Attached files

file filename
EX-32.1 - EXHIBIT 32.1 - Comjoyful International Cov355027_ex32-1.htm
EX-31.1 - EXHIBIT 31.1 - Comjoyful International Cov355027_ex31-1.htm
EX-31.2 - EXHIBIT 31.2 - Comjoyful International Cov355027_ex31-2.htm
EXCEL - IDEA: XBRL DOCUMENT - Comjoyful International CoFinancial_Report.xls

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

 

WASHINGTON, D.C.20549

 

FORM 10-Q

 

  x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the quarterly period ended July 31, 2013.

 

or

 

  ¨ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the transition period from ___________to ___________. 

 

Commission File Number 001-34998

 

COMJOYFUL INTERNATIONAL COMPANY

(Exact name of registrant as specified in its charter)

 

 Nevada   84-0691531
(State or Other Jurisdiction of   (I.R.S. Employer
Incorporation or Organization)   Identification No.)

 

J4-2-12, Diplomatic Residence Compound,

No.1 Xiushui Street, JianguomenWai,

Chaoyang District, Beijing 100600, China

(Address of Principal Executive Offices including zip code)

 

0086 10 858 92903

(Registrant’s Telephone Number, Including Area Code)

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x 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). Yesx No o

 

Indicate by check mark if the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company

 

Large Accelerated Filer¨ Accelerated Filer¨ Non-Accelerated Filer ¨ Smaller reporting companyx
    (Do not check if a smaller
reporting company)
 

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act).

Yesx No ¨

 

The Registrant had 2,080,873shares of common stock outstanding on September 13, 2013.

 

 
 

 

COMJOYFUL INTERNATIONAL COMPANY

 

TABLE OF CONTENTS

 

PART I:FINANCIAL INFORMATION    
     
Item 1 – Interim Financial Statements   1
     
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations   7
     
Item 3 – Quantitative and Qualitative Disclosures about Market Risk   9
     
Item 4 – Controls and Procedures   9
     
PART II:OTHER INFORMATION    
     
Item 1 – Legal Proceedings   10
     
Item 1A – Risk Factors   10
     
Item 2 – Unregistered Sales of Equity Securities and Use Of Proceeds   10
     
Item 3 – Defaults Upon Senior Securities   10
     
Item 4 – Mine Safety Disclosures   10
     
Item 5 – Other Information   10
     
Item 6 – Exhibits   10
     
Signatures   12

 

i
 

 

PART I. FINANCIAL INFORMATION

 

Item 1. Interim Financial Statements

 

COMJOYFUL INTERNATIONAL COMPANY

 

Balance Sheets

 

   July 31, 2013   April 30, 2013 
   (Unaudited)     
ASSETS       
CURRENT ASSETS        
         
TOTAL CURRENT ASSETS  $-   $- 
           
TOTAL ASSETS  $-   $- 
           
           
LIABILITIES AND STOCKHOLDERS’ DEFICIT          
           
CURRENT LIABILITIES          
Other payable – related party  $94,068   $47,000 
           
TOTAL CURRENT LIABILITIES   94,068    47,000 
           
TOTAL LIABILITIES   94,068    47,000 
           
STOCKHOLDERS’ DEFICIT          
Preferred stock, $0.01 par value 100,000,000 shares
authorized; none issued
   -    - 
Common stock, $0.01 par value 50,000,000 shares
authorized; 2,080,873 shares issued and outstanding
at July 31, 2013 and April 30, 2013, respectively
   20,808    20,808 
Additional paid-in-capital   33,156,398    33,156,398 
Accumulated deficit   (33,271,274)   (33,224,206)
TOTAL STOCKHOLDERS’DEFICIT   (94,068)   (47,000)
           
TOTAL LIABILITIES AND STOCKHOLDERS’DEFICIT  $-   $- 

 

The accompanying notes are an integral part of these financial statements

 

1
 

 

COMJOYFUL INTERNATIONAL COMPANY

 

Statements of Operations

 

   Three months ended July 31, 
   2013   2012 
   (Unaudited)   (Unaudited) 
REVENUE  $-   $- 
OPERATING EXPENSE          
Professional fees   46,043    11,502 
Other   1,025    310 
           
TOTAL OPERATING EXPENSE   47,068    11,812 
           
LOSS FROM OPERATIONS   (47,068)   (11,812)
           
OTHER EXPENSE          
Interest expense   -    (2,726)
TOTAL OTHER EXPENSE   -    (2,726)
           
NET LOSS   (47,068)   (14,538)
           
    --    -- 
           
LOSS PER SHARE BASIC AND DILUTED  $(0.02)  $(0.01)
           
           
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING-BASIC AND DILUTED   2,080,873    2,006,528 

 

The accompanying notes are an integral part of these financial statements

 

2
 

 

COMJOYFUL INTERNATIONAL COMPANY

 

Statements of Cash Flows

 

   Three months ended July 31, 
   2013   2012 
   (Unaudited)   (Unaudited) 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net loss  $(47,068)  $(14,538)
Adjustments to reconcile net loss to net cash used in operating activities          
Changes in operating assets and liabilities:          
Accrued interest payable   -    2,726 
Accounts payable   -    10,000 
           
NET CASH USED IN OPERATING ACTIVITIES   (47,068)   (1,812)
           
CASH FLOWS FROM INVESTING ACTIVITIES:          
           
NET CASH PROVIDED BY INVESTING ACTIVITIES   -    - 
           
CASH FLOWS FROM FINANCING ACTIVITIES:          
Advances from related party   47,068    - 
           
NET CASH PROVIDED BY FINANCING ACTIVITIES   47,068    - 
           
Net decrease  in cash and cash equivalents   -    (1,812)
Cash and cash equivalents at beginning of period   -    2,131 
           
CASH AND CASH EQUIVALENTS AT END OF PERIOD  $-   $319 
           
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION          
Cash paid for Interest Expenses  $-   $- 
Cash paid for Income Taxes  $-   $- 

 

The accompanying notes are an integral part of these financial statements

 

3
 

 

COMJOYFUL INTERNATIONAL COMPANY

 

Notes to the Financial Statements

July 31, 2013

 

 

NOTE 1. BASIS OF PRESENTATION

 

Camelot Corporation ("Camelot Colorado") was incorporated pursuant to the laws of the State of Colorado on September 5, 1975, and completed a $500,000 public offering of its common stock in March 1976. The Company made several acquisitions and divestments of businesses. The Company was delisted from NASDAQ's Small Cap Market on February 26, 1998. In July 1998 all employees of Camelot Colorado were terminated. Its directors and officers have since provided unpaid services on a part-time basis to the Company.

 

On April 28, 2011, at the special meeting, a majority of the shareholders of Camelot Corporation approved the adoption of a proposed Agreement and Plan of Merger, to reincorporate Camelot Corporation, a Colorado corporation in the State of Nevada by merger with and into a Nevada corporation with the name Camelot Corporation ("Camelot Nevada") (the "Migratory Merger"). Camelot Colorado formed Camelot Nevada expressly for the purpose of the Migratory Merger.

 

On September 21, 2012, Andrea Lucanto ("Ms. Lucanto"), the sole officer and director of the Company agreed to assume the debt of $74,345 owed by the company to a third party. In exchange Ms. Lucanto was issued 74,345 shares of the company's common stock. The stock was valued at $1.00 per share. Upon issuance of the shares Ms. Lucanto owns 1,784,497 shares of Common Stock, or approximately 85.76% of the issued and outstanding Common Stock.

 

On December 12, 2012, Comjoyful International Ltd., a company incorporated under the laws of the British Virgin Islands (the "Purchaser") and Andrea Lucanto (the "Seller" or "Ms. Lucanto") entered into a Stock Purchase Agreement (the "Stock Purchase Agreement") pursuant to which the Seller sold to the Purchaser 1,784,497 shares of Camelot Nevada's common stock, par value $0.01 per share (the "Common Stock"), representing approximately 85.76% of the total issued and outstanding shares of Common Stock, for a total consideration of $300,000, of which amount $212,381 was used to pay off certain liabilities of the Camelot Nevada. The source of the purchase price was from personal funds of certain of the shareholders of the Purchaser's parent company. We refer to the transaction consummated under the Stock Purchase Agreement as the "Transaction". Upon the closing of such Transaction, the Purchaser acquired 1,784,497 shares of Common Stock, or approximately 85.76% of the issued and outstanding Common Stock and attained voting control of Camelot Nevada.

 

On December 13, 2012, our sole director and officer, Ms. Lucanto resigned from her officer positions, and Mr. Yazhong Liao ("Mr. Liao") was appointed as Chief Executive Officer, President and Chief Financial Officer of the Company and as a director.

 

On December 28, 2012, Camelot Nevada set up a subsidiary, Comjoyful International Company, which is incorporated pursuant to the laws of the State of Nevada. On the same day, Camelot Nevada and its wholly-owned subsidiary, Comjoyful International Company entered into an Agreement and Plan of Merger (the "Merger") and on January 2, 2013 filed with the Secretary of State of Nevada Articles of Merger, pursuant to which the Comjoyful International Company was merged with and into Camelot Nevada. The legal existence of the Comjoyful International Company, which had no assets or operations on the date of the Merger, was terminated effectively as of the consummation of the Merger. Under Nevada law (NRS Section 92A.180), Camelot Nevada may merge Comjoyful International Company into itself without stockholder approval and effectuate a name change without stockholders' approval. As a result, Camelot Nevada was the survivor of the Merger and changed its name to Comjoyful International Company (the "Company").

 

4
 

 

In November 2011, the Company determined it was in its best interests to terminate the mineral lease entered into with Timberwolf Minerals, Ltd on June 11, 2010. The Company is now seeking an operating company to acquire.

 

The accompanying financial statements have been presented in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

 

NOTE 2. GOING CONCERN

 

The Company's financial statements are prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of obligations in the normal course of business. However, the Company has recurring losses and an accumulated deficit of $33,271,274 and $33,224,206 as of July 31, 2013 and April 30, 2013, respectively. The Company currently does not have any revenue generating operations. These conditions raise substantial doubt about the ability of the Company to continue as a going concern.

 

In view of these matters, continuation as a going concern is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to, meets its financial requirements, raise additional capital, and the success of its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company not continue as a going concern.

 

Management plans to fund the operations of the Company through advances from existing shareholders. There are no written agreements in place for such funding or issuance of securities and there can be no assurance that such will be available in the future. Management believes that this plan provides an opportunity for the Company to continue as a going concern.

 

NOTE 3. RECENT ACCOUNTING PRONOUNCEMENTS

 

There were various accounting standards and updates recently issued, none of which are expected to have a material impact on the Company's financial position, operations, or cash flows.

 

NOTE 4. BASIC EARNINGS/(LOSS) PER SHARE

 

ASC No. 260, "Earnings (loss) Per Share", specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. The Company has adopted the provisions of ASC No. 260.

 

Basic earnings (loss) per share are computed by dividing the net income or loss by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share were the same as basic earnings per share due to the lack of dilutive items in the Company and the fact that Company is in net loss position.

 

NOTE 5. RELATED PARTY TRANSACTIONS

 

Through July 31, 2013 and April 30, 2013, Wuxi KangJiaFu Royal Traditional Investment Management Co., Ltd (the "Wuxi KJF") has advanced the Company $94,068 and $47,000 which is non-interest bearing. The Company's President Mr. Liao owns a 60.004% equity interest of Wuxi KJF.

 

Through July 31, 2012, the Company's former President has advanced the Company $65,025. The advances bear an annual interest rate of six percent and have no specific repayment terms. During the three month period ended July 31, 2012 the Company recorded accrued interest payable of $971. On December 12, 2012, advances from the Company's former President and related accrued interest payable have been paid off by the Purchaser in accordance with the Stock Purchase Agreement.

 

5
 

 

NOTE 6. NOTE PAYABLE

 

Effective October 20, 2009, the Company gave a demand promissory note, in exchange for payables, to Daniel Wettreich, its former CEO and majority shareholder, for $116,511 without interest. On November 20, 2009, Mr. Wettreich sold the demand promissory note to an unrelated third party. On July 20, 2010, the demand promissory note was cancelled and a new interest-bearing promissory note was issued as a substitute. The July 20, 2010 Promissory Note is in the principal amount of $117,000, bears an annual interest rate of six percent, is due and payable on November 30, 2015 and is collateralized by all the assets of the Company. During the three months ended July 31, 2013 and 2012, the Company recorded interest of $nil and $1,755, respectively.

 

On December 12, 2012, the note payable and related accrued interest payable have been paid in full by the Purchaser in accordance with the Stock Purchase Agreement.

 

NOTE 7. INCOME TAX

 

The Company has not recorded tax provision for U.S tax purposes as we have no assessable profits. The Company has a deferred tax asset consisted entirely of the benefit from net operating loss (NOL) carry forwards. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the periods in which those net operating losses are available.

 

The Company's deferred tax assets, valuation allowance, and change in valuation allowance are as follows:

 

Period Ending  NOL Carry-forward   Estimated Tax Benefit from NOL   Valuation
Allowance
   Change in Valuation Allowance   Net Tax Benefit 
                     
July 31, 2013  $439,948   $81,390   $(81,390)  $(8,707)  $- 
April 30, 2013  $392,880   $72,683   $(72,683)  $(13,349)  $- 

 

The Company considers projected future taxable income and tax planning strategies in making its assessment. At present, the Company does not have a sufficient operation to conclude that it is more-likely-than-not that the Company will be able to realize all of its tax benefits in the near future and therefore a valuation allowance was established for the full value of the deferred tax asset. A valuation allowance will be maintained until sufficient positive evidence exists to support the reversal of any portion or all of the valuation allowance. Should the Company start operations in future periods with a supportable trend, the valuation allowance will be reversed accordingly. No tax returns have been filed and all years are subject to IRS audit. 

 

The impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than not to be sustained upon audit by the relevant tax authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Interest and penalties on income taxes will be classified as a component of the provisions for income taxes. The Company did not recognize any income tax due to an uncertain tax position or incur any interest and penalties related to potential underpaid income tax expenses during the three months ended July 31, 2013 and 2012 as management believes there were none as of July 31, 2013 and 2012, respectively.

 

NOTE 8. SUBSEQUENT EVENTS

 

Management has considered all events occurring through the date the financial statements have been issued, and has determined that there are no such events that are material to the financial statements.

 

6
 

 

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

 

FORWARD LOOKING STATEMENTS

 

The information in this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These forward-looking statements involve risks and uncertainties, including statements regarding the Company's capital needs, business strategy and expectations. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "intend," "anticipate," "believe," "estimate," "predict," "potential" or "continue," the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined from time to time, in other reports we file with the Securities and Exchange Commission (the "SEC"). These factors may cause our actual results to differ materially from any forward-looking statement. We disclaim any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

 

THE COMPANY

 

The Company was incorporated pursuant to the laws of the State of Colorado on September 5, 1975, and completed a $500,000 public offering of its common stock in March 1976. The Company made several acquisitions and divestments of businesses. The Company was delisted from NASDAQ's Small Cap Market on February 26, 1998. In July 1998 all employees of the Company were terminated. Its directors and officers have since provided unpaid services on a part-time basis to the Company.

 

On April 28, 2011, at the special meeting, a majority of the shareholders of the Company approved the adoption of a proposed Agreement and Plan of Merger, to reincorporate the Company, then a Colorado corporation, in the State of Nevada by merger with and into a Nevada corporation with the name Camelot Corporation (the "Migratory Merger").

 

On September 21, 2012, Andrea Lucanto ("Ms. Lucanto"), the sole officer and director of the Company agreed to assume the debt of $74,345 owed by the Company to a third party. In exchange Ms. Lucanto was issued 74,345 shares of the Company's Common Stock. The stock was valued at $1.00 per share which was the last price at which the stock was traded. Upon issuance of the shares Ms. Lucanto owns 1,784,497 shares of Common Stock, or approximately 85.76% of the total issued and outstanding Common Stock.

 

On December 12, 2012, Comjoyful International Ltd., a company incorporated under the laws of the British Virgin Islands (the "Purchaser") and Andrea Lucanto (the "Seller" or "Ms. Lucanto") entered into a Stock Purchase Agreement (the "Stock Purchase Agreement") pursuant to which the Seller sold to the Purchaser 1,784,497 shares of Common Stock, representing approximately 85.76% of the total issued and outstanding shares of Common Stock, for a total consideration of $300,000, of which $212,381 was used to pay off certain liabilities of the Company. The source of the purchase price was from personal funds of certain of the shareholders of the Purchaser's parent company. We refer to the transaction consummated under the Stock Purchase Agreement as the "Transaction". Upon the closing of such Transaction, the Purchaser acquired 1,784,497 shares of Common Stock, or approximately 85.76% of the issued and outstanding Common Stock and attained voting control of the Company.

 

On December 13, 2012, the former sole director and officer, Ms. Lucanto resigned from her positions, and upon closing of the Transaction Mr. Yazhong Liao ("Mr. Liao") was appointed as Chief Executive Officer, President, Chief Financial Officer and sole director of the Company.

 

7
 

 

On December 28, 2012, the Company and its wholly-owned subsidiary (the "Company Sub") entered into an Agreement and Plan of Merger and on January 2, 2013 filed with the Secretary of State of Nevada Articles of Merger, pursuant to which the Company Sub was merged with and into the Company (the "Name Change Merger"). The legal existence of the Company Sub, which had no assets or operations on the date of the Name Change Merger, was terminated effective as of the consummation of the Name Change Merger. Under Nevada law (NRS Section 92A.180), the Company may merge the Company Sub into itself without stockholder approval and effectuate a name change without stockholder approval. As a result, the Company changed its name to Comjoyful International Company.

 

In November 2011, the Company determined it was in its best interests to terminate the mineral lease entered into with Timberwolf Minerals, Ltd on June 11, 2010. The Company is now seeking an operating company to acquire.

 

LIQUIDITY AND CAPITAL RESOURCES

 

The financial statements have been prepared on the basis that the Company will continue to operate throughout the next twelve months as a going concern. The Company has recurring losses and an accumulated deficit of $33,271,274 and $33,224,206 as of July 31, 2013 and April 30, 2013, respectively. The Company currently does not have any revenue generating operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan is to obtain such resources for the Company through advances from existing shareholders. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. In the event that the Company is not able to obtain funding, it will not be able to implement or may be required to delay all or part of the business plan, and the ability to attain profitable operations, generate positive cash flows from operating and investing activities and materially expand the business will be materially adversely affected. The accompanying financial statements do not include any adjustments relating to the classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.

 

Net cash used in operating expenses for the three months ended July 31, 2013 was $47,068 compared with $1,812 for the three months ended July 31, 2012. This was mainly because of the increase of net loss. Net cash provided by investing activities were both $nil for the three months ended July 31, 2013 and 2012. Net cash provided by financing activities for the three months ended July 31, 2013 was $47,068 compared with $nil provided for the three months ended July 31, 2012. This was mainly due to increase advance from related party for professional service.

 

The Company does not have any plans for capital expenditures. The Company has negligible cash resources and will experience liquidity problems over the next twelve months due to its lack of revenue unless it is able to raise funds from outside sources. There are no known trends, demands, commitments or events that would result in or that are reasonably likely to result in the Company's liquidity increasing or decreasing in a material way.

 

RESULTS OF OPERATIONS

 

The Company's revenue for the three months ended July 31, 2013 and 2012 were both nil. For the three months ended July 31, 2013, the Company incurred a net loss from operations of $47,068, and a net loss of $47,068. For the three months ended July 31, 2012 the Company incurred a net loss from operations of $11,812 and a net loss of $14,538. The increase in net loss is due to the increase in fees for professional services.

 

OFF-BALANCE SHEET ARRANGEMENTS

 

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

 

8
 

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk

 

Pursuant to Item 305(e) of Regulation S-K (§ 229.305(e)), the Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined by Rule 229.10(f)(1).

 

Item 4. Controls and Procedures

 

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

 

As of the end of the period covered by this Report, our sole officer performed an evaluation of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Based on the evaluation and the identification of the material weaknesses in internal control over financial reporting described below, our sole officer concluded that, as of July 31, 2013, the Company's disclosure controls and procedures were not effective.

 

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projection of any evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis. In connection with management's assessment of our internal control over financial reporting as required under Section 404 of the Sarbanes-Oxley Act of 2002, we identified the following material weaknesses in our internal control over financial reporting as of July 31, 2013:

 

1.The Company has not established adequate financial reporting monitoring procedures to mitigate the risk of management override, specifically because there are no employees and only one officer and director with management functions and therefore there is lack of segregation of duties. In addition, the Company does not have accounting software to prevent erroneous or unauthorized changes to previous reporting periods.

 

2.In addition, there is insufficient oversight of accounting principles implementation and insufficient oversight of external audit functions.

 

3.There is a strong reliance on the external attorneys to review and edit the annual and quarterly filings and to ensure compliance with SEC disclosure requirements.

 

REMEDIATION OF MATERIAL WEAKNESSES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

 

As a small business, without a viable business and revenues, the Company does not have the resources to install a dedicated staff with deep expertise in all facets of SEC disclosure and GAAP compliance. As is the case with many small businesses, the Company will continue to work with its external consultants as it relates to new accounting principles and changes to SEC disclosure requirements. The Company has found this approach worked well in the past and believes it to be the most cost effective solution available for the foreseeable future.

 

The Company will conduct a review of existing sign-off and review procedures as well as document control protocols for critical accounting spreadsheets. The Company will also increase management's review of key financial documents and records.

 

9
 

 

As a small business, the Company does not have the resources to fund sufficient staff to ensure a complete segregation of responsibilities within the accounting function. However, Company management does review, and will increase the review of, financial statements on a monthly basis. These actions, in addition to the improvements identified above, will minimize any risk of a potential material misstatement occurring.

 

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

 

There were no significant changes in our internal control over financial reporting during the quarter ended July 31, 2013, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

We know of no material, active or pending legal proceedings against the Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 

ITEM 1A.RISK FACTORS

 

As a smaller reporting company, the Company is not required to make disclosures under this Item 1A.

 

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3.DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4.MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5.OTHER INFORMATION

 

None.

 

ITEM 6:EXHIBITS

 

The exhibits listed on the Exhibit Index are provided as part of this report.

 

10
 

 

EXHIBIT INDEX

 

Exhibit No.   Name of Exhibit
31.1   Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2   Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1   Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101   Interactive data files pursuant to Rule 405 of Regulation S-T

 

11
 

 

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.

 

Dated: September 16, 2013 COMJOYFUL INTERNATIONAL COMPANY
     
  By: /s/ Yazhong Liao
   

Yazhong Liao

Chief Executive Officer and President

     
  By: /s/ Gene Michael Bennett
   

Gene Michael Bennett

Chief Financial Officer

 

12