The Company was incorporated in the State of Nevada as a for-profit Company on May 5, 2011 and established a fiscal year end of May 31. We are a development-stage Company organized to develop a one button remote home locking device that will both lock the house and activate the alarm.
The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at February 29, 2012, and for all periods presented herein, have been made.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Companys May 31, 2011 audited financial statements. The results of operations for the periods ended February 29, 2012 and the same period last year are not necessarily indicative of the operating results for the full years.
The Companys financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has a working capital deficit of $9,043, an accumulated deficit of $14,043 and net loss from operations since inception of $14,043. The Company does not have a source of revenue sufficient to cover its operation costs giving substantial doubt for it to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern. The Company is funding its initial operations by way of issuing Founders shares.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Managements plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
The company has evaluated all the recent accounting pronouncements and believes that none of them will have a material effect on the companys financial statements.
The Company had a prepaid expense of $469 as at February 29, 2012 and $0 as at May31st, 2011 in respect of a legal fee retainer. The prepaid expense is expected to be used within a 12-month period.
The Companys capitalization is 75,000,000 common shares with a par value of $0.001 per share. No preferred shares have been authorized or issued. As of February 29, 2012, 5,168,000 common shares are issued and outstanding.
On May 26, 2011, the Company issued 5,000,000 Founders shares at $0.001 per share for net funds to the Company of $5,000.
In January 2012, the Company issued 168,000 common shares for $0.30 per share, for which there are Subscriptions Receivable of $5,040.
As of February 29, 2012, the Company has not granted any stock options and has not recorded any stock-based compensation.
The Company has evaluated subsequent events from the balance sheet date through the date the financial statements were issued and has determined that there are no events to disclose.
Item 2. Management`s Discussion and Analysis of Financial Condition and Results of Operations
This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.
Auto Home Lock, Inc. ("AHL", "the Company", our or "we") was incorporated in the State of Nevada as a for-profit company on AHL. The Company is a development stage company organized to develop, produce and distribute an automated home locking system. The idea is similar to a car locking system that works with a keychain remote control. With many new cars when one presses a remote control button, the car automatically locks all the doors, closes the windows and activates the alarm system. Another button allows the car owner to unlock the car doors and deactivate the alarm system with the remote.
Our idea is to develop a system with a similar concept to the one described above, but for houses. Our product, when fully developed, may allow the user to lock all the doors in the house and activate the alarm system simply by pressing one button. Another button on the same remote control will unlock the front door and deactivate the alarm system.
Plan of Operation
The Company has not yet generated any revenue from its operations. At the fiscal quarter ended February 29, 2012, we had Current Assets of $470 as compared to $4,951 at May 31, 2011. We incurred operating expenses in the amount of $4,313 in the quarter ended February 29, 2012, as compared to $8,057 for the nine-month period ended February 29, 2012. To date, we have incurred $14,043 in total expenses, resulting in an accumulated deficit of $14,043 since inception.
Our current cash holdings will not satisfy our liquidity requirements and we will require additional financing to pursue our planned business activities. We have registered 2,000,000 of or our common stock for sale to the public. Our registration statement became effective on January 06, 2012 and we are in the process of seeking equity financing to fund our operations over the next 12 months.
We have recently issued 168,000 common shares through private placements. Management believes that if additional private placements are successful, we will generate sales revenue within the following twelve months thereof. However, additional equity financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements.
If AHL is unsuccessful in raising the additional proceeds through a private placement offering it will then have to seek additional funds through debt financing, which would be very difficult for a new development stage company to secure. Therefore, the company is highly dependent upon the success of the anticipated private placement offering described herein and failure thereof would result in AHL having to seek capital from other resources such as debt financing, which may not even be available to the company. However, if such financing were available, because AHL is a development stage company with no operations to date, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing and determine whether the business could sustain operations and growth and manage the debt load. If AHL cannot raise additional proceeds via a private placement of its
common stock or secure debt financing it would be required to cease business operations. As a result, investors in AHL common stock would lose all of their investment.
After we have raised sufficient funds to start this plan of operations, we plan to accomplish the following steps:
Contract third-party engineers (month one) in the first month, the Company will locate, interview and choose the right personal to develop our product. We intend to hire third-party engineer(s) and/or technician(s) capable of developing our concept. The Company has no plans to hire employees, but to contract and negotiate a suitable deal with a third-party. Our president shall be responsible for this step. The contacts and initial interview shall be made via phone and email. Meeting in person shall be scheduled only for good prospects.
Development and testing of our product (months two to ten) We believe that we may be able to have our product developed and tested between the second and tenth months after we have started our business plan. We expect to have a prototype ready for testing by the eight month. The engineers and/or technicians shall be responsible for the development and adjustments of our concept. The Companys president shall oversee the development of our prototype, the product testing and be responsible for final approval.
Contact and negotiate contracts with insurance, alarm and surveillance companies (months eight to eleven) We believe that our product shall be finalized or almost finalized within the eighth and eleventh months after we have started our business plan. At that point, we shall have a concrete concept and a prototype ready. The President should then have a better understanding of our product for presentation to possible partner companies. This would give us a better position in future negotiations. Initial negotiations shall be made via phone and email. Meetings in person shall be scheduled only on the last phase of our negotiations and/or to show our prototype.
Marketing (months seven to twelve) The Company intends to have a Marketing campaign that shall start in the seventh to twelfth month after we have started our business plan. By the end of the twelfth month we expect to have some products ready for sale. Our Marketing campaign shall include full development of our website including videos of our products and concepts. We plan to place ads on specialized magazines and/or websites. We have not yet researched or contacted any magazines or websites. If funds allow, we also intend to advertise on TV shopping channels. No research or contact has been established yet and the funds to be used on our Use of Proceeds are only estimates by our Company.
Production of initial batch (months eleven to twelve) The Company expects to have our product fully developed and functional by the eleventh month after we have started our business plan. Final adjustments and negotiations with factories and manufacturers shall take place during this last step, when we intend to also have our first batch ready for sale by the end of the twelfth month after we have started the implementation of our Business Plan. The president will be responsible for all the negotiations and for the choice of possible manufacturers. The Company has not yet contacted or identified any possible manufacturer.
Marketing is anticipated to be an ongoing matter that will continue during the life of our operations.
We do not currently have any employees and management does not plan to hire employees at this time. We do not expect to purchase any significant equipment, and we currently have no material commitments pending.
There is no historical financial information about us upon which to base an evaluation of our performance. We are a development stage corporation and have not generated any revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources.
If AHL is unsuccessful in raising the additional proceeds through a private placement offering we will then have to seek additional funds through debt financing, which would be highly difficult for a new development stage company to secure. Therefore, the company is highly dependent upon the success of the anticipated private placement offering and failure thereof would result in AHL having to seek capital from other sources such as debt financing, which may not even be available to the company. However, if such financing were available, because AHL is a development stage company with no operations to date, we would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing and determine whether the business could sustain operations and growth and manage the debt load. If AHL cannot raise additional proceeds via a private placement of its common stock or secure debt financing we would be required to cease business operations. As a result, investors in AHL common stock would lose all of their investment.
Off Balance Sheet Arrangement
The company is dependent upon the sale of its common shares to obtain the funding necessary to carry its business plan. Our President, Raul Pinheiro has undertaken to provide the Company with operating capital to sustain its business over the next twelve month period, as the expenses are incurred, in the form of a non-secured loan. However, there is no contract in place or written agreement securing these agreements. Investors should be aware that Mr. Pinheiro expression is neither a contract nor agreement between him and the company.
Other than the above described situation the Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
There have not been any changes in the Company's internal control over financial reporting during the quarter ended February 29, 2012 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
 Incorporated by reference from the Companys filing with the Commission on July 26, 2011.
Pursuant to the requirements of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Auto Home Lock, Inc.