UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended March 31, 2013

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

For the transition period from ___________ to ______________

P2 SOLAR, INC.

 (Exact name of registrant as specified in its charter)

Securities registered under Section 12(b) of the Exchange Act:

None

Securities registered under Section 12(g) of the Exchange Act:    

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act [] Yes [X ] No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the [ ]Yes [X ] No

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 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 [  ] 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 [  ] No.

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not  contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [  ]

Indicate by check mark whether the registrant is a large accelerated filer, 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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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ ] Yes  [X ] No

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of the last business day of the registrant’s most recently completed first fiscal quarter. $1,425,600.

As of June 7, 2013, the Company had 59,613,179 shares issued and outstanding.

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PART I

ITEM 1.

BUSINESS

Organizational Development

P2 Solar, Inc., a Delaware corporation (hereinafter referred to as “we”, “us”, the “Company”, “P2” or the “Registrant”) has been in existence as a Company (including our predecessor British Columbia Corporation) since 1990.   As discussed more fully below, the Company’s current business operations are focused on the construction of solar and hydro power plants located in India and Canada.

The Company was initially organized under the laws of British Columbia, Canada, on November 21, 1990 as Spectrum Trading Inc. The Company’s initial business plan was to import leather products from India and sell them in Canada. However, the supplier in India did not materialize and the Company remained dormant until 1997.  In 1997, the Company began a chemical manufacturing business.  On May 14, 1999, pursuant to Section 388 of the Delaware General Corporation Law, the Company domesticated to Delaware and began a chemical manufacturing business; these operations were phased out in the end of 2008.  Subsequent to the Company’s domestication to Delaware, on June 3, 2004, the Company changed its name to Natco International, Inc. On March 11, 2009, the Company changed its name to P2 Solar, Inc.

Business of the Company

As discussed more fully below, the Company’s current business operations are focused on the construction of solar and hydro power plants located in Canada, and India.  The Company is currently a development stage company.

Canada

On March 1, 2013, Canada Ticket, Inc., (“CanadaTicket”) a Canadian company, engaged the Company to design and install a 53 kilowatt solar photovoltaic system (the “PV System”) on the roof top of CanadaTicket’s office located in Langley British Columbia.  The PV System designed by the Company is based on the equipment standards of the Ontario feed-in-tariff program.  The contract with CanadaTicket is for approximately $158,900 and we expect to install and commission the PV System in the summer of 2013.  The contract is payable in two installments, 50% upfront (already paid) and 50% at completion. Once installed, CanadaTicket will assume ownership of the PV System, but the Company will continue to provide operations and maintenance service over time under the terms of a maintenance agreement to be negotiated and signed.  We anticipate that the majority of the power generated by the PV System will be used by Canada Ticket, but any day to day surplus of power will be fed into British Columbia Hydro’s grid under the latter’s net-metering program.  This project marks a significant milestone for P2 Solar as it is our first project in Canada.  The project itself will be notable as we estimate it will be the largest single solar photovoltaic project connected to the provincial grid, operated by British Columbia Hydro. 

India

During the fiscal year ended March 31, 2013, the Company concentrated a significant amount of its resources and efforts on developing solar Photo Voltaic (“PV”) and hydro projects in India.  The Company’s management team identified India as an emerging market that offered solar PV and hydro investment returns superior to other markets.  Our management spent a significant amount of time in India reviewing dozens of projects, ultimately settling on two hydro projects and one solar project that we determined were worth pursuing. As discussed in detail in the Subsequent Event section below, subsequent to our year end, the Company, through an affiliated entity, Jagat Energy Pvt. Ltd., an Indian corporation, acquired the rights to two hydro projects and, as of the date of this Form 10-K, is negotiating with the Indian government officials to acquire an additional solar project as well.  

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Employees

As of the date of this Form 10-K, we do not have any full or part-time employees.  All work relating to the Company is carried on by the Company’s management.

Reports to Security Holders

We file reports with the SEC under section 15d of the Securities Exchange Act of 1934.  The reports will be filed electronically. You may read copies of any materials we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Room 1580, Washington, D.C. 20549.  You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.  The SEC also maintains an Internet site that will contain copies of the reports we file electronically.  The address for the SEC Internet site is http://www.sec.gov.

Subsequent Events

As of March 31, 2013, the Company, through its partial ownership interest in Solarise Power, Inc. (“Solarise”), a privately owned Nevada corporation, was involved in the research and development of solar panel technology.  Solarise specializes in the development of solar panel technology, specifically the manufacture of solar panels utilizing a technology referred to as the JIL Technology (the “JIL Technology”).  The Company and Solarise have been, for the last two years, working on creating a working prototype of the high efficiency Solar Panel.  All efforts have been unsuccessful. As a result, subsequent to the fiscal year ended March 31, 2013, effective as of May 10, 2013, the Company and Solarise have agreed in principal to cancel the Company’s 1,000,000 preferred shares owned by Solarise in exchange for 1,004,999 Solarise common shares owned by the Company, effectively reversing the transaction that was consummated on September 6, 2010.  The agreement in principal has been approved at a meeting of the shareholders of Solarise, and is subject to approval by the Company’s board of directors.  Once the agreement in principal is approved and finalized the Company will have no further ties with Solarise or the panel it was trying to develop.

Subsequent to the period ended March 31, 2013, the Company, through an affiliated entity, Jagat Energy Pvt. Ltd. (“Jagat”), an Indian corporation, acquired the rights to develop and construct two hydro projects located in Ludhiana, Punjab, India, and, as of the date of this Form 10-K is also negotiating with the Indian government officials to acquire the additional solar project identified below.  At the present time, we do not have a direct ownership interest in Jagat.  However, through contractual arrangements between the Company, Jagat and two shareholders of Jagat, we control Jagat and it is considered to be our operating affiliate because we are able to exert effective control over it and to receive all of the economic benefits derived from its business operations. 

Details of the two hydro projects and the one solar project are as follows:

(i)

Construction of a 700 kilowatt  hydro project on an irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Rajgarh located in Ludhiana, Punjab, India

(ii)

 Construction of an additional 500 kilowatt project a few kilometers downstream from the 700 kilowatt project on irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Tibba located in Ludhiana, Punjab, India

(iii)

 1 Megawatt solar project on top of irrigation canal:

·

Purchase Price: To be determined

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·

Location: Sidhwan irrigation canal in Ludhiana, Punjab, India

The 1MW canal solar project is the first phase of the project which we anticipate will ultimately expand to 7-10 MW at the same site.  The technology to be deployed in all projects is standard off the shelf equipment.  We do not anticipate any technology risks.  Based on current timelines, P2 will commission the solar project in India during the fourth quarter of 2013.  The hydro project has a longer build time, of approximately 10 months; accordingly we anticipate that it will be operational spring of 2014.

ITEM 1A.

RISK FACTORS.

Not Applicable.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

Not Applicable.

ITEM 2.

 PROPERTIES.

Our principal office is located at Unit 204, 13569 – 76 Avenue, Surrey, British Columbia, Canada, V3W 2W3.  As of September 1, 2007 the Company has leased offices at #204, 13569 - 76^th Avenue, Surrey, BC, Canada.  Total space is 750 square feet for total rent of $1000.00 per month.  The lease for the Company’s principal office lease will expire on August 31, 2013.

ITEM 3.

LEGAL PROCEEDINGS.

None.

ITEM 4.

MINE SAFETY DISCLOSURES.

Not Applicable.

PART II

ITEM 5.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market Information.  

The Company’s shares trade on the OTCBB under the symbol “PTOS.”   The following table sets forth the high and low bid prices of our common stock (USD) for the last two fiscal years and subsequent interim period, as reported by the National Quotation Bureau and represents inter dealer quotations, without retail mark-up, mark-down or commission and may not be reflective of actual transactions:

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Holders.  

As of March 31, 2013 there were 57,113,179 shares of common stock issued and outstanding and approximately 63 shareholders of record.  

Dividends.  

The Company has not declared or paid any cash dividends on its common stock during the fiscal years ended March 31, 2013 or 2012.  There are no restrictions on the common stock that limit the ability of us to pay dividends if declared by the Board of Directors and  the loan agreements and general security agreements covering the Company’s assets do not limit its ability to pay dividends.  The holders of common stock are entitled to receive dividends when and if declared by the Board of Directors, out of funds legally available therefore and to share pro-rata in any distribution to the stockholders. Generally, the Company is not able to pay dividends if after payment of the dividends, it would be unable to pay its liabilities as they become due or if the value of the Company’s assets, after payment of the liabilities, is less than the aggregate of the Company’s liabilities and stated capital of all classes

ITEM 6.

 SELECTED FINANCIAL DATA.

Not Applicable.  

ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS

CERTAIN STATEMENTS IN THIS REPORT, INCLUDING STATEMENTS IN THE FOLLOWING DISCUSSION, ARE WHAT ARE KNOWN AS "FORWARD LOOKING STATEMENTS", WHICH ARE BASICALLY STATEMENTS ABOUT THE FUTURE. FOR THAT REASON, THESE STATEMENTS INVOLVE RISK AND UNCERTAINTY SINCE NO ONE CAN ACCURATELY PREDICT THE FUTURE. WORDS SUCH AS "PLANS," "INTENDS," "WILL," "HOPES," "SEEKS," "ANTICIPATES," "EXPECTS "AND THE LIKE OFTEN IDENTIFY SUCH FORWARD LOOKING STATEMENTS, BUT ARE NOT THE ONLY INDICATION THAT A STATEMENT IS A FORWARD LOOKING STATEMENT. SUCH FORWARD LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING OUR PLANS AND OBJECTIVES WITH RESPECT TO THE PRESENT AND FUTURE OPERATIONS OF THE COMPANY, AND STATEMENTS WHICH EXPRESS OR IMPLY THAT SUCH PRESENT AND FUTURE OPERATIONS WILL OR MAY PRODUCE REVENUES, INCOME OR PROFITS. NUMEROUS FACTORS AND FUTURE EVENTS COULD CAUSE THE COMPANY TO CHANGE SUCH PLANS AND OBJECTIVES OR FAIL TO SUCCESSFULLY IMPLEMENT SUCH PLANS OR ACHIEVE SUCH OBJECTIVES, OR CAUSE SUCH PRESENT AND FUTURE OPERATIONS TO FAIL TO PRODUCE REVENUES, INCOME OR PROFITS. THEREFORE, THE READER IS ADVISED THAT THE FOLLOWING DISCUSSION SHOULD BE CONSIDERED IN LIGHT OF THE DISCUSSION OF RISKS AND OTHER FACTORS CONTAINED IN THIS REPORT ON FORM 10-K AND IN THE COMPANY'S OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. NO STATEMENTS CONTAINED IN THE FOLLOWING DISCUSSION SHOULD BE CONSTRUED AS A GUARANTEE OR ASSURANCE OF FUTURE PERFORMANCE OR FUTURE RESULTS.

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Background and Overview

P2 Solar, Inc., a Delaware has been in existence as a Company (including our predecessor British Columbia Corporation) since 1990.   As discussed more fully below, the Company’s current business operations are focused on the construction of solar and hydro power plants located in India, and Canada.  The Company is currently a development stage company.

As discussed more fully below, the Company’s current business operations are focused on the construction of solar and hydro power plants located in Canada, and India.  The Company is currently a development stage company.

Canada

On March 1, 2013, Canada Ticket, Inc., (“CanadaTicket”) a Canadian company, the Company to design and install a 53 kilowatt solar photovoltaic system (the “PV System”) on the roof top of CanadaTicket’s office located in Langley British Columbia.  The PV System designed by the Company is based on the equipment standards of the Ontario feed-in-tariff program.  The contract with CanadaTicket is for approximately $158,900 and we expect to install and commission the PV System in the summer of 2013.  The contract is payable in two installments, 50% upfront (already paid) and 50% at completion. Once installed, CanadaTicket will assume ownership of the PV System, but the Company will continue to provide operations and maintenance service over time under the terms of a maintenance agreement to be negotiated and signed.  We anticipate that the majority of the power generated by the PV System will be used by Canada Ticket, but any day to day surplus of power will be fed into British Columbia Hydro’s grid under the latter’s net-metering program.  This project marks a significant milestone for P2 Solar as it is our first project in Canada.  The project itself will be notable as we estimate it will be the largest single solar photovoltaic project connected to the provincial grid, operated by British Columbia Hydro. 

India

During the fiscal year ended March 31, 2013, the Company concentrated a significant amount of its resources and efforts on developing solar Photo Voltaic (“PV”) and hydro projects in India.  The Company’s management team identified India as an emerging market that offered solar PV and hydro investment returns superior to other markets.  Our management spent a significant amount of time in India reviewing dozens of projects, ultimately settling on two hydro projects and one solar project that we determined were worth pursuing. As discussed in detail in the Subsequent Event section below, subsequent to our year end the Company, through an affiliated entity, Jagat Energy Pvt. Ltd., an Indian corporation, acquired the rights to two hydro projects and, as of the date of this Form 10-K, is negotiating with the Indian government officials to acquire an additional solar project as well.  

Subsequent Events

As of March 31, 2013, the Company, through its partial ownership interest in Solarise Power, Inc. (“Solarise”), a privately owned Nevada corporation, was involved in the research and development of solar panel technology.  Solarise specializes in the development of solar panel technology, specifically the manufacture of solar panels utilizing a technology referred to as the JIL Technology (the “JIL Technology”).  The Company and Solarise have been, for the last two years, working on creating a working prototype of the high efficiency Solar Panel.  All efforts have been unsuccessful. As a result, subsequent to the fiscal year ended March 31, 2013, effective as of May 10, 2013, the Company and Solarise have agreed in principal to cancel the Company’s 1,000,000 preferred shares owned by Solarise in exchange for 1,004,999 Solarise common shares owned by the Company, effectively reversing the transaction that was consummated on September 6, 2010.  The agreement in principal has been approved at a meeting of the shareholders of Solarise, and is subject to approval by the Company’s board of directors.  Once the agreement in principal is approved and finalized the Company will have no further ties with Solarise or the panel it was trying to develop.

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Subsequent to the period ended March 31, 2013, the Company, through an affiliated entity, Jagat Energy Pvt. Ltd. (“Jagat”), an Indian corporation, acquired the rights to develop and construct two hydro projects located in Ludhiana, Punjab, India, and, as of the date of this Form 10-K is also negotiating with the Indian government officials to acquire the additional solar project identified below.  At the present time, we do not have a direct ownership interest in Jagat.  However, through contractual arrangements between the Company, Jagat and two shareholders of Jagat, we control Jagat and it is considered to be our operating affiliate because we are able to exert effective control over it and to receive all of the economic benefits derived from its business operations. 

Details of the two hydro projects and the one solar project are as follows:

(i)

Construction of a 700 kilowatt  hydro project on an irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Rajgarh located in Ludhiana, Punjab, India

(ii)

Construction of an additional 500 kilowatt project a few kilometers downstream from the 700 kilowatt project on irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Tibba located in Ludhiana, Punjab, India

(iii)

 1 Megawatt solar project on top of irrigation canal:

·

Purchase Price: To be determined

·

Location: Sidhwan irrigation canal in Ludhiana, Punjab, India

The 1MW canal solar project is the first phase of the project which we anticipate will ultimately expand to 7-10 MW at the same site.  The technology to be deployed in all projects is standard off the shelf equipment.  We do not anticipate any technology risks.  Based on current timelines, P2 will commission the solar project in India during the fourth quarter of 2013.  The hydro project has a longer build time, of approximately 10 months; accordingly we anticipate that it will be operational spring of 2014.

Results of Operation

As of March 31, 2013, the Company remained in the development stage and had not generated any revenue from operations.  As a result, no meaningful comparison is possible regarding results of operation for the fiscal year ended March 31, 2013 as compared to the fiscal year ended March 31, 2012.

Liquidity and Capital Resources

The following discussion and analysis provides information that we believe is relevant to an assessment and understanding of our financial condition for the twelve months ended March 31, 2013. The following summary should be read in conjunction with the financial statements and accompanying notes to them included elsewhere in this report.  Our financial statements are stated in US Dollars and are prepared in accordance with generally accepted accounting principals of the United States (“GAAP”).

During the fiscal year ended March 31, 2013, the Company did not have any sales or generate any revenues.  As of March 31, 2013, the Company’s audited balance sheet reflects total assets of $75,154, as compared to total assets of $12,093 during the fiscal year ended March 31, 2012, an increase of $63,061 or approximately 521%.  The increase was primarily attributable to the fact that in March 2013, the Company acquired two hydro projects and thereby experienced a slight increase in its assets for the fiscal year ended March 31, 2013, as compared to the fiscal year ended March 31, 2012.

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As of March 31, 2013, the Company’s audited balance sheet reflects total liabilities of $576,597.  The Company has cash on hand of $2,894 and a deficit accumulated during the development stage of $8,747,418.  

The Company does not have sufficient assets or capital resources to pay its on-going expenses.  Additionally, the Company does not currently have the funds necessary to proceed with the development of a power plant in India. To date, the Company has primarily financed its operations through equity investment from investors, shareholder loans, and credit facilities from Canadian chartered banks and increases in payables and share subscriptions. Most of the financing has been debt financing from related and un-related parties.  The Langley project that is being built for a client will be paid for that client and will also provide first income for the company. Currently, our estimated fixed costs at this time are approximately $5500 per month; that figure includes $1000 for lease payments, $500 for utilities, $3,000 for loan interest and principle payments, and $1,000 for miscellaneous expenses. We will have to raise approximately $5500 per month to cover operating expenses, and additional funds to cover expenses of the two acquired projects in India to establish the two power plants.

The Company estimates that the total aggregate costs for the construction of the two hydro projects will be approximately $3.7 million dollars.  The hydro project in Rajgarh located in Ludhiana, Punjab, India is estimated to cost $2.2 million and the hydro project in Tibba located in Ludhiana, Punjab, India Tibba $1.5 million.   The Company anticipates that it will attempt to raise the money from local individual investors by selling convertible preferred shares.  We are currently working on the terms of the preferred shares. Furthermore, we have had preliminary discussions with a number of groups regarding the financing; we are hopeful that we will be able to obtain financing.  However, there is no guarantee that we will be successful in raising any additional capital.  If we are unable to finance the Company by debt or equity financing, or a combination of the two, we will have to look for other sources of funding to meet our requirements.  That source has not yet been identified.   

Our financial statements have been prepared on the going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the ordinary course of business. Operations to date have been primarily financed by long-term debt and equity transactions as well as increases in payables and related party loans. Our future operations are dependent upon the identification and successful completion of additional long-term or permanent equity financing, the continued support of creditors and shareholders, and, ultimately, the achievement of profitable operations. There can be no assurance that we will be successful. If we are not, we will be required to reduce operations or liquidate assets. We will continue to evaluate our projected expenditures relative to our available cash and to seek additional means of financing in order to satisfy working capital and other cash requirements.

Off Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The financial statements of the Company required by Article 8 of Regulation S-X are attached to this report.

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P2 SOLAR, INC.

AUDITED FINANCIAL STATEMENTS

FOR THE FISCAL YEAR ENDED MARCH 31, 2013 and 2012

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of P2 Solar, Inc.

We have audited the accompanying balance sheets of P2 Solar, Inc. (a development stage Company) (the “Company”) as of March 31, 2013 and 2012, and the related statements of operations, stockholders’ deficit, and cash flows for each of the years in the two-year period ended March 31, 2013 and for the period since inception through March 31, 2013. These financial statements are the responsibility of the company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of P2 Solar, Inc. (a development stage Company) as of March 31, 2013 and 2012, and the results of its operations and its cash flows for each of the years in the two-year period ended March 31, 2013 and for the period since inception through March 31, 2013, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  The Company has been in the development stage since its inception and continues to incur significant losses.  The Company’s viability is dependent upon its ability to obtain future financing and the success of its future operations.  These factors raise substantial doubt as to the Company’s ability to continue as a going concern.  Management’s plan in regard to these matters is also described in Note 1.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/Lake & Associates, CPA’s LLC

Lake & Associates, CPA’s LLC

Schaumburg, Illinois

June 27, 2013

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P2 Solar, Inc.

Development Stage Company

Notes to Financial Statements

March 31, 2013 and 2012

Expressed in US Dollars

1.

Nature of Operations and Going Concern

The Company was incorporated as Spectrum Trading Inc. under the laws of the Province of British Columbia, Canada, on November 21, 1990. On May 14, 1999, the Company was discontinued in British Columbia and was reincorporated as Spectrum International Inc. in the State of Delaware, U.S.A. Effective September 3, 2004, the Company changed its name from Spectrum International Inc. to Natco International Inc. On March 11, 2009, the Company changed its name from the Natco International Inc. to P2 Solar, Inc. The Company is in the development stage and has had no revenue since inception.  The Company’s current business operations are focused on the construction of solar and hydro power plants located in Canada, and India.  The Company is currently a development stage company.

On March 1, 2013, Canada Ticket, Inc., (“CanadaTicket”) a Canadian company, the Company to design and install a 53 kilowatt solar photovoltaic system (the “PV System”) on the roof top of CanadaTicket’s office located in Langley British Columbia.  The PV System designed by the Company is based on the equipment standards of the Ontario feed-in-tariff program.  The contract with CanadaTicket is for approximately $158,900 and we expect to install and commission the PV System in the summer of 2013.  The contract is payable in two installments, 50% upfront (already paid) and 50% at completion. Once installed, CanadaTicket will assume ownership of the PV System, but the Company will continue to provide operations and maintenance service over time under the terms of a maintenance agreement to be negotiated and signed.  We anticipate that the majority of the power generated by the PV System will be used by Canada Ticket, but any day to day surplus of power will be fed into British Columbia Hydro’s grid under the latter’s net-metering program.  This project marks a significant milestone for P2 Solar as it is our first project in Canada.  The project itself will be notable as we estimate it will be the largest single solar photovoltaic project connected to the provincial grid, operated by British Columbia Hydro. 

During the fiscal year ended March 31, 2013, the Company concentrated a significant amount of its resources and efforts on developing solar Photo Voltaic (“PV”) and hydro projects in India.  The Company’s management team identified India as an emerging market that offered solar PV and hydro investment returns superior to other markets.  Our management spent a significant amount of time in India reviewing dozens of projects, ultimately settling on two hydro and one solar project that we believed were worth pursuing. Subsequent to our year end the Company has purchased both hydro projects and is negotiating with the Indian government officials to acquire the solar project additional as well.  Details of the two hydro projects and the one solar project are as follows:

(i)

Construction of a 700 kilowatt  hydro project on an irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Ludhiana, Punjab, India

(ii)

Construction of an additional 500 kilowatt project a few kilometers downstream from the 700 kilowatt project on irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Ludhiana, Punjab, India

(iii)

1 Megawatt solar project on top of irrigation canal:

20

·

Purchase Price: To be determined

·

Location: Sidhwan irrigation canal in Ludhiana, Punjab, India

The 1MW canal solar project is the first phase of the project which we anticipate will ultimately expand to 7-10 MW at the same site.  The technology to be deployed in all projects is standard off the shelf equipment.  We do not anticipate any technology risks.  Based on current timelines, P2 will commission the solar project in India during the fourth quarter of 2013.  The hydro project has a longer build time, of approximately 10 months; accordingly we anticipate that it will be operational spring of 2014.

These financial statements have been prepared on the basis of accounting principles applicable to a going concern which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. The Company has incurred significant operating losses over the past three years. The Company's continued existence is dependent upon its ability to raise additional capital and to achieve profitable operations through Solarise and financing and building of power plant in India and elsewhere.

If the going concern assumptions were not appropriate for these financial statements, then adjustments would be necessary in the carrying values of assets and liabilities, the reported revenues and expenses and the balance sheet classifications used.

2.

Summary of Significant Accounting Policies

a) Fiscal Period

The Company's fiscal year ends on March 31.

b) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, term deposits and short term highly liquid investments with a term to maturity of less than one year from inception which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of changes in value.

c) Use of Estimates

In conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that could 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 year. Actual results could vary materially from those reported.

d) Foreign Currency Transactions

The Company's functional currency is the Canadian dollar and the reporting currency is the U.S. dollar. Assets and liabilities are translated from the functional to the reporting currency at the exchange rate in effect at the balance sheet date and equity at the historical exchange rates. Revenue and expenses are translated at rates in effect at the time of the transactions. Resulting translation gains and losses are accumulated in a separate component of stockholders' equity - other comprehensive income (loss). Realized foreign currency transaction gains and losses are credited or charged directly to operations.

e) Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation is provided annually on the diminishing balance method to write-off the assets over their estimated useful lives as follows:

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Computer and office equipment - 5 years

Manufacturing equipment - 10 years

f) Income Taxes

Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such asset will not be recovered.

g) Fair value of Financial Instruments

The company's financial instruments consist of accounts receivable, bank indebtedness, accounts payable and amounts due to related parties. Unless otherwise noted, it is management's opinion that this Company is not exposed to significant interest or credit risks arising from these financial instruments. The fair values of these financial instruments approximate their carrying values unless otherwise noted.

h) Stock-Based Compensation

Effective January 1, 2006, the Company adopted the provisions of Accounting Standards Codification (ASC) Topic 718 “Stock Compensation”, which establishes accounting for equity instruments exchanged for employee services. Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the employees' requisite service period (generally the vesting period of the equity grant). Before January 1, 2006, the Company accounted for stock-based compensation to employees in accordance with Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," and complied with the disclosure requirements of SFAS No. 123, "Accounting for Stock-Based Compensation". The Company adopted SFAS 123(R) using the modified prospective method, which requires the Company to record compensation expense over the vesting period for all awards granted after the date of adoption, and for the unvested portion of previously granted awards that remain outstanding at the date of adoption. Accordingly, financial statements for the periods prior to January 1, 2006 have not been restated to reflect the fair value method of expensing share-based compensation. Adoption of ASC 718 does not change the way the Company accounts for share-based payments to non-employees, with guidance provided by SFAS 123 (as originally issued) and Emerging Issues Task Force Issue No. 96-18, "Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in conjunction with Selling, Goods or Services".

i) Revenue Recognition

Revenues are recognized when all of the following criteria have been met: persuasive evidence for an arrangement exists; delivery has occurred; the fee is fixed or determinable; and collection is reasonably assured.

j) Advertising Policy

The Company expenses the cost of advertising when incurred.

k) Research and Development

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Research and development is expensed as incurred.

l) Shipping and Handling

The company includes the cost of shipping and handling as a component of cost of sales in accordance with ASC Topic 605,"Accounting for Shipping and Handling Fees and Costs."

m) Long-Lived Assets

The company monitors the recoverability of long-lived assets, including property, plant and equipment and product rights, based on estimates using factors such as current market value, future asset utilization, business climate and future undiscounted cash flows expected to result from the use of the related assets. The company policy is to record any impairment loss in the period when it is determined that the carrying amount of the asset may not be recoverable equal to the excess of the asset's carrying value over its fair value.

n) Loss Per Share

The company computes net loss per common share using ASC Topic 260 "Earnings Per Share" guidance. Basic loss per common share is computed based on the weighted average number of shares outstanding for the period. Diluted loss per share is computed by dividing net loss by the weighted average shares outstanding assuming all dilutive potential common shares were issued. There were no dilutive potential common shares at March 31, 2013 and 2012. Because the company has incurred net losses and has no potentially dilutive common shares, basic and diluted loss per share, is the same. Additionally, for the purposes of calculating diluted loss per share, there were no adjustments to net loss.

o) Obligations Under Capital Leases

Leases are classified as either capital or operating. Leases that transfer substantially all of the benefits and risks of ownership of property to the company are accounted for as capital leases. At the time a capital lease is entered into, an asset is recorded with its related long-term financing. Payments under operating leases are expensed as incurred.

p) Segmented Reporting

ASC Topic 280 "Segment Reporting", changed the way public companies report information about segments of their business in their quarterly reports issued to stockholders. It also requires entity-wide disclosures about the products and services and entity provides, the material countries in which it holds assets and reports revenues and its major customers. The company's sales are generated in one geographical area, Canada. All revenues consist of interest earned on investment.

q) Comprehensive Income

ASC Topic 220, "Comprehensive Income", establishes standards for reporting and display of comprehensive income and its components in a full set of general-purpose financial statements.

r) Derivative Financial Instruments

The company was not a party to any derivative financial instruments during any of the reported fiscal periods.

s) Recent Accounting Pronouncements

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In September 2011, the FASB issued ASU 2011-08 which provides an entity the option to first assess qualitative factors to determine whether it is necessary to perform the current two-step test for goodwill impairment.  If an entity believes, as a result of its qualitative assessment, that it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, the quantitative impairment test is required.  Otherwise, no further testing is required. The revised standard is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011.   We do not expect that the adoption of this standard will have a material impact on our results of operations, cash flows or financial condition.

In December 2011, FASB issued Accounting Standards Update 2011-11, “Balance Sheet - Disclosures about Offsetting Assets and Liabilities” to enhance disclosure requirements relating to the offsetting of assets and liabilities on an entity's balance sheet. The update requires enhanced disclosures regarding assets and liabilities that are presented net or gross in the statement of financial position when the right of offset exists, or that are subject to an enforceable master netting arrangement. The new disclosure requirements relating to this update are retrospective and effective for annual and interim periods beginning on or after January 1, 2013. The update only requires additional disclosures, as such, we do not expect that the adoption of this standard will have a material impact on our results of operations, cash flows or financial condition.

 In July 2012, the FASB amended guidance on the annual testing of indefinite-lived intangible assets for impairment. Under the amended guidance, an entity has the option first to assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the indefinite-lived intangible asset is impaired. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then the entity is not required to take further action. However, if an entity concludes otherwise, then it is required to determine the fair value of the indefinite-lived intangible asset and perform the quantitative impairment test by comparing the fair value with the carrying amount. This guidance will be effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Company has determined that this new guidance will not have a material impact on its consolidated financial statements.

In February 2013, the FASB issued guidance on the Reporting of Amounts Reclassified out of Accumulated Other Comprehensive Income. The guidance requires that companies present either in a single note or parenthetically on the face of the financial statements, the effect of significant amounts reclassified from each component of accumulated other comprehensive income based on its source (e.g., the release due to cash flow hedges from interest rate contracts) and the income statement line items affected by the reclassification (e.g., interest income or interest expense). If a component is not required to be reclassified to net income in its entirety (e.g., the net periodic pension cost), companies would instead cross reference to the related footnote for additional information (e.g., the pension footnote). This guidance is effective for fiscal and interim reporting periods beginning after December 15, 2012. The adoption of this guidance is not expected to have a material effect on the Company’s consolidated 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 believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements.

3.

Solar Panel License and Share Exchange

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On September 6, 2010, the Company acquired 1,004,999 shares of restricted common stock of Solarise Power, Inc., a privately owned Nevada corporation (“Solarise”) that specializes in the development of solar panel technology, for a total purchase price of $2,500,000 which was paid as follows: i) consideration in the amount of $250,000; and ii) the issuance to Solarise of 1,000,000 shares of Series A Non-Voting Convertible Preferred Common Stock of the Company. The 1,004,999 shares of Solarise acquired by the Company represent approximately 33.5% of the issued and outstanding shares of common stock of Solarise.

On September 29, 2010, the Company, Lassen, DBK Corp., and Boyd entered into an Agreement pursuant to which the parties agreed to terminate the License Agreement and each of the parties’ respective obligations under the License Agreement. Specifically, all of the licenses granted under the License Agreement were terminated and P2 Solar’s financial obligations under the License Agreement were terminated. The agreed upon effective date of the License Termination Agreement was September 1, 2010

As of March 31, 2011 the Company believes the Investment in Solarise to be fully impaired.  Subsequent to the fiscal year ended March 31, 2013, effective as of May 10, 2013, the Company and Solarise have agreed in principal to cancel the Company’s 1,000,000 preferred shares owned by Solarise in exchange for 1,004,999 Solarise common shares owned by the Company, effectively reversing the transaction that was consummated on September 6, 2010.  The agreement in principal has been approved at a meeting of the shareholders of Solarise, and is subject to approval by the Company’s board of directors.  Once the agreement in principal is approved and finalized the Company will have no further ties with Solarise or the panel it was trying to develop.

4.

Bank Indebtedness

There is no Bank Indebtedness.

5.

Related Party Transactions

Other than as disclosed elsewhere in these financial statements, the following amounts have been recorded as transactions with related parties:

a) Amounts due to related parties are as follows:

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b) Interest expense on amounts due to directors and an officer was $nil (2012 - nil).

c) Salaries and benefits include $76,445 (2012 - $75,407) paid to a director and officer of the Company.

d) As at March 31, 2013, a director and officer of the Company held approximately 27.61% of the issued and outstanding shares of the Company.

6.

Capital Stock

a) Authorized Stock

The company has authorized 500,000,000 common shares with a par value of $0.001 per share. Each common share shall entitle the holder to one vote, in person or proxy on any matter on which action of the stockholder of the corporation is sought. The company has authorized 5,000,000 shares of preferred stock with a par value of $0.001 per share. The holders of preferred stock have no rights except as determined by the Board of Directors of the company and/or provided by Delaware General Corporate Law.

b) Share Issuances

During the current period, the company issued a total of 500,000 common shares from the treasury to two individuals from subscription received in last fiscal year.

c) Share Subscriptions

At March 31, 2013 there were no outstanding share subscriptions

d) Warrants

No new warrants were issued in this period. 80,000 warrants issued in conjunction with private placements in 2010 expired on March 2013 and further 270,000 warrants expired subsequent to the yearend in April 2013.

e) Stock Options

There were 200,000 options issued to a company consultant for services. As to the total number of Shares with respect to which the Option is granted, the Option shall be exercisable as follows: (i) 50% of the Option (100,000 Shares) in the aggregate may be exercised on or after November 21, 2009 at an Exercise Price of $0.20 per Share; and (ii) 50% of the Option (100,000 Shares) in the aggregate may be exercised on or after November 1, 2010 at an Exercise Price in an amount per Share that is 25% less than the ten day moving average of the Company’s Common Stock immediately prior to November 1, 2010.

The Company has committed to issue to the Chief Executive Officer 67,000 share purchase options every April. These options will be exercisable at $0.10 per share and will expire five years after the date of grant. Further bonus options are available to the Chief Executive Officer. These bonus options entitle the Chief Executive Officer to purchase shares at 20% below the market price up to a value determined by 5% of the amount of annual profits from sales in excess of $2,500,000 up to $3,999,999 and 8% of the amount of annual profits from sales in excess of $4,000,000. To date, sales have not exceeded $2,500,000 and thus no bonus options have been issued.

Under the Black-Scholes pricing model, the fair value of the warrants as of the issuance date was calculated to be $14,768 and $20,780 and charged as warrants expense for the period ended March 31, 2013 and 2012, respectively. The fair value of each option granted is estimated at the respective grant date using the

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Black-Scholes Option Module. The following assumptions were made in estimating fair value:

The following table summarizes stock options and warrants outstanding as of March 31, 2013, as well as activity during the twelve months then ended:

The following table provides certain information with respect to the above referenced warrants and options outstanding at March 31, 2013:

f) Debt Conversion

No debit conversion in this period

7.

Income Taxes

The Company has accumulated net operating losses for federal income tax purposes of approximately $1,313,952, which may be carried forward and used to reduce taxable income of future years. These losses expire as follows:

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The potential future tax benefits of these losses have not been recognized in these financial statements due to uncertainty of their realization. When the future utilization of some portion of the carry forwards is determined not to be "more likely than not," a valuation allowance is provided to reduce the recorded tax benefits from such assets.

8.

Commitments

As of September 1, 2007 the company has leased offices at #204, 13569 - 76^th Avenue, Surrey, BC, Canada. Total space is 750 square feet for total rent of $1,000.00 per month. This lease will expire on August 31, 2013.

9.

Unearned Income

During the quarter the company was engaged to undertake the construction of a 53 KWp solar PV facility for a company based in Canada.  The customer advanced $79,450 to us during the quarter and the company has recorded this amount as Unearned Revenue as the project will be undertaken in a subsequent quarter and hence the revenue has not yet been earned.  We will record the revenue on a percentage of completion basis, but we expect the project to be undertaken and completed in July, 2013 and hence to report all the revenue in that quarter.

10.

Other Significant events

On June 15, 2012, 384,454 warrants exercisable at $0.42 expired.

On March 15, 2012, 80,000 warrants exercisable at $0.42 expired.

On March 3, 2013, company took a deposit of $79,450 from Canada Ticket of Langley BC to build a 53kWh solar Power Plant on their roof.

11.

Subsequent Events

In April 2013 further 270,000 warrants exercisable at $0.42 have expired

On April 15, 2013, the company signed an agreement with Capital Group Communications for 12 months of IR work.

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On April 15, 2013, the Company signed an agreement with Lagoon Labs LLC for 12 months of IR work.

On May 28, 2013, the Company issued 2,500,000 shares to Capital Group Communications (2,000,000 shares) and Lagoon Labs LLC (500,000 shares) for their service.

As of March 31, 2013, the Company, through its partial ownership interest in Solarise Power, Inc. (“Solarise”), a privately owned Nevada corporation, was involved in the research and development of solar panel technology.  Solarise specializes in the development of solar panel technology, specifically the manufacture of solar panels utilizing a technology referred to as the JIL Technology (the “JIL Technology”).  The Company and Solarise have been, for the last two years, working on creating a working prototype of the high efficiency Solar Panel.  All efforts have been unsuccessful. As a result, subsequent to the fiscal year ended March 31, 2013, effective as of May 10, 2013, the Company and Solarise have agreed in principal to cancel the Company’s 1,000,000 preferred shares owned by Solarise in exchange for 1,004,999 Solarise common shares owned by the Company, effectively reversing the transaction that was consummated on September 6, 2010.  The agreement in principal has been approved at a meeting of the shareholders of Solarise, and is subject to approval by the Company’s board of directors.  Once the agreement in principal is approved and finalized the Company will have no further ties with Solarise or the panel it was trying to develop.

Subsequent to the period ended March 31, 2013, the Company, through an affiliated entity, Jagat Energy Pvt. Ltd. (“Jagat”), an Indian corporation, acquired the rights to develop and construct two hydro projects located in Ludhiana, Punjab, India, and, as of the date of this Form 10-K is also negotiating with the Indian government officials to acquire the additional solar project identified below.  At the present time, we do not have a direct ownership interest in Jagat.  However, through contractual arrangements between the Company, Jagat and two shareholders of Jagat, we control Jagat and it is considered to be our operating affiliate because we are able to exert effective control over it and to receive all of the economic benefits derived from its business operations. 

Details of the two hydro projects and the one solar project are as follows:

(i)

Construction of a 700 kilowatt  hydro project on an irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Rajgarh located in Ludhiana, Punjab, India

(ii)

 Construction of an additional 500 kilowatt project a few kilometers downstream from the 700 kilowatt project on irrigation canal:

·

Purchase price: 1.55 million INR (approx. $16,000)

·

Location: Sidhwan irrigation canal in Tibba located in Ludhiana, Punjab, India

(iii)

 1 Megawatt solar project on top of irrigation canal:

·

Purchase Price: To be determined

·

Location: Sidhwan irrigation canal in Ludhiana, Punjab, India

The 1MW canal solar project is the first phase of the project which we anticipate will ultimately expand to 7-10 MW at the same site.  The technology to be deployed in all projects is standard off the shelf equipment.  We do not anticipate any technology risks.  Based on current timelines, P2 will commission the solar project in India during the fourth quarter of 2013.  The hydro project has a longer build time, of approximately 10 months; accordingly we anticipate that it will be operational spring of 2014.

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ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

We have had no changes in or disagreements with our accountants required to be disclosed pursuant to Item 304 of Regulation S-K. 

ITEM 9A.    CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

The Securities and Exchange Commission defines the term “disclosure controls and procedures” to mean a company's controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely decisions regarding disclosure.

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures.  Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are designed to provide reasonable assurance of achieving the objectives of timely alerting them to material information required to be included in our periodic SEC reports and of ensuring that such information is recorded, processed, summarized and reported with the time periods specified.  Our chief executive officer and chief financial officer also concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report to provide reasonable assurance of the achievement of these objectives.  

Internal Control Over Financial Reporting

The management of the Company is responsible for the preparation of the financial statements and related financial information appearing in this Annual Report on Form 10-K. The financial statements and notes have been prepared in conformity with accounting principles generally accepted in the United States of America. The management of the Company also is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. A company's internal control over financial reporting is defined as a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the issuer are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or

30

timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

Management, including the Chief Executive Officer and Chief Financial Officer, does not expect that the Company's disclosure controls and internal controls will prevent all error and all fraud. Because of its inherent limitations, a system of internal control over financial reporting can provide only reasonable, not absolute, assurance that the objectives of the control system are met and may not prevent or detect misstatements. Further, over time control may become inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate.

With the participation of the Chief Executive Officer and Chief Financial Officer, our management evaluated the effectiveness of the Company's internal control over financial reporting as of March 31, 2013 based upon the framework in Internal Control –Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on that evaluation, our management has concluded that, as of March 31, 2013, the Company's internal control over financial reporting was effective.

This annual report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management's report in this Annual Report on Form 10-K.

There was no change in the Company's internal control over financial reporting during the last fiscal quarter, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

ITEM 9B.     OTHER INFORMATION.

None.

PART III

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE.

Directors and Executive Officers

The following table sets forth, as of March 31, 2013, the names and ages of the directors and executive officers of the Registrant, the principal positions with the Registrant held by such persons. The executive officers are elected annually by the Board of Directors. The directors serve one year terms or until their successors are elected.  

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Biographical Information

Raj-Mohinder S. Gurm. Mr. Gurm is the President, Chief Financial Officer, and a Director of the Company.  From 1985 to 1987 Mr. Gurm was a partner in B.R. International Marketing Company of Vancouver, BC a company, which provided North American representation to manufacturers from Asia. From 1987 to 1989 he was a manager of Metro Parking Ltd. of Vancouver, BC and was responsible for overseeing 70 employees and 20 parking lots. From 1989 to 1995 he was involved in importing products from Asia and selling them by the container loads to large retail chain stores. In 1995 Mr. Gurm was founder and president of Xanatel Communications Inc. a company involved in the wireless communications industry and which was sold to a public company listed on The Alberta Stock Exchange. Mr. Gurm has been a President and CEO of Spectrum International Inc. from 1990 to present. From Jan. 2000 to Nov. 9th, 2001 he was also President/CEO of Canoil Exploration Corporation, a publicly traded company that recently completed the acquisition of a Medical Equipment company. Mr. Gurm attended the University of British Columbia and earned a Bachelor of Sciences Degree in Biology in 1983. Born in 1960 in India, Mr. Gurm is a citizen and resident of Canada.

Hans Edblad.  Hans Edblad is 47years old. In addition to serving as a director of the Company, Mr. Edblad also works as the Vice President of Business Development for the Company.  From 2006 to 2009 Mr. Edblad served as a consultant to the Company.  In addition to his work with the Company, Mr. Edblad is also the President of Chag Investments Ltd., a position he has held since 1997.  Chag Investments specializes in assisting businesses with business development and investment strategies.  Additionally, from 2002 to present Mr. Edblad has served as a consultant with APR Consulting Group specializing in technical market consulting to various individuals and companies.

Stephen Sleigh.  Stephen Sleigh is 59years old currently serves as a director of the Company.  Since 2001, Mr. Sleigh has been a Certified General Accountant.  In addition to serving as a director of the Company, Mr. Sleigh has worked as the Controller for Zodiac Hurricane Technologies, Inc., (“Zodiac”) a French owned boat builder since 2001.  As the Controller, Mr. Sleigh handles all maters of accounting for Zodiac, including accounts payable, accounts receivable, and monitoring the company’s capital assets, as well as assisting with the development and maintenance of the company’s budgets.  Mr. Sleigh has a BSc., MSc., and a PhD in Chemistry from the University of Manchester, UK.

Family Relationships

There are no family relationships between any of the current directors or officers of the Company.

Involvement in Certain Legal Proceedings

To the best of its knowledge, the Company’s directors and executive officers were not involved in any legal proceedings during the last ten years as described in Item 401(f) of Regulation S-K.

Directorships

None of the Company’s executive officers or directors is a director of any company with a class of equity securities registered pursuant to Section 12 of the Securities exchange Act of 1934 (the “Exchange Act”) or subject to the requirements of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940.

Code of Ethics

The Company has not yet adopted a code of ethics.  The Company intends to adopt a code of ethics in the near future.  

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ITEM 11.

EXECUTIVE COMPENSATION.

Executive Compensation

The following table sets forth, for the years indicated, all compensation paid, distributed or accrued for services, including salary and bonus amounts, rendered in all capacities by the Company’s chief executive officer , chief financial officer and all other executive officers; the information contained below represents compensation paid to the Company’s officers for their work related to the Company.

Employment Agreements

On December 12, 1999, the Company entered into an employment agreement with Raj-Mohinder Gurm.  Pursuant to the terms of the employment agreement, Mr. Gurm is entitled to annual compensation of $72,000 at a rate of $6,000 per month.    A copy of the employment agreement was filed as Exhibit 10.4 to the Company’s Registration Statement on Form SB-2 filed with the Securities and Exchange Commission on June 26, 2002, and is hereby incorporated by reference.  

Option Grants in Last Fiscal Year

There were no options granted to anyone for the work he did for the company.

Equity Compensation Plan Information

The Company currently does not have any equity compensation plans.

Director Compensation

The following table provides summary information concerning compensation awarded to, earned by, or paid to any of our directors for all services rendered to the Company in all capacities for the fiscal year ended March 31, 2013:

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ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth, as of March 31, 2013, certain information with respect to the common stock beneficially owned by (i) each director and executive officer of the Company; (ii) each person who owns beneficially more than 5% of the common stock; and (iii) all directors and executive officers as a group:

(1) Director or Officer of Company

(2)Percentages are calculated based on 57,113,179 shares outstanding as of March 31, 2013.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Certain Relationships and Related Transactions

As of March 31, 2013, there were no material transactions, or series of similar transactions, during our Company’s last fiscal year, or any currently proposed transactions, or series of similar transactions, to which our Company was or is to be a party, in which the amount involved exceeded the lesser of $120,000 or one percent of the average of the small business issuer’s total assets at year-end for the last three completed fiscal years and in which any director, executive officer or any security holder who is known to us to own of record or beneficially more than five percent of any class of our common stock, or any member of the immediate family of any of the foregoing persons, had an interest.

Director Independence

The NASDAQ Stock Market has instituted director independence guidelines that have been adopted by the Securities & Exchange Commission.  These guidelines provide that a director is deemed “independent” only if the board of directors affirmatively determines that the director has no relationship with the company which, in the board’s opinion, would interfere with the director’s exercise of independent judgment in carrying out his or her responsibilities.  Significant stock ownership will not, by itself, preclude a board finding of independence.

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For NASDAQ Stock Market listed companies, the director independence rules list six types of disqualifying relationships that preclude an independence filing.  The Company’s board of directors may not find independent a director who:

1.

is an employee of the company or any parent or subsidiary of the company;

2.

accepts, or who has a family member who accepts, more than $60,000 per year in payments from the company or any parent or subsidiary of the company other than (a) payments from board or committee services; (b) payments arising solely from investments in the company’s securities; (c) compensation paid to a family member who is a non-executive employee of the company’ (d) benefits under a tax qualified retirement plan or non-discretionary compensation; or (e) loans to directors and executive officers permitted under Section 13(k) of the Exchange Act;

3.

is a family member of an individual who is employed as an executive officer by the company or any parent or subsidiary of the company;

4.

is, or has a family member who is, a partner in, or a controlling shareholder or an executive officer of, any organization to which the company made, or from which the company received, payments for property or services that exceed 5% of the recipient’s consolidated gross revenues for that year, or $200,000, whichever is more, other than (a) payments arising solely from investments in the company’s securities or (b) payments under non-discretionary charitable contribution matching programs;

5.

is employed, or who has a family member who is employed, as an executive officer of another company whose compensation committee includes any executive officer of the listed company; or

6.

is, or has a family member who is, a current partner of the company’s outside auditor, or was a partner or employee of the company’s outside auditor who worked on the company’s audit.

Based upon the foregoing criteria, our Board of Directors has determined that Raj-Mohinder S. Gurm is not an independent director under these rules as he is also employed by the Company as its Chief Executive Officer and President, respectively.

ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES

Audit Fees

(1)

The aggregate fees billed by Lake & Associates, CPA’s LLC for audit and review of the Company's financial statements were $23,250 for the fiscal year ended March 31, 2013, and $23,250 for the fiscal year ended March 31, 2012.

Audit Related Fees

(2)

Lake & Associates, CPA’s LLC did not bill the Company any amounts for assurance and related services that were related to its audit or review of the Company’s financial statements during the fiscal years ended 2013 and 2012.

Tax Fees

(3)

The aggregate fees billed by Lake & Associates, CPA’s LLC for tax compliance, advice and planning were $0.00 for the fiscal year ended March 31, 2013 and 2012.

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All Other Fees

 (4)

Lake & Associates, CPA’s LLC did not bill the Company for any products and services other than the foregoing during the fiscal years ended 2013 and 2012.

Audit Committee’s Pre-approval Policies and Procedures

(5)

P2 Solar, Inc. does not have an audit committee per se. The current board of directors functions as the audit committee.

PART IV

ITEM 15.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

(a)  

Exhibits.

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* Filed Herewith

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

By: /s/ Raj-Mohinder S. Gurm

Raj-Mohinder S. Gurm, Chief Executive Officer

Date:  July 1, 2013

In accordance with Section 13 or 15(d) of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:

By: /s/

Raj-Mohinder S. Gurm

Raj-Mohinder S. Gurm, Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer, Director

Date:  July 1, 2013

By:  /s/ Hans Edblad

Hans Edblad, Director

Date:  July 1, 2013

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