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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 January 31, 2012

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

For the transition period from

Commission File No.  000-50493

ALVERON ENERGY CORP.
(Exact name of small business issuer as specified in its charter)
 
Delaware   98-0412431
(State or other jurisdiction of
Incorporation or organization)
 
(I.R.S. Employer
Identification No.)
 
735 Don Mills Road, Suite 1405
Toronto, Ontario, M3C 1S9
(Address of Principal Executive Offices)
 
647-435-9852
(Issuer’s telephone number)
 
MODENA I, INC.
 (Former name, address and fiscal year, if changed since last report)
 
Check whether the issuer (1) has 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 issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13, or 15 (d) of the Exchange Act subsequent to the distribution of securities under a plan confirmed by a court.  Yes o 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 filer.  See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one):
 
Large Accelerated Filer o Accelerated Filer o
Non-Accelerated Filer o Smaller Reporting Company x
 
As of March 16, 2012, 52,140,000 shares of Common Stock, par value $0.001 per share, were outstanding.

Transitional Small Business Disclosure Format Yes o No x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
 


 
 

 
 
TABLE OF CONTENTS
 
PART I – FINANCIAL INFORMATION      
         
Item 1.   
Financial Statements
    3  
           
Item 2.   
Management’s Discussion and Analysis of Financial Condition
    13  
           
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
    15  
           
Item 4T.
Control and Procedures
    16  
           
PART II – OTHER INFORMATION        
           
Item 1.    
Legal Proceedings
    17  
           
Item 2.  
Unregistered Sales of Equity Securities and Use of Proceeds
    17  
           
Item 3.  
Defaults Upon Senior Securities
    17  
           
Item 4.  
Submission of Matters to a Vote of Security Holders
    17  
           
Item 5.  
Other Information
    17  
           
Item 6.  
Exhibits
    18  
           
Signatures     19  
 
 
2

 
 
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements.
 
ALVERON ENERGY CORP.
     
(A Development Stage Company)
     
       
CONSOLIDATED BALANCE SHEETS
     
As of JANUARY 31, 2012 and OCTOBER 31, 2011
     
 
   
January 31, 2012
   
October 31, 2011
 
    (unaudited)        
ASSETS
           
Current Assets:
           
Cash and cash equivalents
  $ 109     $ 109  
Total Current Assets
    109       109  
                 
Total Assets
  $ 109     $ 109  
                 
                 
LIABILITIES AND STOCKHOLDERS' DEFICIT
               
                 
Current Liabilities:
               
Accounts payable and accrued liabilities
  $ 56,682     $ 46,005  
Related party note
    485,160       482,731  
Total Current Liabilities
    541,842       528,736  
                 
Total Liabilities
    541,842       528,736  
                 
STOCKHOLDERS' DEFICIT
               
Capital stock - $.001 par value, 100,000,000 common shares authorized, 52,140,000 common shares issued and outstanding as of January 31, 2012 and October 31, 2011, respectively
    52,140       52,140  
Additional paid-in capital
    184,342       184,342  
Deficit accumulated during the development stage
    (778,215 )     (765,109 )
Total Stockholders' Deficit
    (541,733 )     (528,627 )
                 
Total Liabilities and Total Stockholders' Deficit
  $ 109     $ 109  
 
The accompany notes are integral part of these consolidated financial statements.
 
 
3

 
 
ALVERON ENERGY CORP.
(A Development Stage Company)
 
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended January 31, 2012 and 2011, and Cumulative from November 18, 2003 (Date of Inception) Through January 31, 2012
(unaudited)
 
   
Three Months
Ended
January 31, 2012
   
Three Months
Ended
January 31, 2011
   
November 18, 2003
(Date of Inception)
Through
January 31,
2012
 
                   
Revenues
  $ -     $ -     $ -  
                         
Expenses
                       
Consulting Expense
    -       26,000       30,000  
Professional fees
    2,000       4,599       67,547  
Interest expense
    9,679       7,586       54,003  
Office and Administrative
    1,427       7,071       34,824  
Foreign exchange loss/(gain)
    -       (1,569 )     1,941  
Total Operating Expenses
    13,106       43,687       188,315  
                         
Net Loss before discontinued operations
    (13,106 )     (43,687 )     (188,315 )
Loss from Discontinued Operations
    -       (239,900 )     (589,900 )
Net Loss
    (13,106 )     (283,587 )     (778,215 )
                         
Loss Per Common Share - Basic
  $ (0.00 )   $ (0.00 )        
and Diluted
                       
                         
Weighted Average Number of Common Shares Outstanding, Basic and Diluted
    52,140,000       51,417,174          
 
The accompany notes are integral part of these consolidated financial statements.
 
 
4

 
 
ALVERON ENERGY CORP.
(A Development Stage Company)
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended January 31, 2012 and 2011, and Cumulative from November 18, 2003 (Date of Inception) Through January 31, 2012
(unaudited)
 
   
Three Months
Ended
January 31, 2012
   
Three Months
Ended
January 31, 2011
   
November 18, 2003
(Date of Inception)
Through
January 31,
2012
 
                   
Cash Flows from Operating Activities                  
Net loss including non-controlling interest   $ (13,106 )   $ (283,587 )   $ (778,215 )
Adjustments to reconcile net loss to net cash used by Operating Activities:                        
Discontinued operations     -               545,964  
Common stock issued for services     -       26,000       30,000  
Imputed Interest     -       -       370  
Interest accrued on convertible note     -       -       5,851  
Repayment in excess of lending     -       5,000       5,000  
Changes in assets and liabilities                        
Other Assets     -       (258,230     -  
Accounts payable and accrued liabilities     10,677       6,626       53,543  
    Net cash used in continuing operating  activities     (2,429 )     (504,191 )     (137,487 )
    Net cash used in discontinued operating activities     -       -       (44,206 )
Cash flows used in operating activities
    (2,429 )     (504,191 )     (181,693 )
                         
Cash Flows from Investing Activities
                       
    Cash used for discontinued investing activities
    -       -       (501,758 )
    Net Cash Used in Investing Activities
    -       -       (501,758 )
                         
Cash Flows from Financing Activities
                       
Proceeds from convertible note
    -       -       6,000  
Repayment of note
    -       (6,000 )     (11,000 )
Proceeds from issuance of common stock
    -       -       61,200  
Advances from related party
    2,429       548,321       599,882  
Stockholder contributions
    -       -       37,199  
    Net cash used in continuing financing activities
    2,429       542,321       693,281  
Net cash provided by discontinued financing activities
    -       -       (9,721 )
Cash flows provided by financing  activities
    2,429       542,321       683,560  
                         
Net (Decrease) Increase in Cash
    -       38,130       109  
                         
Cash and Cash Equivalents, beginning of year
    109       15,858       -  
                         
Cash and Cash Equivalents, end of year
  $ 109     $ 53,988     $ 109  
                         
Supplemental Cash Flow Information
                       
                         
Interest paid
  $ -     $ -     $ -  
Income taxes paid
    -       -       -  
Non-cash transactions                        
Forgiveness of Related Party Debt
  $ -     $ -     $ 100,000  
 
The accompany notes are integral part of these consolidated financial statements.
 
 
5

 
 
ALVERON ENERGY CORP.
(A DEVELOPMENT STAGE COMPANY)
Notes to Interim Financial Statements
January 31, 2012 and 2011
Unaudited
 
1.           History and Organization

Modena I, Inc. is a development stage company which was incorporated under the laws of the State of Delaware on November 18, 2003.  From inception to September 2007, the Company was focused on providing a vehicle for a foreign or domestic non-public company to become an SEC reporting (publicly-traded) company. To this end, we intended to locate and negotiate with a business entity for the combination of that target company with the Company.  Since September 2007, the Company has shifted its focus to becoming a wind and hydro electric energy generation company. In February 12, 2010, the Company formed a new Joint Venture Corporation, “Yantai Alveron Energy Development Company”, in Shandong, China as per the agreement signed on June 20, 2009. The company ownership was organized per the agreement with Alveron Energy Corp. owning 77% and the joint partners owning the remaining 23% of the new entity. Alveron Energy Corp. transferred $50,000 to this new entity during the quarter ending July 31, 2010 to be used on the feasibility report for a potential 48MW wind energy plant in Shandong, China. On the date of the Joint Venture, Yantai had no balance sheet or income statement activities. Alveron Energy Corp. transferred a total of $539,900 to this new entity during the quarter ending January 31, 2011 to be used on the feasibility report for a potential 48MW wind energy plant in Shandong, China. Out of the total $539,900, $239,900 was allocated to the Rushan Project and $258,230 to the Longquan Project. On July 20, 2011, the Company discontinued the operations for the Longquan joint venture to build the 48MW wind power plant near Yantai, Shandong, China. The operations were discontinued due to the inability to further fund the project under the time line required by the joint venture. The Company suffered a loss as of October 31, 2011 for the amount of $306,064 due to the discontinued operation on the Longquan Project.  In addition, the Rushan Project $239,900 loss has been reclassified in a prior period, to discontinued operations.  Total loss from discontinued operation from inception to October 31, 2011 is $589,900.

On April 12, 2010 the Board of Directors of Modena I, Inc. (the “Company”) filed a Certificate of Amendment to the Articles of Incorporation with the Secretary of State of Delware changing the Company’s name to Alveron Energy Corp.
 
2.           Going Concern
 
These accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") with the assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. The Company has a working capital deficit of $541,733 and has no current revenue stream. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue as a going concern.
 
The Company's ability to continue as a going concern is also contingent upon its ability to complete certain capital formation activities and generate working capital operations in the future. Management's plan in this regard is to secure additional funds through equity financing activities, and from loans made by the Company's stockholder.
 
The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the inability of the Company to continue as a going concern.
 
 
6

 

3.           Basis of Presentation

The Company has not earned any revenues from limited principal operations and accordingly, the Company's activities have been accounted for as those of a "Development Stage Enterprise" as set forth in FASB Pronouncements. Among the disclosures required are that the Company's financial statements be identified as those of a development stage company, and that the statements of operation, stockholders' deficit and cash flows disclose activity since the date of the Company's inception.

The interim condensed financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to not make the information presented misleading.

These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these interim condensed financial statements be read in conjunction with the financial statements of the Company for the year ended October 31, 2011 and notes thereto included in the Company's 10-K annual report. The Company follows the same accounting policies in the preparation of interim reports.

In preparing financial statements, the Company's management makes informed judgments and estimates that affect the reported amounts of assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period. We review our estimates on an on-going basis, including those related to contingencies and income taxes. Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates.

Results of operations for the interim periods are not indicative of annual results.

4.           Principle of Consolidation

The accounts of all of our wholly-owned subsidiaries are included in the consolidation of these financial statements from the date of acquisition.  All significant intercompany accounts and transactions have been eliminated in consolidation.  The Company records net income attributable to non-controlling interest in the consolidated statements of operations for any non-owned portion of its consolidated subsidiary.  Non-controlling interest being accounted for in owners’ equity on the consolidate balance sheet.  In the prior audited period the company has discontinued their Joint Venture.

 
7

 

 
5.           Summary of Significant Accounting Policies

a) 
Fair Value of Financial Instruments
 
The Company adopted ASC No. 820-10 (ASC 820-10), Fair Value Measurements. ASC 820-10 relates to financial assets and financial liabilities.
 
ASC 820-10 defines fair value, establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (GAAP), and expands disclosures about fair value measurements. The provisions of this standard apply to other accounting pronouncements that require or permit fair value measurements and are to be applied prospectively with limited exceptions.

ASC 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This standard is now the single source in GAAP for the definition of fair value, except for the fair value of leased property. ASC 820-10 establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions, about market participant assumptions that are developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under ASC 820-10 are described below:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
 
Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of cash, accounts payable, accrued liabilities, and amounts due to related parties. Pursuant to ASC 820, the fair value of our cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.
 
 
8

 
 
b)
Income Taxes
 
The Company had adopted Accounting Standard Codification subtopic 740-10, Income Taxes (“ASC 740-10”) which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns.  Under this method, deferred tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is recorded for the amount of income tax payable or refundable for the period increased or decreased by the change in deferred tax assets and liabilities during the period. As of October 31, 2011, a deferred tax asset (which arises solely as a result of net operating losses), has been entirely offset by a valuation reserve due the uncertainty that this asset will be realized in the future.
 
c)
Earnings or Loss Per Share
 
The Company computes net loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.
 
d) 
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 could differ from those estimates.
 
e) 
Cash and Cash Equivalents

For the purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of January 31, 2012 and October 31, 2011, respectively, there were no cash equivalents.

 
9

 
 
f) 
Recent Accounting Pronouncements

In April 2010, the FASB issued ASU No. 2010-18 regarding improving comparability by eliminating diversity in practice about the treatment of modifications of loans accounted for within pools under Subtopic 310-30 – Receivable – Loans and Debt Securities Acquired with Deteriorated Credit Quality (“Subtopic 310-30”). Furthermore, the amendments clarify guidance about maintaining the integrity of a pool as the unit of accounting for acquired loans with credit deterioration.  Loans accounted for individually under Subtopic 310-30 continue to be subject to the troubled debt restructuring accounting provisions within Subtopic 310-40, Receivables—Troubled Debt Restructurings by Creditors. The amendments in this Update are effective for modifications of loans accounted for within pools under Subtopic 310-30 occurring in the first interim or annual period ending on or after July 15, 2010. The amendments are to be applied prospectively. Early adoption is permitted. We are currently evaluating the impact of this ASU; however, we do not expect the adoption of this ASU to have a material impact on our financial statements.

In March 2010, the FASB (Financial Accounting Standards Board) issued Accounting Standards Update 2010-11 (ASU 2010-11), “Derivatives and Hedging (Topic 815): Scope Exception Related to Embedded Credit Derivatives.” The amendments in this Update are effective for each reporting entity at the beginning of its first fiscal quarter beginning after June 15, 2010. Early adoption is permitted at the beginning of each entity’s first fiscal quarter beginning after issuance of this Update. The Company does not expect the provisions of ASU 2010-11 to have a material effect on the financial position, results of operations or cash flows of the Company.

In February 2010, the FASB Accounting Standards Update 2010-10 (ASU 2010-10), “Consolidation (Topic 810): Amendments for Certain Investment Funds.” The amendments in this Update are effective as of the beginning of a reporting entity’s first annual period that begins after November 15, 2009 and for interim periods within that first reporting period. Early application is not permitted. The Company’s adoption of provisions of ASU 2010-10 did not have a material effect on the financial position, results of operations or cash flows.

In February 2010, the FASB issued ASU No. 2010-09 “Subsequent Events (ASC Topic 855) “Amendments to Certain Recognition and Disclosure Requirements” (“ASU No. 2010-09”). ASU No. 2010-09 requires an entity that is an SEC filer to evaluate subsequent events through the date that the financial statements are issued and removes the requirement for an SEC filer to disclose a date, in both issued and revised financial statements, through which the filer had evaluated subsequent events. The adoption did not have an impact on the Company’s financial position and results of operations.

In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06, “Improving Disclosures about Fair Value Measurements.” ASU No. 2010-06 amends FASB Accounting Standards Codification (“ASC”) 820 and clarifies and provides additional disclosure requirements related to recurring and non-recurring fair value measurements and employers’ disclosures about postretirement benefit plan assets. This ASU is effective for interim and annual reporting periods beginning after December 15, 2009. The adoption of ASU 2010-06 did not have a material impact on the Company’s financial statements.

In January 2010, the FASB issued an amendment to ASC 505, Equity, where entities that declare dividends to shareholders that may be paid in cash or shares at the election of the shareholders are considered to be a share issuance that is reflected prospectively in EPS, and is not accounted for as a stock dividend. This standard is effective for interim and annual periods ending on or after December 15, 2009 and is to be applied on a retrospective basis. The adoption of this standard is not expected to have a significant impact on the Company’s financial statements.

 
10

 
 
In January 2010, the FASB issued ASU No. 2010-06 regarding fair value measurements and disclosures and improvement in the disclosure about fair value measurements. This ASU requires additional disclosures regarding significant transfers in and out of Levels 1 and 2 of fair value measurements, including a description of the reasons for the transfers.  Further, this ASU requires additional disclosures for the activity in Level 3 fair value measurements, requiring presentation of information about purchases, sales, issuances, and settlements in the reconciliation for fair value measurements. This ASU is effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. We are currently evaluating the impact of this ASU; however, we do not expect the adoption of this ASU to have a material impact on our financial statements.

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operation
 
g) 
Foreign Currency Translation
 
Transactions in foreign currencies are translated into the currency of measurement at the exchange rates in effect on the transaction date. Monetary balance sheet items expressed in foreign currencies are translated into United States dollars at the exchange rates in effect at the balance sheet date. The resulting exchange gains and losses are recognized in income.
 
h) 
Stock-based Compensation
 
The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.
 
6.           Promissory Note

In July 2007, the Company received proceeds of $6,000 and issued a convertible note to an unrelated party.  The loan bears a stated interest rate of 5% per annum, is unsecured and the principal amount of $6,000 plus all accrued interest was due on July 2, 2010. As of October 31, 2010 the note was past due, however, on November 26, 2010, Alveron repaid $6,000 principal towards the convertible promissory note. As of January 31, 2012, accrued interest of $1,493 remains unpaid.

 
11

 
 
7.
Related Party Transactions

Related party transactions are in the normal course of operations and are recorded at amounts established and agreed between the related parties. Related party transactions not disclosed elsewhere in these consolidated financial statements are as follows:

During the quarter, $429 was paid by shareholder for office and administration fees and $2,000 was paid by a related party for professional fees, which were added to the related party loans. Since inception, the shareholder has advanced funds for professional fees and other office and general expenses in the amount of $622,359.  The shareholder has waived reimbursement of $137,199 and considered these advances as a contribution to capital. Accordingly, the contributions have been recorded as additional paid-in capital. The remaining $485,160 is considered as a unsecured loan with interest rate of 7% annual rate and due upon demand. Accrued interest recorded as of January 31, 2012 is $50,920, a total of $9,679 is recognized as interest expense for the three months ended January 31, 2012.

8.           Joint Venture

On February 12, 2010, the Company formed a new Joint Venture Corporation, “Yantai Alveron Energy Development Company”, in Shandong, China as per the agreement signed on June 20, 2009. The company ownership was organized per the agreement with Alveron Energy Corp. owning 77% and the joint partners owning the remaining 23% of the new entity. On the date of the Joint Venture, Yantai had no balance sheet or income statement activities. Alveron Energy Corp. transferred a total of $539,900 to this new entity during the quarter ending January 31, 2011 to be used on the feasibility report for a potential 48MW wind energy plant in Shandong, China. Out of the total $539,900, $239,900 was allocated to the Rushan Project and $258,230 to the Longquan Project. As of October 31, 2011 and based on events that have deterred the likely success of the Rushan and Longuan Project, the company has discontinued operations in the Joint Venture.
 
9.            Subsequent Events
 
We have evaluated subsequent events through date of issuance of the financial statement and did not have any material events that require additional disclosures.
 
 
12

 
 
Item 2. Management’s Discussion and Analysis or Plan of Operation.

As used in this Form 10-Q, references to the "Company," "we," “our” or "us" refer to Alveron Energy Corp, unless the context otherwise indicates.

This Management’s Discussion and Analysis or Plan of Operation should be read in conjunction with the financial statements and the notes thereto.

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Plan of Operation

The Company has begun preliminary investigation into wind and hydro energy technologies and has been researching wind and hydro electric energy properties and project opportunities.  The Company is also focusing on developing its economic models and financial forecasts while attempting to raise capital.

The Company plans to complete the following stages of development within the next twelve months of operations:

Site and Development Partner Identification and Agreement — Identify regions that are economically viable for wind or hydro turbine development and development partners that would be appropriate for a particular project. We would then have to finalize an agreement with a development partner before proceeding.

Data Collection — For the wind energy projects this involves location mapping and wind resource data monitoring and collection using meteorological instruments especially anemometers which read wind-speed and direction among other things. For hydro-electric projects, this involves location mapping and water resource data monitoring and collection using acoustical current instruments, as well as recorded and ongoing data collected by publicly-accessible stations.

 
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Results of Operation
 
The Company did not have any operating income from inception (November 18, 2003) through January 31, 2012. During the three months ended January 31, 2012, the company had $2,000 of accounting expenses and Office and general expenses of $1,427 as compared to the three months ended January 31, 2011, where the company had $2,000 of accounting expenses and interest expense on our note of $9,679. The company had no consulting expenses during the three months ended January 31, 2012 compared to $26,000 for the three months ended January 31, 2011. During the three months ended January 31, 2012, the company did not incur losses on investments as compared to the three months ended January 31, 2011, where the company incurred a loss on investment of $239,900 due to the cancellation of an early stage wind project.
 
Liquidity and Capital Resources

As shown in the accompanying financial statements, Alveron has an accumulated deficit of $778,215 and working capital deficit of $541,733 as of such period. These results raise substantial doubt as to our ability to continue as a going concern. Over the next twelve months, we anticipate expenses will be approximately $35,000, which includes administrative costs, including professional fees and general business expenses, including costs related to complying with our filing obligations as a reporting company. Our sole executive officer, Mr. Sang Ho Kim has indicated that he is prepared to loan such funds to us for these expenses, but there are no formal arrangements in this regard and he is not legally obligated to loan funds to us.

 As our operations become more complex, it is anticipated that these costs will increase. We do not have sufficient funds on hand to cover these expenses.  Our cash on hand, $109 as of January 31, 2012, will not be sufficient to implement operational activities during the next 12 months and we will require at least $400,000 additional funding to implement our business plan.

The table below sets forth the anticipated expenses for the next 12 months:
 
    Amount Allocated   Amount Expended   Estimated Completion
             
Marketing Materials/Website
  $ 20,000      
Use as needed
Legal/Accounting
  $ 50,000      
Use as needed
SEC Reporting
  $ 25,000      
Use as needed
Computer Systems
  $ 6,000      
Use as needed
Wind/Hydro Monitors
  $ 80,000      
Use as needed
Consultants
  $ 80,000        
General Administration
           
Use as needed
Meals & Entertainment
  $ 6,000      
Use as needed
Insurance
  $ 6,000      
Use as needed
Office Supplies
  $ 6,000      
Use as needed
Salaries
  $ 80,000      
Use as needed
Professional Fees
  $ 7,000      
Use as needed
Rent
  $ 6,000      
Use as needed
Telephone/Mobile
  $ 6,000      
Use as needed
Travel
  $ 20,000      
Use as needed
Utilities
  $ 2,000      
Use as needed
Total
  $ 400,000        
               
 
 
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We have allocated approximately $139,000 towards general business purposes. Of this amount, $6,000 is intended to be used to computer hardware and software, $6,000 will be used to purchase general office supplies and $87,000 is set aside for salaries and other professional expenses.

We will not generate any revenues in the next twelve months and we will be required to raise additional capital by issuing equity or debt securities in exchange for cash in order to continue as a going concern. We can not assure you that any financing can be obtained or, if obtained, that it will be on reasonable terms. Without realization of additional capital, it would be unlikely for us to continue as a going concern.
 
Going Concern Consideration

Our independent auditors included an explanatory paragraph in their report on the financial statements included herein regarding concerns about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that lead to this disclosure by our independent auditors.
 
Critical Accounting Policies And Estimates

Our most critical accounting policies, which are those that require significant judgment, include: income taxes and revenue recognition. In-depth descriptions of these can be found in our Annual Report on Form 10-K for the fiscal year ended October 31, 2011 (the “2011 Form 10-K”). There have been no material changes in our existing accounting policies from the disclosures included in our 2010 Form 10-K.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet guarantees, interest rate swap transactions or foreign currency contracts. We do not engage in trading activities involving non-exchange traded contracts.

Item 3. Quantitative and Qualitative Disclosures about Market Risks

We conduct our business in United States dollars. Our market risk is limited to the United States domestic, economic and regulatory factors.

 
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Item 4T. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act"). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of January 31, 2012, due to the material weaknesses resulting from the Board of Directors not currently having any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K, and controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Please refer to our Annual Report on Form 10-K as filed with the SEC on February 13, 2012, for a complete discussion relating to the foregoing evaluation of Disclosures and Procedures.

Changes in Internal Control over Financial Reporting

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

The Company is not required by current SEC rules to include, and does not include, an auditor's attestation report. The Company's registered public accounting firm has not attested to Management's reports on the Company's internal control over financial reporting.
 
 
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PART II
OTHER INFORMATION
 
Item 1.   Legal Proceedings.

There are no pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company. The Company’s property is not the subject of any pending legal proceedings.
 
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds.
 
The Company did not sell any unregistered equity securities during the quarter ended January 31, 2012. The company has a total of 52,140,000 common shares issued and outstanding held by 50 individuals, including 40,000,000 shares held by Sang-Ho Kim, the President and CEO of the Company.
 
Item 3.   Defaults Upon Senior Securities.
 
None.
 
Item 4.    Submission of Matters to a Vote of Security Holders.
 
There has not been any matter submitted to a vote of the Company’s shareholders, through the solicitation of proxies or otherwise, during the three months ended January 31, 2012.
 
Item 5.   Other Information.
 
None.

 
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Item 6. Exhibits and Reports on Form 8-K
 
Exhibit Number
  
Description
  
  
  
31.1
  
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
  
  
  
32.1
  
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
101.INS **
 
XBRL Instance Document
     
101.SCH **
 
XBRL Taxonomy Extension Schema Document
     
101.CAL **
 
XBRL Taxonomy Extension Calculation Linkbase Document
     
101.DEF **
 
XBRL Taxonomy Extension Definition Linkbase Document
     
101.LAB **
 
XBRL Taxonomy Extension Label Linkbase Document
     
101.PRE **
 
XBRL Taxonomy Extension Presentation Linkbase Document

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
 
 
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SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this quarterly report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.
 
   ALVERON ENERGY CORP.  
       
Date: March 16, 2012
By:
/s/ Sang Ho Kim  
    Name: Sang Ho Kim  
    Title:    President, Chief Executive Officer, Chief Financial Officer (Principal Executive Financial and Accounting Officer)  
 
 
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