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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Commission File Number 000-21812

SEEN ON SCREEN TV INC.

(Exact name of registrant as specified in its charter)

NEVADA

(State or other jurisdiction of incorporation or organization)

4017 Colby Avenue

Everett, Washington 98201

(Address of principal executive offices, including zip code.)

(425) 367-4668

(Registrant's telephone number, including area code)

Indicate by check mark whether the issuer (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 last 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 (SS 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). YES [   ]     NO [X]

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," "non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES [   ]     NO [X]

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:  As of June 25, 2015, there were 60,103,308 shares of the registrant's $0.001 par value common stock issued and outstanding.

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NOTICE

This Form 10-Q contains interim financial statements for the quarter ended April 30, 2015 that have not been reviewed by an independent public accountant as required by Item 8.03 of Reg. S-X of the Securities Exchange Act of 1934, as amended.  The reason is that the Public Company Accounting Oversight Board ("PCAOB") on June 16, 2015 revoked the registration of Harris & Gillespie CPA's LLC, our former auditor, and Thomas J. Harris, individually.  As of today we have not retained a new independent public accountant.  We intend to do so in the immediate future.  While an independent public accountant has not reviewed the financial statements, we are confident they are accurate and represent the financial condition of the Seen on Screen TV Inc., the registrant, on April 30, 2015.  As soon as we have retained a new independent public accountant we will submit the April 30, 2015 interim financial statements to it for review and file an amendment to this Form 10-Q disclosing the results of its review.

TABLE OF CONTENTS

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PART I - FINANCIAL INFORMATION

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SEEN ON SCREEN TV, INC.

NOTES TO FINANCIAL STATEMENTS

April 30, 2015

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Note 1 - Summary of Significant Accounting Policies

General Organization and Business

The Company was originally incorporated as "Naxos Resources Ltd." ("Naxos" in British Columbia under the Canada Business Corporation Act on May 23, 1986, with its principal place of business in Vancouver, BC.  On October 15, 2001, the shareholders approved the domiciliation of the Company to the United States.  On January 3, 2002, Industry Canada Issued a Certificate of Discontinuance, formally ending the Company's legal ties to Canada.  On January 9, 2002, the name change to Franklin Lake Resources, Inc. became effective for trading purposes.

The Company was in the business of exploring for precious metals, developing processes for extracting them from the earth and if warranted, developing sites for possible exploration. As of November 2008, the Company has refocused its operations and now operates as a retail store under the name Seen On Screen TV, Inc. and purchases products from companies advertising on TV. The Company trades under the symbol SONT.

In February 2015, the Company closed its retail store and now operates primarily though internet sales and wholesale sales.

Basis of presentation

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company for the periods ended April 30, 2015 and October 31, 2014 and for the six months ended April 30, 2015 and 2014.

Use of 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 amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents

The Company maintains a cash balance in a non-interest-bearing account that currently does not exceed federally insured limits. For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of April 30, 2015 and 2014.  The Company has been and continues to be in overdraft situations.

Inventory

Inventory is recorded at the lower of cost or market and is computed on a first-in first-out basis.  The inventory consists of various products that have been previously marketed via infomercials on various cable and TV stations across the nation. These products are sourced from the original marketing company and from generic suppliers serving the same niche.

Revenue Recognition

Revenue from the sale of goods is recognized when the following conditions are satisfied:

·	The Company has transferred to the buyer the significant risks and rewards of ownership of the goods;

·	The Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

·	The amount of revenue can be measured reliably;

·	It is probable that the economic benefits associated with the transaction will flow to the entity; and

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SEEN ON SCREEN TV, INC.

NOTES TO FINANCIAL STATEMENTS

April 30, 2015

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The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Fair value of financial instruments and derivative financial instruments

The Company's financial instruments include cash, accounts payable, and notes payable. All instruments are accounted for on a historical cost basis, which, due to the short maturity of these financial instruments, approximates fair value at April 30, 2015 and October 31, 2014. The Company did not engage in any transaction involving derivative instruments.

Federal income taxes

The Company accounts for its income taxes in accordance with Income Taxes Topic of the FASB ASC 740, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.

Management has evaluated the tax positions taken on the Company's tax returns and concluded that the Company has taken no uncertain tax positions that require adjustment to the financial statements. The Company's income tax filings are subject to audit by various taxing authorities. The Company's tax returns are generally open to audit for the previous three years.

Net Loss Per Share of Common Stock

Net loss per share is provided in accordance with FASB ASC 260-10, "Earnings per Share". Basic net loss per common share ("EPS") is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued, unless doing so is anti-dilutive.

Common Stock Registration Expenses

The Company considers incremental costs and expenses related to the registration of equity securities with the SEC, whether by contractual arrangement as of a certain date or by demand, to be unrelated to original issuance transactions.  As such, subsequent registration costs and expenses are reflected in the accompanying financial statements as general and administrative expenses, and are expensed as incurred.

Advertising:

The Company expenses all costs of advertising as incurred.  The advertising costs included in general and administrative expenses for the six months ended April 30, 2015 and 2014 were $1,068 and $2,692, respectively.

Recently Issued Accounting Pronouncements:

For the period ended April 30, 2015 and October 31, 2014, the Company does not expect any of the recently issued accounting pronouncements to have a material impact on its financial condition or results of operations.

 

Note 2 - Uncertainty, going concern:

The Company's financial statements are prepared using generally accepted accounting principles 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 to allow it to continue as a going concern. As of April 30, 2015, the Company had an accumulated deficit of $37,361,385 and unpaid payroll tax liabilities of $155,427.  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.

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SEEN ON SCREEN TV, INC.

NOTES TO FINANCIAL STATEMENTS

April 30, 2015

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In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company is contemplating conducting an offering of its debt or equity securities to obtain additional operating capital. The Company is dependent upon its ability, and will continue to attempt, to secure equity and/or debt financing. There are no assurances that the Company will be successful and without sufficient financing it would be unlikely for the Company to continue as a going concern.

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. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

Note 3 - Related Party Transactions

The Company has multiple related party transactions.  These related party transactions include accrued rent, accrued compensation and officer and shareholder payable.  These accounts are provided for working capital purposes, and are unsecured, non-interest bearing, and have no specific terms of repayment.

For the year ended October 31, 2014, the Company has decreased the balance of accrued rent by $26,232, increased accrued compensation by $303,231, increased officer and shareholder payable by 114,989 and decreased receivables from related entity by $25,804 since the year ended October 31, 2013.

The net balance of these related party transactions on October 31, 2014 was $2,484,494.

For the period ended April 30, 2015, the Company has increased accrued compensation by $170,719, increased officer and shareholder payable by 89,880 since the year ended October 31, 2014.

The net balance of these related party transactions on April 30, 2014 was $2,745,093.

Note 4 – Contingent Liabilities

In July 2013, the employee filed a claim with the State of California for unpaid wages.  The State of California has placed a judgment against the Company for $37,574.  The Company has presently recorded the amount they believe is owed to this former employee and is disputing the amount with State of California.  During the year ended October 31, 2014 the State of California has increased the balance by $4,843 for additional interest and penalties.  The balance of this note at April 30, 2015 and October 31, 2014 was $42,417.

Note 5 - Common Stock

The beginning balance of the shares outstanding at November 1, 2013 was 47,076,523.

On January 10, 2014, the Company received $101,714 cash in exchange for 2,034,280 shares of common stock.  The price per share was $0.05.

On January 10, 2014, the Company issued 7,700,000 shares of stock for services performed.  The Company recognized a stock based compensation expense of $385,000.  The price per share was $0.05.

On January 31, 2014, the Company received $12,250 cash in exchange for 245,005 share of common stock.  The price per share was $0.05.

On April 30, 2014, the Company received $74,250 in exchange for 1,485,000 shares of common stock.  The price per share was $0.05.

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SEEN ON SCREEN TV, INC.

NOTES TO FINANCIAL STATEMENTS

April 30, 2015

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On October 13, 2014, the Company issued 1,562,500 share of stock.  The Company has not received these funds and recorded this transaction as a stock subscription.  The Company expects full payment once the S-1 is filed.

The number of common stock shares outstanding at April 30, 2015 was 60,103,308.

Note 6 – Stock Option Plan

On July 31, 2014, the Company initiated a stock option plan for its employees, directors and officers.  The plan has allocated 15,000,000 shares that can be granted up to 10 years.  The option price will be determined by the Board of Directors but will not be less than the fair market value of stock on that specific date.  The grant period will not exceed 10 years.  Since inception, the Company has not issued any stock options.

As of April 30, 2015, the Company has not issued any options.

Note 7 – Payroll Liabilities

As of April 30, 2015 the Company had incurred significant unpaid payroll liabilities.  The Company has unpaid federal and state payroll taxes of $155,427.  The Company is currently working with the State and Federal Government in setting up payment plans.  The balance of these liabilities was $145,552 on October 31, 2014.  As of April 30, 2015, The Company does not have any specific terms on repayment with any Federal or State Agency.

Note 8 – Subsequent Events

Management has evaluated events occurring between April 30, 2015 and June 15, 2015, the date that the  financial statements were available to be issued, and has recognized in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at June 15, 2015, including the estimates inherent in the processing of the financial statements.

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ITEM 2.

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

This section of this quarterly report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.

Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. We have not attained profitable operations and are dependent upon obtaining financing to pursue our business plan and activities. For these reasons, our auditors stated in their report on our audited financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing. 

Overview

For the three months ended April 30, 2015, we had a gross profit of $3,576.00 compared to a gross profit of $5,551 for the same period ended April 30, 2014.  The decrease in gross profit is due to closing the store.

Total Operating Expenses

For the three months ended April 30, 2015, we incurred a net losses of $136,783 compared with a net loss of $163,136 for the same periodi ended April 30, 2014.  The decrease in net loss was due to the in the total operating expenses.

Operating Activities

During the period ended April 30, 2015, cash used in operations was $258,175, as compared to $282,443 in April 30, 2014.  During the three month period ended April 30, 2015, we didn't issue any stock based compensation, our net loss was $258,175.  As compared with the three month period in April 30, 2014, there we

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issued stock based compensation of $385,000, the net loss was $724,912. The change for the three month period ended April 30, 2015, is also attributed to a result in an increase in inventory of $11,081, and a decrease in accounts payable and accrued expenses of $25,691.

Investing Activities

During the three month period ended April 30, 2015, we had no investing activities.

Financing Activities

During the three month period ended April 30, 2015, we did not received any funds from the sale of of our restricted shares of common stock.

As of April 30, 2015, we had a working capital deficit of $37,361,385, as compared to a working capital deficit of $37,063,757 at April 30, 2014.  In the past, we have relied on sales of our equity securities, as well as, loans from our majority stockholder, to raise funds for our working capital requirements. We need to continue to raise additional capital in order to implement our business plan and will continue to sell additional equity and/or debt securities to accomplish this objective. There can be no assurance we will be able to raise sufficient funds to implement and sustain our business plan, or if, funds are available these funds will be on acceptable terms.

For the six month period ended April 30, 2015, we had a gross profit of $13,275, as compared to gross profits of $25,210 for the period ended April 30, 2014.  The decrease in gross profit is due to the location of the store and the items the store had.

Total Operating Expenses

For the six month period ended April 30, 2015 we incurred net losses of $297,628, as compared with a net loss of $724,912 for the same period ended April 30, 2014.  The decrease in net loss was due to the decrease in the total operating expenses.

As of April 30, 2015, our working capital deficit was $37,361,385, as compared to the working capital deficit of $37,063,757 at April 30, 2014.  In the past, we have relied on sales of our equity securities to raise funds for our working capital requirements, as well as, loans from our majority shareholder.  We will need to continue to raise additional capital in order to implement our business plan and will seek to sell additional equity and/or debt securities to accomplish this objective. There can be no assurance that we will be able to raise funds sufficient to carry-out our business plan, or that if funds are available to us that they will be on acceptable terms.

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Seasonality Results

We do not expect to experience any seasonality in our operating results.

Going Concern

We have not attained profitable operations and are dependent upon obtaining financing to pursue our business plan and activities. For these reasons, our auditors stated in their report on our audited financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing.

Off-Balance Sheet Arrangements

We currently do not have any off-balance sheet arrangements or financing activities with special purpose entities.

Future Financings

 

We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.

Critical Accounting Policies and Estimates

Management's Discussion and Analysis of Financial Condition and Results of Operations discusses our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. To prepare these financial statements, we must make estimates and assumptions that affect the reported amounts of assets and liabilities. These estimates also affect our reported revenues and expenses. On an ongoing basis, management evaluates its estimates and judgment, including those related to revenue recognition, accrued expenses, financing operations and contingencies and litigation. Management bases its estimates and judgment on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of our financial statements are set forth in Note 1 to our audited financial statements.

Use of 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 revenue and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value of Financial Instruments

The fair value of the Company's assets and liabilities, which qualify as financial instruments under Financial Accounting Standards Board (FASB) guidance regarding disclosures about fair value of financial instruments, approximate the carrying amounts presented in the accompanying consolidated balance sheets.

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Inventory

Inventories consist of merchandise that is ready for sale to end-user customers. Inventories are recorded at the lower of average cost or market. In-bound freight-related costs from our vendors are included as part of the net cost of merchandise inventories. Other costs associated with acquiring, storing and transporting merchandise inventories are expensed as incurred. Our inventories are acquired and carried for retail sale and, accordingly, the carrying value is susceptible to, among other things, market trends and conditions and overall customer demand. We use our best estimates of all available information to establish reasonable inventory quantities. However, these conditions may cause our inventories to become obsolete and/or excessive. We review our inventories periodically for indications that reserves are necessary to reduce the carrying values to the lower of cost or market values. For all periods presented, the Company determined that no reserves were necessary.

Property and Equipment

Computer equipment, computer software and furniture and fixtures are stated at cost and depreciated on a straight-line basis over an estimated useful life of five years. Upon disposal, assets and related accumulated depreciation are removed from the accounts and the related gain or loss is included in results from operations.

Impairment of Long-Lived Assets and Other Intangible Assets

We evaluated the recoverability of long-lived assets with finite lives in accordance with ASC 350. Intangible assets, including purchased technology and other intangible assets, are carried at cost less accumulated amortization. Finite-lived intangible assets are being amortized on a straight-line basis over their estimated useful lives of five to ten years. ASC 350 requires recognition of impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying value amount of an asset may not be recoverable. An impairment charge is recognized in the event the net book value of such assets exceeds the future undiscounted cash flows attributable to such assets. A significant impairment of finite-lived intangible assets could have a material adverse effect on our financial position and results of operations. For all periods presented, we determined that no impairment charges were incurred.

Revenue Recognition

Overview

We recognize revenue when persuasive evidence of an arrangement exists, we have delivered the product or performed the service, the fee is fixed or determinable and collection is reasonably assured. If any of these criteria are not met, we defer recognizing the revenue until such time as all criteria are met. Determination of whether or not these criteria have been met may require us to make judgments, assumptions and estimates based upon current information and historical experience.

We market our products direct to customers and have developed retail pricing for all revenue generating products. In addition, we may mark-down prices on an individual case basis to increase demand on our products, and increase our sales to boost up the market.

Advertising and Marketing Costs

We expense advertising and marketing costs as they are incurred.

Computation of (Loss) Per Share

Basic earnings (loss) per share is calculated by dividing the earnings (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share is calculated by dividing the earnings (loss) by the weighted average number of common shares and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of incremental common shares issuable upon exercise of stock options, warrants and shares issuable upon the conversion of convertible notes. The dilutive effect of the

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convertible notes is calculated under the if-converted method. The dilutive effect of outstanding shares is reflected in diluted earnings per share by application of the treasury stock method. This method includes consideration of the amounts to be paid by the employees, the amount of excess tax benefits that would be recognized in equity if the instruments were exercised and the amount of unrecognized stock-based compensation related to future services.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Under the supervision and with the participation of our management, including the Principal Executive Officer and Principal Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, the Principal Executive Officer and Principal Financial Officer have concluded that these disclosure controls and procedures are effective. There was no change in our internal control over financial reporting during the quarter ended April 30, 2015, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

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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, on this 25^th day of June, 2015.

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EXHIBIT INDEX