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EX-31.1 - RULE 13A-14(A)/15D-14(A) CERTIFICATION. - ORANCO INCorancoexh311.htm
EX-32.1 - CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER/ACTING CHIEF FINANCIAL OFFICER RELATING TO A PERIODIC REPORT CONTAINING FINANCIAL STATEMENTS. - ORANCO INCorancoexh321.htm


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    March 31, 2014

(  )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   000-28181

ORANCO,  INC.
(Exact name of registrant as specified in charter)

Nevada
87-0574491
(State or other jurisdiction of  incorporation or organization
(I.R.S. Employer Identification No.)
   
 1981 E. Murray Holladay Rd, Suite 100,  Salt Lake City, Utah
84117
(Address of principal executive offices)
(Zip Code)

702-583-7248
Registrant’s telephone number, including area code

                               
(Former name, former address, and former fiscal year, if changed since last report.)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes [x ]   No  [  ]

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. Se the definitions of “large accelerated filer”, ”accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act

Large Accelerated Filer [  ]
Accelerated Filer [  ]
   
Non-Accelerated filer [  ]
Smaller Reporting Company [ x ]
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)    Yes [X]      No [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer=s classes of common stock, as of the last practicable date

Class
Outstanding as of May 1, 2014
Common  Stock, $0.001
4,269,950

 
 

 
 
INDEX
 
 
 
Page
 
 
Number
PART I.
   
     
ITEM 1.
Financial Statements (unaudited)
3
     
 
Balance Sheets
4
  March 31, 2014 and December 31, 2013  
    5
  Statements of Operations  
 
For the three months ended March 31, 2014 and 2013 and the period June 16, 1977 to March 31, 2014
6
     
 
Statements of Cash Flows 7
  For the three months ended March 31, 2014 and 2013 and the period June 16, 1977 to March 31, 2014  
 
   
 
Notes to Financial Statements
 
     
ITEM 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
  9
     
ITEM 3.
Quantitative and Qualtitative Disclosures About Market Risk
10
     
ITEM 4T.
Controls and Procedures
10
     
PART II.
   
      
ITEM 6.
Exhibits
11
     
  Signatures
11
 
 
2

 
 
PART I - FINANCIAL INFORMATION



ITEM 1. FINANCIAL STATEMENTS



The accompanying  balance sheets of Oranco, Inc.  (a development stage company) at March 31, 2014 and December 31, 2013, and the related  statement of operations  and the  statement of cash flows for the three months, ended March 31, 2014 and 2013 and the period June 16, 1977 to March 31, 2014 have been prepared by the Company’s management in conformity with accounting principles generally accepted in the United States of America.  In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.

Operating  results for the three months ended March 31, 2014, are not necessarily indicative of the results that can be expected for the year ending December 31, 2014.
 
 
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ORANCO, INC.
 
(A Development Stage Company)
 
   
BALANCE SHEETS
 
   
MARCH 31, 2014 AND DECEMBER 31, 2013
 
             
   
March 31,
   
December 31,
 
   
2014
   
2013
 
Assets
           
             
Current Assets:
           
Cash
  $ 82,145     $ 86,337  
Prepaid expenses
    4,880       4,880  
                 
Total current assets
    87,025       91,217  
                 
Total Assets
  $ 87,025     $ 91,217  
                 
Liabilities and Stockholders' Equity
               
                 
Current Liabilities:
               
Accounts payable, related party
  $ --     $ 1,425  
Accounts payable
    8,345       1,400  
                 
Total current liabilities
    8,345       2,825  
                 
Stockholders' Equity:
               
Common stock, $.001 par value 100,000,000 shares authorized,4,269,950 issued and outstanding
    4,270       4,270  
Additional paid-in capital
    349,898       349,898  
Deficit accumulated during the development stage
    (275,488 )     (265,776 )
                 
Total Stockholders' Equity
    78,680       88,392  
                 
                 
Total Liabilities and Stockholders' Equity
  $ 87,025     $ 91,217  
 
The accompanying notes are an integral part of the financial statements.

 
4

 
 
ORANCO, INC.
 
(A Development Stage Company)
 
   
STATEMENTS OF OPERATIONS
 
                   
               
For the
 
               
Period
 
   
For the
   
For the
   
June 16, 1977
 
   
Three Months
   
Three Months
   
(Inception)
 
   
Ended
   
Ended
   
Through
 
   
March 31,
   
March 31,
   
March 31,
 
   
2014
   
2013
   
2014
 
                   
Revenues
  $ --     $ --     $ --  
                         
Expenses, general  and administrative
    9,722       11,570       438,475  
                         
Valuation adjustment - available   for sale securities
    --       --       30,401  
                         
Operating loss
    (9,722 )     (11,570 )     (468,876 )
                         
Other income (expense):
                       
   Litigation settlement
    --       --       (12,500 )
   Interest and contract income
    10       1,113       205,888  
                         
Loss before provision  for income taxes
    (9,712 )     (10,457 )     (275,488 )
                         
Provision for income taxes
    --       --       --  
                         
Net loss
  $ (9,712 )   $ (10,457 )   $ (275,488 )
                         
Net loss per share
  $ --     $ --          
                         
Weighted average shares outstanding
    4,269,950       4,269,950          
 
The accompanying notes are an integral part of the financial statements.
 
 
5

 

ORANCO, INC.
 
(A Development Stage Company)
 
   
STATEMENTS OF CASH FLOWS
 
                   
               
For the
 
               
Period
 
   
For the
   
For the
   
June 16, 1977
 
   
Three Months
   
Three Months
   
(Inception)
 
   
Ended
   
Ended
   
Through
 
   
March 31,
   
March 31,
   
March 31,
 
   
2014
   
2013
   
2014
 
Cash flows from operating activities:
                 
Net loss
  $ (9,712 )   $ (10,457 )   $ (275,488 )
Adjustments to reconcile net loss to cash provided by operating activities:
                       
(Increase) in prepaid expenses
    --       --       (4,880 )
(Increase) decrease in interest receivable
    --       15       --  
Increase in accounts payable
    5,520       5       8,345  
                         
Net cash used by operating activities
    (4,192 )     (10,437 )     (272,023 )
                         
Cash flows from investing activities:
    --       --       --  
                         
Cash flows from  financing activities:
                       
Issuance of common stock
    --       --       354,168  
Net increase (decrease) in cash
    (4,192 )     (10,437 )     82,145  
                         
Cash, beginning of period
    86,337       39,881       --  
                         
Cash, end of period
  $ 82,145     $ 29,444     $ 82,145  
Interest paid
  $ --     $ --     $ --  
Income taxes paid
  $ --     $ --     $ --  
 
The accompanying notes are an integral part of the financial statements.
 
 
6

 
 
ORANCO, INC.
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS


1.           Summary of Business and Significant Accounting Policies

a.           Summary of Business
 
The Company was incorporated under the laws of the State of Nevada on June 16, 1977.  The Company has been in the business of the development of mineral deposits. During 1983 all activities were abandoned and the Company has remained inactive since that time. The Company has not commenced principal operations and is considered a "Development Stage Company" as defined by FASB ASC 915 (formerly Statement of Financial Accounting Standards (SFAS) No. 7).

b.           Basis of Presentation
 
The accompanying financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America.

In July 2009, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Codification (“ASC”) 105-10, formerly Statement of Financial Accounting Standards (“SFAS”) No. 168, The FASB Accounting Standards Codification and Hierarchy of Generally Accepted Accounting Principles, which became the single source of authoritative GAAP recognized by the FASB. ASC 105-10 does not change current U.S. GAAP, but on the effective date, the FASB ASC superseded all then existing non-SEC accounting and reporting standards.

c.           Cash Flows

For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with a maturity of three months or less to be cash or cash equivalents.
 
d.           Net Loss Per Share
 
 
The net loss per share calculation is based on the weighted average number of shares outstanding during the period.

e.           Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.
 
 
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Notes to Financial Statements – Continued
 
f.           Fair Value of Financial Instruments

 ASC 820-10 (formerly SFAS No. 157, Fair Value Measurements) requires entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value. ASC 820-10 defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of March 31, 2014 and December 31, 2013, the carrying value of certain financial instruments approximates fair value due to the short-term nature of such instruments.
 
2.           Warrants and Stock Options

No options or warrants are outstanding to acquire the Company's common stock.
 
3.           Income Taxes

The Company has had no taxable income under Federal or State tax laws. The Company has loss carryforwards totaling $265,776 that may be offset against future federal income taxes. If not used, the carryforwards will expire 20 years after they are incurred. Due to the Company being in the development stage and incurring net operating losses, a valuation allowance has been provided to reduce the deferred tax assets from the net operating losses to zero. Therefore, there are no tax benefits recognized in the accompanying statement of operations.

4.           Office Rent

The Company’s board of directors approved a $475 per month office rent to a current director of the Company. The amount expensed for the three-months ended at March 31, 2014 and 2013 amounted to $1,425 and $950, respectively.

 
8

 



ITEM 2.   MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 


Plan of Operations.

The Company has not engaged in any material operations or had any revenues from operations  since inception.  The  Company's  plan of operation  for the next 12  months is to  continue  to seek the  acquisition  of assets,  properties  or  businesses  that  may  benefit  the  Company  and  its stockholders. Management intends to focus is efforts in Europe, Africa, and South America both because management is located Europe and because management believes that the Company can locate superior acquisition opportunities in these geographical areas.  Management anticipates that to achieve any such acquisition, the Company will issue shares of its common stock as the sole consideration for such acquisition.

During the next 12 months, the Company's only foreseeable cash requirements will relate to maintaining  the  Company in good  standing  or the  payment of expenses  associated  with  reviewing or  investigating  any potential  business venture,  which  the  Company  expects  to pay from its  cash  resources Management believes that these funds are sufficient to cover its cash needs for the next 12 months. If additional funds are required during this period, such funds may be  advanced  by  management  or stockholders as loans to the Company. Because the Company has not identified any such venture as of the date of this Report, it is impossible to predict the amount of any such loan.  However, any such loan will be on terms no less favorable to the Company than would be available from a commercial lender in an arm's length transaction. As of the date of this Report, the Company is not engaged in any negotiations  with any person  regarding  any venture.

Results of Operations.

Other than restoring and maintaining its good  corporate  standing in the State  of  Nevada,  obtaining an audit of the Company’s financial statements, submitting the Company’s common stock for quotation on the NASD OTC Bulleting Board, the filing of  a Form 10 Registration, and the completion of a private placement, the Company has had no material business operations and in the two most recent calendar years, it activities have been limited to evaluating possible merger or acquisition candidates..

Three Month Period Ended March 31, 2014 and 2013

The Company did not generate any revenue during the three months ended March 31, 2014 and 2013. It had interest income of $10 and $1,113 for the three months ended March 31, 2014 and 2013, the decrease of which is directly attributable to decreased interest income.

General and administrative expenses were $9,722 and $11,570 for the three months ended March 31, 2014 and 2013 . The decrease in expenses for the three months ended March 31, 2014 were largely due to decreased consultant's travel expenses offset by some increases in accounting, legal, other professional costs As a result of the foregoing, the Company realized net losses of $9,712 and $10,457  for the three months ended March 31, 2014 and 2013.  The Company’s decreased net loss is attributable to decreased travel expenses offset by an increase in ongoing professional costs associated with preparing the Company’s public reports..

Liquidity and Capital Resources

At March 31, 2014, assets consisted of $82,145 in cash and $4,880 in prepaid expenses compared to $86,337 in cash and $4,880 in prepaid expenses on December 31, 2013. As of March 31, 2014, the Company had $8,345 in accounts payable.

Currently, the Company has no material commitments for capital expenditures.  Management anticipates that operating expenses for the next twelve months will be approximately $20,000 to $25,000, which it will fund from its cash assets.
 
 
9

 



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 


Not Required by smaller reporting companies.
 


ITEM 4T. CONTROLS AND PROCEDURES
 


Evaluation of Disclosure Controls and Procedures. Our management, with the participation of our president/chief financial officer, carried out an evaluation of the effectiveness of our "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 (the "Exchange Act") Rules 13a-15(e) and 15-d-15(e)) as of the end of our last fiscal quarter, March 31, 2014, (the "Evaluation Date"). Based upon that evaluation, our president/chief financial officer concluded that, as of the Evaluation Date, our disclosure controls and procedures are not effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms and (ii) is accumulated and communicated to our management, including our president and our chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting. There were no changes in our internal controls over financial reporting that occurred during our last fiscal quarter (ended March 31, 2014) that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 
10

 

PART 2 - OTHER  INFORMATION



ITEM 6. EXHIBITS AND REPORTS ON FORM 8K
 


(a) Exhibits

Exhibit 31.1
Rule 13a-14(a)/15d-14(a) Certification.
   
Exhibit 32.1
Certification by the Chief Executive Officer/Acting Chief Financial Officer Relating to a Periodic Report Containing Financial Statements.*
   
101.INS
XBRL Instance*
   
101.SCH
XBRL Schema*
   
101.CAL
XBRL Calculation*
   
101.DEF
XBRL Definition*
   
101.LAB
XBRL Label*
   
101.PRE
XBRL Presentation*
 
* The Exhibit attached to this Form 10-Q shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to liability under that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.


 
SIGNATURES
 


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned there unto duly authorized.

  ORANCO, Inc.
 
[Registrant]
   
   
 
/s/ Juan S. Zabala
  Juan S. Zabala
 
President & Treasurer
May 5, 2014
 
 
 
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