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EX-31.1 - EX-31.1 - ORIENTAL MAGIC SOUP, INC.ex-31_1.htm
EX-32.1 - EX-32.1 - ORIENTAL MAGIC SOUP, INC.ex-32_1.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 July 31, 2015

[   ] 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  333-189550


ORIENTAL MAGIC SOUP, INC.
(Exact name of small business issuer as specified in its charter)
 

Nevada
 
3990
 
33-1227831
(State or other jurisdiction of incorporation or organization)
 
(Primary Standard Industrial
Classification Number)
 
(IRS Employer Identification Number)


700 N. Valley Street, Suite B#14917
Anaheim, CA 92801
(Address of principal executive offices)

323-978-0870
(Issuer's telephone number)

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       No


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer
 
Large accelerated filer
 
Non-accelerated filer
Smaller reporting company
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 33,900,000 common shares issued and outstanding as of September 10, 2015.

 

ORIENTAL MAGIC SOUP, INC.
QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS
 
 
 
Page
PART I
 
 
 
 
Item 1.
 3
 
 
 
 
 4
 
 
 
 
 5
 
 
 
 
 6
 
 
 
 
 7
 
 
 
Item 2.
 8
 
 
 
Item 3.
 10
 
 
 
Item 4.
 10
 
 
 
PART II
 
 
 
 
Item 1.
 12
 
 
 
Item 1A
 12
 
 
 
Item 2.
 12
 
 
 
Item 3.
 12
 
 
 
Item 4.
 12
 
 
 
Item 5.
 12
 
 
 
Item 6.
 12
 
 
 
 
 13
 
 


PART 1 – FINANCIAL INFORMATION

Item 1.
Financial Statements

The accompanying interim financial statements of Oriental Magic Soup, Inc. (the "Company"), have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States generally accepted principles have been condensed or omitted pursuant to such rules and regulations.

In the opinion of management, the financial statements contain all material adjustments, consisting only of normal adjustments considered necessary to present fairly the financial condition, results of operations, and cash flows of the Company for the interim periods presented.
 
3

 
ORIENTAL MAGIC SOUP, INC.
BALANCE SHEETS
 
 
   
July 31,
2015
(Unaudited)
   
April 30,
2015
 
         
ASSETS 
       
Current 
       
Cash and cash equivalents 
 
$
-
   
$
-
 
Total Current Assets
   
-
     
-
 
                 
 Total Assets
 
$
-
   
$
-
 
                 
LIABILITIES 
               
Current 
               
Accounts payable and accrued liabilities
 
$
6,530
   
$
1,165
 
Due to related party
   
25,549
     
21,049
 
 Total Liabilities
   
32,079
     
22,214
 
                 
SHAREHOLDERS’ DEFICIT
               
Preferred stock, $0.001 par value, 5,000,000 shares authorized,
               
   0 shares issued and outstanding as at July 31, 2015 and April 30, 2015
   
-
     
-
 
Common stock, $0.001 par value, 150,000,000 shares authorized,
               
   33,900,000 shares issued and outstanding as at July 31, 2015 and April 30, 2015
   
33,900
     
33,900
 
Additional paid-in capital
   
1,800
     
1,800
 
Accumulated deficit
   
(67,779
)
   
(57,914
)
 Total Stockholders’ Deficit
   
(32,079
)
   
(22,214
)
                 
 Total Liabilities and Stockholders’ Deficit
 
$
-
   
$
-
 
                 
 
The accompanying notes are an integral part of these unaudited financial statements.
 
 
4

 
ORIENTAL MAGIC SOUP, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
 
 
   
Three Months Ended
 
   
July 31,
 
   
2015
   
2014
 
REVENUES
 
$
-
   
$
-
 
                 
OPERATING EXPENSES
               
General and administrative expenses
   
81
     
162
 
Professional fees
   
9,784
     
8,250
 
TOTAL OPERATING EXPENSES
   
9,865
     
8,412
 
                 
NET LOSS FROM OPERATIONS
   
(9,865
)
   
(8,412
)
Provision for income taxes
   
-
     
-
 
                 
NET LOSS
 
$
(9,865
)
 
$
(8,412
)
                 
BASIC AND DILUTED LOSS PER SHARE
 
$
(0.00
)
 
$
(0.00
)
                 
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED
   
33,900,000
     
33,900,000
 
 
 
The accompanying notes are an integral part of these unaudited financial statements.
 
5

 
ORIENTAL MAGIC SOUP, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
 
 
   
Three Months Ended
 
   
July 31,
 
   
2015
   
2014
 
Cash flows from operating activities:
       
Net loss
 
$
(9,865
)
 
$
(8,412
)
Adjustments to reconcile net loss to net cash used in operating activities:
               
Changes in operating assets and liabilities:
               
   Prepaid expenses
   
-
     
3,791
 
   Accounts payable and accrued liabilities
   
5,365
     
4,500
 
Net cash used in operating activities
   
(4,500
)
   
(121
)
                 
Cash flows from  financing activities:
               
Loans from related party
   
4,500
     
-
 
Net cash provided by financing activities
   
4,500
     
-
 
                 
Cash flows from investing activities:
               
Net cash provided by investing g activities
   
-
     
-
 
                 
Net (decrease) increase in cash
   
-
     
(121
)
Cash, beginning of the period
   
-
     
5,736
 
Cash, end of the period
 
$
-
   
$
5,615
 
                 
Supplemental disclosure of cash flow information:
               
                 
Cash paid during the period for interest
 
$
-
   
$
-
 
Cash paid during the period for tax
 
$
-
   
$
-
 
 
 
The accompanying notes are an integral part of these unaudited financial statements.
 
6

 
ORIENTAL MAGIC SOUP, INC.
NOTES TO THE FINANCIAL STATEMENTS
July 31, 2015
(Unaudited)

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

The Company was originally incorporated as Dinamo Corp. in the State of Nevada on March 25, 2013.  The Company’s fiscal year end is April 30. On March 23, 2015, the Company changed its name to Oriental Magic Soup, Inc. and had a new symbol of “CQGU”.

NOTE 2 – BASIS OF PRESENTATION

Basis of Presentation

The accompanying unaudited financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information regarding the Company's significant accounting policies, refer to the audited financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended April 30, 2015 filed with the Securities and Exchange Commission on July 29, 2015. The financial statements are stated in United States dollars.

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation for comparative purposes. 

NOTE 3 – DUE TO RELATED PARTY

In support of the Company’s efforts and cash requirements, it may rely on advances from related parties until such time that the Company can support its operations or attains adequate financing through sales of its equity or traditional debt financing. Those loans are non-interest bearing, unsecured, and due on demand.

During the year ended April 30, 2015, the director advanced $21,049 to the Company to cover the Company’s operating expenses. During the period ended July 31, 2015, the director advanced another $4,500 to the Company. As of July 31, 2015, $25,549 was owed by the Company to the director and was recorded as due to related party.

NOTE 4 – CAPITAL STOCK

As of July 31, 2015 and April 30, 2015, the Company had 33,900,000 shares of common stock issued and outstanding.

NOTE 5 – COMMITMENTS AND CONTINGENCIES

The Company neither owns nor leases any real or personal property. An officer has provided office services without charge.  There is no obligation for the officer to continue this arrangement.  Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.

NOTE 6 – GOING CONCERN

The accompanying financial statements have been prepared in conformity with generally accepted accounting principle, which contemplate continuation of the Company as a going concern.  However, the Company had no revenues since inception. The Company currently has limited working capital, and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. These factors raise substantial doubt as to the Company’s ability to continue as a going concern.

Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
7

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

FORWARD LOOKING STATEMENT NOTICE

Statements made in this Form 10-Q that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

Financial information contained in this quarterly report and in our unaudited interim financial statements is stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.

GENERAL

The Company was originally incorporated as Dinamo Corp. in the State of Nevada on March 25, 2013. Although the Company is currently classified as a shell company, the Company intends to be involved in making and distributing oriental soup for the United States.  The Company's fiscal year end is April 30.

On October 20, 2014, Jolanta Gajdzis, the principal shareholder of the Company consummated the transactions contemplated by the Stock Purchase Agreement dated as of October 20, 2014 which provided for the sale of an aggregate of 4,500,000 shares of common stock of the Company (the "Shares") to Zhufeng Wang (3,600,000 shares), Qingran Yang (679,500 shares) and De Hou Wang (220,500 shares). The consideration paid for the Shares, which represent 79.65% of the issued and outstanding share capital of the Company on a fully-diluted basis, was $325,000. The source of the cash consideration for the Shares was personal funds of the purchasers. In connection with the transaction, Mrs. Gajdzis released the Company from all debts owed to her. Effective as of October 20, 2014, in connection with the sale of the Shares, Jolanta Gajdzis resigned from all her positions as the sole officer and director of the Company. The Board of Directors of the Company elected Zhufeng Wang as President, Chief Executive Officer, Chief Financial Officer and Secretary and as a director of the Company, to serve until his successors are duly appointed and qualified.

On March 20, 2015, Dinamo Corp. received notification from FINRA that the name of the Company was changed to "Oriental Magic Soup, Inc." and the 6-1 forward stock split will take effect on March 23, 2015. The new symbol of the Company became "CQGU". In addition to the name change of the Company, the Company's Amended and Restated Articles of Incorporation increased the amount of authorized shares of common stock from 75,000,000 to 150,000,000 and increased the authorized share capital of the Company by providing for the adoption of 5,000,000 shares of blank check preferred stock.

To date, we have minimal assets. Our operations to have been merely preparatory and have not generated any revenues and we have incurred losses since inception.
8


RESULTS OF OPERATIONS

We have not generated any revenue to date and have incurred recurring losses since inception. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation. We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

During the three month period ended July 31, 2015 and the three month period ended July 31, 2014, we have not generated any revenue. We did not generate any revenue since inception.

Our net loss for the three months period ended July 31, 2015 and 2014 were $9,865, and $8,412, respectively. During the three months period ended July 31, 2015 our operating expenses consisted of $9,784 of professional fees and $81 of general and administrative expenses. The increase in operating expenses of $1,453 from the three months period ended July 31, 2014 was an increase in professional fees of $1,534 and a decrease of $81 in general and administrative expenses.

LIQUIDITY AND CAPITAL RESOURCES

As at July 31, 2015, we had no cash or other assets. As at July 31, 2015, our current liabilities were $32,079, consisting of $25,549 due to the sole officer and director and $6,530 for accounts payable and accrued liabilities.

We will have to issue debt or equity or enter into a strategic arrangement with a third party in order to finance our operations. There can be no assurance that additional capital will be available to us. We currently have no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

CASH FLOWS FROM OPERATING ACTIVITIES

We have not generated positive cash flows from operating activities. For the three months period ended June 30, 2015, net cash flows used in operating activities was $4,500.

CASH FLOWS FROM INVESTING ACTIVITIES

For the three months period ended July 31, 2015, we did not have any cash flows used in investing activities.

CASH FLOWS FROM FINANCING ACTIVITIES

We have financed our operations primarily from either advancements or the issuance of equity. For the three months period ended July 31, 2015, we received $4,500 loan from our director.

PLAN OF OPERATION AND FUNDING

The company intends to be involved in making and distributing oriental soup in the United States. The target market is in areas where there is a higher density of people of China, Taiwan, or Hong Kong descent.   However, the Company might also identify and negotiate with another company for the business combination or merger of that entity with and into the Company.
 
9

Our cash reserves are not sufficient to meet our obligations for the next twelve month period. As a result, we will need to seek additional funding in the near future. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of shares of our common stock. We may also seek to obtain short-term loans from our directors or unrelated parties. Our shareholders may lend us funds. However, those shareholders have no formal commitment, arrangement or legal obligation to advance or loan funds to the company.

GOING CONCERN

The independent auditors' audit report accompanying our April 30, 2015 financial statements contained an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

OFF-BALANCE SHEET ARANGEMENTS

As of the date of this Quarterly Report, 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 are material to investors.

ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

None.

ITEM 4.
CONTROLS AND PROCEDURES
 
Under the supervision and with the participation of our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d- 15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of July 31,2015. Based on this evaluation, our principal executive officer and principal financial officer has concluded that our disclosure controls and procedures were ineffective at such time to ensure that information required to be disclosed by us in the reports filed or submitted under the Securities Exchange Act were recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. Our principal executive officer and principal financial officer also concluded that our disclosure controls, which are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is accumulated and communicated to management, was inappropriate to allow timely decisions regarding required disclosure.

Based on management's assessment, the Company determined that there were material weaknesses in its internal control over financial reporting as of July 31, 2015 based on the material weaknesses described below:

Because the Company consists of one person who acts as the sole officer and director of the Company, there are limited controls over information processing.

There is an inadequate segregation of duties consistent with control objectives as management is composed of only one person. In order to remedy this situation, we would need to hire additional staff to provide greater segregation of duties. Currently, it is not feasible to hire additional staff to obtain optimal segregation of duties. Management will reassess this matter in the following year to determine whether improvement in segregation of duty is feasible.

The Company does not have a formal audit committee with a financial expert, and thus the Company lacks the board oversight role within the financial reporting process.

There is a lack of formal policies and procedures necessary to adequately review significant accounting transactions.
 
10

The Company utilizes a third party independent contractor for the preparation of its financial statements. Although the financial statements and footnotes are reviewed by our management, we do not have a formal policy to review significant accounting transactions and the accounting treatment of such transactions. The third party independent contractor is not involved in the day to day operations of the Company and may not be provided information from management on a timely basis to allow for adequate reporting/consideration of certain transactions.

As a result of this material weakness, our management concluded that our internal control over financial reporting was not effective as of July 31, 2015. 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 our annual or interim financial statements will not be prevented or detected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness; yet important enough to merit attention by those responsible for oversight of the company's financial reporting.

Because of its inherent limitations, however, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

In order to mitigate the foregoing material weakness, we have engaged an outside accounting consultant with significant experience in the preparation of financial statements in conformity with U.S. GAAP to assist us in the preparation of our financial statements to ensure that these financial statements are prepared in conformity to U.S. GAAP. Management believes that this will lessen the possibility that a material misstatement of our annual or interim financial statements will be prevented or detected on a timely basis, and we will continue to monitor the effectiveness of this action and make any changes that our management deems appropriate.

Changes in Internal Controls over Financial Reporting.
 
There were no changes in our internal controls over financial reporting that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
 
11


PART II.  OTHER INFORMATION


ITEM 1.
LEGAL PROCEEDINGS
 
We know of no material, existing or pending legal proceedings against our 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

A smaller reporting company, as defined by Item 10 of Regulation S-K, is not required to provide the information required by this item.
 
ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 
None

ITEM 3.
DEFAULTS UPON SENIOR SECURITES

None

ITEM 4.
MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5.
OTHER INFORMATION

None

ITEM 6.
EXHIBITS

The following exhibits are included as part of this report by reference:
 Exhibit No.
 Description
31.1* 
32.1*
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.
 
12

 
SIGNATURES
 
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Anaheim, United States, on September 11, 2015.
 
 
ORIENTAL MAGIC SOUP, INC.
 
 
 
 
 
 Date: September 11, 2015
By:
/s/ Zhufeng Wang
 
 
Name:
Zhufeng Wang
 
 
Title:
President and Chief Executive  Officer
(principal executive officer and principal financial and accounting officer)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
13