UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q/A

 

Amendment No. 1

(Mark One)

 

x	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended August 31, 2011

 

OR

 

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

 

For the transition period from               to

 

COMMISSION FILE NUMBER:    333-142076

 

PROFIT PLANNERS MANAGEMENT, INC.

(Exact Name of small business issuer as specified in its charter)

 

Nevada		90-0450030
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

 

350 Madison Avenue, 8th Floor

New York, New York 10017

(Address of principal executive offices) (Zip Code)

 

Issuer’s telephone Number: (646) 416-6802

 

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 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 ¨   No x

 

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   ¨		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   ¨   No x

 

As of October 14, 2011, the issuer had 25,018,523 outstanding shares of Common Stock.

 

 

 

 

 

Explanatory Note

 

Profit Planners Management, Inc. (the “Company”) is filing this Amendment No. 1 on Form 10-Q/A (the “Amendment”) to the Company’s quarterly report on Form 10-Q for the period ended August 31, 2011 (the “Form 10-Q”), filed with the Securities and Exchange Commission on October 20, 2011 (the “Original Filing Date”), solely to furnish Exhibit 101 to the Form 10-Q in accordance with Rule 405 of Regulation S-T. Exhibit 101 consists of the following materials from the Company’s Form 10-Q, formatted in XBRL (eXtensible Business Reporting Language):

 

101.INS XBRL Instance Document

101.SCH XBRL Taxonomy Schema

101.CAL XBRL Taxonomy Calculation Linkbase

101.DEF XBRL Taxonomy Definition Linkbase

101.LAB XBRL Taxonomy Label Linkbase

101.PRE XBRL Taxonomy Presentation Linkbase

 

No other changes have been made to the Form 10-Q. This Amendment speaks as of the Original Filing Date, does not reflect events that may have occurred subsequent to the Original Filing Date, and does not modify or update in any way disclosures made in the Form 10-Q.

 

Pursuant to Rule 406T of Regulation S-T, the interactive data files attached as Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit Planners Management, Inc.

 

TABLE OF CONTENTS

 

			Page
	PART I
Item 1.	Consolidated Financial Statements
	Consolidated Balance Sheets as of August 31, 2011 (Unaudited) and May 31, 2011 (Audited)		1
	Consolidated Statements of Operations for the three months ended August 31, 2011 (Unaudited) and the three months ended August 31, 2010 (Unaudited)		2
	Consolidated Statements of Cash Flows for the three months ended August 31, 2011 (Unaudited) and the three months ended August 31, 2010 (Unaudited)		3
	Notes to the Consolidated Financials (Unaudited)		4
Item 2.	Management’s Discussion and Analysis or Plan of Operation		7
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		9
Item 4T	Controls and Procedures		9
	PART II
Item 1.	Legal Proceedings		10
Item 1A.	Risk Factors		10
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		10
Item 3.	Defaults Upon Senior Securities		10
Item 4.	Submission of Matters to a Vote of Security Holders		10
Item 5.	Other Information		10
Item 6.	Exhibits		10
SIGNATURES			10

 

 

 

 

 

 

PART I.

 

ITEM 1. FINANCIAL INFORMATION

 

Profit Planners Management, Inc.

 

Consolidated Balance Sheets

 

		August 31, 2011				May 31, 2011
Assets
Current Assets:
Cash		$	26,556			$	37,300
Accounts receivable			42,637				-
Accounts receivable-related party			28,500				25,500
Other current assets			1,288				1,288
Total Assets		$	98,981			$	64,088
Liabilities and Stockholders' Equity
Current liabilities:
Client Deposits/Retainers		$	-			$	3,500
Accounts and accrued expenses payable			7,487				11,058
Accounts and accrued expenses payable - related party			75,641				44,375
Total Liabilities			83,128				58,933
Stockholders' Equity
Preferred stock - $.001 par value; 50,000,000 shares authorized; none and none issued and outstanding, respectively			-				-
Common stock - $.001 par value; 500,000,000 shares authorized; 25,018,523 and 10,416,669 shares issued and outstanding, respectively			25,018				25,018
Common stock - $.001 par value; 370,371 shares subscribed not issued			370				370
Additional paid-in capital			157,477				157,112
Less: Amount due from subscriber under subscription agreement			(66,667	)			(66,667	)
Accumulated deficit			(100,345	)			(110,678	)
Total Stockholders' Equity			15,853				5,155
Total Liabilities And Stockholders' Equity		$	98,981			$	64,088

 

See accompanying notes to consolidated financial statements.

 

 

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Profit Planners Management, Inc.

 

Consolidated Statements of Operations

(Unaudited)

 

		Three months Ended August 31, 2011				Three months Ended August 31, 2010
Revenue		$	46,637			$	-
Revenue - Related Parties			3,000				6,000
Total Revenue			49,637				6,000
Operating expenses:
Consulting & professional expenses - related party			29,488				4,500
Consulting & professional expenses			2,136				9,970
Other operating expenses			7,680				1,446
Total operating expenses			39,304				15,916
Net Income (Loss)		$	10,333			$	(9,916	)
Basic and diluted net income (loss) per weighted-average shares common stock		$	0.00			$	(0.00	)
Weighted-average number of shares of common stock to be issued and outstanding-Basic			25,027,039				10,416,669
Weighted-average number of shares of common stock to be issued and outstanding-Diluted			25,397,410				10,416,669

 

See accompanying notes to consolidated financial statements.

 

 

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Profit Planners Management, Inc.

 

Consolidated Statements of Cash Flows

(Unaudited)

 

		Three months ended August 31, 2011				Three months ended August 31, 2010
Cash Flows From Operating Activities
Net income (loss)		$	10,333			$	(9,916	)
Adjustments to reconcile net income (loss) to cash used in operating activities:
Stock compensation			365				-
Changes in operating assets and liabilities:
Accounts receivable			(42,637	)			-
Accounts receivable-related party			(3,000	)			(6,000	)
Accounts and accrued expenses payable, and client deposits/retainers			(7,071	)			9,037
Accounts and accrued expenses payable - related party			31,266				4,500
Net Cash Used in Operating Activities			(10,744	)			(2,379	)
Net decrease in Cash			(10,744	)			(2,379	)
Cash, beginning of period			37,300				18,204
Cash, end of period		$	26,556			$	15,825

 

See accompanying notes to consolidated financial statements.

 

 

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Profit Planners Management, Inc.

Notes to Consolidated Financial Statements

August 31, 2011

(Unaudited)

 

NOTE 1 - BASIS OF PRESENTATION

 

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows. It is management's opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation. The results for the interim period are not necessarily indicative of the results to be expected for the full year.

 

Profit Planners Management, Inc. (the “Company”) was a development stage company until May 31, 2011.  As of August 31, 2011 the Company is no longer in development stage because the Company has generated sufficient third party revenue.

 

In August 2011, the Company formed a wholly owned subsidiary Profit Planners South (“PPS”), a South Carolina Corporation. PPS was formed to perform services in Charleston, South Carolina. The condensed consolidated financial statements for the three months ended August 31, 2011 include the accounts of PPS and all significant intercompany balances and transactions have been eliminated.

 

The balance sheet at May 31, 2011 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.  

 

The unaudited interim financial statements should be read in conjunction with the Company’s Form 10-K, which contains the audited financial statements and notes thereto, together with Management’s Discussion and Analysis, for the year ended May 31, 2011.  The interim results for the period ended August 31, 2011 are not necessarily indicative of the results for the full fiscal year.

 

NOTE 2 – NET INCOME (LOSS) PER COMMON SHARE

 

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. There were 370,371 potentially dilutive shares outstanding as of August 31, 2011 and May 31, 2011.

 

NOTE 3 – GOING CONCERN

 

The Company has used $10,744 net cash in operations for the three months ended August 31, 2011 and has only $15,853 of working capital in addition to an accumulated deficit of $100,345 at August 31, 2011.  These factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

 

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Management believes that the actions presently being taken and the success of future operations will be sufficient to enable the Company to continue as a going concern.  In addition, management intends to obtain capital in the near future through additional private placement offerings. However, there can be no assurance that the raising of equity will be successful and that the Company’s anticipated financing will be available in the future, at terms satisfactory to the Company. Failure to achieve the equity and financing at satisfactory terms and amounts could have a material adverse effect on 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.

 

NOTE 4 – CONCENTRATION RISK

 

Major Customers

 

For the three months ended August 31, 2011 and three months ended August 31, 2010, the Company had four and two customers, respectively, who accounted for 100% of total revenues. One customer accounted for 92% of sales for the three months ended August 31, 2011 and 60% of accounts receivable at August 31, 2011.

 

NOTE 5 – RELATED PARTY TRANSACTIONS

 

Revenues of $3,000 and $6,000 for the three month period ended August 31, 2011 and 2010, respectively, are derived from providing consulting services (primarily CFO services) to two companies substantially owned by our CEO.  Accounts receivable related to these two companies totaled $28,500 and $25,500 at August 31, 2011 and 2010, respectively.

 

Consulting and professional expenses totaling $29,488 and $4,500 for the three months ended August 31, 2011 and 2010, respectively, are derived from consulting services provided by our CFO and outsourcing consulting services to a company substantially owned by our CEO.

 

NOTE 6 – INCOME TAXES

 

The Company has not recorded any income tax expense or benefit for the three months ended August 31, 2011.  Any taxable income generated will be offset by net operating losses (“NOL”) generated in previous years.  At the present time, management cannot determine if the Company will be able to generate sufficient taxable income to realize the benefit of the NOL carryforwards; accordingly, a valuation allowance has been established to offset the asset.

 

NOTE 7 –  SUBSCRIPTION AGREEMENT

 

In May 2011 the Company entered into a Stock Purchase Agreement with Orchid Island Capital Partners LP (“Orchid”) whereby Orchid agreed to purchase 555,556 shares of the company’s restricted common stock for $100,000.  The Company issued 185,185 shares of common stock under the subscription agreement during May 2011 upon receipt of $33,333.  On September 7, 2011, the Company received another $33,333 and issued 185,185 more shares of common stock under the subscription agreement.

 

As of October 20, 2011, the Company has received a total of $66,666 of the $100,000 by subscription agreement through the private placement.  Upon receipt of the remaining $33,334, an additional 185,186 shares will be issued.

 

 

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NOTE 8 – STOCK COMPENSATION

 

Profit Planners South entered into an employment agreement with an employee on August 1, 2011.  In connection with the agreement the Company will issue 25,000 shares of Company common stock to the employee as stock compensation.  The common stock vests over two years from the date of the employment agreement.  In connection with the agreement, the Company recognized stock compensation expense of $365 for the period ended August 31, 2011.  Additional stock compensation of $8,385 is expected to be recognized over the remaining period of the employment agreement.

 

 

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

 

Forward-Looking Statements

 

The information in this report contains forward-looking statements. All statements other than statements of historical fact made in this report are forward looking. In particular, the statements herein regarding industry prospects and future results of operations or financial position are forward-looking statements. These forward-looking statements can be identified by the use of words such as “believes,” “estimates,” “could,” “possibly,” “probably,” anticipates,” “projects,” “expects,” “may,” “will,” or “should” or other variations or similar words. No assurances can be given that the future results anticipated by the forward-looking statements will be achieved. Forward-looking statements reflect management’s current expectations and are inherently uncertain. Our actual results may differ significantly from management’s expectations.

 

The following discussion and analysis should be read in conjunction with our financial statements, included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future. Such discussion represents only the best present assessment of our management.

 

Overview

 

We are a Nevada Corporation founded in January 2009. We provide short-term engagements of an outside chief financial officer (“CFO”) to assist companies with certain transactions or restructurings. Such transactions include, but are not limited to, the sale of a business, business reorganizations, the transfer of a family business, estate planning and the tax implications of such transactions.  There are many similar situations where a small company, which normally would not have a CFO, would need one for a period of time to complete a business transaction. We intend, through the existing relationships of our CEO, to target companies that may need our services.

 

Marketing

 

Our marketing efforts will be targeted to small to mid sized companies that are known to, located or identified by our CEO.  We will also utilize our contacts with other professional service firms (law firms, investment bankers, venture capital firms and CPA audit firms) that provide services to the small and middle market sector for referrals of potential clients. Our focus will be on continuing to expand our client base to include companies that are not affiliated with our CEO. We believe that this strategy will provide the best results given our limited marketing budget.

 

Our target will be on companies that have sales of less than $100 million and are based in North America. Our industry focus is media, technology, oil, gas, coal and renewable energy. Although we will focus on these industries we will look at opportunities in other industries if it makes economic sense.

 

Our web-site is www.profitplannersmgt.com and we continue to develop this web-site as part of our marketing strategy.

 

 

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Critical Accounting Policies

 

Basis of presentation - Going concern

 

The accompanying financial statements have been prepared under a going concern basis that contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has incurred operating losses from its inception and has an accumulated deficit of $100,345 as of August 31, 2011. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

During 2011, the Company intends to raise financing for the purpose of funding operating expenses.  However, there can be no assurance that the raising of future equity will be successful and that the Company’s anticipated financing will be available in the future, at terms satisfactory to the Company. Failure to achieve the equity and financing at satisfactory terms and amounts could have a material adverse effect on 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.

  

Accounts receivable

 

Accounts receivable represents CFO and accounting services obligations from customers. The Company periodically evaluates the collectability of its accounts receivable and considers the need to record or adjust an allowance for doubtful accounts based upon historical collection experience and specific customer information. Actual amounts could vary from the recorded estimates. The Company has determined that as of August 31, 2011, no allowance for doubtful accounts was required because we believe that all receivables will subsequently be collected. The Company does not require collateral to support customer receivables.

 

Revenue recognition

 

The Company’s revenues are derived from management, financial and accounting advisory services.  The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when it has persuasive evidence of an arrangement that the services have been rendered to the customer, the sales price is fixed or determinable, and collectability is reasonably assured.

 

Results of operations

 

Three Months Ended August 31, 2011 and August 31, 2010

 

For the three months ended August 31, 2011 and August 31, 2010, we had revenue of $49,637 and $6,000, of which $3,000 and $6,000 was derived from related-party service income, respectively.  The increase in revenue was mainly due to a new third party customer in the three months ended August 31,2011 compared to the three months ended August 31, 2010.  Operating expenses for the three months ended August 31, 2011 and August 31, 2010 totaled $39,304 and $15,916, respectively resulting in a net income of $10,333 and a net loss of $9,916, respectively.

 

Operating expenses for the three months ended August 31, 2011 was $39,304, comprised of related party consulting fees for Wesley Ramjeet, CEO, of $4,500, other related party consulting and professional expenses of $24,988, accounting fees of $2,136, filing fees of $285, stock compensation expense of $365 and other operating expenses for $7,030.  For the three months ended August 31, 2010, the operating expenses was $15,916, which was comprised of related party consulting fees for Wesley Ramjeet, CEO, of $4,500, accounting fees of $9,970 and filing fees of $1,446. The increase in operating expenses for the three months ended August 31, 2011 compared to August 31, 2010 was mainly due an increase in outsourcing consulting services to service third party revenue obtained during the three months ended August 31, 2011.

 

 

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Liquidity and Capital Resources

 

Capital Resources and Liquidity

 

As of August 31, 2011, we had cash of $26,556 as compared to cash of $37,300 as of May 31, 2011. Net cash used in operating activities totaled $10,744 and $2,379 for the three months ended August 31, 2011 and August 31, 2010, respectively.  We had a net income (loss) of $10,333 and $(9,916) during these periods, respectively.  During the three months ended August 31, 2011 compared to August 31, 2010, we had stock compensation of $365 and none, and changes in operating assets and liabilities of $(21,442) and $7,537 resulting in a net decrease in cash of $10,744 and $2,379, respectively.

 

In order for us to execute our business plan we will need to raise at least $500,000 in debt or equity. The funds are needed for building out the management team, sales and marketing and working capital. There can be no assurance that we will be able to raise the funds needed to execute our business plan.

 

If we are unable to satisfy our cash requirements we may be unable to proceed with our plan of operations.  We do not anticipate the purchase or sale of any significant equipment. The foregoing represents our best estimate of our cash needs based on current planning and business conditions.  In the event we are not successful in reaching our initial revenue targets, additional funds may be required, and we may not be able to proceed with our business plan for the development and marketing of our core services. Should this occur, we will suspend or cease operations.

 

We anticipate that depending on market conditions and our plan of operations, we may incur operating losses in the foreseeable future. Therefore, our auditors have raised substantial doubt about our ability to continue as a going concern.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

  N/A

 

ITEM 4T. CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures . Under the supervision and with the participation of our management, including our President, Chief Financial Officer and Secretary, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end of the period covered by this report. Based upon that evaluation, our President, Chief Financial Officer and Secretary concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective such that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

 

Changes in Internal Control Over Financial Reporting. During the most recent quarter ended August 31, 2011, there has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

 

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PART II

 

ITEM 1. LEGAL PROCEEDINGS.

 

We were not a party to any legal proceedings as of the date of filing of this Quarterly Report.

 

ITEM 1A. RISK FACTORS.

 

Our Annual Report on Form 10K for the fiscal year ended May 31, 2011 contains a description of the risk factors relating to our operations and to an investment in our common stock.

 

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

 

We did not issue or sell any equity shares during the fiscal quarter covered by this Quarterly Report.

 

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.

 

Exhibit Number		Description of Exhibit
31.1		Certifications required by Rule 13a-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Chief Executive Officer and Principal Accounting Officer pursuant to 18 U.S.C.§ 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

SIGNATURES

 

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

 

	PROFIT PLANNERS MANAGEMENT, INC.
	/s/ Wesley Ramjeet
October 20, 2011	Wesley Ramjeet
	Chief Executive Officer, Chief Financial Officer and Director

 

 

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