Attached files
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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x
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QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended September 30, 2012
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from ________to________
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Commission File Number: 000-54695
nycaMedia, Inc.
(Exact name of registrant as specified in its charter)
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Nevada
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27-0203690
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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1077 Balboa Avenue, Laguna Beach, CA 92651
(Address of principal executive offices) (Zip Code)
(714) 651-8000
(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 Exchange Act during the past 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. x Yes o No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes o No
Indicate by check mark whether the registrant is a large accelerated file, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
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o
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Accelerated filer
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o
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Non-accelerated filer
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o (Do not check if a smaller reporting company)
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Smaller reporting company
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x
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). o Yes x No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of November 13, 2012, there were 5,824,038 shares of the issuer's $.001 par value common stock issued and outstanding.
1
TABLE OF CONTENTS
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PART I
FINANCIAL INFORMATION
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Page
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PART II
OTHER INFORMATION
2
PART I - FINANCIAL INFORMATION
NYCAMEDIA, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEET
SEPTEMBER 30, 2012 AND DECEMBER 31, 2011
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September 30,
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December 31,
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2012
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2011
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(Unaudited)
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ASSETS
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CURRENT ASSETS
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Cash
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$ | 10,252 | $ | 1,489 | ||||
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Accounts receivable
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533 | 3,074 | ||||||
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Other receivable
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- | - | ||||||
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Deferred tax asset
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29,839 | 15,687 | ||||||
| Total current assets | 40,624 | 20,250 | ||||||
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Property and Equipment, Net
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5,549 | 9,088 | ||||||
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TOTAL ASSETS
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$ | 46,173 | $ | 29,338 | ||||
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
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CURRENT LIABILITIES
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Accounts payable and Accrued liabilities
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$ | 133,092 | $ | 73,474 | ||||
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Note payable
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22,500 | 22,500 | ||||||
| Total current liabilities | 155,592 | 95,974 | ||||||
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Deferred tax liability - non current
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1,801 | 1,801 | ||||||
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TOTAL LIABILITIES
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157,393 | 97,775 | ||||||
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STOCKHOLDERS' EQUITY (DEFICIT)
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Common stock; $.001 par value; 50,000,000 shares authorized; 5,824,038 shares
issued and outstanding as of September 30, 2012 and December 31, 2011, respectively |
5,824 | 5,000 | ||||||
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Preferred stock; $.001 par value; 5,000,000 shares authorized; zero shares
issued and outstanding as of September 30, 2012 and December 31, 2011, respectively |
- | - | ||||||
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Additional paid-in capital
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48,578 | 6,400 | ||||||
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Accumulated deficit
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(165,622 | ) | (79,837 | ) | ||||
| Total stockholders' equity (deficit) | (111,220 | ) | (68,437 | ) | ||||
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
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$ | 46,173 | $ | 29,338 | ||||
The accompanying notes are an integral part of these condensed financial statements.
3
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NYCAMEDIA, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
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FOR THE THREE MONTHS
ENDED
SEPTEMBER 30, 2012
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FOR THE THREE MONTHS
ENDED |
FOR THE NINE MONTHS
ENDED |
FOR THE NINE MONTHS
ENDED |
FOR THE PERIOD FROM
THROUGHMAY 1, 2009
(INCEPTION)
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REVENUES
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$ | 6,592 | $ | 46,372 | $ | 138,133 | $ | 82,242 | $ | 560,898 | ||||||||||
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COST OF REVENUES
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5,085 | 9,763 | 59,132 | 30,179 | 283,858 | |||||||||||||||
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GROSS PROFIT
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1,507 | 36,609 | 79,001 | 52,063 | 277,040 | |||||||||||||||
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OPERATING EXPENSES
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General and Administrative
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23,256 | 28,539 | 70,466 | 48,719 | 243,037 | |||||||||||||||
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Selling
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- | 3,226 | 1,751 | 3,894 | 21,744 | |||||||||||||||
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Professional Fees
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26,673 | 39,783 | 105,033 | 41,997 | 193,884 | |||||||||||||||
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TOTAL OPERATING EXPENSES
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49,929 | 71,548 | 177,250 | 94,610 | 458,665 | |||||||||||||||
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NET INCOME (LOSS) BEFORE OTHER EXPENSE
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(48,422 | ) | (34,939 | ) | (98,249 | ) | (42,547 | ) | (181,625 | ) | ||||||||||
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OTHER INCOME (EXPENSE)
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Interest expense
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(564 | ) | (41 | ) | (1,688 | ) | (159 | ) | (2,473 | ) | ||||||||||
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TOTAL OTHER INCOME (EXPENSE)
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(564 | ) | (41 | ) | (1,688 | ) | (159 | ) | (2,473 | ) | ||||||||||
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NET INCOME (LOSS) BEFORE INCOME TAXES
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(48,986 | ) | (34,980 | ) | (99,937 | ) | (42,706 | ) | (184,098 | ) | ||||||||||
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INCOME TAX (BENEFIT) EXPENSE
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(2,168 | ) | (6,552 | ) | (14,152 | ) | (5,763 | ) | (18,476 | ) | ||||||||||
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NET INCOME (LOSS)
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$ | (46,818 | ) | $ | (28,428 | ) | $ | (85,785 | ) | $ | (36,943 | ) | $ | (165,622 | ) | |||||
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WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING
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5,824,038 | 5,000,000 | 5,692,580 | 5,000,000 | ||||||||||||||||
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BASIC AND DILUTED NET INCOME (LOSS) PER COMMON SHARE
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$ | (0.02 | ) | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | ||||||||
The accompanying notes are an integral part of these condensed financial statements.
4
NYCAMEDIA, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENT OF STOCKHOLDERS' INCOME (LOSS)
FOR THE PERIOD FROM MAY 1, 2009 (INCEPTION) THROUGH SEPTEMBER 30, 2012
(UNAUDITED)
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Additional
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Total
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Common Stock
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Paid-in
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Accumulated
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Stockholders’
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Shares
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Par Value
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Capital
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Deficit
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Equity/(Deficit)
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Balance - May 1, 2009
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- | $ | - | $ | - | $ | - | $ | - | |||||||||||
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Common shares issued for services
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5,000,000 | 5,000 | - | - | 5,000 | |||||||||||||||
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Additional paid-in capital in exchange
for facilities provided by related party |
- | - | 1,600 | - | 1,600 | |||||||||||||||
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Net income
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- | - | - | 3,511 | 3,511 | |||||||||||||||
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Balance - December 31, 2009
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5,000,000 | 5,000 | 1,600 | 3,511 | 10,111 | |||||||||||||||
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Additional paid-in capital in exchange
for facilities provided by related party |
- | - | 2,400 | - | 2,400 | |||||||||||||||
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Net income
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- | - | - | 6,689 | 6,689 | |||||||||||||||
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Balance - December 31, 2010
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5,000,000 | 5,000 | 4,000.00 | 10,200 | 19,200 | |||||||||||||||
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Additional paid-in capital in exchange
for facilities provided by related party |
- | - | 2,400 | - | 2,400 | |||||||||||||||
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Net income
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- | - | - | (90,037 | ) | (90,037 | ) | |||||||||||||
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Balance - December 31, 2011
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5,000,000 | $ | 5,000 | $ | 6,400 | $ | (79,837 | ) | $ | (68,437 | ) | |||||||||
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Additional paid-in capital in exchange
for facilities provided by related party |
- | - | 1,800 | - | 1,800 | |||||||||||||||
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Comon stock issued for cash
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824,000 | 824 | 40,378 | 41,202 | ||||||||||||||||
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Net income
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- | - | - | (85,785 | ) | (85,785 | ) | |||||||||||||
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Balance - September 30, 2012
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5,824,000 | $ | 5,824 | $ | 48,578 | $ | (165,622 | ) | $ | (111,220 | ) | |||||||||
5
NYCAMEDIA, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF CASH FLOW
FOR THE NINE MONTH PERIODS ENDED SEPTEMBER 30, 2012 AND 2011
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FOR THE
NINE MONTHS ENDED |
FOR THE
NINE MONTHS ENDED |
MAY 1, 2009
(INCEPTION) |
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CASH FLOWS FROM OPERATING ACTIVITIES:
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Net income (loss)
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$ | (85,785 | ) | $ | (36,943 | ) | $ | (165,622 | ) | |||
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Adjustments to reconcile net (loss)
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to net cash used in operating activities:
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Depreciation expense
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3,539 | 2,629 | 9,698 | |||||||||
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Common stock issued for services
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- | - | 5,000 | |||||||||
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Additional paid-in capital in exchange for facilities provided by related party
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1,800 | 1,800 | 8,200 | |||||||||
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Change in assets and liabilities
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(Increase) Decrease in accounts receivable
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2,541 | 4,500 | (533 | ) | ||||||||
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(Increase) Decrease in other receivable
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- | 7,529 | - | |||||||||
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Increase (Decrease) in deferred tax asset
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(14,152 | ) | (5,689 | ) | (29,839 | ) | ||||||
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Increase (Decrease) in accounts payable and accrued expenses
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59,618 | 30,482 | 131,592 | |||||||||
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Increase (Decrease) in income tax payable
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- | (551 | ) | - | ||||||||
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(Decrease) in deferred tax liability
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- | - | - | |||||||||
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Increase (Decrease) in deferred tax liability - non current
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- | (392 | ) | 1,802 | ||||||||
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Net cash provided by (used in) operating activities
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(32,439 | ) | 3,365 | (39,702 | ) | |||||||
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CASH FLOWS USED IN INVESTING ACTIVITIES:
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Purchase of property and equipment
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- | (982 | ) | (15,248 | ) | |||||||
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Net cash (used in) investing activities
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- | (982 | ) | (15,248 | ) | |||||||
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CASH FLOWS FROM FINANCING ACTIVITIES:
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Proceeds received from note payable
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- | 5,000 | 24,000 | |||||||||
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Proceeds received from issuance of common stock
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41,202 | - | 41,202 | |||||||||
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Net cash provided by financing activities
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41,202 | 5,000 | 65,202 | |||||||||
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NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
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8,763 | 7,383 | 10,252 | |||||||||
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CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD
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1,489 | 11,416 | - | |||||||||
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CASH AND CASH EQUIVALENTS - END OF PERIOD
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$ | 10,262 | $ | 18,799 | $ | 10,252 | ||||||
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SUPPLEMENTAL CASH FLOW INFORMATION:
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Cash paid during the period for:
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Interest
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$ | - | $ | - | ||||||||
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Taxes
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$ | - | $ | 3,277 | ||||||||
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SUPPLEMENTAL NONCASH INVESTING AND FINANCING ACTIVITIES:
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Shares issued for services
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$ | - | $ | - | ||||||||
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6
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NOTE 1- ORGANIZATION AND BASIS OF PRESENTATION
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Organization
On May 1, 2009, nycaMedia, Inc. (a corporation in the development stage) (the “Company”) was incorporated in the State of Nevada.
nycaMedia, Inc. is a high end print production, design and media company that specializes in all types of advertising printing and digital design, which range from large formal graphics and poster printing to digital motion graphics and client website construction.
Basis of Presentation
These condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q and Article 8 of SEC Regulation S-X. The principles for interim financial information do not require the inclusion of all the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these condensed financial statements should be read in conjunction with the Company’s audited financial statements on Form 10-K for the years ended December 31, 2011. The condensed financial statements included herein are unaudited; however, in the opinion of management, they contain all normal recurring adjustments necessary for a fair statement of the condensed results for the interim periods. Operating results for the nine month period ended September 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012. We made certain reclassifications to prior-period amounts to conform to the current presentation.
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NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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Development Stage Company
The Company is considered to be in the development stage as defined by ASC 915. The Company has devoted substantially all of its efforts to the corporate formation, the raising of capital and attempting to generate revenues from the Company’s print production services.
Going Concern
The accompanying financial statements as of September 30, 2012 have been prepared assuming the Company will continue as a going concern. The Company has experienced a net loss, has a working capital deficit and has an accumulated deficit of $165,622 at September 30, 2012. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management intends to raise additional debt and/or equity financing to fund future operations. There is no assurance that its plan can be implemented; or that the results will be of a sufficient level necessary to meet the Company’s ongoing cash needs. No assurances can be given that the Company can obtain sufficient working capital through borrowings or that the continued implementation of its business plan will generate sufficient revenues in the future to sustain ongoing operations.
The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern. The asset and liability carrying amounts in the accompanying financial statements do not purport to represent realizable or settlement values.
7
NYCAMEDIA, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2012 AND DECEMBER 31, 2011
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NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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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 disclosures 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.
Property and Equipment
Property and equipment is recorded at cost and depreciated over the estimated useful lives of the assets using principally the straight-line method. When items are retired or otherwise disposed of, income is charged or credited for the difference between net book value and proceeds realized. Ordinary maintenance and repairs are charged to expense as incurred, and replacements and betterments are capitalized.
The range of estimated useful lives used to calculated depreciation for principal items of property and equipment are as follow:
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Asset Category
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Depreciation Period
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Furniture and Fixture
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5 Years
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Computer equipment
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3 Years
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Impairment of Long-Lived Assets
In accordance with ASC Topic 360, long-lived assets, such as property, plant, and equipment, and purchased intangibles, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Goodwill and other intangible assets are tested for impairment. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. There were no events or changes in circumstances that necessitated an impairment of long lived assets.
Income Taxes
The Company has adopted Accounting Standards Codification subtopic 740-10, Income Taxes (“ASC 740-10”). ASC 740-10 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 liabilities and assets are determined based on the difference between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established, when necessary, to reduce deferred tax assets to amounts that are expected to be realized.
The Company adopted the provisions of FASB Interpretation No. 48; “Accounting For Uncertainty In Income Taxes” - An Interpretation of ASC Topic 740 ("FIN 48"). FIN 48 contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not, that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating the Company's tax positions and tax benefits, which may require periodic adjustments. At September 30, 2012 and December 31, 2011, the Company did not record any liabilities for uncertain tax positions.
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NYCAMEDIA, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2012 AND DECEMBER 31, 2011
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NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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Revenue Recognition
The Company will record revenue from sales in accordance with ASC 605. The criteria for recognition are as follows:
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1)
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Persuasive evidence of an arrangement exists;
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2)
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Delivery has occurred or services have been rendered;
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3)
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The seller’s price to the buyer is fixed or determinable, and
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4)
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Collectability is reasonably assured.
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Determination of criteria (3) and (4) will be based on management's judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments will be provided for in the same period the related sales are recorded.
Share-Based Compensation
The Company accounts for share-based compensation in accordance with Accounting Standards Codification subtopic 718-10, Stock Compensation (“ASC 718-10”). This requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors, including employee stock options and employee stock purchases related to an Employee Stock Purchase Plan based on the estimated fair values.
As of September 30, 2012, there were no outstanding employee stock options.
Basic and Diluted Loss Per Common Share
Basic net loss per common share is computed using the weighted average number of common shares outstanding. Diluted loss per share reflects the potential dilution from common stock equivalents, such as stock issuable pursuant to the exercise of stock options and warrants. There were no dilutive potential common shares as of September 30, 2012. Because the Company has incurred net losses and there are no potential dilutive shares, basic and diluted loss per common share are the same.
Concentrations of Credit Risk
For the period ended September 30, 2012, the Company transacted its business with two major customers who accounted for 84% of total revenues. Total revenues approximated $95,445 for these customers. Total accounts receivable from these related customers was $0 at September 30, 2012.
For the period ended September 30, 2012, the Company transacted business with one vendors totaling $52,815 or 86% of cost of goods sold.
9
NYCAMEDIA, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2012 AND DECEMBER 31, 2011
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NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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Recently Issued Accounting Standards
In May 2011, the FASB issued ASU No. 2011-04, Fair Value Measurement: Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. This standard clarifies guidance on how to measure fair value and is largely consistent with existing fair value measurement principles. The ASU also expands existing disclosure requirements for fair value measurements and makes other amendments. For the Company, this ASU is effective prospectively beginning January 1, 2012. The adoption of this standard is not expected to have a material impact on the Company’s results of operations or financial condition.
In September 2011, the FASB issued Accounting Standards Update No. 2011-08, Intangibles - Goodwill and Other (Topic 350) - Testing Goodwill for Impairment (ASU 2011-08), to allow entities to use a qualitative approach to test goodwill for impairment. ASU 2011-08 permits an entity to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform the currently prescribed two-step goodwill impairment test. Otherwise, the two-step goodwill impairment test is not required. ASU 2011-08 is effective for us in fiscal 2012 and earlier adoption is permitted. The Company is currently evaluating the impact of our pending adoption of ASU 2011-08 on our financial statements.
There were various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company's financial position, results of operations or cash flows.
Management does not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.
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NOTE 3- PROPERTY AND EQUIPMENT
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Property and equipment consisted of the following as of September 30, 2012 and December 31, 2011:
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2012
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2011
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Computer equipment
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$
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2,706
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$
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2,706
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Furniture and equipment
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12,542
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12,542
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15,248
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15,248
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Less: accumulated depreciation
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(9,699
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)
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(6,160
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)
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Property and equipment, net
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$
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5,549
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$
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9,088
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The Company recorded depreciation expense of $3,540 and $3,953, for the period ended September 30, 2012 and for the year ended December 31, 2011, respectively.
10
NYCAMEDIA, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2012 AND DECEMBER 31, 2011
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NOTE 4- RELATED PARTY TRANSACTIONS
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From the Company’s inception (May 1, 2009) through September 30, 2012, the Company utilized approximately 200 square feet of office space from its officer and stockholder at no charge. The Company treated the usage of the office space as additional paid-in capital and charged the estimated fair value rent of $200 per month to operations. For the period ended September 30, 2012 and for the year ended December 31, 2011, we recorded a total rent expense of $1,800 and $2,400, respectively.
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NOTE 5- NOTE PAYABLE
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On June 6, 2011, the Company issued a promissory note to a related party in the amount of $5,000. The note is payable on demand and bears interest at 10% per annum.
On October13, 2011, the Company issued a promissory note to a related party in the amount of $12,500. The note is payable on demand and bears interest at 10% per annum.
On November 9, 2011, the Company issued a promissory note to a related party in the amount of $5,000. The note is payable on demand and bears interest at 10% per annum.
As of September 30, 2012 and 2011, the Company recorded interest expense in the amount of $1,688 and $159, respectively.
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NOTE 6- STOCKHOLDERS' EQUITY
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The Company was established with two classes of stock, common stock – 50,000,000 shares authorized at a par value of $0.001 per share and preferred stock- 5,000,000 shares authorized at a par value of $0.001 per share.
On May 5, 2009, the Company issued 5,000,000 shares of common stock to the Company’s founder at a value of $5,000 ($0.001 per share) for services rendered by the Company’s founder, which included the following: corporate formation, website development and identifying strategic business partners. Those 5,000,000 shares were valued at $0.001 per share based on the fair value of the services performed on the date of issuance. No quoted market price was available on the date they were granted.
During the period nine months ended September 30, 2012, the Company issued 824,000 shares of common stock to investors for $41,202 ($0.05 per share).
11
NYCAMEDIA, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2012 AND DECEMBER 31, 2011
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NOTE 7- INCOME TAXES
|
Income tax expense (benefit) amounted to $(14,152) and $(13,886) for the nine months ended September 30, 2012 and for the year ended December 31, 2011, respectively. The Company has a federal net operating loss carry forward of approximately $26,000, which if not used to offset future taxable income will expire during 2031. The actual tax expense (benefit) differs from the "expected" tax (computed by applying the U.S. federal corporate tax rate of 15% to earnings before income taxes and the State tax rate of 8.84% to earnings before income tax) as follows:
| 2012 | 2011 | ||||||||
|
Expected tax expense (benefit)
|
$
|
(24,929)
|
$
|
(24,964)
|
|||||
|
Non-deductible expenses
|
1,824
|
2,220
|
|||||||
|
Depreciation
|
(2,226
|
)
|
(2,226)
|
||||||
|
Cash to accrual adjustment
|
18,901
|
17,038
|
|||||||
|
Valuation allowance
|
(7,722)
|
(5,954)
|
|||||||
|
$
|
(14,152)
|
$
|
(13,886)
|
The components of income tax expense (benefit) for 2012 is as follows:
|
Tax expense (benefit)
|
Current
|
Deferred
|
Total
|
||||||||||
|
Federal
|
$ | - | $ | (14,500 | ) | $ | (14,500 | ) | |||||
|
State
|
- | (7,374 | ) | (7,374 | ) | ||||||||
|
Valuation allowance
|
7,722 | 7,722 | |||||||||||
| $ | - | $ | (14,152 | ) | $ | (14,152 | ) | ||||||
The components of income tax expense (benefit) for 2011 is as follows:
|
Tax expense (benefit)
|
Current
|
Deferred
|
Total
|
||||||||||
|
Federal
|
$ | - | $ | (12,543 | ) | $ | (12,543 | ) | |||||
|
State
|
- | (7,297 | ) | (7,297 | ) | ||||||||
|
Valuation allowance
|
- | 5,954 | 5,954 | ||||||||||
| $ | - | $ | (13,886 | ) | $ | (13,886 | ) | ||||||
12
NYCAMEDIA, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2012 AND DECEMBER 31, 2011
|
NOTE 7- INCOME TAXES
|
The components of deferred tax assets and (liabilities) for 2012 is as follows:
|
Tax Asset (liabilty)
|
Current
|
Noncurrent |
Total
|
||||||||||
|
Federal
|
$ | 19,884 | $ | 3,946 | $ | 23,830 | |||||||
|
State
|
9,955 | 1,975 | 11,930 | ||||||||||
|
Valuation allowance
|
- | ( 7,722 | ) | (7,722 | ) | ||||||||
| $ | 29,839 | $ | (1,801 | ) | $ | 28,038 | |||||||
The components of deferred tax assets and (liabilities) for 2011 is as follows:
|
Tax Asset (liabilty)
|
Current
|
Noncurrent
|
Total
|
||||||||||
|
Federal
|
$ | 10,453 | $ | 2,768 | $ | 13,221 | |||||||
|
State
|
5,234 | 1,386 | 6,619 | ||||||||||
|
Valuation allowance
|
(5,954 | ) | (5,994 | ) | |||||||||
| $ | 15,687 | $ | (1,801 | ) | $ | 13,886 | |||||||
13
Forward-looking Statements.
This Quarterly Report of nycaMedia, Inc. on Form 10-Q contains forward-looking statements, particularly those identified with the words, “anticipates,” “believes,” “expects,” “plans,” “intends,” “objectives,” and similar expressions. These statements reflect management's best judgment based on factors known at the time of such statements. The reader may find discussions containing such forward-looking statements in the material set forth under “Management's Discussion and Analysis of Financial Condition and Results of Operations,” generally, and specifically therein under the captions “Liquidity and Capital Resources” as well as elsewhere in this Quarterly Report on Form 10-Q. Actual events or results may differ materially from those discussed herein. The forward-looking statements specified in the following information have been compiled by our management on the basis of assumptions made by management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guarantee, or warranty is to be inferred from those forward-looking statements.
The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.
Critical Accounting Policy and Estimates. Our Management's Discussion and Analysis of Financial Condition and Results of Operations section discusses our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. These accounting policies are described at relevant sections in this discussion and analysis and in the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2011 and this Quarterly Report on Form 10-Q for the period ended September 30, 2012.
Overview. nycaMedia, Inc. (“nycaMedia,” “we” or the “Company”) was incorporated in the State of Nevada on May 1, 2009. We are a print production, design and media company that specializes in all types of advertising printing and digital design, which range from large formal graphics and poster printing to digital motion graphics and client website construction. We specialize in providing and maintaining outdoor advertising space on street furniture, which refers to objects and pieces of equipment installed on streets and roads such as bus shelters, newsstands, taxi stands and street lamps. Our management has over twenty-seven years of experience in the print industry, including experience in conceptual design, pre-press and production management.
The following discussion of our financial condition and results of operations should be read in conjunction with our audited financial statements for the year ended December 31, 2011, together with notes thereto, as previously filed with our Annual Report on Form 10-K, and our financial statements for the period ended September 30, 2012, together with notes thereto, which are included in this report.
14
For the three months ended September 30, 2012, as compared to the three months ended September 30, 2011.
Results of Operations.
Revenues. We generated revenues of $6,592 for the three months ended September 30, 2012, as compared to revenues of $46,372 for the three months ended September 30, 2011. The significant decrease in revenues of $39,780 over the comparable periods is directly attributable to a large decrease in orders from our primary customer. We hope to generate increased revenues from that customer in the next quarter and as we further implement our business plan.
Costs of Revenues. Our cost of revenues sold decreased by $4,678 from $9,763 for the three months ended September 30, 2011 to $5,085 for the three months ended September 30, 2012. The decrease in cost of revenues between the comparable periods was primarily related to decreased revenues between those periods. For the three months ended September 30, 2012, our cost of revenues were comprised of work performed by contractors and supplies purchased. Our design services are provided by outside contractors and their compensation included in our cost of revenues. Supplies purchased by these contractors are billed with the labor performed on each respective job as one amount.
Gross Profit. Our gross profit decreased by $35,102 from $36,609 for the three months ended September 30, 2011 to $1,507 for the three months ended September 30, 2012.
Operating Expenses. Our operating expenses decreased $21,619 from $71,548 for the three months ended September 30, 2011 to $49,929 for the three months ended September 30, 2012. The overall decrease between the comparable periods is primarily due to a decrease in professional fees, which decreased from $39,783 for the three months ended September 30, 2011 to $26,673 for the three months ended September 30, 2012. The decrease in professional fees was directly related to a decrease in legal and accounting costs as a result of reduced public company reporting activity for the three months ended September 30, 2012. In addition, our general and administrative expenses decreased from $28,539 for the three months ended September 30, 2011 to $23,256 for the three months ended September 30, 2012 and our selling expenses decreased from $3,226 for the three months ended September 30, 2011 to $0 for the three months ended September 30, 2012.
Other Expense. Interest expense increased $523 from $41 for the three months ended September 30, 2011 to $564 for the three months ended September 30, 2012. The increase in interest expense was a result of issuing three notes payable to our officer and director. The notes each bear 10% interest per annum and are payable on demand.
Income Tax Benefit. Income tax benefit decreased by $4,384 from $6,552 for the three months ended September 30, 2011 to $2,168 for the three months ended September 30, 2012. The income tax benefit was a result of a federal net operating loss carry forward of approximately $26,000, which if not used to offset future taxable income will expire during 2031.
Net Loss. Our net loss increased $18,390 from $28,428 for the three months ended September 30, 2011 to $46,818 for the three months ended September 30, 2012. The increase in net loss between the comparable periods was attributable to decreased revenues for the three months ended September 30, 2012.
For the nine months ended September 30, 2012, as compared to the nine months ended September 30, 2011.
Results of Operations.
Revenues. We generated revenues of $138,133 for the nine months ended September 30, 2012, as compared to revenues of $82,242 for the nine months ended September 30, 2011. The increase in revenues of $55,891 over the comparable periods is directly attributable to increased sales. We hope to generate increased revenues as we continue operations and further implement our business plan.
15
Costs of Revenues. Our cost of revenues sold increased by $28,953 from $30,179 for the nine months ended September 30, 2011 to $59,132 for the nine months ended September 30, 2012. The increase in cost of revenues between the comparable periods was primarily related to increased revenues between those periods. For the nine months ended September 30, 2012, our cost of revenues were comprised of work performed by contractors and supplies purchased. Our design services are provided by outside contractors and their compensation included in our cost of revenues. Supplies purchased by these contractors are billed with the labor performed on each respective job as one amount.
Gross Profit. Our gross profit increased by $26,938 from $52,063 for the nine months ended September 30, 2011 to $79,001 for the nine months ended September 30, 2012.
Operating Expenses. Our operating expenses increased $82,640 from $94,610 for the nine months ended September 30, 2011 to $177,250 for the nine months ended September 30, 2012. The overall increase between the comparable periods is primarily due to increased professional fees, which increased from $41,997 for the nine months ended September 30, 2011 to $105,033 for the nine months ended September 30, 2012 and also an increase in general and administrative expenses, which increased from $48,719 for the nine months ended September 30, 2011 to $70,466 for the nine months ended September 30, 2012. The increase in professional fees was directly related to an increase in legal and accounting costs as a result of becoming a public company. In addition, our selling expenses decreased from $3,894 for the nine months ended September 30, 2011 to $1,751 for the nine months ended September 30, 2012.
Other Expense. Interest expense increased $1,529 from $159 for the nine months ended September 30, 2011 to $1,688 for the nine months ended September 30, 2012. The increase in interest expense was a result of issuing three notes payable to our officer and director. The notes each bear 10% interest per annum and are payable on demand.
Income Tax Benefit. Income tax benefit increased by $8,389 from $5,763 for the nine months ended September 30, 2011 to $14,152 for the nine months ended September 30, 2012. The income tax benefit was a result of a federal net operating loss carry forward of approximately $26,000, which if not used to offset future taxable income will expire during 2031.
Net Loss. Our net loss increased $48,842 from $36,943 for the nine months ended September 30, 2011 to $85,785 for the nine months ended September 30, 2012. The increase in net loss between the comparable periods was attributable to increased professional fees as a result of becoming a public company.
Liquidity and Capital Resources.
As of September 30, 2012, our current assets are comprised of cash of $10,252, accounts receivable of $533 and a deferred tax asset of $29,839. Our current assets, combined with property and equipment worth $5,549, represent our total assets of $46,173 as of September 30, 2012.
As of September 30, 2012, our total liabilities were $157,393. Our total current liabilities consisted of current liabilities of $133,092 for accounts payable and accrued expenses and $22,500 for a note payable and a non-current liability of $1,801 for a deferred tax liability. We had no other long term liabilities, commitments or contingencies.
We filed a Registration Statement on Form S-1 to sell 10,000,000 shares of our common stock at a purchase price of $0.05 per share in a direct public offering. The Registration Statement on Form S-1 was declared effective on January 9, 2012. On January 26, 2012, we sold 596,000 shares of our common stock to unrelated investors for cash of $29,800 pursuant to that offering. Additionally, on March 30, 2012, we sold an additional 228,038 to unrelated investors for cash of $11,402 pursuant to that offering. Our offering pursuant to the Registration Statement closed on April 3, 2012. We have used proceeds from the offering for working capital and general corporate purposes.
During 2013, we expect to continue to incur significant accounting and legal costs associated with being a public company. We expect that the legal and accounting costs of being a public company will continue to impact our liquidity and we may need to obtain funds to pay those expenses. We estimate that these costs will range up to $75,000 per year for the next few years. Those fees will be higher if our business volume and activity increases.
16
As of September 30, 2012, we had a cash balance of $10,252. In the opinion of management, available funds are not sufficient to satisfy our working capital requirements for the next twelve months. If we are unable to obtain additional financing, then we will need to rely solely on revenues to meet our working capital requirements. We cannot guarantee that we will obtain additional financing or generate sufficient revenues to meet our working capital requirements. Our failure to raise additional capital will negatively impact our business and, potentially, our ability to continue operations. Accordingly, the notes to our financial statements for the period ended September 30, 2012 disclose uncertainty as to our ability to continue as a going concern.
Our forecast for the period for which our financial resources will be adequate to support our operations involves risks and uncertainties and actual results could fail as a result of a number of factors. We intend to pursue capital through public or private financing as well as borrowings and other sources, such as our officers and directors. We cannot guarantee that additional funding will be available on favorable terms, if at all. If adequate funds are not available, we hope that our officers and directors will contribute funds to pay for our expenses to achieve our objectives over the next twelve months, although we cannot guarantee they will do so. On June 6, 2011, Michael Hawks, our officer and director, loaned us $5,000 to cover our expenses and fund our operations. On October 13, 2011, Mr. Hawks loaned us an additional $12,500 to cover our expenses and fund our operations. On November 9, 2011, Mr. Hawks loaned us an additional $5,000 to cover our expenses and fund our operations. The three loans are evidenced by promissory notes that are due on demand and bear annual interest of 10%. For each of the three outstanding promissory notes, the principal together with any accrued interest shall be due and payable on demand by Mr. Hawks, which means that Mr. Hawks can request that we repay him at any time. We hope to repay these notes by using revenues generated from our operations during the next twelve to twenty four months. If funding cannot be obtained to pay these promissory notes, then Mr. Hawks may exercise all rights available to him under California law to collect the amounts due. Although the promissory notes technically include any future advances by Mr. Hawks, we do not have any oral or written commitment with Mr. Hawks or our other officer to provide additional funds in the future to cover our expenses and fund our operations. We cannot guarantee that additional funds will be advanced to us by Mr. Hawks.
As part of our growth strategy, we may look to acquire businesses, products or technologies that allow us to complement our existing product offerings. We believe that the current marketplace of companies that advertising and print related products is highly fragmented, with numerous small and medium sized companies located throughout the country. As such, we believe that there is an opportunity for a publicly traded company to acquire several, smaller and more established such companies with already-established reputations and product lines using our common stock as payment for any potential acquisitions. Our acquisition strategy is designed to complement our core business. If we do find suitable acquisition opportunities, we cannot guaranty that we will be able to consummate the acquisitions on commercially acceptable terms or at all, or may not realize the anticipated benefits of any acquisitions we do undertake.
We are not currently conducting any research and development activities. We do not anticipate conducting such activities in the near future. In the event that we expand our customer base, then we may need to hire additional employees or independent contractors as well as purchase or lease additional equipment. Our management believes that we do not require the services of independent contractors to operate at our current level of activity.
Off-Balance Sheet Arrangements. We have no off-balance sheet arrangements.
Not applicable.
Evaluation of disclosure controls and procedures. We maintain controls and procedures designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission and (ii) that such information is accumulated and communicated to our principal executive and principal financial officers to allow timely decisions regarding required disclosure. Based upon their evaluation of those controls and procedures performed as of September 30, 2012, the date of this report, our Principal Executive Officer and the Principal Financial Officer concluded that our disclosure controls and procedures were not effective.
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, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.
17
PART II — OTHER INFORMATION
None.
Not applicable.
None.
None.
Not applicable.
None.
|
101.ins
|
XBRL Instance Document
|
|
101.def
|
XBRL Taxonomy Definition Linkbase Document
|
|
101.sch
|
XBRL Taxonomy Schema Document
|
|
101.cal
|
XBRL Taxonomy Calculation Linkbase Document
|
|
101.lab
|
XBRL Taxonomy Label Linkbase Document
|
|
101.pre
|
XBRL Taxonomy Presentation Linkbase Document
|
18
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.
|
nycaMedia, Inc.,
a Nevada corporation
|
|||
|
November 13, 2012
|
By:
|
/s/ Michael Hawks
|
|
|
Michael Hawks
|
|||
|
Its:
|
President, Chief Executive Officer and a Director
|
||
|
(Principal Executive Officer)
|
|||
|
November 13, 2012
|
By:
|
/s/ Bernard Colacchio
|
|
|
Bernard Colacchio
|
|||
|
Its:
|
Chief Financial Officer and Chief Operating Officer
|
||
|
(Principal Financial and
Accounting Officer)
|
|||