NOTE 6 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following summarizes significant accounting policies to assist the reader in understanding and evaluating the condensed financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America and have been applied consistently in all material respects.
Basis of Accounting
The condensed financial statements are prepared using the accrual basis of accounting where revenues and expenses are recognized in the period in which they were incurred.
The Company had no revenues for the Three and Nine month period ended December 31, 2011.
Fair Value of Financial Instruments
ASC topic 825, "Disclosures about Fair Value of Financial Instruments," requires disclosures of information regarding the fair value of certain financial instruments for which it is practicable to estimate the value. For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying values of the Company's financial instruments which consist of accounts receivable, notes receivable, accounts payable, and notes payable approximate fair values due to the short-term maturities of such instruments.
The Company accounts for income taxes in accordance with FASB ASC 740-10 (Prior authoritative literature Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" ), using the asset and liability approach, which requires recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of such assets and liabilities. This method utilizes enacted statutory tax rates in effect for the year in which the temporary differences are expected to reverse and gives immediate effect to changes in income tax rates upon enactment. Deferred tax assets are recognized, net of any valuation allowance, for temporary differences and net operating loss and tax credit carry forwards. Deferred income tax expense represents the change in net deferred assets and liability balances.
Loss Per Share
Loss per common share is computed in accordance with FASB ASC 260-10 (Prior authoritative literature Statement of Financial Accounting Standards No. 128, "Earnings Per Share" ), by dividing income (loss) available to common stockholders by weighted average number of common shares outstanding for each period.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results can differ from those estimates.