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EX-31.1 - SECTION 302 CERTIFICATION - US-China Biomedical Technology, Inc.ex311sec302.htm
EX-32.1 - SECTION 906 CERTIFICATION - US-China Biomedical Technology, Inc.ex321sec906.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark one)
   
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended November 30, 2011

OR

 
   
o 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:  0-54440
 

ACCEND MEDIA

(Exact name of registrant as specified in its charter)

____Nevada   27-4479356
(State or Other Jurisdiction   (I.R.S. Employer
of Incorporation or Organization)   Identification No.)

 

8275 S. Eastern Avenue, Suite 200-306, Las Vegas, NV      89123
          (Address of principal executive offices)   (Zip Code)

(702) 332-9888
(Registrant’s 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 o No o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a smaller reporting company, defined in Rule 12b-2 of the Exchange Act (Check one).

 

Large accelerated filer o   Accelerated filer o
Non-accelerated filer o   Smaller Reporting Company þ
(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). Yes þ No o

 

There were 30,000,000 shares of Common Stock outstanding as of January 23, 2012.

Table of Contents

Accend Media

Index to Form 10-Q

For the Quarterly Period Ended November 30, 2011

 

PART I Financial Information   3
     
ITEM 1. Financial Statements   3
  Balance Sheets   3
  Unaudited Statements of Operations   4
  Unaudited Statements of Cash Flows   5
  Notes to the Unaudited Financial Statements   6
     
ITEM 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations  10
     
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk 16
     
ITEM 4T. Controls and Procedures 17
     
PART II Other Information 20
     
ITEM 1. Legal Proceedings 20
     
ITEM 1A. Risk Factors 20
     
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 20
     
ITEM 3 Defaults Upon Senior Securities 20
     
ITEM 4 Submission of Matters to a Vote of Security Holders 20
     
ITEM 5 Other Information 20
     
ITEM 6 Exhibits 21
     
  SIGNATURES 22

 

 

2

 
 

 

Part I. Financial Information

 

Item 1. Financial Statements

 

Accend Media

(A Development Stage Company)

Balance Sheets

 

 

        November 30, 2011   February 28, 2011
        (Unaudited)   (Audited)
    ASSETS        
Current assets:        
  Cash   $-   $45,851
  Accounts receivable   79,270   -
  Other receivable   300   -
    Total current assets                                                       79,570   45,851

Other assets

 

3,100   
TOTAL ASSETS   82,670   45,851
             
    LIABILITIES AND STOCKHOLDERS' EQUITY        

Current liabilities:

Bank overdraft

  $603    
  Accounts payable   5,780   $122
  Payroll taxes   (10)   -
    Total current liabilities   6,373   122
             
Stockholders' equity:        
  Common stock, $0.001 par value, 75,000,000 shares 30,000   30,000
    authorized, 30,000,000 and 30,000,000 issued and      
    outstanding as of 11/30/2011 and 2/28/2011,        
    respectively        
  Additional paid-in capital   20,075   20,075
  Deficit accumulated during development stage   26,222   (4,346)
    Total stockholders' equity   76,297   45,729
TOTAL LIABILITIES AND STOCKHOLDERS'        
  EQUITY   $82,670   $45,851

The accompanying notes are an integral part of these financial statements.

 

3

 

 
 

Accend Media

(A Development Stage Company)

Statements of Operations

(Unaudited)

 

 

      For the three months ended November 30, 2011   For the nine months ended November 30, 2011   From Inception (December 20, 2010) to November 30, 2011
Revenue $81,244   $110,779   $110,779
               
Expenses:          
  General & Administrative 11,989   80,171   84,517
    Total expenses 11,989   80,171   84,517
               
Net income $69,255   $30,609   $26,262
               
Other Income (Expense):          
  Interest earned 2   3   3
  Penalties & Settlements (43)   (43)   (43)
    Total other income (expense) (41)   (40)   (40)
               
Net income applicable to          
  common shareholders $69,214   $30,568   $26,222
               
Weighted average number of common shares          
  outstanding- basic 30,000,000   30,000,000    
               
Net loss per share $0.00   $0.00    

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these financial statements.

 

4

 
 

Accend Media

(A Development Stage Company)

Statements of Cash Flows

(Unaudited)

 

 

      For the nine months ended November 30, 2011   From Inception (December 20, 2010) to November 30, 2011
OPERATING ACTIVITIES      
Net income 30,568   26,222
Adjustment to reconcile net loss to net cash used by      
  operating activities:      
    Increase in accounts payable 5,658   5,780
    (Increase) in accounts receivable (79,270)   (79,270)
    Increase in payroll taxes (10)   (10)
    Increase in other receivable (300)   (300)
Net cash used by operating activities (43,354)   (47,578)

 

INVESTING ACTIVITIES

Cost incurred for website development

(3,100)   (3,100)
Net cash used     For investing activities (3,100)                     (3,100)

 

FINANCING ACTIVITIES

Bank Overdraft

603    603
Proceeds from issuance of common stock -   30,000
Contribution to capital -   20,075
Net cash provided by financing activities 603   50,678
           
NET INCREASE IN CASH (45,851)   0
CASH - BEGINNING OF THE PERIOD 45,851   -
CASH - END OF THE PERIOD 0   0

 

 

 

 

 

The accompanying notes are an integral part of these financial statements.

 

5

 
 

NOTICE OF NO AUDITOR REVIEW

FINANCIAL STATEMENTS

 

The accompanying unaudited interim financial statements of Accend Media for the nine months ended November 30, 2012 have been prepared by the management of the Company and approved by the Company’s Board of Directors.

 

The accompanying unaudited interim financial statements of the Company have been prepared by and are the responsibility of the Company’s management.

 

The Company’s independent auditor has not performed a review of these financial statements in accordance with accounting standards for a review of interim financial statements by an entity’s auditor.

 

 

Accend Media

(A Development Stage Company)

Notes to Financial Statements

November 30, 2011

(Unaudited)

 

 

NOTE 1. General Organization and Business

 

The Company was organized on December 20, 2010 (Date of Inception) under the laws of the State of Nevada, as Accend Media. The Company is a Development Stage Company as defined by Guide 7 of the Securities Exchange Commission's Industry Guide and FASB ASC 915 "Development Stage Entities".

 

As of January 23, 2012, the Company is in default with the State of Nevada.

 

NOTE 2. Summary of Significant Accounting Policies

 

Basis of Accounting

The financial statements and accompanying notes are prepared under full accrual of accounting in accordance with generally accepted accounting principles of the United States of America ("US GAAP"). In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation, have been included.

 

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

 

Earnings per Share

The basic earnings (loss) per share is calculated by dividing the Company's net income (loss) available to common shareholders by the weighted average number of common shares issued and outstanding during the year. The diluted earnings (loss) per share is calculated by dividing the Company's net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as of the first year for any potentially dilutive debt or equity.

 

The Company has not issued any options or warrants or similar securities since inception.

 

Revenue recognition

The Company will recognize revenue when all of the following conditions are satisfied: (1) there is persuasive evidence of an arrangement; (2) the service has been provided to the customer; (3) the amount of fees to be paid by the customer is fixed or determinable; and (4) the collection of our fees is probable.

 

6

 
 

Accend Media

(A Development Stage Company)

Notes to Financial Statements

November 30, 2011

(Unaudited)

 

 

 

Dividends

The Company has not yet adopted any policy regarding payment of dividends. No dividends have been paid during the period shown.

 

Website development costs

The Company has recognized the website development cost per the requirements of the ASC topic 350-50-05. This topic provides the guidance on accounting of costs incurred to develop a website, per the stages in the development of the website. Depending on the stage of the development, the cost is either capitalized or expensed. During the current period the Company has incurred costs for purchase of website from third party, this costs incurred has recurring benefits and hence the cost is amortized over its useful life.

 

 

Income Taxes

The provision for income taxes is the total of the current taxes payable and the net of the change in the deferred income taxes. Provision is made for the deferred income taxes where differences exist between the period in which transactions affect current taxable income and the period in which they enter into the determination of net income in the financial statements.

 

Year-end

The Company has selected February 28 as its year-end.

 

Advertising

Advertising is expensed when incurred. A total of $22,903 in advertising costs were incurred during the current period November 30, 2011.

 

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Fair value of financial instruments

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of August 31, 2011 and February 28, 2011. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash and accounts payable. Fair values were assumed to approximate carrying values for cash and payables because they are short term in nature and their carrying amounts approximate fair values or they are payable on demand.

 

NOTE 3 - Going concern

 

The Company's financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company generated revenues of $81,244 during the three months ended November 30, 2011, and revenues of $110,779 from inception to November 30, 2011. In order to obtain the necessary capital, the Company is seeking equity and/or debt financing. There are no assurances that the Company will be successful, without sufficient financing it would be unlikely for the Company to continue as a going concern. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from the outcome of this uncertainty.

 

7

 
 

Accend Media

(A Development Stage Company)

Notes to Financial Statements

November 30, 2011

(Unaudited)

 

NOTE 4 - Stockholders' Equity and Contributed Capital

 

The Company is authorized to issue 75,000,000 shares of its $0.001 par value common stock.

 

On December 20, 2010, the Company issued 20,000,000 shares of its Common Stock to a founder for cash of $20,000.

 

On December 20, 2010, a director of the Company contributed capital of $75 for incorporating fees.

 

On February 28, 2011, the Company issued 4,000,000 shares of its Common Stock to a founder for cash of $12,000.

 

On February 28, 2011, the Company issued 6,000,000 shares of its Common Stock to shareholders for cash of $18,000 pursuant to a Regulation S offering.

 

As of November 30, 2011, there have been no other issuances of common stock or there have been no stock options or warrants granted.

 

 

NOTE 5. Related Party Transactions

 

The Company does not lease or rent any property. Office services are provided without charge by a director. Such costs are immaterial to the financial statements and, accordingly, have not been reflected therein. The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts.

 

On December 20, 2010, the Company issued 20,000,000 shares of its Common Stock to a founder for cash of $20,000.

 

On December 20, 2010, a director of the Company contributed capital of $75 for incorporating fees.

 

On February 28, 2011, the Company issued 4,000,000 shares of its Common Stock to a founder for cash of $12,000.

8

 
 

Accend Media

(A Development Stage Company)

Notes to Financial Statements

November 30, 2011

(Unaudited)

 

 

NOTE 6. Operating Leases and Other Commitments

 

The Company has no lease or other obligations.

 

 

NOTE 7. Recent Accounting Pronouncements

 

The Company's management has evaluated all the recently issued accounting pronouncements through the filing date of these financial statements and does not believe that any of these pronouncements will have a material impact on the Company's financial position and results of operations.

 

 

NOTE 8. Legal Proceedings

 

The Company is not currently involved in any legal proceedings at this time.

 

 

 

 

9

 

 
 

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

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

 

Forward-Looking Information

 

This Quarterly Report on Form 10-Q contains forward-looking statements. When used in this Quarterly Report on Form 10-Q, the words "anticipate," "believe," "estimate," "will," "plan," "seeks," "intend," and "expect" and similar expressions identify forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in any forward-looking statements are reasonable, these plans, intentions, or expectations may not be achieved. Our actual results, performance, or achievements could differ materially from those contemplated, expressed, or implied, by the forward-looking statements contained in this Quarterly Report on Form 10-Q. Important factors that could cause actual results to differ materially from our forward-looking statements are set forth in this Quarterly Report on Form 10-Q All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth in this Quarterly Report on Form 10-Q. Except as required by federal securities laws, we are under no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

 

Critical Accounting Policies

 

There have been no material changes to our critical accounting policies and estimates from the information provided in "Management's Discussion and Analysis of Financial Condition and Results of Operations", included in our Registration Statement on Form S-1/A for the fiscal year ended February 28, 2011.

 

 

Results of Operations

 

Overview of Current Operations

 

Accend Media ("the Company") was incorporated in the State of Nevada on December 20, 2010, under the name Accend Media.

 

 

 

 

 

 

 

10

 
 

 

 

 

Description of Business

 

Accend Media provides internet marketing services for its clients, who seek increased sales and customer contact through online marketing channels. The Company's clients will include branded advertisers, direct marketers, lead aggregators, and agencies.

 

Our services include:

 

a)      Creating of advertising campaigns used to market products and/or services online.

 

b)      Designing and hosting of customized web pages for our customers.

 

c)      Development of software applications that provide increased efficiency, compliance and/or better monetization of online marketing campaigns. An example of our compliance application is the UnsubToday.com service for email suppression list management.

 

Accend Media is powered by its own proprietary Lead Generation Software Platform. This technology platform allows the Company to process and sell real-time leads to clients across multiple verticals. The platform employs a rules-based decision engine designed to maximize the value of every lead that it processes. The platform conducts comprehensive detailed analysis of every lead entering the system as well as the pool of clients eligible to purchase the lead. The system also monitors consumer and publisher activity which allows us to analyze the effectiveness of different marketing campaigns, advertisements and specific promotions. This software tool helps us separate performing campaigns from non-performing campaigns, which allows us to maximize our internal profit margin while best serving our clients’ needs.

 

Marketing Strategy

 

Accend Media plans to own and operate a variety of Internet websites. The Company plans to generate traffic to its websites both internally and from third party internet advertising. The Company's Web properties and marketing activities are designed to generate real-time response based marketing results for our clients.

 

 

 

 

 

11

 

 
 

While visiting one of our Accend Media's websites, consumers will be given the opportunity to sign up, purchase and/or ask to be contacted about various product and service offerings. These web websites generate a variety of transactional results ranging from: (a) Web traffic; (b) inbound telemarketing calls; (c) outbound telemarketing leads; (d) marketable profiled data lists of consumers; (e) targeted response leads; and (f) completed applications for products and services.

 

Accend Media plans to utilize a number of online marketing channels to build our databases. These include but are not limited to:

 

Email Marketing

 

The Company's websites will be promoted through CANSPAM compliant opt-in email marketing newsletters. Advertising dollars for email marketing are typically spent on a Cost-Per-Acquisition basis, but Accend Media also employs on a Cost-Per-Click or Cost-Per-Million basis.

 

Search Engine Marketing

 

Accend Media plans to utilize search engine marketing to direct consumers to its websites. Funds generated from the program will be placed in an open account with each provider and are spent on a Cost-Per-Click auction basis. Google, Yahoo, and Bing are the primary 3 search engines providers used.

 

Display Advertising

 

Accend Media plans to purchase an advertising inventory by placing a banner, button, or text link on websites owned by third party companies. When consumers click on our banner, button, or text link, they are referred to our website. Using an ad server and our internal platform, we gauge effectiveness and return on investment of each advertising campaign.

 

Affiliate Marketing

 

Accend Media plans to engage publishers to run its offers and promotions on a Cost Per Action basis. Publishers are provided with real-time commission tracking.

Sales Strategy

 

Accend Media plans to sell its products and services to a network of participating lead buyers and advertisers in various categories. Some of these categories include - but are not limited to - the financial, insurance, travel, automotive, and deal of the day coupon industries.

 

Accend Media delivers internet marketing leads to business buyers in a lead auction format. This format allows clients to bid on qualified leads as they are created. Management believes this is the best way to derive the highest revenue per lead in the marketplace.

 

12

 

Software Development

 

Our sole officer is responsible for all Accend Media's software development, management, and upgrades. He creates all new client accounts and implements lead delivery options based on customer needs. He is responsible for continually upgrading the Lead Generation Software Platform to accommodate new feature sets and increased scalability.

 

Competition

 

The internet lead generation and product sales marketplace is highly competitive. Management believes that Accend Media's proprietary Lead Generation Software Platform provides the company with a competitive advantage within the marketplace because of its concurrent ability to exploit the most effective marketing campaigns while selling leads at their highest value. A number of competitors are active in specific aspects of our business. In the area of business sales lead products, Accend Media faces competition primarily from companies such as Experian, Equifax, Acxiom, Quinstreet, Atrinsic, and ValueClick. These major competitors offer online leads directly to the end customer and sell their online leads through reseller networks. In the area of email compliance software, Accend Media faces competition from Digital River, Unsub Central, and Optizmo.

 

Government Regulation

 

We are subject to federal, state and local laws and regulations affecting our business. Although the Company plans on obtaining all required federal and state permits, licenses, and bonds to operate its facilities, there can be no assurance that the Company's operation and profitability will not be subject to more restrictive regulation or increased taxation by federal, state, or local agencies. New laws and regulations may restrict specific Internet activities, and existing laws and regulations may be applied to Internet activities, either of which could increase our costs of doing business over the Internet and adversely affect the demand for our advertising services. In the United States, federal and state laws already apply or may be applied in the future to areas, including children's privacy, copyrights, taxation, user privacy, search engines, Internet tracking technologies, direct marketing, data security, pricing, sweepstakes, promotions, intellectual property ownership and infringement, trade secrets, export of encryption technology, acceptable content and quality of goods and services.

 

 

 

 

13

 

 
 

 

 

Results of Operations for the three months and nine months ended November 30, 2011

 

Revenues

 

During the three month period ended November 30, 2011, the Company generated $81,244 in revenues. For the nine months ending November 30, 2011 generated $110,779 in revenues. Revenues came from the development of marketing landing pages (digital production) and engaging online publishers to drive traffic to different websites. Although the Company has some digital production development underway, at this time, management is uncertain as to the amount of revenues the Company can generate. This work is still in progress.

 

Expenses

 

For the three and nine month period ending November 30, 2011, the Company experienced general and administrative expenses of $11,989 and $80,171 respectfully. These expenses represented start-up costs as the Company begins its business operations.

 

For the three and nine months ended November 30, 2011, the Company had net income of $69,214 and $30,568respectfully from operations. Since the Company's inception, on December 20, 2010, the Company had a net income from operations of $26,222.

 

Going ConcernThe financial statements included with this quarterly report have been prepared in accordance with generally accepted accounting principles applicable to a going concern which contemplates the realization of assets business. As of November 30, 2011, the Company has recognized $110,779 in revenues and has accumulated operating income of approximately $26,222 since inception. The Company's ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and its ability to achieve and maintain profitable operations. Management plans to raise equity capital to finance the operating and capital requirements of the Company. Amounts raised will be used to further development of the Company's products, to provide financing for marketing and promotion, to secure additional property and equipment, and for other working capital purposes. While the Company is putting forth its best efforts to achieve the above plans, there is no assurance that any such activity will generate sufficient funds to continue its operations.

 

These conditions raise substantial doubt about the Company's ability to continue as a going concern. Our financial statements do not include any adjustments that might arise from this uncertainty.

 

14

 
 

 

Plan of Operation

 

The Company's need for capital may change dramatically if it can generate additional revenues from its operations. In the event the Company requires additional funds, the Company will have to seek loans or equity placements to cover such cash needs. There are no assurances additional capital will be available to the Company on acceptable terms.

 

 

Summary of any product research and development that we will perform for the term of our plan of operation.

 

We do not anticipate performing any additional significant product research and development under our current plan of operation.

 

 

Expected purchase or sale of plant and significant equipment

 

We do not anticipate the purchase or sale of any plant or significant equipment; as such items are not required by us at this time.

 

 

Significant changes in the number of employees

 

As of November 30, 2011, we did not have any employees. We are dependent upon our sole officer and director for our future business development. As our operations expand we anticipate the need to hire additional employees, consultants and professionals; however, the exact number is not quantifiable at this time.

 

 

 

 

 

 

 

 

15

 
 

 

 

Liquidity and Capital Resources

 

As of November 30, 2011, our current assets were $79,570 and our current liabilities were $6373. Without realization of additional capital or added revenues, it would be unlikely for the Company to continue as a going concern. In order for the Company to remain a Going Concern it will need to find additional capital or generate sufficient revenues to cover its costs. Additional working capital may be sought through additional debt or equity private placements, additional notes payable to banks or related parties (officers, directors or stockholders), or from other available funding sources at market rates of interest, or a combination of these. The ability to raise necessary financing will depend on many factors, including the nature and prospects of any business to be acquired and the economic and market conditions prevailing at the time financing is sought. No assurances can be given that any necessary financing can be obtained on terms favorable to the Company, or at all.

 

We have not generated positive cash flows from operating activities. For the nine months ended November 30, 2011, net cash flow used in operating activities was $(43,354).

 

Our Chief Executive Officer has agreed to donate funds to the operations of the Company, in order to keep it fully reporting for the next twelve (12) months, without seeking reimbursement for funds donated.

 

The Company has no employment agreements in place with its officers, nor does the Company owe its officers any accrued compensation, as the Officers agreed to work for the company at no cost, until the company can become profitable on a consistent Quarter-to-Quarter basis.

 

Off-Balance Sheet Arrangements

 

We do not have any 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 or operations, liquidity, capital expenditures or capital resources that is material to investors.

 

Critical Accounting Policies and Estimates

 

Revenue Recognition: We recognize revenue from product sales once all of the following criteria for revenue recognition have been met: pervasive evidence that an agreement exists; the services have been rendered; the fee is fixed and determinable and not subject to refund or adjustment; and collection of the amount due is reasonably assured.

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

 

Not required for smaller reporting companies.

 

16

 
 

 

 

Item 4T. Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures

 

Our disclosure controls and procedures, as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in rules and forms adopted by the SEC, and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.

 

Management, with the participation of the Chief Executive Officer and the Chief Financial Officer, who is also the sole member of our Board of Directors, has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on such evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that, our disclosure controls and procedures were not effective. Our disclosure controls and procedures were not effective because of the "material weaknesses" described below under "Management's report on internal control over financial reporting," which are in the process of being remediated as described below under "Management Plan to Remediate Material Weaknesses."

 

Management's Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting, as defined in rules promulgated under the Exchange Act, is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer and affected by our Board of Directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that:

 

- pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the

transactions and dispositions of our assets;

 

- provide reasonable assurance that transactions are recorded as necessary to permit preparation of

financial statements in accordance with GAAP, and that our receipts and expenditures are being

made only in accordance with authorizations of our management and our Board of Directors; and

 

- provide reasonable assurance regarding prevention or timely detection of unauthorized

acquisition, use or disposition of our assets that could have a material effect on our financial

statements

 

 

17

 
 

 

 

Because of its inherent limitations, a system of internal control over financial reporting can provide only reasonable, not absolute, assurance that the objectives of the control system are met and may not prevent or detect misstatements. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper override. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process, and it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Further, over time control may become inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate.

 

Our management assessed the effectiveness of our internal control over financial reporting as of November 30, 2011. In making its assessment, management used the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based on its assessment, management has concluded that we had certain control deficiencies described below that constituted material weaknesses in our internal controls over financial reporting. As a result, our internal control over financial reporting was not effective as of November 30, 2011.

 

A "material weakness" is defined under SEC rules as a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a company's annual or interim financial statements will not be prevented or detected on a timely basis by the company's internal controls. As a result of management's review of the investigation issues and results, and other internal reviews and evaluations that were completed after the end of quarter related to the preparation of management's report on internal controls over financial reporting required for this quarterly report on Form 10-Q, management concluded that we had material weaknesses in our control environment and financial reporting process consisting of the following:

 

1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures;

 

We do not believe the material weaknesses described above caused any meaningful or significant misreporting of our financial condition and results of operations for the fiscal year ended February November 30, 2011. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

 

 

 

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Management Plan to Remediate Material Weaknesses

 

Management is pursuing the implementation of corrective measures to address the material weaknesses described below. In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

 

We will create a position to segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us. We plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.

 

We believe the remediation measures described above will remediate the material weaknesses we have identified and strengthen our internal control over financial reporting. We are committed to continuing to improve our internal control processes and will continue to diligently and vigorously review our financial reporting controls and procedures. As we continue to evaluate and work to improve our internal control over financial reporting, we may determine to take additional measures to address control deficiencies or determine to modify, or in appropriate circumstances not to complete, certain of the remediation measures described above.

 

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

This amended quarterly report does not include an attestation report of the Corporation's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Corporation's registered public accounting firm pursuant to temporary rules of the SEC that permit the Corporation to provide only the management's report in this quarterly report.

 

 

Changes in internal controls over financial reporting

 

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

 

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PART II. OTHER INFORMATION

 

Item 1 -- Legal Proceedings

 

From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.

 

We are not presently a party to any material litigation, nor to the knowledge of management is any litigation threatened against us, which may materially affect us.

 

Item 1A - Risk Factors

 

See Risk Factors set forth in Part I, Item 1A of the Company's Registration Statement on S-1/A for the fiscal year ended February 28, 2011 and the discussion in Item 1, above, under "Liquidity and Capital Resources."

 

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

 

None.

 

Item 3 -- Defaults Upon Senior Securities

 

None.

 

 

Item 4 -- Submission of Matters to a Vote of Security Holders

 

None.

 

 

Item 5 -- Other Information

 

None.

 

 

 

 

 

 

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Item 6 -- Exhibits

 

 

      Incorporated by reference
Exhibit Exhibit Description Filed herewith Form Period Ending Exhibit Filing Date
3.1 Articles of Incorporation, as currently in effect   S-1 02/28/11 3.1  04/29/11
3.2 Bylaws, as currently in effect   S-1 02/28/11 3.2  04/29/11
31.1 Certification of President and Principal Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act X        
32.1 Certification of President and Principal Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act X        

 

 

 

 

 

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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.

 

 

 

Accend Media

Registrant

   
   
Date:  January 23, 2012        /s/ Scott Gerardi
  Name: Scott Gerardi
 

Title: Chief Executive Officer, President,

Director, Principal Executive, Financial,

and Accounting Officer

 

 

 

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