ACQUISITION OF THE SMSA CRANE: MANAGEMENT’S ANALYSIS OF THE FINANCIAL SITUATION AND OPERATING RESULTS. (form 10-Q)

By Angela B. Morales Last updated Oct 5, 2021

Forward-looking statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected results of operations, and the assumptions on which such statements are based, are “statements”. prospective ”. These forward-looking statements are generally identified by the words “believes”, “plan”, “expects”, “plans”, “believes”, “intention”, “strategy”, “plan”, “may”. , “” “” Would “,” would “,” continue “,” will probably result “and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties that may cause actual results to differ materially from forward-looking statements. Our ability to predict the actual results or effect of future plans or strategies is inherently uncertain. Factors that could have a material adverse effect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative / regulatory changes, availability of capital, rates interest, competition and generally accepted accounting principles. These risks and uncertainties should also be taken into account in evaluating forward-looking statements and one should not place undue reliance on such statements.

Overview

Our business plan is to pursue a business combination through acquisition or merger with an existing company seeking the perceived benefits of being a publicly traded company. We do not limit our potential target companies to any specific business, industry or geographic location. No guarantee can be given that we will be successful in locating or negotiating with a target company.

Our continued existence depends on our ability to generate new funding or sufficient cash flow to continue our reporting obligations to the Security and Trade Commission in right time. We cannot guarantee that we will achieve a business combination through the acquisition or merger of an existing company. We currently have no firm financing arrangements and may not be able to secure financing as needed, in amounts necessary to complete our plans in their entirety, or on economically feasible terms.

Expected changes in the number of employees, factories and equipment

We do not currently plan to purchase specific additional physical facilities and major equipment in the immediate future. We currently have no specific plans to change the number of our employees over the next twelve months.


Results of Operations

For the three and nine months ended September 30, 2020 and 2019

Revenue

The Company recorded no sales for the three and nine months ended September 30, 2020 and 2019.


Operating Expenses

The following table shows our total operating expenses for the three and nine months ended. September 30, 2020 and 2019:

                                     Three months ended          Nine months ended
                                        September 30,              September 30,
                                      2020          2019          2020         2019
Professional fees                  $      569      $ 1,056     $   21,117     $ 3,335

Other general and administrative expenses 2,039 1,160 7,560 2,815 Operating expenses

                 $    2,608      $ 2,216     $   28,677     $ 6,150

The operating expenses consist mainly of the costs of maintaining the corporate entity and the preparation and filing of reports with the Security and Trade Commission. The increase in operating expenses for the nine months ended September 30, 2020 is explained by the increase in professional fees and other general and administrative expenses compared to the same periods in 2019.

Liquidity and capital resources

From September 30, 2020, the Company had short-term assets in the amount of $ 3,612
made up of cash only. At September 30, 2020, the Company had current liabilities of $ 108,690, consisting of an amount due to our majority shareholder of $ 81,615, and accounts payable and accrued liabilities of $ 27,075. Our working capital deficit at September 30, 2020 was $ 105,078.

Since its inception, the Company has financed its cash requirements from the sale of common shares and advances from related parties. Uses of funds have included activities to establish our business, professional fees and other general and administrative expenses.

We believe that the Company will need additional resources to implement its strategic objectives in the coming quarters. However, due to our lack of operating history, our auditors indicated in their audit report on the December 31, 2019
financial statements that there is substantial doubt as to our ability to continue to operate. From September 30, 2020, the Company has an accumulated deficit of $ 457,054. The Company intends to finance its operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the next twelve months.

The Company’s ability to continue operating depends, among other things, on obtaining additional financing to continue its deposits with the Security and Trade Commission. In response to this and other potential issues, management intends to raise additional funds through public or private placement offers. These factors, among others, raise significant doubt as to the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustment that could result from the outcome of this uncertainty.

The following table provides detailed information about our free cash flow for the periods presented in this report.

Cash Flow



                                               Nine months ended
                                                 September 30,
                                               2020          2019

Net cash used in operating activities $ (16,118) $ (2,826)
Net cash flow generated by investing activities

            -             -
Net cash provided by financing activities            -             -
Net cash (outflow)                          $ (16,118)     $ (2,826)




Operating Activities

Cash used in operating activities for the nine months ended September 30, 2020, consisted of a net loss of $ 28,667, offset by an increase in accounts payable and accrued liabilities of $ 12,559. Cash used in operating activities for the nine months ended September 30, 2019 consisted of a net loss of $ 6,150, offset by an increase in accounts payable and accrued liabilities of $ 3,324. The increase in cash used in operating activities during the nine-month period ended September 30, 2020, compared to the same period in 2019, is explained by the increase in the net loss of $ 6,150 in 2019 at $ 28,667 in 2020, offset by a larger increase in accounts payable and accrued liabilities in 2020.

Investing Activities

Net cash flow generated by our investing activities for the nine months ended
September 30, 2020 and 2019 was $ 0.

Financing Activities

Net cash flow generated by our financing activities for the nine months ended
September 30, 2020 and 2019 was $ 0.

Pending the completion of a potential future business combination, we are not engaged in any commercial activity. Our only operating activities are to comply with Security and Trade Commission reporting requirements and seeking to achieve a business combination through acquisition or merger with an existing company seeking the perceived benefits of being a publicly traded company.

Off-balance sheet provisions

From September 30, 2020, there were no off-balance sheet arrangements.

10








Critical Accounting Policies

In december 2001, the SECOND asked all registrants to list their “most critical accounting policies” in the MD&A. The SECOND
stated that a “critical accounting policy” is a method that is both important for the representation of a company’s financial position and results, and requires the most difficult, subjective or complex judgments of management, often because of the need to make estimates on the effect of questions that are inherently uncertain. We do not believe that any accounting policy currently meets this definition.

Recently published accounting position papers

Our management has taken into consideration all the recent accounting pronouncements issued since the last audit of our financial statements. Our management believes that these recent statements will not have a material impact on our financial statements.

Source link