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 January 31, 2017

 

or

 

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from to

 

Commission file number: 000-55588

 

WISHBONE PET PRODUCTS INC.

(Exact name of registrant as specified in its charter)

 

Nevada		Pending
State or other jurisdiction of incorporation or organization		(I.R.S. Employer Identification No.)

 

2857 Sherwood Heights Drive, Oakville, Ontario, L6J 7J9

(Address of principal executive offices) (Zip Code)

 

(888) 414-6832

Registrant’s telephone number, including area code

 

N/A

(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 check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). 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.

 

Large accelerated filer	[  ]	Accelerated filer	[  ]
Non-accelerated filer	[  ]	Smaller reporting company	[X]
(Do not check if a smaller reporting company)

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the 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 latest practicable date.

 

3,750,000 shares of common stock are issued and outstanding as of March 14, 2017.

 

 

 

INDEX

 

		Page
PART I	FINANCIAL INFORMATION	3
Item 1.	Financial Statements (unaudited)	3
	BALANCE SHEETS as of January 31, 2017 and April 30, 2016	3
	STATEMENTS OF OPERATIONS for the three and nine months ended January 31, 2017 and 2016	4
	STATEMENTS OF SHAREHOLDERS’ EQUITY for the period from April 1, 2014 to January 31, 2017	5
	STATEMENTS OF CASH FLOWS for the nine months ended January 31, 2017 and 2016	6
	NOTES TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	9
Item 3	Quantitative and Qualitative Disclosures About Market Risk	11
Item 4.	Controls and Procedures	11
PART II	OTHER INFORMATION	12
Item 1.	Legal Proceedings	12
Item 1A.	Risk Factors
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	12
Item 3.	Defaults Upon Senior Securities.	12
Item 4	Submission of Matters to a Vote of Security Holders	12
Item 5.	Other Information.	12
Item 6.	Exhibits	13
SIGNATURES		14

 

 

PART 1. FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

WISHBONE PET PRODUCTS INC.

 

CONDENSED BALANCE SHEETS

 

		January 31, 2017				April 30, 2016
		(Unaudited)				(Audited)
ASSETS
Current Assets
Cash		$	596			$	635
TOTAL CURRENT ASSETS		$	596			$	635
LIABILITIES & STOCKHOLDER’S EQUITY
LIABILITIES
Current Liabilities
Accounts payable & Accrued interest		$	47,874			$	39,020
Loans payable			91,988				80,225
TOTAL CURRENT LIABILITIES			139,862				119,245
COMMITMENTS & CONTINGENCIES		$	-			$	-
STOCKHOLDER’S EQUITY
Capital stock authorized: 200,000,000 common shares with a par value $0.001 Issued and outstanding: 3,750,000 common shares		$	3,750			$	3,750
Additional paid-in capital			18,250				18,250
Accumulated deficit			(161,266	)			(140,610	)
TOTAL STOCKHOLDER’S EQUITY			(139,266	)			(118,610	)
TOTAL LIABILITIES & STOCKHOLDER’S EQUITY		$	596			$	635

 

See accompanying notes to the condensed financial statements

 

 

WISHBONE PET PRODUCTS INC.

 

CONDENSED INCOME STATEMENTS

For the three and nine months ended January 31, 2017 and 2016

(Unaudited)

 

		For the three months								For the nine months
		ended January 31,								ended January 31,
		2017				2016				2017				2016
OPERATING EXPENSES
Professional fees		$	2,975			$	2,975			$	8,925			$	10,525
General & administrative expenses			1,404				1,267				4,194				10,016
TOTAL EXPENSES			4,379				4,242				13,119				20,541
OPERATING LOSS		$	(4,379	)		$	(4,242	)		$	(13,119	)		$	(20,541	)
OTHER EXPENSES
Interest on loans			2,643				1,741				7,537				5,038
NET INCOME/(LOSS)		$	(7,022	)		$	(5,983	)		$	(20,656	)		$	(25,579	)
Net loss per share, basic and diluted		$	(0.002	)		$	(0.002	)		$	(0.006	)		$	(0.007	)
Weighted average common shares outstanding, basic and diluted			3,750,000				3,750,000				3,750,000				3,750,000

 

See the accompanying notes to the condensed financial statements

 

 

WISHBONE PET PRODUCTS INC.

 

CONDENSED STATEMENT OF CHANGES IN STOCKHOLDER’S EQUITY

(Unaudited)

 

		Common Stock
		200,000,000 shares authorized												Additional								Total
		Shares				Par Value				Shares				Paid in				Accumulated				Shareholder’s
		Issued				$.001 per share				Subscribed				Capital				Deficit				Equity
Balance, April 30, 2014			3,500,000			$	3,500			$	-			$	13,500			$	(67,522	)		$	(50,522	)
Shares subscribed at $0.02											5,000												5,000
Net income/loss																			(24,534	)			(24,534	)
Balance, April 30, 2015			3,500,000			$	3,500			$	5,000			$	13,500			$	(92,056	)		$	(70,056	)
Shares issued at $0.02			250,000				250				(5,000	)			4,750								-
Net income/loss																			(48,554	)			(48,554	)
Balance, April 30, 2016			3,750,000			$	3,750			$	-			$	18,250			$	(140,610	)		$	(118,610	)
Net income/loss																			(20,656	)			(20,656	)
Balance, January 31, 2017			3,750,000			$	3,750			$	-			$	18,250			$	(161,266	)		$	(139,266	)

 

See accompanying notes to the condensed financial statements

 

 

WISHBONE PET PRODUCTS INC.

 

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

 

		For the nine months
		ended January 31,
		2017				2016
Cash Flows from Operating Activities
Net income/(loss)		$	(20,656	)		$	(25,579	)
Changes in current assets and liabilities:
Accounts payable & accrued interest			8,854				10,717
Net cash used in operating activities		$	(11,802	)		$	(14,862	)
Cash Flows from Financing Activities
Proceeds from the issuance of common stock		$	-			$	5,000
Shares subscribed			-				(5,000	)
Proceeds from loans payable			11,763				14,500
Net cash provided by financing activities		$	11,763			$	14,500
Net decrease in cash		$	(39	)		$	(362	)
Cash and cash equivalents, beginning of period		$	635			$	1,011
Cash and cash equivalents, end of period		$	596			$	649

 

See accompanying notes to the condensed financial statements

 

 

WISHBONE PET PRODUCTS INC.

 

Notes to the Condensed Financial Statements

January 31, 2017

(Unaudited)

 

Note 1 Nature and Continuance of Operations

 

Wishbone Pet Products Inc. was incorporated in the State of Nevada on July 30, 2009. The Company has been in the development stage since its formation and has not realized any revenues from its planned operations. The Company is primarily engaged in the business of developing, manufacturing, marketing and selling dog waste removal devices.

 

The Company has chosen an April 30 fiscal year end.

 

Note 2 Basis of Presentation – Going Concern Uncertainties

 

These financial statements have been prepared in conformity with generally accepted accounting principles in the United States, which contemplate continuation of the Company as a going concern. The Company is at its early stages of development and has limited operations, and has sustained operating losses resulting in a deficit.

 

The Company has accumulated a deficit of $161,266 since inception, has yet to achieve profitable operations and further losses are anticipated in the development of its business. The Company’s ability to continue as a going concern is in substantial doubt and is dependent upon obtaining financing and/or achieving a sustainable profitable level of operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company may seek additional equity as necessary and it expects to raise funds through private or public equity investment or loans from directors of the Company in order to support existing operations. There is no assurance that such additional funds will be available for the Company on acceptable terms, if at all.

 

Note 3 Interim Reporting and Significant Accounting Policies

 

The interim financial statements are prepared under the accrual basis of accounting in accordance with accounting principles generally accepted (GAAP) in the United States of America for the interim information. Accordingly, the financial statements do not include all of the information and notes required by GAAP for the complete financial statements. While the information presented is unaudited, it includes all adjustments, which are, in the opinion of management, necessary to present fairly the financial position, result of operation and cash flows for the interim periods presented in accordance with accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature. It is suggested that the interim financial statements be read in conjunction with the Company’s April 30, 2016 annual financial statements. Operating results for the nine month period ended January 31, 2017 are not necessarily indicative of the results that can be expected for the year ended April 30, 2017.

 

 

There have been no changes in the accounting policies from those disclosed in the notes to the audited condensed financial statements for the year ended April 30, 2016.

 

Recently issued accounting pronouncements

 

The Company adopts new pronouncements relating to generally accepted accounting principles applicable to the Company as they are issued, which may be in advance of their effective date. Management does not believe that any pronouncement not yet effective but recently issued by the FASB (including its Emerging Issues Task Force), the AICPA or the SEC would, if adopted, have a material effect on the accompanying financial statements.

 

Note 4 Notes Payable

 

The Company entered into 9 notes payable. They are all due within 30 days following written demand and bears a monthly interest rate of 1% (12% per annum).

 

		Principal				Interest
		Amount				Accrued				Total
Dec 31 12		$	17,000			$	8,330			$	25,330
Aug 13 13			20,000				8,300				28,300
Dec 04 14			11,000				2,848				13,848
Jun 26 15			10,000				1,917				11,917
Jan 25 16			4,500				541				5,041
Mar 22 16			17,725				1,861				19,586
Jul 28 16			2,700				162				2,862
Oct 31 16			5,161				155				5,315
Jan 31 17			3,902				-				3,902
		$	91,988			$	24,114			$	116,101

 

Note 5 Common Shares

 

During the year ended April 30, 2016, the Company issued 250,000 common shares to investors valued at $0.02 per share.

 

Note 6 Subsequent events

 

The Company evaluated all events and transactions that occurred after January 31, 2017 up through date the Company issued these financial statements and found no subsequent events that needed to be reported.

 

 

FORWARD LOOKING STATEMENTS

 

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.

 

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

 

GENERAL

 

Wishbone Pet Products Inc. was incorporated under the laws of the State of Nevada, U.S. on July 30, 2009. Our registration statement on Form S-1 was filed with the Securities and Exchange Commission was declared effective on February 14, 2013.

 

We intend to commence business operations by developing, manufacturing, marketing, and selling dog waste removal devices. We are currently considered a development stage company. To date, our president, Rami Tabet, has developed a device concept that permits the user to enclose dog waste in a plastic bag this is contained inside of a sealed plastic case. The user can then disposed of the plastic bag without direct contact. To date, we have not manufactured or sold any dog waste removal devices. We are considered to be a “shell company”, which is a company with either no or nominal operations or assets, or assets consisting solely of cash and cash equivalents. An investment in the shares of a shell company should be considered highly illiquid given the resale restrictions that apply to them. In order to continue our business plan, we need to transform our device concept into a working prototype that is suitable for mass production and then enter into an agreement with a suitable third party for manufacture. We then intend to initially distribute our products in North America with a view to expanding our market focus depending on our initial success.

 

RESULTS OF OPERATIONS

 

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.

 

Nine-Month Period Ended January 31, 2017 Compared to the Nine-Month Period Ended January 31, 2016.

 

Our net loss for the nine-month period ended January 31, 2017 was $20,656 (2016: $25,579), which consisted of professional fees of $8,925 (2016: $10,525), general and administration expenses of $4,194 (2016: $10,016), and interest on loans of $7,537 (2016: $5,038). We did not generate any revenue during either nine-month period in fiscal 2017 or 2016. The lower expenses in the current fiscal year primarily relate to an decrease in general expenses.

 

The weighted average number of shares outstanding was 3,750,000 for the nine-month period ended January 31, 2017 and 3,750,000 for the nine-month period ended January 31, 2016.

 

 

LIQUIDITY AND CAPITAL RESOURCES

 

As at January 31, 2017, our current assets were $596 compared to $635 at April 30, 2016. As at January 31, 2017, our current liabilities were $139,862 compared to $119,245 at April 30, 2016. Current liabilities at January 31, 2017 were comprised of $91,988 in loans payable and $47,874 in accounts payable and accrued liabilities.

 

Stockholders’ deficit increased from $140,610 as of April 30, 2016 to $161,266 as of January 31, 2017.

 

Cash Flows from Operating Activities

 

We have not generated positive cash flows from operating activities. For the nine-month period ended January 31, 2017, net cash flows used in operating activities were $11,802 consisting of a net loss of $20,656, which was offset by a $8,854 non-cash component of accounts payable. For the nine-month period ended January 31, 2016, net cash flows used in operating activities were $14,862.

 

Cash Flows from Financing Activities

 

We have financed our operations primarily from either the issuance of our shares of common stock or from loans. In the nine-month period ended January 31, 2017, we received $11,763 in proceeds relating to shareholder loans. In the comparative period for fiscal 2016, we generated $5,000 from share subscriptions received and $14,500 from loans.

 

PLAN OF OPERATION AND FUNDING

 

We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

 

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next three months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; (ii) developmental expenses associated with a start-up business; and (iii) marketing expenses. We intend to finance these expenses with further issuances of securities and director loans. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations. We will have to raise additional funds in the next twelve months in order to sustain and expand our operations. 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 our common stock. We have and will continue to seek to obtain short-term loans from our directors, although no future arrangement for additional loans has been made. We do not have any agreements with our directors concerning these loans. We do not have any arrangements in place for any future equity financing.

 

 

OFF-BALANCE SHEET ARRANGEMENTS

 

As of the date of this 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.

 

GOING CONCERN

 

The independent auditors’ report accompanying our April 30, 2016 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.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

No report required.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures:

 

We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of January 31, 2017. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of January 31, 2017, our disclosure controls and procedures were not effective due to the presence of material weaknesses in internal control over financial reporting.

 

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. Management has identified the following material weaknesses which have caused management to conclude that, as of January 31, 2017, our disclosure controls and procedures were not effective: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.

 

Changes in Internal Control over Financial Reporting:

 

There were no changes in our internal control over financial reporting during the six months ended January 31, 2017, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Quarterly Report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.

 

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

 

No report required.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

No report required.

 

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

 

No report required.

 

ITEM 5. OTHER INFORMATION

 

No report required.

 

 

ITEM 6. EXHIBITS

 

Exhibits:

 

31.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act
32.1	Certification of Chief Executive Officer and Chief Financial Officer Under Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act.
101	Interactive data files pursuant to Rule 405 of Regulation S-T.

 

 

SIGNATURES

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	WISHBONE PET PRODUCTS INC.
Dated: March 14, 2017	By:	/s/ Rami Tabet
		Rami Tabet, President and Chief Executive Officer
		and Chief Financial Officer