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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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 October 31, 2012
   
o
Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934
   
For the transition period from __________  to __________
   
Commission File Number: 001-35316

Superior Venture Corp.
(Exact name of Registrant as specified in its charter)

Nevada
 
27-2450645
(State or other jurisdiction of incorporation or organization) 
 
(IRS Employer Identification No.)
 
Suite 220 – 2 Old Brompton Road
South Kensington, London UK SW7 3DQ
(Address of principal executive offices)

+44 (0) 207 543 7720
(Registrant’s telephone number)
 
 _______________________________________________________________
(Former name, former address and former fiscal year, if changed since last report)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days 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 (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). 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.

o
Large accelerated filer
o Accelerated filer
o
Non-accelerated filer
x Smaller reporting company

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

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 392,850,000 common shares as of December 13, 2012.
 


 
 

 
 
TABLE OF CONTENTS
 
     
Page
 
PART I – FINANCIAL INFORMATION
 
   
Item 1:
Financial Statements
    3  
Item 2:
Management’s Discussion and Analysis of Financial Condition and Results of Operations
    4  
Item 3:
Quantitative and Qualitative Disclosures About Market Risk
    7  
Item 4:
Controls and Procedures
    7  
   
PART II – OTHER INFORMATION
 
   
Item 1:
Legal Proceedings
    9  
Item 1A:
Risk Factors
    9  
Item 2:
Unregistered Sales of Equity Securities and Use of Proceeds
    9  
Item 3:
Defaults Upon Senior Securities
    9  
Item 4:
Mine Safety Disclosure
    9  
Item 5:
Other Information
    9  
Item 6:
Exhibits
    10  
 
 
2

 
 
PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements

Our financial statements included in this Form 10-Q are as follows:

F-1  
Balance Sheets as of October 31, 2012 (unaudited) and April 30, 2012 (audited);

F-2  
Statements of Operations for the three and six months ended October 31, 2012 and 2011 and period from inception (April 27, 2010) to October 31, 2012 (unaudited);

F-3  
Consolidated Statements of Cash Flow for the six months ended October 31, 2012 and 2011 and period from inception (April 27, 2010) to October 31, 2012 (unaudited);

F-4  
Notes to Financial Statements.

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions to Form 10-Q.  In the opinion of management, all adjustments considered necessary for a fair presentation have been included.  Operating results for the interim period ended October 31, 2012 are not necessarily indicative of the results that can be expected for the full year.
 
 
3

 
 
SUPERIOR VENTURE CORPORTION (A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
 
   
October 31,
   
April 30,
 
   
2012
   
2012
 
ASSETS
 
(unaudited)
       
             
CURRENT ASSETS:
           
Cash and cash equivalents
  $ 5,688     $ 10,267  
Total Current Assets
    5,688       10,267  
                 
                 
TOTAL ASSETS
  $ 5,688     $ 10,267  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
               
                 
CURRENT LIABILITIES:
               
Accounts payable
  $ 3,688     $ 3,113  
Total Current Liabilities
    3,688       3,113  
                 
STOCKHOLDERS' EQUITY (DEFICIT)
               
Preferred stock; $0.001 par value; 5,000,000 shares authorized; 0 shares issued
               
and outstanding
    -       -  
Common stock, $0.001 par value; 545,000,000 shares authorized; 507,850,000
               
shares issued and  outstanding
    507,850       507,850  
Capital in excess of par value
    (447,750 )     (452,750 )
Accumulated deficit
    (58,100 )     (45,808 )
      2,000       9,292  
                 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
  $ 5,688     $ 12,405  
 
* A stock split (35:1) authorized on August 22, 2012 was retroactively applied to all years presented.
 
F-1

 
 
SUPERIOR VENTURE CORPORTION (A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS (uanaudited)
 
   
For the Three
Months Ended October 31,
   
For the Six
Months Ended October 31,
   
For the period from April 27, 2010
(Date of Inception) to
October 31,
 
   
2012
   
2011
   
2012
   
2011
   
2012
 
REVENUE:
                             
Sales
  $ -     $ -     $ -     $ -     $ -  
                                         
OPERATING EXPENSES
                                       
Selling, general and administrative expenses
    7,848       7,694       10,154       14,707       58,100  
TOTAL OPERATING EXPENSES
    7,848       7,694       10,154       14,707       58,100  
                                         
NET LOSS
  $ (7,848 )   $ (7,694 )   $ (10,154 )   $ (14,707 )   $ (58,100 )
                                         
NET LOSS PER COMMON SHARE, BASIC AND DILUTED
  $ (0.00 )   $ (0.00 )   $ (0.00 )   $ (0.00 )   $    
                                         
WEIGHTED AVERAGE NUMBER OF
                                       
COMMON  SHARES OUTSTANDING, BASIC AND DILUTED
    507,850,000       525,000,000       507,850,000       461,277,180          

 
 
F-2

 
 
SUPERIOR VENTURE CORPORTION (A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
 
               
Capital in
               
Total
 
   
Common Stock
   
Excess of
   
Stock
   
Accumulated
   
Stockholders'
 
   
Shares
   
Amount
   
Par Value
   
Subscription
   
Deficit
   
Equity (Deficit)
 
                                     
Balance, April 27, 2010 (date of inception)
    -     $ -     $ -     $ -     $ -     $ -  
                                                 
Shares issued
    350,000,000       350,000       -       (346,000 )     -       4,000  
                                                 
Net loss for the period April 27, 2010 (Date of Inception) through April 30, 2010
    -       -       -       -       (100 )     (100 )
                                                 
Balance, April 30, 2010
    350,000,000     $ 350,000     $ -     $ (346,000 )   $ (100 )   $ 3,900  
                                                 
Stock subscription
    -       -       (340,000 )     346,000       -       6,000  
                                                 
Net loss
    -       -       -       -       (10,048 )     (10,048 )
                                                 
Balance, April 30, 2011
    350,000,000       350,000       (340,000 )     -       (10,148 )     (148 )
                                                 
Shares issued
    157,850,000       157,850       (112,750 )     -       -       45,100  
                                                 
Net loss
    -       -       -       -       (37,798 )     (37,798 )
                                                 
Balance, April 30, 2012
    507,850,000       507,850       (452,750 )     -       (47,946 )     7,154  
                                                 
Capital contribution
    -       -       5,000       -       -       5,000  
                                                 
Net loss (unaudited)
    -       -       -       -       (10,154 )     (10,154 )
                                                 
Balance, October 31, 2012 (unaudited)
    507,850,000     $ 507,850     $ (447,750 )   $ -     $ (58,100 )   $ 2,000  
 
* A stock split (35:1) authorized on August 22, 2012 was retroactively applied to all years presented.
 
F-3

 
 
SUPERIOR VENTURE CORPORTION (A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS (unaudited)
 
   
For the Six
Months Ended October 31,
   
For the Period from April 27, 2010 (Date of Inception) through
October 31,
 
   
2012
   
2011
   
2012
 
                   
CASH FLOWS FROM OPERATING ACTIVITIES:
                 
Net loss
  $ (10,154 )   $ (14,707 )   $ (58,100 )
Adjustments to reconcile net loss to net cash and cash equivalents
                       
Increase (decrease) in:
                       
Accounts payable and accrued expenses
    575       428       3,688  
Net cash used by operating activities
    (9,579 )     (14,279 )     (54,412 )
                         
CASH FLOWS FROM INVESTING ACTIVITIES:
                       
Net cash used by investing activities
    -       -       -  
                         
CASH FLOWS FROM FINANCING ACTIVITIES:
                       
Cash contribution from shareholder
    5,000       -       5,000  
Proceeds from issuance of shares of stock
    -       50,000       55,100  
Net cash provided by financing activities
    5,000       50,000       60,100  
                         
Net increase (decrease) in cash and cash equivalents
    (4,579 )     35,721       5,688  
                         
Cash and cash equivalents, beginning of period
    10,267       2,224       -  
                         
Cash and cash equivalents, end of period
  $ 5,688     $ 37,945     $ 5,688  
                         
SUPPLEMENTAL CASH FLOW INFORMATION:
                       
Cash paid for interest
  $ -     $ -     $ -  

 
F-4

 
 
Superior Venture Corporation
(A Development Stage Corporation)
Notes to Financial Statements

For the Three and Six Months Ended October 31, 2012 and 2011 and
for the Period from April 27, 2010 (Date of Inception) through October 31, 2012
 
1.
Background Information

Superior Venture Corporation (the “Company”), is a Nevada Corporation, incorporated on April 27, 2010 (Date of Inception) with its corporate headquarters located in Colorado and its year-end is April 30. The Company has a principal business objective of producing and selling wine varietals. Producing wines that are both well balanced and possessing clearly projected aromas, combined with stylistic packaging; Superior Venture plans to position itself in the market place by branding our product and leaving the consumer with an eclectic impression. We plan to produce and promote an elevation of chic sophistication while maintaining selections that are innovative and progressive with a multiplicity in its flavors and sensations.
 
On November 9, 2012, in accordance with the Exchange Agreement, we acquired all of the issued and outstanding shares of IPL, which resulted in a parent-subsidiary relationship. In exchange for all of the issued and outstanding shares of IPL, the shareholders of IPL received 60,000,000 shares of our common stock, which represented approximately 15% of our outstanding common stock following the Acquisition.  See Note 6 for additional information.
 
In consequence of entering into the Exchange Agreement, we have determined to pursue the business plan of IPL. We are now in the business of developing feature theatrical films to be financed and distributed domestically by Chinese production companies, and for international release. Our website is located at www.superiorventurecorp.com.
 
2.
Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. For the three and six months ended October 31, 2012, the Company has had no operations and as of October 31, 2012, the Company has not emerged from the development stage. In view of these matters, the Company’s ability to continue as a going concern is dependent upon the Company’s ability to begin operations and to achieve a level of profitability. The Company intends on financing its future development activities and its working capital needs largely from the sale of public equity securities with some additional funding from other traditional financing sources, including term notes until such time that funds provided by operations are sufficient to fund working capital requirements. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.
 
 
F-5

 
 
3.
Significant Accounting Policies

The significant accounting policies followed are:
 
 
FASB codification - In June 2009, the FASB issued ASC 105, Generally Accepted Accounting Principles, effective for interim and annual reporting periods ending after September 15, 2009. This statement establishes the Codification as the source of authoritative accounting principles used in the preparation of financial statements in conformity with generally accepted accounting principles. The Codification does not replace or affect guidance issued by the SEC or its staff. As a result of the Codification, the references to authoritative accounting pronouncements included herein now refer to the Codification topic section rather than a specific accounting rule as was past practice.
 
 
Use of estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
 
 
Cash and cash equivalents - Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. The Company has never experienced any losses related to these balances. All non-interest bearing cash balances were fully insured at October 31, 2012 and 2011 due to a temporary federal program in effect from December 31, 2010 through December 31, 2012. Under the program, there is no limit to the amount of insurance for eligible accounts. Beginning 2013, insurance coverage will revert to $250,000 per depositor at each financial institution, and the Company's non-interest bearing cash balances may again exceed federally insured limits.
   
 
Research and development expenses - Expenditures for research, development, and engineering of products are expensed as incurred.
 
 
Common stock - The Company records common stock issuances when all of the legal requirements for the issuance of such common stock have been satisfied.
 
 
Revenue and cost recognition  The Company has no current source of revenue; therefore the Company has not yet adopted any policy regarding the recognition of revenue or cost.
 
 
Advertising costs - The Companys policy regarding advertising is to expense advertising when incurred.
 
 
F-6

 
 
 
Income taxes - Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes resulting from temporary differences. Such temporary differences result from differences in the carrying value of assets and liabilities for tax and financial reporting purposes. The deferred tax assets and liabilities represent the future tax consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.
 
The Company adopted the provisions of FASB ASC 740-10 Uncertainty in Income Taxes (ASC 740-10), at inception. The Company has not recognized a liability as a result of the implementation of ASC 740-10. A reconciliation of the beginning and ending amount of unrecognized tax benefits has not been provided since there is no unrecognized benefit since the date of adoption. The Company has not recognized interest expense or penalties as a result of the implementation of ASC 740-10. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses.
 
 
Earnings (loss) per share - Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share is computed giving effect to all potentially dilutive common shares. Potentially dilutive common shares may consist of incremental shares issuable upon the exercise of stock options and warrants and the conversion of notes payable to common stock. In periods in which a net loss has been incurred, all potentially dilutive common shares are considered anti-dilutive and thus are excluded from the calculation. At October 31, 2012, the Company did not have any potentially dilutive common shares.
 
 
F-7

 
 
  Financial instruments In September 2006, the Financial Accounting Standards Board (FASB) introduced a framework for measuring fair value and expanded required disclosure about fair value measurements of assets and liabilities. The Company adopted the standard for those financial assets and liabilities as of the beginning of the 2008 fiscal year and the impact of adoption was not significant. FASB Accounting Standards Codification (ASC) 820 Fair Value Measurements and Disclosures (ASC 820) defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also 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 entitys own assumptions about market participant assumptions 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 are described below:
 
 
Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
     
 
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.
 
 
Level 3 - Inputs that are both significant to the fair value measurement and unobservable.
 
  Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of October 31, 2012. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.
 
At inception, the Company applied ASC 820 for all non-financial assets and liabilities measured at fair value on a non-recurring basis. The adoption of ASC 820 for non-financial assets and liabilities did not have a significant impact on the Company’s financial statements.

Recent accounting pronouncements

Recent accounting pronouncements issued by FASB (including EITF), the AICPA and the SEC did not or are not believed by management to have a material impact on the Company’s present or future financial statements.
 
 
F-8

 
 
4.
Equity
 
The Company's Board of Directors has authorized 5,000,000 million shares of preferred stock with a par value of $0.001 to be issued in series with terms and conditions to be determined by the Board of Directors.

At the date of incorporation, a stock subscription was received for 10,000,000 shares of its $0.001 common stock, at par for $10,000, of which $4,000 was received as of April 30, 2010. The remaining amount, $6,000, was received on May 12, 2010.

During the year ended June 30, 2012, the Company sold 4,510,000 shares of common stock for $0.01 per share and received $45,010.

Effective March 15, 2012, the Company’s Board of Directors has increased the number of authorized shares of common stock to 545,000,000 million with a par value of $0.001.

On August 22, 2012, the Company authorized a 35 to 1 stock split, all share numbers in the Form 10Q have been adjusted to reflect the split.
 
5.
Income Taxes
 
There is no current or deferred income tax expense or benefit for the period ended October 31, 2012.
 
The provision for income taxes is different from that which would be obtained by applying the statutory federal income tax rate to income before income taxes. The items causing this difference are as follows
 
   
April 27, 2010
(Date of Inception) through
June 30, 2012
 
Tax benefit at U.S. statutory rate
 
$
16,100
 
State income tax benefit, net of federal benefit
   
-
 
Valuation allowance
   
(16,100
)
   
$
-
 
 
The Company did not have any temporary differences for the period from April 27, 2010 (Date of Inception) through June 30, 2012.
 
6.
Subsequent Events

Effective November 9, 2012, the Company entered into a Share Exchange Agreement (the “Exchange Agreement”) with Ilustrato Pictures Ltd., a British Columbia corporation (“IPL”) and the shareholders of IPL. In connection with the closing of this transaction, we acquired all of the issued and outstanding shares of IPL, which resulted in a parent-subsidiary relationship (the “Acquisition”).

In addition, pursuant to the terms and conditions of the Exchange Agreement:
 
 
The shareholders of all of the capital stock of IPL issued and outstanding immediately prior to the closing of the Acquisition, exchanged their shares into 60,000,000 shares of our common stock. As a result, the shareholders of IPL received 60,000,000 newly issued shares of our common stock.

 
Our board of directors was reconstituted to consist of Brian Hammond and Harry Sutherland who, prior to the Acquisition, were directors of IPL.

 
Immediately following the exchange of the above shares, Brian Hammond, our President, CEO and Director, agreed to cancel 175,000,000 shares of his common stock in exchange for a one year unsecured 10% promissory note for $20,000.00 (the “Cancellation”) to reduce shares issued and outstanding.

 
As a result, immediately following the Acquisition and the Cancellation, there were 392,850,000 shares of our common stock issued and outstanding.

 
IPL provided customary representations and warranties and closing conditions, including the unanimous approval of the Acquisition by its shareholders.
 
 
F-9

 
 
The Acquisition is being accounted for as a reverse acquisition with IPL being treated as the accounting acquirer and the Company being treated as the accounting acquiree.  The consolidated financial statements after completion of the Acquisition have been included in our 8K filing with the Securities and Exchange Commission on November 9, 2012.

On November 9, 2012, the Company issued a $200,000 promissory note due on demand bearing interest at 10% per annum to a shareholder of the Company.

On November 30, 2012, the Company incorporated Ilustrato Pictures Limited, as a wholly owned Hong Kong corporation and transferred all the assets of Ilustrato Pictures Ltd., the B.C. Corporation to the new subsidiary and assumed all its liabilities.

The proforma for the six months ended November 30, 2012 is shown below:
 
   
Superior Venture
Corporation
   
Ilustrato
Pictures Ltd.
   
Pro-Forma
Adjustments
and
Eliminating
Entries
(Note 3)
   
Pro-Forma
Condensed
Consolidated
Superior Venture
Corporation
 
Expenses
                       
Bank charges and interest
  $     $ 8,364     $     $ 8,364  
Consulting
          17,949             17,949  
Editing
                       
Management fees
          77,780             77,780  
Meals and entertainment
          758             758  
Office and miscellaneous
          101,848             101,848  
Professional fees
          9,821       12,000       21,821  
Selling, general and administration
    10,154                   37,798  
Translation and scripting
          2,492             2,492  
            4,844             4,844  
Writing and Editing
          20,941             20,941  
                                 
Net loss before other item
    (10,154 )     (244,797     (12,000 )     (256,797 )
                                 
Other item
                               
Impairment of goodwill
                (55,152 )     (55,152 )
                                 
Net loss for the year
  $ (10,154 )   $ (244,797 )   $ (67,152 )   $ (311,949 )
                                 
Basic and diluted loss per common share
  $ (0.00 )                   $ (0.00 )
                                 
Weighted average number of common shares used in per share calculations
    507,850,000               (115,000,000 )     374,825,000  
                                 
Comprehensive loss
                               
Net loss for the year
  $ (10,154 )   $ (244,797 )   $ (67,152 )   $ (311,949 )
Foreign currency translation adjustment
          (694 )           (694 )
                                 
Total comprehensive loss for the year
  $ (10,154 )   $ (245,491   $ (67,152 )   $ (312,643 )
                                 
Basic and diluted comprehensive loss per common share
  $ (0.00 )                   $ (0.00 )
 
 
F-10

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

Forward-Looking Statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.   These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions.  We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions.  Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain.  Factors which could have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.  We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.  Further information concerning our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

Company Overview

We were incorporated as “Superior Venture Corp.” on April 27, 2010, in the State of Nevada for the purpose of selling wine varietals. On November 9, 2012, we entered into the Exchange Agreement with Ilustrato Pictures Ltd., a British Columbia corporation (“Ilustrato BC”), whereby we acquired all of the issued and outstanding common stock of Ilustrato BC.  On November 30, 2012, Ilustrato BC transferred all of its assets and liabilities to Ilustrato Pictures Limited, our wholly owned subsidiary in Hong Kong (“Ilustrato HK”).

In consequence of the above transactions, we now operate primerily out of Hong Kong and are in the business of developing feature theatrical films to be financed and distributed domestically by Chinese production companies, and for international release. Our website is located at www.superiorventurecorp.com.

The principals of our Company, Brian Hammond and Harry Sutherland, have spent years developing a network in China to integrate the Company into the Chinese business fabric, an option we believe is not available for most of Hollywood. Our business plan is to capitalize on this network and earn revenues in China and from worldwide film sales through entertainment mediums such as the movie theatre box-office, DVDs and pay-per-view television channels. We will also provide movie pre-production services, which include writing original scripts, directing, and educating Chinese film companies on special effects and various film techniques.

The Company has made partnerships, agreements, and plans with various Chinese movie production companies to fund and co-develop featured films in China. We plan to become involved with 6-12 film projects in our first year and expand in total film projects annually depending on success. Most recently, we signed a feature film development deal for domestic motion picture co-production with Beijing-based Hairun Pictures with a total budget value of USD $8 million. The feature film Stuck is a domestic Chinese drama set in a traffic jam in Northern China that is designed primarily for distribution to the domestic Chinese market. The second feature, Disoriented, is an English language crime thriller based on a true story set in North America. The two films are expected to go into production in 2013, subject to financing.

 
4

 
 
Results of Operations for the Three and Six Months Ended October 31, 2012 and 2011 and the Period from Inception (April 27, 2010) to October 31, 2012

The following income and operating expenses tables summarize selected items from the statement of operations for the three and six months ended October 31, 2012 and the period from inception (April 27, 2010) to October 31, 2012.

   
Three Months Ended October 31, 2012
   
Three Months Ended October 31, 2011
   
Six Months Ended October 31, 2012
   
Six Months Ended October 31, 2011
   
Period from
Inception to
October 31, 2012
 
Revenue
  $ 0     $ 0     $ 0     $ 0     $ 0  
Expenses
  $ 7,848     $ 7,694     $ 10,154     $ 14,707     $ 58,100  
Net Loss
  $ 7,848     $ 7,694     $ 10,154     $ 14,707     $ 58,100  
 
Revenues

We are a development stage company and have not earned any revenues since our inception. There is no assurance that we will be able to accomplish our business plan to earn revenues in China and from worldwide film sales through entertainment mediums such as the movie theatre box-office, DVDs and pay-per-view television channels.

Expenses

Our expenses for the three and six months ended October 31, 2012 and the period from inception (April 27, 2010) to October 31, 2012 are outlined in the table below:

   
Three Months Ended October 31, 2012
   
Three Months Ended October 31, 2011
   
Six Months Ended October 31, 2012
   
Six Months Ended October 31, 2011
   
Period from
Inception to
October 31, 2012
 
Selling, general and administrative expenses
  $ 7,848     $ 7,694     $ 10,154     $ 14,707     $ 58,100  
 
We incurred operating expenses of $58,100 for the period from inception to October 31, 2012. Our operating expenses during this period consisted of selling, general and administrative expenses.

We expect that our expenses will increase in the next twelve months as we execute our business plan and pay added professional and other costs as a result of becoming a public company.

Net Loss

We incurred a net loss of $$7,848 for the three months ended October 31, 2012, as compared with $7,694 for the three months ended October 31, 2011.  We incurred a net loss of $10,154 for the six months ended October 31, 2012, as compared with $14,707 for the six months ended October 31, 2011.  We incurred a net loss of $58,100 for the period from inception (April 27, 2010) to October 31, 2012.

Liquidity and Capital Resources

Working Capital

The following table summarizes our working capital at October 31, 2012 and April 30, 2012.

   
As of
October 31, 2012
   
As of
April 30, 2012
 
Current Assets
  $ 5,688     $ 10,267  
Current Liabilities
  $ 3,688     $ 3,113  
Working Capital
  $ 2,000     $ 7,154  

 
5

 
 
Cash Flows

The following table summarizes our cash flows for the six months ended October 31, 2012 and for the period from inception (April 27, 2010) to October 31, 2012.

   
Six Months Ended
October 31, 2012
   
Period from Inception to
October 31, 2012
 
Cash used in Operating Activities
  $ 9,579     $ 54,412  
Cash used in Investing Activities
    -       -  
Cash provided by Financing Activities
  $ 5,000     $ 60,100  
Increase (Decrease) in Cash
  $ (4,579 )   $ 5,688  

Cash Used In Operating Activities

Our net losses for the six months ended October 31, 2012 and period from inception (April 27, 2010) to October 31, 2012 were the main reasons for our negative operating cash flow for both periods. Cash used in operating activities was funded by cash from financing activities.

Cash from Financing Activities

We generated $5,000 in cash from shareholder contributions during the six months ended October 31, 2012, and $55,100 in cash from the issuance of stock and $5,000 in shareholder contributions for the period from inception (April 27, 2010) to October 31, 2012.

We will depend almost exclusively on outside capital to fund our business plan for the next twelve months. Such outside capital may include the sale of common stock and/or commercial borrowing. Capital may not continue to be available if necessary to meet these continuing development costs or, if the capital is available, that it will be on terms acceptable to us. The issuance of additional equity securities by us would result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

If we are unable to obtain financing in the amounts and on terms deemed acceptable to us, we may be unable to continue our business and as a result may be required to scale back or cease operations for our business, the result of which would be that our stockholders would lose some or all of their investment.

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

We are not anticipating significant research and development expenditures in the near future.

Expected purchase or sale of plant and significant equipment.

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

Significant changes in the number of employees.

We currently have two full-time employees and one part-time employee. All labor is provided on an independent month to month contract. We do not anticipate a significant change in the number of full time employees over the next 12 months. None of our employees are subject to any collective bargaining agreements.

 
6

 
 
Going Concern
 
For the three and six months ended October 31, 2012, we have had no operations and as of October 31, 2012, we have not emerged from the development stage. In view of these matters, our ability to continue as a going concern is dependent upon our ability to begin operations and to achieve a level of profitability. We intend on financing our future development activities and our working capital needs largely from the sale of public equity securities with some additional funding from other traditional financing sources, including term notes until such time that funds provided by operations are sufficient to fund working capital requirements. Our financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should we be unable to continue as a going concern.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, results or operations, liquidity, capital expenditures or capital resources that is deemed material.

Critical Accounting Policies

In December 2001, the SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. We do not believe that any accounting policies currently fit this definition.

Recently Issued Accounting Pronouncements

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

Item 3.   Quantitative and Qualitative Disclosures About Market Risk

A smaller reporting company is not required to provide the information required by this Item.

Item 4.   Controls and Procedures

Disclosure Controls and Procedures

We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of October 31, 2012.  This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer.  Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of October 31, 2012, our disclosure controls and procedures were not effective due to the presence of material weaknesses in internal control over financial reporting.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. Management has identified the following material weaknesses which have caused management to conclude that, as of October 31, 2012, our disclosure controls and procedures were not effective: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.

 
7

 
 
Remediation Plan to Address the Material Weaknesses in Internal Control over Financial Reporting

Our Company plans to take steps to enhance and improve the design of our internal controls over financial reporting.  During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the following changes during our fiscal year ending April 30, 2013: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

We are unable to remedy our controls related to the inadequate segregation of duties and ineffective risk management until we receive financing to hire additional employees and expand our board of directors. 

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the three months ended October 31, 2012 that have materially affected, or are reasonable likely to materially affect, our internal control over financial reporting.

 
8

 
 
PART II – OTHER INFORMATION

Item 1.   Legal Proceedings

None.

Item 1A: Risk Factors

A smaller reporting company is not required to provide the information required by this Item.

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

The information set forth below relates to our issuances of securities without registration under the Securities Act of 1933 during the reporting period which were not previously included in a Quarterly Report on Form 10-Q or Current Report on Form 8-K.

On August 22, 2012, we authorized a 35 to 1 split of our common stock.

In connection with the acquisition of Ilustrato BC, the previous shareholders of Ilustrato BC received 60,000,000 shares of our common stock.

These securities were issued pursuant to Section 4(2) of the Securities Act and/or Rule 506 promulgated thereunder. The holders represented their intention to acquire the securities for investment only and not with a view towards distribution. The investors were given adequate information about us to make an informed investment decision. We did not engage in any general solicitation or advertising. We directed our transfer agent to issue the stock certificates with the appropriate restrictive legend affixed to the restricted stock.

Item 3.   Defaults upon Senior Securities

None

Item 4.   Mine Safety Disclosures

Not applicable

Item 5.     Other Information

None

 
9

 
 
Item 6.   Exhibits

Exhibit Number
 
Description of Exhibit
31.1
 
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2
 
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
 
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101**
 
The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended October 31, 2012 formatted in Extensible Business Reporting Language (XBRL).
________
**Provided herewith
** 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.
 
 
10

 
 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
  Superior Venture Corp.  
       
Date: December 13, 2012
By:
/s/ Brian Hammond  
    Brian Hammond  
    Chief Executive Officer, Chief Financial Officer and Director  
 
 
11