9.

SEGMENTED INFORMATION

The Company currently operates in one business segment, which is the internet hotel booking service. Accordingly, the Company does not have separately reportable segments.

10.

SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

During the six months ended June 30, 2014, the Company issued 200,000 common shares to an arm’s length party for $10,000 share subscription advance received during the year ended December 31, 2012.

There were no significant non-cash transaction during the six months ended June 30, 2013.

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

Trends and Uncertainties

During 2008, we started generating revenue upon completion of the acquisition of OneWorld Hotel Destination Services, Inc.  We acquired all of the common shares of OneWorld for 2,000,000 common shares and a promissory note.  In addition, we are seeking to expand our revenue base by adding new customers and increasing our marketing and advertising.  

Due to the recession in 2009, the registrant halted the plan to raise extra capital which is for the completion of the online hotel room reservation web site and the expansion of the Hotel booking business.  The registrant decided to allocate the majority cash flow to maintain the operation of One World because of the recession in 2009.  The officers and directors also agreed not to receive cash compensation for their management work in the registrant including the continuation of the development of the website in-house by the directors, the defraying of marketing, promotion and travel.

While the economy is gradually recovering today, One World currently generates sufficient cash flow to maintain its own daily operation.  However, in order to realize effective marketing and promotion, the registrant will need to raise the addition capital through the sale of capital stock in the future.  The use of funds would be rationed for marketing and promotion purposes, expansion of the OneWorld operation and working capital needs.

There are several known trends that are reasonably likely to have a material effect on our net sales or revenues alongside our income from continuing operations and profitability.

We expect to experience significant fluctuations in our future operating results due to a variety of factors, many of which are outside our control. Factors that may adversely affect our quarterly operating results include but are not limited to:

   - Our ability to develop and complete the hotel booking website.

   - Our ability to attract customer to use our web site and maintain user satisfaction;

   - Our ability to attract hotel suppliers to provide their hotel rooms in our web site.

   - Our ability to hire and train qualified personnel.

   - Our ability to resolve any technical difficulties and system downtime or Internet disconnection.

- Governmental regulations on use of Internet as a tool to conduct business transaction.

- Change of customer’s acceptance to use Internet to book hotel rooms.

We may also incur losses for the foreseeable future due to costs and expenses related to:

- The implementation of our hotel booking web site business model;

- Marketing and other promotional activities;

- Competition

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- The continued development of our website;

- High cost to maintain the hotel booking web site, and

- Hiring and training new staff for customer services.

We cannot be sure that we will be successful in addressing these risks and uncertainties and our failure to do so could have a materially adverse effect on our financial condition.  In addition, our operating results are dependent to a large degree upon factors outside of our control.  There are no assurances that we will be successful in addressing these risks, and failure to do so may adversely affect our business.

Capital and Source of Liquidity

Prior to the acquisition of OneWorld, all of Globalink’s operating capital had either been advanced by current shareholders or from proceeds for the issuance of common shares.  

For the six months ended June 30, 2014, the Company had a net loss of $29,231.  We had an increase in accounts receivable of $100,044 and an increase in other current assets of $6,546.  We also had an increase in accounts payable and accrued liabilities of $138,314 and an increase in other current liabilities of $25,970.  As a result, we had net cash provided by operating activities of $26,086 for the six months ended June 30, 2014.

For the six months ended June 30, 2013, the Company had a net loss of $31,505.  We had an adjustment of $215 for depreciation.  We had a decrease in accounts receivable of $50,952 and a decrease in other current assets of $211.  We had a decrease in accounts payable and accrued liabilities of $21,896 and an increase in other current liabilities of $4,197.  As a result, we had net cash provided by operating activities of $2,174 for the six months ended June 30, 2013.

For the six months ended June 30, 2014, we spent $145 on the purchase of computer equipment, resulting in net cash used in investing activities of $145 for the period.  For the six months ended June 30, 2013, we did not pursue any investing activities.

For the six months ended June 30, 2014, we received $700,000 from the proceeds from the issuance of shares and received $2,729 from advances from shareholders.  As a result, we had net cash provided by financing activities of $702,729 for the six months ended June 30, 2014.

For the six months ended June 30, 2013, we received $15,770 from advances from shareholders.  As a result, we had net cash provided by financing activities of $15,770 for the six months ended June 30, 2013.

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Results of Operations

For the three months ended June 30, 2014, we recorded revenues of $107,627.  We paid or accrued $67,460 on salaries and benefits and $52,023 on other general and administrative expenses.  As a result, we had a net loss of $11,856 for the three months ended June 30, 2014.  In addition, we recognized $294 from the exchange difference on translating foreign operations, resulting in a comprehensive loss of $11,562 for the period.

Comparatively, for the three months ended June 30, 2013, we recorded revenues of $47,750.  We paid or accrued salaries and benefits of $46,288 and $36,472 on other general and administrative expenses.  As a result, we had a net loss of $35,010 for the three months ended June 30, 2013.  In addition, we recognized $23,078 from the exchange difference on translating foreign operations, resulting in a comprehensive loss of $11,932 for the period.

The $23,154 decrease in net loss between the three months ended June 30, 2014 and 2013 is due to increased revenues received during the three months ended June 30, 2014.  We earned 55.6% more revenues.  We paid 31.4% more in salaries and benefits and 30% more in other general and administrative expenses during the three months ended June 30, 2014.  Even with this increase in general and administrative expenses, our increase in revenues results in us earning more in total during 2014.  However, our comprehensive loss decreased by 3.1% due to the greatly reduced exchange difference on translating foreign operations for the three months ended June 30, 2014.

For the six months ended June 30, 2014, we recorded revenues of $172,538.  We paid or accrued salaries and benefits of $115,617 and other general and administrative expenses of $86,152.  As a result, we had a net loss of $29,231 for the six months ended June 30, 2014.  In addition, we recognized $496 from the exchange difference on translating foreign operations, resulting in a comprehensive loss of $28,735 for the period.

Comparatively, for the six months ended June 30, 2013, we recorded revenues of $127,450.  We paid or accrued salaries and benefits of $93,200 and other general and administrative expenses of $65,755.  As a result, we had a net loss of $31,505 for the six months ended June 30, 2013.  In addition, we recognized $4,334 from the exchange difference on translating foreign operations, resulting in a comprehensive loss of $27,171 for the period.

The $2,274 decrease in net loss between the six months ended June 30, 2014 and 2013 is due to the increased revenues not fully compensating for the increased general and administrative expenses.  Our revenues increased by $45,088, or 26.1%, while our salaries and benefits increased by $22,417, or 19.4% and our other general and administrative expenses increased by $20,397, or 23.7%.  However, our comprehensive loss increased by $1,564 due to reduced exchange difference on translating foreign operations for the six months ended June 30, 2014.

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The registrant has developed a proprietary online hotel booking program for connecting users with available rooms in hotels across the world.  In order to gain the access to the hotels, the registrant acquired OneWorld Hotel Destination Service Inc in Vancouver, B.C. Canada on October 31, 2008.  OneWorld Hotel Destination Service Inc is a hotel booking company which has established strong relationships with major hotel chains such as Radisson, Hilton and Sheraton. Its clients include travel agents in major cities such as Vancouver, Toronto, Calgary, and Montreal. After the acquisition the Company intends to put the OneWorld operations into the online platform.

Our hotel travel booking web site for the business-to-business stage is now under testing prior to the official launching.   The initial 39,000 available hotel rooms have been uploaded to the site, and will facilitate travel agencies to book rooms directly via the internet without having to personally call the office for booking.   The web site launched in 2012.  The web site facilitates the company’s travel agency customers, who already have or will set up accounts with us (B to B).

B to B is defined as business interactions between one business entity (OneWorld) to other business entities (the travel agencies in the travel industry). Our next stage of the web site development will be to facilitate non-business customers such that any individuals wishing to book rooms themselves may do so from our web site instead of booking through their travel agencies (B to C).  B to C is defined as business interactions between a business entity (OneWorld) and the individual customers, be they an individual or corporation, whose business is not related to the travel industry.  This web site is still in the development stage.

Management expects sales and gross revenue will grow significantly over the current year volume after the web site is launched.  We anticipate that it will not be a straight-line growth pattern but an exponential increase.  This anticipation can be realized if we spend the necessary funds in promotion through internet advertising, radio and television clicks and news media advertising.  On the whole, the more we direct funds into promotion, the bigger the increase in sales as a return.

In order to achieve our goal, the registrant may seek additional funds.  The funds distribution to various sectors will depend on the actual funds raised and on the time needed to raise such sums.  The larger portion of the raised funds will be allocated towards marketing and promotion.   

Although there are signs of gradual stability, management believes that the effects of the recent economic crisis is a long ways from being over.   However, our One World operation has been well-established over the past ten years that we are capable of continuously sustain our existence during the current crisis.   We will survive under future crisis by maintaining a skeleton staff, reduce promotion and advertising to a bare minimum and management officers providing services temporarily en gratis.

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Off-Balance Sheet Arrangements

The Company had no material off-balance sheet arrangements as of June 30, 2014.

Contractual Obligations

On May 4, 2014, the Company entered into a joint venture agreement (the “Agreement”) with Shizhen Bio-Technology Co., Ltd. (“Shizhen Biotech”) in Jiangsu Province, China. Subsequently on May 22, 2014, Globalink (Xuzhou) Bio-Technology Co., Ltd. (the “JV”) was incorporated in Jiangsu Province, China pursuant to the Agreement. The JV has total registered capital of $10,000,000, whereby the Company will invest $8,000,000 to earn an 80% interest of the JV and Shizhen Biotech will invest $2,000,000 to earn the remaining 20%. 15% of the total $10,000,000 investment should be paid up within three months after the incorporation of the JV, with the balance being paid up in the following two years. The JV will be involved in the business of biological science and technology research, biological technology popularization service, and fruit and vegetable distribution. Currently, the JV focuses on developing health supplement products from the extract of gingko leaves. No transactions have incurred in the JV from its incorporation to the period ended June 30, 2014.

New Accounting Pronouncements

The Company has adopted all recently issued accounting pronouncements.  The adoption of the accounting pronouncements, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the Company.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

Not applicable for smaller reporting companies.

Item 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures:

We maintain disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act that are designed to insure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, or the persons performing similar functions, to allow timely decisions regarding required disclosure.

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Under the supervision and with the participation of our CEO and CFO, or the persons performing similar functions, our management has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this annual report.  Based on that evaluation, our CEO and CFO, or the persons performing similar functions, concluded that our disclosure controls and procedures were not effective as of June 30, 2014.

Management’s Annual Report on Internal Control over Financial Reporting:

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act, for the Company. Our internal control over financial reporting is the process designed by and under the supervision of our CEO and CFO, or the persons performing similar functions, to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our financial statements for external reporting in accordance with accounting principles generally accepted in the United States of America.  

Management recognizes that there are inherent limitations in the effectiveness of any system of internal control, and accordingly, even effective internal control can provide only reasonable assurance with respect to financial statement preparation and may not prevent or detect material misstatements. In addition, effective internal control at a point in time may become ineffective in future periods because of changes in conditions or due to deterioration in the degree of compliance with our established policies and procedures.

Management has evaluated the effectiveness of our internal control over financial reporting using the criteria established in Internal Control – Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).  

The matters involving internal control over financial reporting that our management considered to be material weaknesses were:

-

Lack of segregation of duties as we have an inadequate number of personnel to properly implement control procedures.

The aforementioned material weaknesses were identified by our chief executive officer and chief financial officer in connection with the review of our consolidated financial statements as of June 30, 2014.

Management believes that the material weaknesses set forth above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee, the inadequate accounting personnel results in ineffective oversight in the monitoring of required internal controls over financial reporting, which weaknesses could result in a material misstatement in our financial statements in future periods.

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Management’s Remediation Initiatives

In an effort to remediate the identified material weaknesses and enhance our internal controls over financial reporting, the Company plans to make the necessary improvements to remediate these deficiencies.  

This quarterly report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting.  We were not required to have, nor have we, engaged our independent registered public accounting firm to perform an audit of internal control over financial reporting pursuant to the rules of the Commission that permit us to provide only management’s report in this annual report.

Evaluation of Changes in Internal Control over Financial Reporting:

Under the supervision and with the participation of our CEO and CFO, or those persons performing similar functions, our management has evaluated changes in our internal controls over financial reporting that occurred during the three months ended June 30, 2014.  Based on that evaluation, our CEO and CFO, or those persons performing similar functions, did not identify any change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1.   Legal Proceedings

None

Item 1A.  Risk Factors

Not applicable for smaller reporting companies

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

In June 2014, the Company issued 12,000,000 common shares to two new directors for their advances of $700,000 to the Company during the six months ended June 30, 2014. The Company also issued 200,000 common shares to an arm’s length party for $10,000 of share subscription advance received during the year ended December 31, 2012. These shares were issued under the private placement exemption granted by Section 4(a)(2) of the Securities Act.  

Item 3.   Defaults Upon Senior Securities.

None

Item 4.   Mine Safety Disclosures

Not applicable

Item 5.   Other Information

None

Item 6.   Exhibits

       Exhibit 31* - Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

       Exhibit 32* - Certifications 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.DEF**   XBRL Taxonomy Extension Definition Linkbase Document

       101.LAB**   XBRL Taxonomy Extension Label Linkbase Document

       101.PRE**   XBRL Taxonomy Extension Presentation Linkbase Document

*  Filed herewith

**XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated:  August 14, 2014

GLOBALINK, LTD.

By: /s/Hin Kwok Sheung

Hin Kwok Sheung

Chief Executive Officer

By:  /s/Ben Choi

Ben Choi

Chief Financial Officer

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