U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2002
[ ] 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 333-85787
TRADING SOLUTIONS.COM, INC.
(Exact name of small business issuer as specified in its charter)
NEVADA 880425691
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
2 RODEO COURT, TORONTO, ONTARIO CANADA M2M 4M3
(Address of principal executive offices)
416-512-2356
(Issuer's telephone number)
NOT APPLICABLE
(Former name, address and fiscal year, if changed since last report)
Check 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 issuer was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes [ X] No [
]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:
Check whether the registrant has filed all documents and reports required to be
filed by Sections 12, 13, or 15(d) of the Exchange Act subsequent to the
distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
State the number of shares outstanding of each of the issuer's classes of common
equity, as of December 31, 2002: 18,523,500 shares of common stock, par value
$0.001.
Transitional Small Business Format: Yes [ ] No [ X ]
FORM 10-QSB
TRADING SOLUTIONS.COM, INC.
INDEX
PART I. Financial Information Page
Item 1. Financial Statements 3
Accountants' Review Report 4
Consolidated Balance Sheets as of December 31, 2002 and 2001 5
Consolidated Statements of Comprehensive Income (Loss) for the
Three Months Ended December 31, 2002 and 2001 6
Consolidated Statements of Stockholders' Equity (Deficit) From
the Date of Inception, May 14, 1999 through December 31, 2002 8
Consolidated Statements of Cash Flows for the Three Months
Ended December 31, 2002 and 2001 9
Notes to Consolidated Financial Statements 10
Item 2. Management's Discussion and Analysis of Financial
Condition or Plan of Operation 16
Item 3. Controls and Procedures 17
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K 17
Signatures 18
Certification 19
(Inapplicable items have been omitted)
2
PART I.
FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
In the opinion of management, the accompanying unaudited financial statements
included in this Form 10-QSB reflect all adjustments (consisting only of normal
recurring accruals) necessary for a fair presentation of the results of
operations for the periods presented. The results of operations for the periods
presented are not necessarily indicative of the results to be expected for the
full year.
3
To the Board of Directors
Trading Solutions.com Incorporated
Toronto, Ontario Canada
We have reviewed the accompanying consolidated balance sheet of Trading
Solutions.com Incorporated and Subsidiary (A Development Stage Enterprise) as of
December 31, 2002 and 2001 and the related statements of income and retained
earnings, comprehensive income, and cash flows for the three months then ended,
in accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants. All
information included in these financial statements is the representation of the
Company's management.
A review consists principally of inquiries of Company personnel and analytical
procedures applied to financial data. It is substantially less in scope than an
audit in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements in order for them to be in
conformity with generally accepted accounting principles.
Respectfully,
/s/Freedman & Goldberg
- ------------------------------
Certified Public Accountants
Farmington Hills, Michigan
February 17, 2003
4
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2002 AND 2001
ASSETS
2002 2001
----------- ----------
Current Assets
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . $ -0- $ 1,100
Net Current Assets of Discounted Operations . . . . . . . -0- -0-
----------- ----------
Total Current Assets. . . . . . . . . . . . . . . . -0- 1,100
Property and Equipment
Net property and Equipment of Discounted Operations . . . -0- -0-
Other Assets
Trademark . . . . . . . . . . . . . . . . . . . . . . . . -0- 4,171
----------- ----------
Total Assets. . . . . . . . . . . . . . . . . . . . . . $ -0- $ 5,271
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts Payable - Trade . . . . . . . . . . . . . . . . . . $ 31,888 $ 15,151
Accrued Expenses . . . . . . . . . . . . . . . . . . . . . . 11,415 7,011
Bank Overdraft Loan. . . . . . . . . . . . . . . . . . . . . 14,888 -0-
Shareholder Advances . . . . . . . . . . . . . . . . . . . . 50,471 42,438
Net Current Liabilities of Discontinued Operations . . . . . 4,500 5,300
----------- ----------
Total Current Liabilities . . . . . . . . . . . . . . . . 113,162 69,900
----------- ----------
----------- ----------
Total Liabilities . . . . . . . . . . . . . . . . . . . 113,162 69,900
----------- ----------
Stockholders' Equity (Deficit)
Common Stock, $.01 Par Value, 20,000,000 Shares Authorized,
18,523,500 Shares Issued and Outstanding . . . . . . . . . . 56,153 56,153
Additional Paid-In Capital . . . . . . . . . . . . . . . . . 207,380 207,380
Accumulated Deficit During The
Development Stage . . . . . . . . . . . . . . . . . . . . . (376,555) (329,388)
Accumulated Other Comprehensive income . . . . . . . . . . . (140) 1,226
----------- ----------
Total Stockholders' Equity (Deficit) . . . . . . . . . . . ( 113,162) ( 64,629)
----------- ----------
Total Liabilities and Stockholders'
Equity (Deficit) . . . . . . . . . . . . . . . . . . $ -0- $ 5,271
=========== ==========
See accompanying accountant's review report and notes to financial statements
5
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
FOR THE THREE MONTHS ENDED DECEMBER 31, 2002 AND 2001
Cumulative From
Inception
May 14, 1999
to December 31,
2002 2002 2001
----------------- ------------ ------------
Income . . . . . . . . . . . . . . . . . . . . $ -0- $ -0- $ -0-
----------------- ------------ ------------
Expenses
Advertising. . . . . . . . . . . . . . . . . 765 -0- -0-
Amortization . . . . . . . . . . . . . . . . 367 -0- 90
Office . . . . . . . . . . . . . . . . . . . 1,375 -0- 434
Professional Fees. . . . . . . . . . . . . . 54,556 2,022 2,393
Rent . . . . . . . . . . . . . . . . . . . . 1,905 -0- 473
Taxes and Licenses . . . . . . . . . . . . . 1,600 -0- 800
Telephone. . . . . . . . . . . . . . . . . . 1,079 -0- 277
Travel and Entertainment . . . . . . . . . . 6,125 -0- 1,490
----------------- ------------ ------------
Total Expenses . . . . . . . . . . . . . . 67,772 2,022 5,957
----------------- ------------ ------------
Operating Loss . . . . . . . . . . . . . . . . ( 67,772) ( 2,022) ( 5,957)
----------------- ------------ ------------
Other Income (Expense) . . . . . . . . . . . . (635) -0- -0-
Interest Expense
Loss on Expiration of Land Options . . . . . ( 63,407) -0- -0-
Loss on Impairment of Trademark. . . . . . . (3,451) (3,451) -0-
----------------- ------------ ------------
Total Other Income (Expense). . . . . . . . ( 67,493) (3,451) -0-
----------------- ------------ ------------
Loss From Continuing Operations. . . . . . . . ( 135,265) ( 5,473) ( 5,957)
Loss on Sale of Discontinued
Operations, Net of Income Taxes. . . . . . . (2,674) -0- -0-
Income From Discontinued
Operations, Net of Income Taxes. . . . . . . (238,616) -0- -0-
----------------- ------------ ------------
Net Income (Loss). . . . . . . . . . . . . . . $ (376,555) $ ( 5,473) $ ( 5,957)
================= ============ ============
Weighted Average Number of Shares Outstanding. 8,727,915 18,523,500 18,523,500
================= ============ ============
Loss From Continuing Operation Per
Share. . . . . . . . . . . . . . . . . . . . $ (.01) $ (.00) $ (.00)
================= ============ ============
Net Loss Per Share . . . . . . . . . . . . . . $ (.04) $ (.00) $ (.00)
================= ============ ============
See accompanying accountant's review report and notes to financial statements
6
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
FOR THE THREE MONTHS ENDED DECEMBER 31, 2002 AND 2001
Commutative From
Inception
May 14, 1999 to
December 31, 2002 2002 2001
------------------ -------- --------
Net income (Loss) . . . . . . . . $ (376,555) $(5,473) $(5,957)
Other Comprehensive Loss,
net of Tax:
Foreign currency translation
adjustment. . . . . . . . . . (140) (1,520) 1,226
------------------ -------- --------
Comprehensive Income (Loss) . . . $ (376,695) $(6,993) $(4,731)
================== ======== ========
See accompanying accountant's review report and notes to financial statements
7
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FROM THE DATE OF INCEPTION (MAY 14, 1999 THROUGH DECEMBER 31, 2002)
Accumulated
Common Common Additional Other
Stock Stock Paid-In Accumulated Comprehensive
Shares Amount Capital Deficit Income Total
Shares Issued during the
Year Period Ended
March 31, 2000. . . . . . . 2,760,000 $27,600 $ 107,390 $ -0- $ -0- $ 134,990
Net Loss for the Period
Ended March 31, 2000. . . . -0- -0- -0- (128,864) -0- (128,864)
- ----------------------------- ----------- ------- ----------- ------------- --------------- ----------
Balance, March 31, 2000 . . . 2,760,000 27,600 107,390 (128,864) -0- 6,126
Shares Issued During the
Year Ended March 31, 2001 . 101,000 1,010 99,990 -0- -0- 101,000
Net Loss for the Year Ended
March 31, 2001. . . . . . . -0- -0- -0- (110,578) -0- (110,578)
- ----------------------------- ----------- ------- ----------- ------------- --------------- ----------
Balance, March 31, 2001 . . . 2,861,000 28,610 207,380 (239,442) -0- (3,452)
August 18, 2001 Exchange
Of Shares for Springland
Beverages, Inc. . . . . . . 15,542,500 15,543 -0- -0- -0- 15,543
September 10, 2001 Shares
Issued for Services . . . . 120,000 12,000 -0- -0- -0- 12,000
Net Loss For the Six Months
Ended September 30, 2001 . . -0- -0- -0- ( 83,989) -0- (83,989)
- ----------------------------- ----------- ------- ----------- ------------- --------------- ----------
Balance, September 30, 2001 . 18,523,500 56,153 207,380 (323,431) -0- (59,898)
Net Loss For the Year Ended
September 30, 2002. . . . . -0- -0- -0- (47,651) 1,380 (46,271)
- ----------------------------- ----------- ------- ----------- ------------- --------------- ----------
Balance, September 30, 2002 . 18,523,500 56,153 207,380 (371,082) 1,380 (106,169)
Net Loss For the Three Months
Ended December 31,2002. . . -0- -0- -0- ( 5,473) (1,520) ( 6,993)
- ----------------------------- ----------- ------- ----------- ------------- --------------- ----------
Balance, December 31, 2002. . 18,523,500 $56,153 $ 207,380 $ (376,555) $ (140) $(113,162)
============================= =========== ======= =========== ============= ===========================
See accompanying accountant's review report and notes to financial statements
8
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED DECEMBER 31, 2002 AND 2001
Cumulative From
Inception
May 14, 1999 to
December 31,2002 2002 2001
----------------- ---------- ----------
Cash Flows From Operations
Net Loss From Continuing Operations. . . . . $ (135,265) $( 5,473) $( 5,957)
Adjustments to Reconcile Net Income to Net
Cash Provided By Operating Activities
Amortization . . . . . . . . . . . . . 367 -0- 90
Land Option Acquired in Stock Exchange 60,260 -0- -0-
Loss on Impairment of Trademark. . . . 3,451 3,451 -0-
Foreign Currency Translation Adjustment. . (140) (1,520) 1,226
(Increase) Decrease
Other Assets . . . . . . . . . . . . ( 4,379) -0- ( 4,261)
Increase (Decrease) In:
Accounts Payable and Accrued Expenses. . 34,489 3,542 6,178
- ----------------------------------------------------------------------------------------
Net Cash Used In Continuing Operations. . (41,217) -0- ( 2,724)
Net Cash Used In Discontinued Operations. (198,911) -0- -0-
----------------- ---------- ----------
Net Cash Used In Operating Activities. . . (240,128) -0- ( 2,724)
----------------- ---------- ----------
Cash Flows From Investing Activities
Equipment Purchases. . . . . . . . . . . . . ( 3,879) -0- -0-
----------------- ---------- ----------
Net Cash Used In Investing Activities. . ( 3,879) -0- -0-
----------------- ---------- ----------
Cash Flows From Financing Activities
Proceeds From Shareholder Advances . . . . . 13,526 -0- 2,079
Short Term Borrowing . . . . . . . . . . . 17,724 -0- -0-
Payment of Short Term Borrowing. . . . . . (3,000) -0- -0-
Issuance of Common Stock . . . . . . . . . 213,990 -0- -0-
Cash From Subsidiary Acquired Via Stock
Exchange . . . . . . . . . . . . . . . . 1,767 -0- -0-
----------------- ---------- ----------
Net Cash Provided By Financing
Activities . . . . . . . . . . . . . 244,007 -0- 2,079
----------------- ---------- ----------
Increase (Decrease) in Cash . . . . . . . . . -0- -0- ( 645)
Balance, Beginning of Period. . . . . . . . . -0- -0- 1,745
Balance, End of Period. . . . . . . . . . . . $ -0- $ -0- $ 1,100
================= ========== ==========
See accompanying accountant's review report and notes to financial statements
9
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies of Trading Solutions.com
Incorporated and Subsidiary (the Company) is presented to assist in
understanding the Company's financial statements. The financial statements and
notes are representations of the Company's management who is responsible for
their integrity and objectivity. These accounting policies conform to generally
accepted accounting principles and have been consistently applied in the
preparation of the financial statements.
A. Nature of Operations - Trading Solutions.com Incorporated was
incorporated under the laws of the State of Nevada on May 14, 1999.
The Company was established to provide educational services for people
interested in on-line investing. The Company also intended to
establish a corporate trading account and manage money. The Company
further intended to establish or acquire an e-commerce business to
link with the trading school. Since its inception, the Company has
been in a developmental stage. The only activities have been
organizational matters and the sale of stock. The company ceased its
development of the above business on August 18, 2001.
In August 2001, the Company acquired Springland Beverages, Inc., a
wholly owned subsidiary. Springland Beverages, Inc. is also in a
developmental stage and is pursuing the bottled water and related
beverage market. The only activities of Springland Beverages, Inc. has
been the acquisition of a option to purchase land and the registration
of trademarks in the United States and Canada.
B. Basis of Consolidation - The consolidated financial statements
include the accounts of Springland Beverages, Inc., a wholly owned
subsidiary located in Toronto, Ontario. All significant intercompany
accounts and transactions have been eliminated in consolidation.
C. Revenues - The Company recognizes revenue at time services are
rendered for educational services and upon shipment for beverage
sales.
E. For purposes of the statement of cash flows, the Company considers
all short-term debt securities purchased with a maturity of three
months or less to be cash equivalents.
F. Property, Equipment and Related Depreciation - Property and
equipment are recorded at cost. Depreciation is computed by the
straight-line method for financial reporting purposes and accelerated
methods for tax reporting purposes. Estimated lives range from five to
ten years. Depreciation charged to discontinued operations was $-0-
and $-0- for the three months ended December 31, 2002 and 2001,
respectively. When properties are disposed of, the related costs and
accumulated depreciation are removed from the respective accounts and
any gain or loss on disposition is recognized currently. Maintenance
and repairs which do not improve or extend the lives of assets are
expensed as incurred.
10
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
G. Intangible Assets - Prior to October 1, 2002, the Company has
capitalized certain costs related to registering a trademark. These
costs were amortized on a straight-line basis over its useful life of
twelve years. Amortization charged to continuing operations was $-0-
and $90 for the three months ended December 31, 2002 and 2001,
respectively.
In October 2002, the Company adopted Statement of Financial Accounting
Standards No. 142, "Goodwill and Other Intangible Assets" (SFAS 142).
Under SFAS 142, intangible assets with indefinite lives are not
subject to amortization, but is tested for impairment annually. The
Company's trademark has been deemed to have an indefinite useful life;
therefore the Company ceased amortization effective October 1, 2002.
During the three months ended December 31, 2002 and 2001, the company
recognized a loss on the impairment of intangible assets of $3,451 and
$-0-, respectively. Reconciliation of reported net income from the
date of inception through December 31, 2002 to the net income that
would have been reported had the provisions of SFAS 142 been applied
in all periods presented is as follows:
Cumulative From Inception
May 14, 1999 to December Three Months Ended Three Months Ended
31, 2002 December 31,2002 December 31,2001
Reported Net Loss . . . . . . . . $ (376,555) $ (5,473) $ (5,957)
Add Back: Trademark Amortization 367 -0- 90
--------------------------- -------------------- --------------------
Adjusted Net Income . . . . . . . $ (376,188) $ (5,473) $ (5,867)
=========================== ==================== ====================
H. In accordance with SFAS No. 121, the Company reviews its long-lived
assets, including property and equipment, goodwill and other
identifiable intangibles for impairment whenever events or changes in
circumstances indicate that the carrying amount of the assets may not
be fully recoverable. To determine recoverability of its long-lived
assets, the Company evaluates the probability that future undiscounted
net cash flows, without interest charges, will be less than the
carrying amount of the assets. Impairment is measured at fair value.
I. 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 revenues and expenses during the reporting period.
Actual results could differ from those estimates.
J. Income Taxes - The Company accounts for income taxes under the
provisions of SFAS No. 109, "Accounting for Income Taxes," which
requires recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been included in
the Company's consolidated financial statements or tax returns. Under
this method, deferred tax assets and liabilities are determined based
on the differences between the financial accounting and tax basis of
assets and liabilities using enacted tax rates in effect for the year
in which the differences are expected to reverse.
11
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
K. Foreign Currency Translation - The income statements of foreign
operations are translated into U.S. dollars at rates of exchange in
effect each month. The balance sheets of these operations are
translated at period-end exchange rates, and the differences from
historical exchange rates are reflected in stockholders' equity as
cumulative other comprehensive income. During the three months ended
December 31, 2002 and 2001, there was $(1,520) and $1,226 unrealized
currency translation adjustments.
L. Change in Fiscal Year - On August 28, 2001, the Board of Directors
determined it is in the Company's best interest to change its fiscal
year to be the same as its wholly owned subsidiary. Therefore, the
Company has changed its fiscal year from March 31 to September 30.
NOTE 2. BANK OVERDRAFT LOAN
The Company's subsidiary has a line-of-credit facility with its bank to
fund bank overdrafts up to $15,750 U.S. ($25,000 $CDN). Interest is payable
monthly at prime plus 2 3/4% per annum. The facility is guaranteed by an
officer/stockholder.
NOTE 3. SHAREHOLDER ADVANCES
As of December 31, 2002 and 2001 the Company owed $50,471 and $42,438,
respectively, to an officer/stockholder for various advances made to the
Company's wholly owned subsidiary. The advances are unsecured and due on
demand.
NOTE 4. COMMON STOCK
On August 18, 2001, the company exchanged 15,542,500 shares of its common
stock in exchange for 100% of the outstanding stock of Springland
Beverages, Inc. (See Note 8)
On September 10, 2001, the Company issued 120,000 shares of its common
stock to an individual as payment for consulting services performed for the
benefit of the company. The value of these services were $12,000.
NOTE 5. PER SHARE COMPUTATION
Earnings per share have been calculated based on the weighted average
number of shares outstanding.
12
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
NOTE 6. INCOME TAXES
The provision for income taxes consists of the following components:
December 31, 2002 December 31, 2001
------------------- -------------------
Current:
Current Tax Benefit. . . . . . . . . . $ 687 $ 612
Deferred Tax Expense . . . . . . . . . (687) (612)
------------------- -------------------
Net Tax Expense. . . . . . . . . . . $ -0- $ -0-
=================== ===================
Deferred taxes are detailed as follows:
December 31, 2002 December 31, 2001
------------------- -------------------
Deferred Income Tax Assets
Net Operating Loss Available. . . . . . $ 91,471 $ 56,574
Valuation Allowance . . . . . . . . . . 91,471 56,574
------------------- -------------------
Net Deferred Income Tax Asset . . . . . $ -0- $ -0-
=================== ===================
The valuation allowance is evaluated at the end of each year, considering
positive and negative evidence about whether the asset will be realized. At
that time the allowance will either be increased or reduced; reduction
would result in the complete elimination of the allowance if positive
evidence indicates that the value of the deferred tax assets is no longer
required.
NOTE 7. CASH FLOW DISCLOSURES
On August 18, 2001, the Company issued 15,542,500 shares of its common stock in
exchange for 100% of the outstanding stock on Springland Beverages, Inc. in a
non-cash transaction. (See Note 8).
On September 10, 2001, the Company issued 120,000 shares of its common stock to
an individual as payment for consulting services performed for the benefit of
the company. The value of these services were $12,000.
13
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
NOTE 8. ACQUISITION OF SUBSIDIARY
On August 18, 2001, the Company acquired 100% of the outstanding stock of
Springland Beverages, Inc., a Canadian corporation, via the issuance of
15,542,500 shares of its common stock valued at par value ($.001 per share) or
$15,543. Springland Beverages, Inc. is in a developmental stage and is pursuing
the bottled water and related beverage market. The only activities of
Springland Beverages, Inc. has been the acquisition of a option to purchase land
and the registration of trademarks in the United States and Canada. The
exchange created a change in control of the Company. As a result, the majority
shareholder of Springland Beverages, Inc. became the majority shareholder and
also became the sole director and officer of the company. The Company accounted
for this acquisition using the purchase method of accounting. The purchase
price was allocated as follows:
Cash. . . . . . . . . $ 1,767
Land Option . . . . . 60,260
-------
Total Assets. . . 62,027
-------
Accounts Payable. . . 5,881
Accrued Expenses. . . 4,213
Shareholder Advances. 36,390
-------
Total Liabilities 46,484
-------
Net Assets Acquired . $15,543
=======
NOTE 9. DISCONTINUED OPERATIONS
In August 18, 2001, the Company discontinued the development of its educational
service business segment. This disposal has been accounted for as a
discontinued operation and, accordingly, its net assets (liabilities) have been
segregated from continuing operations in the accompanying consolidated balance
sheets, and its operating results are segregated and reported as discontinued
operations in the accompanying consolidated statement of income and cash flows.
There was no income or expenses related to the educational service business
segment for the three months ended December 31, 2002 and 2001.
The net assets and liabilities of the discontinued operations of the education
services business segment included in the accompanying consolidated balance
sheets as of December 31, 2001 and 2000 are as follows:
December 31, 2002 December 31, 2001
------------------- -------------------
Current Assets
Cash . . . . . . . . . $ -0- $ -0-
Other Receivables. . . -0- -0-
Property and Equipment, Net. -0- -0-
Current Liabilities
Accounts Payable . . . (4,500) (4,500)
Accrued Expenses . . . -0- (800)
------------------- -------------------
Net Assets (Liabilities) . . $ (4,500) $ (5,300)
=================== ===================
14
TRADING SOLUTIONS.COM AND SUBSIDIARY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
NOTE 10. GOING CONCERN
From the date of inception to December 31, 2002, the Company has net losses
from operations with raise substantial doubt about its ability to continue
as a going concern.
Management has discontinued its efforts to develop an educational service
business.
Through the acquisition of its subsidiary, the Company is looking to
develop a business in the bottled water and related beverage market. The
Company is seeking to acquire an operating plant and source of natural
spring water. Upon location of a plant and water source, the Company will
need to raise capital to finance such acquisition and begin marketing its
product.
The Company's ability to continue as a going concern is dependent upon the
Company ability to raise capital and acquire or establish a profitable
operation in the bottled water market.
There is no assurance that the Company will be successful in its efforts to
raise additional proceeds or achieve profitable operations. The financial
statements do not include any adjustments that might result from the
outcome of this uncertainty.
15
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION
FORWARD-LOOKING STATEMENT NOTICE
When used in this report, the words "may," "will," "expect," "anticipate,"
"continue," "estimate," "project," "intend," and similar expressions are
intended to identify forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934 regarding events, conditions, and financial trends that may affect the
Company's future plans of operations, business strategy, operating results, and
financial position. Persons reviewing this report are cautioned that any
forward-looking statements are not guarantees of future performance and are
subject to risks and uncertainties and that actual results may differ materially
from those included within the forward-looking statements as a result of various
factors.
DESCRIPTION OF THE BUSINESS
Trading Solutions.com, Inc. was incorporated on May 14, 1999 in the state
of Nevada. We operate through a wholly owned subsidiary, Springland Beverages,
Inc., an Ontario, Canada corporation. We intend to market natural spring water
and water related beverages, initially in the United States but eventually as a
global operation.
We have registered the trademarks "Springland" and "Aurora" in both the United
States and Canada. We hope to secure a source of spring water and an operating
beverage plant to begin marketing Springland beverages. We had previously
identified a potential source of spring water. However, the option to purchase
the land with the springs expired before we could exercise it.
Following the acquisition of an operating plant and source of water, we
plan to initiate an aggressive marketing campaign to establish the Springland
name. We will strive for corporate brand identification by increasing exposure
within the water and water related industry. We intend to develop sales
literature, demonstration materials and direct response promotions. We also
intend to use direct mail, fax and telemarketing campaigns for sales generation.
We recognize that advertising and promotion must be done aggressively in order
to accomplish sales goals. Along with ad campaigns, we will release key press
releases and reports to appropriate journals and market specific trade shows.
Trade show marketing may include informational brochures and giveaways.
THREE MONTH PERIODS ENDED DECEMBER 31, 2002 AND DECEMBER 31, 2001
We did not generate any revenue from operations during the three-month
periods ended December 31, 2002 and December 31, 2001. To date we have been
unsuccessful in our attempts to acquire a bottling plant and secure a source of
spring water for our proposed products. As a result, we have been unable to
fully implement our business plan.
Operating expenses for the three months ended December 31, 2002 consisted
of $2,022 in professional fees. We also had a loss of $3,451 relating to the
impairment of our trademark. As a result, net loss for the three months ended
December 31, 2002 was $5,473. During the three months ended December 31, 2001,
net loss from continuing operations was $5,957. Expenses in 2001 consisted
mainly of $2,393 in professional fees and $1,490 in travel and entertainment
expenses associated with promoting our trademark. During the same period, we had
general operating expenses of $1,984 consisting of office rental, telephone
bills, taxes and licensing fees. We also had amortization expenses of $90 during
the three months ended December 31, 2001.
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As a result of the foregoing, net losses from continuing operations were
$5,473 during the three months ended December 31, 2002 and $5,957 during the
comparable period in 2001.
LIQUIDITY AND CAPITAL RESOURCES
At December 31, 2002, we had no assets. Assets at December 31, 2001 were
$5,271 consisting of $1,100 in cash and $4,171 in trademarks. In October of
2002, we ceased amortization of our trademarks. As a result, the trademarks are
no longer recorded as assets.
Our auditors have expressed substantial doubt as to our ability to continue
as a going concern. Since inception on May 14, 1999, we have not generated any
revenue and have cumulative net losses of $376,695 after adjusting for income
tax and foreign currency exchange values. Our need for capital will change
dramatically if we locate an operating plant to purchase or secure a source of
spring water. In the past, we have relied on advances from officers and
shareholders to cover our operating costs. Management anticipates that we will
receive sufficient advances from our current president to meet our needs through
the next 12 months. However, there can be no assurances to that effect. Should
we require additional capital, we may seek additional advances from officers or
shareholders, sell equity of the Company or find other forms of debt financing.
Our current operating plan is to handle the administrative and reporting
requirements of a public company, attempt to pay our debts, and to continue
searching for a bottling plant and a reliable source of spring water.
ITEM 3. CONTROLS AND PROCEDURES
Within the 90-day period prior to the date of this report, we evaluated the
effectiveness and operation of our disclosure controls and procedures pursuant
to Rule 13a-14 of the Securities Exchange Act of 1934. Based on that
evaluation, our Chief Executive Officer and Chief Financial Officer have
concluded that our disclosure controls and procedures are effective. There have
been no significant changes in internal controls or other factors that could
significantly affect internal controls subsequent to the date we carried out our
evaluation.
PART II. OTHER INFORMATION
EXHIBITS AND REPORTS ON FORM 8-K
EXHIBIT NUMBER TITLE LOCATION
99.1 Certification of Chief Executive Officer and Chief Attached
Financial Officer
REPORTS ON FORM 8-K
None.
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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.
TRADING SOLUTIONS.COM, INC.
Date: February 18, 2003 /s/Ralph Moyal
-----------------------------------
Ralph Moyal
CEO and Chief Financial Officer
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CERTIFICATION
I, Ralph Moyal, the Chief Executive Officer and Chief Financial Officer of
Trading Solutions.Com, Inc. (the "Company"), certify that:
1. I have reviewed this quarterly report on Form 10-QSB of the Company;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this quarterly report is being
prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
February 18, 2003 /s/Ralph Moyal
-------------------------
Chief Executive Officer
Chief Financial Officer
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CERTIFICATION PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
In connection with the Quarterly Report of Trading Solutions.Com, Inc., a Nevada
corporation (the "Company"), on Form 10-QSB for the quarter ending December 31,
2002 as filed with the Securities and Exchange Commission (the "Report"), I,
Ralph Moyal, Chief Executive Officer and Chief Financial Officer of the Company,
certify, pursuant to 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350),
that to my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and result of operations of the Company.
/s/Ralph Moyal
- -------------------------
Chief Executive Officer
Chief Financial Officer
February 18, 2003
