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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended December 31, 2011

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

For the transition period from _______ to _______

Commission File No. 000-54000

Big Sky Productions, Inc.
(Exact name of registrant as specified in its charter)

Nevada
88-0410480
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)

12021 Wilshire Blvd. #234
Los Angeles, CA
 
90025
(Address of principal executive offices)
(Zip Code)

Registrant’s telephone number, including area code: (310) 430-1388

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.
ý 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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
ý Yes           o No (Not required)

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.

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

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

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date:  12,063,381 shares of common stock as of December 31, 2011.



 
1

 

BIG SKY PRODUCTIONS INC.
FOR THE FISCAL QUARTER ENDED
DECEMBER 31, 2011

INDEX TO FORM 10-Q

 
PART I
 
Page
     
Item 1
Financial Statements (Unaudited)                                                                                                                                
3
Item 2
Management’s Discussion and Analysis of Financial Condition and
Results of Operations                                                                                                                                
12
Item 3
Quantitative and Qualitative Disclosures About Market Risk                                                                                                                                
14
Item 4
Controls and Procedures                                                                                                                                
14
     
PART II
   
     
Item 1
Legal Proceedings                                                                                                                                
15
Item 1A
Risk Factors                                                                                                                                
15
Item 2
Unregistered Sales of Equity Securities and Use of Proceeds                                                                                                                                
15
Item 3
Defaults Upon Senior Securities                                                                                                                                
15
Item 4
Mine Safety Disclosures                                                                                                                                
15
Item 5
Other Information                                                                                                                                
15
Item 6
Exhibits                                                                                                                                
15
 
Signatures                                                                                                                                
16
 
 
 
 

 
 
2

 
 
PART I

Item 1
Financial Statements

BIG SKY PRODUCTIONS, INC.
(A Development Stage Enterprise)
 
Financial Statements
December 31, 2011
 
 
 
 
 
 
 
3

 
 
BIG SKY PRODUCTIONS, INC.
(A Development Stage Enterprise)
 
Financial Statements
December 31, 2011
 
 
 
CONTENTS
 
 
   
Page(s)
Balance Sheets as of December 31 and June 30, 2011
5
     
Statements of Operations for the three and six months ended December 31, 2011 and 2010 and the
period of February 28, 2008 (inception) to December 31, 2011
6
     
Statements of Cash Flows for the six months ended December 31, 2011 and 2010 and the period of
February 28, 2008 (inception) to December 31, 2011
7
     
Notes to unaudited financial statements
8 - 11
 
 
 
 

 
 
4

 
 
BIGSKY PRODUCTIONS, INC
(A Development Stage Enterprise)
Condensed Balance Sheets
 
 
 
   
December 31,
2011
   
June 30, 2011
 
   
(Unaudited)
       
ASSETS
 
Current assets
           
Cash
  $ 26,442     $ 40,263  
Accounts receivable
    -       2,000  
Prepaid expenses and other current assets
    18,174       21,138  
Total current assets
    44,616       63,401  
                 
Equipment, net of accumulated depreciation of $3,497 and $715
    8,636       6,046  
                 
Total assets
  $ 53,252     $ 69,447  
                 
LIABILITIES AND STOCKHOLDERS' DEFICIT
 
                 
Current liabilities
               
Accounts payable
  $ 41,511     $ 38,796  
Related party payable, net of $971  discount on December 31, 2011
    7,529       3,500  
Deferred revenue
    72,584       95,443  
Total current liabilities
    121,624       137,739  
                 
Stockholders' Deficit
               
Common stock, $0.001 par value; 75,000,000 shares authorized; 12,063,381
shares issued and outstanding
    12,063       12,063  
Additional paid in capital
    82,751       81,595  
Deficit accumulated during the development stage
    (163,186 )     (161,950 )
Total stockholders' deficit
    (68,372 )     (68,292 )
                 
Total liabilities and stockholders' deficit
  $ 53,252     $ 69,447  
 
The accompanying notes are an integral part of these (unaudited) condensed financial statements
 

 
5

 
 
BIGSKY PRODUCTIONS, INC
(A Development Stage Enterprise)
Condensed Statements of Operations
(Unaudited)
 
   
                           
From February 28,
2008 (inception)
to December 31,
2011
 
                         
   
Three months ended December 31,
   
Six months ended December 31,
 
   
2011
   
2010
   
2011
   
2010
 
Revenue
  $ 91,146     $ 14,827     $ 214,161     $ 18,425     $ 413,547  
Cost of revenue
    51,934       8,967       115,131       13,713       226,129  
Gross margin
    39,212       5,860       99,030       4,712       187,418  
                                         
Operating Expenses
                                       
Professional fees
    36,893       15,244       77,032       18,354       290,779  
Depreciation
    1,780       -       2,782       -       3,497  
General and administrative
    10,075       3,675       20,154       6,221       55,467  
Total operating expenses
    48,748       18,919       99,968       24,575       349,743  
                                         
Other income (expense)
                                       
Gain on foreign currency exchange
    -       -       -       -       102  
Interest income
    -       -       -       -       3  
Interest expense
    (209 )     -       (298 )     -       (966 )
Total other income (expense)
    (209 )     -       (298 )     -       (861 )
                                         
Net loss
  $ (9,745 )   $ (13,059 )   $ (1,236 )   $ (19,863 )   $ (163,186 )
                                         
Basic and diluted loss per common
share
  $ (0.00 )   $ (0.00 )   $ (0.00 )   $ (0.00 )        
                                         
Weighted average shares outstanding
    12,063,381       12,063,381       12,063,381       12,063,381          
 
The accompanying notes are an integral part of these (unaudited) condensed financial statements
 
 
 
6

 
 
BIGSKY PRODUCTIONS, INC
(A Development Stage Enterprise)
Condensed Statements of Cash Flows
(Unaudited)
 
     
Six months ended December 31,
      For the period from
February 28, 2008
(inception) to
 
     
2011
     
2010
     
December 31, 2011
 
Cash flows from operating activities
                       
Net loss
  $ (1,236 )   $ (19,863 )   $ (163,186 )
Adjustments to reconcile net loss to net cash used in operating activities
         
Common stock issued for services
    -       -       37,658  
Depreciation
    2,782       -       3,497  
Amortization of debt discount
    185       -       185  
Changes in operating assets and liabilities
                 
Accounts receivable
    2,000       (50 )     -  
Prepaid expenses and other current asset
    2,964       (7,102 )     (18,174 )
Accounts payable
    2,715       (2,278 )     41,511  
Deferred revenue
    (22,859 )     30,375       72,584  
Net cash used in operating activities
    (13,449 )     1,082       (25,925 )
                         
Cash flows from investing activities
                 
Purchase of equipment
    (5,372 )     -       (12,133 )
Cash flows from investing activities
    (5,372 )     -       (12,133 )
                         
Cash flows from financing activities
                 
Related party payable
    5,000       1,500       8,500  
Proceeds from sale of stock
    -       -       56,000  
Net cash provided by financing activities
    5,000       1,500       64,500  
                         
Net change in cash
    (13,821 )     2,582       26,442  
Cash at beginning of period
    40,263       1,233       -  
Cash at end of period
  $ 26,442     $ 3,815     $ 26,442  
                         
Supplemental disclosure of non-cash investing and financing activities:
         
Issuance of common stock for professional and
consulting services
  $ -     $ -     $ 37,658  
                         
Supplemental cash flow Information:
                 
Cash paid for interest
  $ -     $ -     $ 668  
Cash paid for income taxes
  $ -     $ -     $ -  
 
The accompanying notes are an integral part of these (unaudited) condensed financial statements
 

 
7

 
 
BIG SKY PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to Condensed Financial Statements
(Unaudited)
 
Note 1 – Nature of Business
 
Big Sky Productions, Inc. (the “Company”) was incorporated in the State of Nevada on February 28, 2008. Big Sky Productions, Inc. is developing a business plan as a producer of radio advertisements for small businesses.   To date, our business activities have been limited to organizational matters, reselling of advertising time, developing our website and the preparation and filing of the registration statement. The Company has elected a fiscal year end of June 30.
 
 
Note 2 - Condensed Financial Statements
 
The accompanying financial statements have been prepared by the Company without audit.  In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at December 31, 2011, and for all periods presented herein, have been made.
 
Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s June 30, 2011 audited financial statements. The results of operations for the periods ended December 31, 2011 and 2010 are not necessarily indicative of the operating results for the full year.
 
Note 3 – Significant Accounting Policies
 
Estimates
 
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Areas requiring the use of estimates include impairment of long lived assets, valuation allowance applied to deferred tax assets and useful lives used in the depreciation of equipment. Actual results could differ from those estimates.
 
Cash and Cash Equivalents
 
All highly liquid investments with maturity of three months or less are considered to be cash equivalents.  There were no cash equivalents as of December 31, 2011.
 
Earnings per Share
 
FASB ASC 260, “Earnings Per Share” provides for calculation of "basic" and "diluted" earnings (loss) per share.  Basic earnings per share includes no dilution and is computed by dividing net income (loss) available to common shareholders by the weighted average common shares outstanding for the period.  Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity similar to fully diluted earnings per share.  Basic and diluted loss per share were the same, at the reporting dates, as there were no common stock equivalents outstanding.
 
 
8

 
 
BIG SKY PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to Condensed Financial Statements
(Unaudited)  
 
Note 3 - Significant Accounting Policies (continued)

Share Based Expenses

ASC 718 "Compensation - Stock Compensation" codified SFAS No. 123 prescribes accounting and reporting standards for all stock-based payments award to employees, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights. , may be classified as either equity or liabilities. The Company should determine if a present obligation to settle the share-based payment transaction in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices or stated policies. If a present obligation exists, the transaction should be recognized as a liability; otherwise, the transaction should be recognized as equity.
 
The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50 "Equity - Based Payments to Non-Employees" which codified SFAS 123 and the Emerging Issues Task Force consensus in Issue No. 96-18 ("EITF 96-18"), "Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring or in Conjunction with Selling, Goods or Services". Measurement of share-based payment transactions with non-employees shall be based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction should be determined at the earlier of performance commitment date or performance completion date.
 
Going concern
 
The Company's financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable.  If the Company is unable to obtain adequate capital, it could be forced to cease operations.
 
In order to continue as a going concern, the Company will need, among other things, additional capital resources.  Management's plans to obtain such resources for the Company include (1) obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses, and (2) as a last resort, seeking out and completing a merger with an existing operating company. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.
 
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
 
 
9

 
 
BIG SKY PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to Condensed Financial Statements
(Unaudited)
 
Note 3 - Significant Accounting Policies (continued)
 
Revenue Recognition
 
The Company's financial statements are prepared under the accrual method of accounting. Revenues are recognized when evidence of an agreement exists, the price is fixed or determinable, collectability is reasonably assured and goods have been delivered or services performed.
 
The Company derives revenues from the sale of advertising space on its radio program “The Ellis Martin Report.” “The Ellis Martin Report” is a paid news magazine airing on select AM radio stations in the United States.  Clients and/or guests compensate the Company for time on this program to expose their business or stories to the listening audience.
 
Advertising contracts are structured to run for a time period between 30 and 120 days. Accordingly, revenues are recognized on a pro-rata basis resulting in recognized revenue and deferred revenue of $214,161 and $72,584 respectively for and as of the six months ended December 31, 2011.
 
Recent Accounting Pronouncements
 
The Company has evaluated recent accounting pronouncements and their adoption has not had or is not expected to have a material impact on the Company’s financial position, or statements.
 
Property and Equipment
 
Property and equipment are carried at cost. Expenditures for maintenance and repairs are charged against operations. Renewals and betterments that materially extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period.
 
Depreciation is computed for financial statement purposes on a straight-line basis over estimated useful lives of the related assets. The estimated useful lives of depreciable assets are:
 

 
 
Estimated Useful Lives
Furniture and Fixtures
5 - 10 years
Computer Equipment
2 - 5 years
Vehicles
5 - 10 years
 
For federal income tax purposes, depreciation is computed under the modified accelerated cost recovery system. For audit purposes, depreciation is computed under the straight-line method.   
 
Property and equipment consisted of the following:
 
   
December 31, 2011
   
June 30, 2011
 
Leasehold improvements
  $ 2,795     $ -  
Computer and video equipment
    9,338       6,761  
Sub Total
  $ 12,133     $ 6,761  
                 
Accumulated depreciation
    (3,497 )     (715 )
Total
  $ 8,636     $ 6,046  

 
10

 
 
BIG SKY PRODUCTIONS, INC.
(A Development Stage Enterprise)
Notes to Condensed Financial Statements
(Unaudited)
 
Note 4 – Related Party Transactions
 
During the six months ended December 31, 2011, the Company received loans totaling $5,000 from a related party to fund operations. There was a total of $8,500 due to related parties as of December 31, 2011.
 
Notes payable consisted of the following:
 
   
December 31, 2011
   
June 30, 2011
 
Related Party payable
  $ 8,500     $ 3,500  
Discount on note
    (971 )     -  
Net Total
  $ 7,529     $ 3,500  
 
The loans are non-interest bearing, due on demand and as such is included in current liabilities.  The Company has imputed interest at a rate of approximately 5% for each of the aforementioned notes, which has been recorded as a discount to each note with an increase in paid in capital. Imputed interest expense for the six months ended December 31, 2011and 2010 was $185 and $0, respectively.
 
During the six months ended December 31, 2011, the Company paid $48,715 in commissions to a director and officer of the Company related to advertising sales during the period. As of December 31, 2011, $17,729 has been deferred and recorded as other current asset on the balance sheet.
 
During the six months ended December 31, 2011, the Company incurred $1,500 in transcription and administrative services to an officer of the Company.
 
During the six months ended December 31, 2011, the Company incurred $30,000 in management fees to a director and officer of the Company.
 
Note 5 – Stockholders’ Equity
 
Common Stock
 
On February 28, 2008, the Company was formed with one class of common stock, par value $0.001. The Company authorized 75,000,000 shares of common stock. At December 31, 2011, the Company had 12,063,381 common shares issued and outstanding. There are no preferred shares authorized, issued or outstanding.  The Company has no stock option plan, warrants or other dilutive securities.
 
Net loss per common share
 
Net loss per share is calculated in accordance with FASB ASC 260, “Earnings Per Share.” The weighted-average number of common shares outstanding during each period is used to compute basic loss per share. Diluted loss per share is computed using the weighted average number of shares and dilutive potential common shares outstanding. Dilutive potential common shares are additional common shares assumed to be exercised.
 
Note 6 – Subsequent Events
 
The Company has evaluated subsequent events through the date of this filing and determined there are none to disclose

 
11

 

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

The following discussion and analysis of our financial condition and plan of operations should be read in conjunction with our unaudited interim financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q.  Various statements have been made herein that may constitute “forward-looking statements”.  Forward-looking statements may also be made in the Company’s other reports filed with or furnished to the United States Securities and Exchange Commission (the “SEC”) and in other documents.  In addition, the Company through its management may make oral forward-looking statements.

Forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from such statements.  The words “believe,” “expect,” “anticipate,” “optimistic,” “intend,” “plan,” “aim,” “will,” “may,” “should,” “could,” “would,” “likely” and similar expressions are intended to identify forward-looking statements.  These statements are not guarantees of future performance, and therefore, you should not put undue reliance upon them.  Some of the statements that are forward-looking include: our ability to successfully implement our business plan; our estimates of revenues and of other expenses associated with our operations; our ability to identify, explore and extract mineralized material; and our ability to generate sufficient cash flows and maintain adequate sources of liquidity to finance our ongoing operations and capital expenditures.  The Company undertakes no obligation to update or revise any forward-looking statements.

CORPORATE HISTORY AND BACKGROUND

Big Sky Productions, Inc. (the “Company”) was incorporated in the State of Nevada on February 28, 2008. The Company has elected a fiscal year end of June 30.

BUSINESS

Our business is focused on (i) film production and distribution, and (ii) an online news magazine and terrestrial radio program broadcast known as the “Ellis Martin Report”.

Film Production and Distribution

With respect to our film production and distribution business we have been engaged in business planning activities, including researching the industry, developing our economic models and financial forecasts, performing due diligence regarding potential geographic locations most suitable for our services, identifying future sources of capital and developing a business plan as a producer of low-budget motion pictures.  Our Company intends to use North America as its primary area for producing these feature films.   We cannot provide any assurance or guarantee that we will be able to generate revenues in the future years through this activity.

Ellis Martin Report

Our radio program is broadcast during market hours in several key US cities and worldwide on the web featuring small-cap or microcap companies from a variety of industry sectors trading on a number of North American and foreign exchanges. We produce and provide news, general analyst opinions and other programming content. Our content is distributed to radio stations and digital platforms.  We sell radio airtime to customers who discuss their company.  The airtime is purchased from a third party radio airtime broker at a discount to our company. We derive substantially all of our revenue from the sale of 3 minute, 5 minute, and 10 minute and 60 second commercial airtime increments to companies. Our clients who target local/regional audiences generally find that an effective method is to purchase shorter duration interviews, which are principally correlated to our stock and information related programming and content. Our clients who target national audiences generally find that a cost effective method is to purchase longer airtime, which are principally correlated to our news, stock market related programming and content. A growing number of advertisers purchase both local/regional and national airtime. Our goal is to maximize the yield of our available commercial airtime to optimize revenue and profitability.
 
There are a variety of factors that influence our revenue on a periodic basis, including but not limited to:
 
·   economic conditions and the relative strength or weakness in the United States economy;
 
·  advertiser spending patterns and the timing of the broadcasting of our programming, principally the seasonal nature of financial programming;
 
·  changes in ratings/audience levels for our programming; increases or decreases in our portfolio of program offerings and the audiences of our programs, including changes in the demographic composition of our audience base;
 
·  advertiser demand on a local/regional or national basis for radio related advertising products; increases or decreases in the size of our advertiser sales force; and
 
 
12

 
 
·  competitive and alternative programs and advertising mediums.
 
Our commercial airtime is perishable, and accordingly, our revenue is significantly impacted by the commercial airtime available at the time we enter into an arrangement with a company. Our ability to specifically isolate the relative historical aggregate impact of price and volume is not practical as commercial airtime is sold and managed on an order-by-order basis. We closely monitor advertiser commitments for the current calendar year, with particular emphasis placed on the annual upfront process. We take the following factors, among others, into account when pricing commercial airtime: (1) the dollar value, length and breadth of the order; (2) the desired reach and audience demographic; (3) the quantity of commercial airtime available for the desired demographic requested by the advertiser for sale at the time their order is negotiated; and (4) the proximity of the date of the order placement to the desired broadcast date of the commercial airtime.
 
The principal components of our operating expenses are programming, production and distribution costs (including affiliate compensation and broadcast rights fees), selling expenses, including commissions, promotional expenses and bad debt expenses, depreciation and amortization, and corporate general and administrative expenses.

We consider our operating cost structure to be largely fixed in nature, and as a result, we need several months lead time to make significant modifications to our cost structure to react to what we view are more than temporary increases or decreases in advertiser demand. This becomes important in predicting our performance in periods when advertiser revenue is increasing or decreasing. In periods where advertiser revenue is increasing, the fixed nature of a substantial portion of our costs means that operating income will grow faster than the related growth in revenue. Conversely, in a period of declining revenue, operating income will decrease by a greater percentage than the decline in revenue because of the lead-time needed to reduce our operating cost structure. If we perceive a decline in revenue to be temporary, we may choose not to reduce our fixed costs, or may even increase our fixed costs, so as to not limit our future growth potential when the advertising marketplace rebounds. We carefully consider matters such as credit and commercial inventory risks, among others, in assessing arrangements with our programming and distribution partners. In those circumstances where we function as the principal in the transaction, the revenue and associated operating costs are presented on a gross basis in the accompanying Statement of Operations. In those circumstances where we function as an agent or sales representative, our effective commission is presented within revenue with no corresponding operating expenses. Although no individual relationship is significant, the relative mix of such arrangements is significant when evaluating operating margin and/or increases and decreases in operating expenses.

Results of Operations
 
The following discussion of the financial condition and results of operations should be read in conjunction with the financial statements included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future.
 
Three Months ended December 31, 2011 and 2010:

Net Revenue
 
2011:  $39,212
2010:  $5,860
 
The increase in revenues for 2011 was related to increased revenue from the Ellis Martin Report.

Expenses

2011:  $48,748
2010:  $18,919

The increase in expenses for 2011 was related to increased professional fee costs associated with being a public company.

Net Profit (Loss)
 
2011:  ($9,345)
2010:  ($13,059)

Six Months ended December 31, 2011 and 2010:

Net Revenue
 
2011:  $99,030
2010:  $4,712
 
 
 
13

 
The increase in revenues for 2011 was related to increased revenue from the Ellis Martin Report.

Expenses

2011:  $99,968
2010:  $24,575

The increase in expenses for 2011 was related to increased professional fee costs associated with being a public company.

Net Profit (Loss)
 
2011:  ($1,236)
2010:  ($19,863)

Liquidity and Financial Condition
 
As of December 31, 2011, the Company had current assets of $44,616 and current liabilities of $121,624; our cash balance was $26,442.

We anticipate that additional capital will be required to implement our business plan for the next 12 months.  In order to obtain the necessary capital, the Company may need to sell additional shares of common stock or borrow funds from private lenders.

Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect significant amounts owed to us or experience unexpected cash requirements that would force us to seek alternative financing.  Further, if we issue additional equity or debt securities as a means of raising additional capital, stockholders may experience dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of common stock.

Summary of Significant Accounting Policies

See Note 3 to our financial statements.

Recent Accounting Pronouncements

See Note 3 to our financial statements.

Off-Balance Sheet Arrangements
 
None.

Item 3     Quantitative and Qualitative Disclosures about Market Risk

Not required for a smaller reporting company.

Item 4     Controls and Procedures

Disclosure Controls and Procedures

Our management has evaluated, under the supervision and with the participation of our President, Chief Executive and Interim Chief Financial Officer, the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15(b) and 15d-15 (b) under the Securities Exchange Act of 1934 (the “Exchange Act”).  Based on that evaluation, our management has concluded that, as of the end of the period covered by this report, our disclosure controls and procedures are not effective in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized and reported in a timely manner, and (2) accumulated and communicated to our management, including our President, Chief Executive and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 
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PART II

Item 1                 Legal Proceedings

None.

Item 1A              Risk Factors

N/A

Item 2                Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3                Defaults upon Senior Securities

None. 

Item 4                Mine Safety Disclosures

N/A.

Item 5                Other Information

None.

Item 6                 Exhibits

Number
Exhibit
   
31
Certification of Principal Executive and Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32
Certification of Principal Executive and Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*
XBRL Instance Document
101.SCH*
XBRL Taxonomy Extension Schema Document
101.CAL*
XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*
XBRL Taxonomy Extension Label Linkbase Document
101.PRE*
XBRL Taxonomy Extension Presentation Linkbase Document

*  Pursuant to applicable securities laws and regulations, we are deemed to have complied with the reporting obligation relating to the submission of interactive data files in such exhibits and are not subject to liability under any anti-fraud provisions of the federal securities laws as long as we have made a good faith attempt to comply with the submission requirements and promptly amend the interactive data files after becoming aware that the interactive data files fail to comply with the submission requirements. Users of this data are advised that, pursuant to Rule 406T, these interactive data files are deemed not filed and otherwise are not subject to liability.
 
 
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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

   
Big Sky Productions, Inc.
 
       
Date: August 21, 2013
 
/s/ Ellis Martin
 
   
Ellis Martin, Chief Executive Officer
 
 
 
 
 
 
 
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