companys internal controls over financial reporting were not effective as of April 30, 2010. The significant deficiency relates to a lack of segregation of duties due to the small number of employees involvement with general administrative and financial matters.  The material weakness relates to a lack of formal policies and procedures necessary to adequately review significant accounting transactions. 


There have not been any changes in the Company's internal control over financial reporting during the quarter ended October 31, 2010 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

 

 







12



PART II - OTHER INFORMATION


Item 1. Legal Proceedings


The Company is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated.


No director, officer, or affiliate of the issuer and no owner of record or beneficiary of more than 5% of the securities of the issuer, or any security holder is a party adverse to the small business issuer or has a material interest adverse to the small business issuer.


Item 2. Unregistered Sales of Equity Securities and Use of Proceeds


        None.



Item 3. Defaults Upon Senior Securities


        None


Item 4. (Removed and Reserved)



Item 5. Other Information


    None



Item 6. Exhibits


Exhibit No.


Document Description

3.1


Articles of Incorporation [1]




3.2


By-Laws [1]




31.1


Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer




31.2


Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer *




32.1


Section 1350 Certification of Chief Executive Officer




32.2


Section 1350 Certification of Chief Financial Officer **



[1]     Incorporated by reference from the Companys filing with the Commission on June 29, 2009.

*     Included in Exhibit 31.1

**    Included in Exhibit 32.1



13



                                   



SIGNATURES


Pursuant to the requirements of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


                        


Vacation Home Swap, Inc.



BY:      /s/ Donald MacDow

 ----------------------

Donald MacDow

President, Secretary Treasurer, Principal Executive Officer,

Principal Financial Officer


Dated:  January 31, 2011




14