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 March 31, 2017
   
[  ] 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: 000-27791

 

Wincash Apolo Gold & Energy, Inc.

(Exact name of small business issuer in its charter)

 

Nevada   98-0412805
State or other jurisdiction of   I.R.S. Employer
incorporation or organization   Identification No.

 

20/F, EIB Centre, 40-44 Bonham Strand    
 Sheung Wan, Hong Kong     -
(Address of principal executive offices)   (Zip Code)

 

Issuer’s telephone number: (852) 2516 5060

 

Securities Registered Under Section 12(b) of the Exchange Act: None

 

Securities Registered Under Section 12(g) of the Exchange Act:

 

Common Stock, $0.001 par value

(Title of class)

 

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 [X] 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 definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

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 [  ]

 

State the aggregate market value of the voting and non-voting common equity held by non-affiliates. As of March 31, 2017, the aggregate market value of the voting and non-voting common equity held by non-affiliates is based on 3,664,974 shares and the average bid and asked price of $0.041 per share is $150,243.

 

The number of shares outstanding of each of the Registrant’s classes of common stock, as of May 2, 2017 was 23,863,463 shares, all of one class of $0.001 par value Common Stock.

 

 

 

 
   

 

Table of Contents

 

    Page
  Part I. Financial Information    
       
Item 1 Financial Statements   4
       
  Condensed Balance Sheets as of March 31, 2017 (unaudited) and June 30, 2016 (audited)   5
       
  Condensed Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended March 31, 2017 and 2016 (unaudited)   6
       
  Condensed Statements of Cash Flows for the Nine Months Ended March 31, 2017 and 2016 (unaudited)   7
       
  Notes to Condensed Financial Statements   8 - 12
       
Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations General Overview   13
Item 3 Quantitative and Qualitative Disclosures About Market Risk   16
Item 4 Controls and procedures   16
       
  Part II – Other Information    
       
Item 1 Legal Proceedings   17
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds   17
Item 3 Default Upon Senior Securities   17
Item 4 Mine Safety Disclosures   17
Item 5 Other Information   17
Item 6 Exhibits   17
       
  Signatures   18

 

2
   

 

SPECIAL NOTE ON FORWARD LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2 of Part I of this report include forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by forward-looking statements.

 

In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “proposed,” “intended,” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other “forward-looking” information. There may be events in the future that we are not able to accurately predict or control. Before you invest in our securities, you should be aware that the occurrence of any of the events described in this Quarterly Report could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities could decline and you could lose all or part of your investment. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this Quarterly Report to conform these statements to actual results.

 

3
   

 

PART I. FINANCIAL INFORMATION

 

ITEM 1. Financial Statements

 

WINCASH APOLO GOLD & ENERGY, INC.

 

INDEX TO CONDENSED FINANCIAL STATEMENTS

 

(UNAUDITED)

 

    Page
     
Condensed Balance Sheets as of March 31, 2017 and June 30, 2016 (Audited)   5
     
Condensed Statements of Operations And Comprehensive Loss for the Three and Nine Months Ended March 31, 2017 and 2016   6
     
Condensed Statements of Cash Flows for the Nine Months Ended March 31, 2017 and 2016   7
     
Notes to Condensed Financial Statements   8 - 12

 

4
   

 

WINCASH APOLO GOLD & ENERGY, INC.

CONDENSED BALANCE SHEETS

AS OF MARCH 31, 2017 AND JUNE 30, 2016

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

    March 31, 2017     June 30, 2016  
    (Unaudited)     (Audited)  
ASSETS                
Current assets                
Cash and cash equivalents   $ 21,382     $ 8,993  
Prepayments     -       2,914  
                 
TOTAL ASSETS   $ 21,382     $ 11,907  
                 
LIABILITIES & STOCKHOLDERS’ DEFICIT                
Current liabilities                
Other payables and accrued liabilities   $ 41,567     $ 43,067  
Amount due to a director     111,800       44,300  
                 
Total liabilities     153,367       87,367  
                 
Commitments and contingencies                
                 
Stockholders’ deficit                
Preferred stock, $0.001 par value; 25,000,000 shares authorized; None issued and outstanding     -       -  
Common stock, $0.001 par value; 300,000,000 shares authorized; 22,072,118 and 21,872,118 shares issued and outstanding as of March 31, 2017 and June 30, 2016, respectively     22,072       21,872  
Additional paid-in capital     15,955,079       15,939,279  
Deferred compensation     -       (6,667 )
Stock payable     -       16,000  
Accumulated other comprehensive income     4,882       4,882  
Accumulated deficit     (16,114,018 )     (16,050,826 )
Total stockholders’ deficit     (131,985 )     (75,460 )
                 
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT   $ 21,382     $ 11,907  

 

See accompanying notes to the condensed financial statements.

 

5
   

 

WINCASH APOLO GOLD & ENERGY, INC.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2017 AND 2016

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

    Three Months Ended     Nine Months Ended  
    March 31, 2017     March 31, 2016     March 31, 2017     March 31, 2016  
                         
REVENUES   $ -     $ -     $ -     $ -  
                                 
EXPENSES                                
Consulting & professional fees     13,500       16,500       40,500       18,370  
General & administrative expenses     6,198       2,825       16,025       6,344  
Stock-based compensation     -       154,000       6,667       455,333  
TOTAL EXPENSES     19,698       173,325       63,192       480,047  
                                 
LOSS BEFORE INCOME TAX     (19,698 )     (173,325 )     (63,192 )     (480,047 )
                                 
Income tax expense     -       -       -       -  
                                 
NET LOSS   $ (19,698 )   $ (173,325 )   $ (63,192 )   $ (480,047 )
                                 
Other comprehensive loss:                                
Foreign currency translation loss     -       -       -       (2. )
                                 
COMPREHENSIVE LOSS   $ (19,6988 )   $ (173,325 )   $ (63,1923 )   $ (480,049. )
                                 
NET LOSS PER SHARE, BASIC & DILUTED:   $ (0.00 )   $ (0.01 )   $ (0.00 )   $ (0.02 )
                                 
WEIGHTED AVERAGE NUMBER OF COMMON STOCK OUTSTANDING, BASIC & DILUTED:     22,072,118       21,872,118       22,047,300       21,872,118  

 

See accompanying notes to the condensed financial statements.

 

6
   

 

WINCASH APOLO GOLD & ENERGY, INC.

CONDENSED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED MARCH 31, 2017 AND 2016

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

 

    For the nine months ended
March 31, 		 
    2017     2016  
CASH FLOWS FROM OPERATING ACTIVITIES:                
Net loss   $ (63,192 )   $ (480,047 )
Adjustments to reconcile net loss to net cash used in operating activities:                
Stock based compensation     6,667       455,333  
Changes in operating assets and liabilities                
Prepayments     2,914       -  
Other payables and accrued liabilities     (1,500 )     (16,999 )
Net cash used in operating activities     (55,111 )     (10,338 )
                 
CASH FLOWS FROM FINANCING ACTIVITIES:                
Advances from a director     67,500       31,375  
Net cash provided by financing activities     67,500       31,375  
                 
Effect of exchange rate changes on cash and cash equivalents     -       (3 )
                 
NET CHANGE IN CASH AND CASH EQUIVALENTS     12,389       (10,341 )
Cash and cash equivalents, beginning of period     8,993       14,403  
Cash and cash equivalents, end of period   $ 21,382     $ 4,062  
                 
SUPPLEMENTAL CASH FLOWS INFORMATION                
Income taxes paid   $ -     $ -  
Interest paid   $ -     $ -  

 

See accompanying notes to the condensed financial statements.

 

7
   

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED MARCH 31, 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

1. BASIS OF PRESENTATION

 

The accompanying unaudited condensed financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and notes disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosure made are adequate to make the information not misleading.

 

In the opinion of management, the balance sheet as of June 30, 2016 which has been derived from audited financial statements and these unaudited condensed financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended March 31, 2017 are not necessarily indicative of the results to be expected for the entire fiscal year ending June 30, 2017 or for any future period.

 

These unaudited condensed financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended June 30, 2016.

 

2. ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Wincash Apolo Gold & Energy, Inc. (“the Company”) was incorporated in March of 1997 under the laws of the State of Nevada primarily for the purpose of acquiring and developing mineral properties.

 

On September 17, 2014, the Company terminated the Asset Sale & Purchase Agreements with Mr. Tang and Mr. Hu for the acquisition of 24% and 29% equity interest and assets in Everenergy, respectively due to neither Mr. Tang, Mr. Hu or Everenergy had complied various terms and conditions of the Asset Sale & Purchase Agreement. On the same day, the Board of Directors approved the cancellation of the total 19,000,000 shares of restricted common stock at the current market value of $0.12 per share. On October 21, 2014, 11,000,000 shares were returned and effectively cancelled and the Company continues to pursue the return and cancellation of the remaining 8,000,000 shares. On October 16, 2016, the Company received and cancelled 6,208,655 shares.

 

On February 13, 2015, the Company disposed its 100% equity interest in Apolo Gold Direct Limited (formerly Apolo Gold & Energy Asia Limited) to (i) Mr. Tommy Tsap Wai Ping, the Chief Executive Officer (“CEO”) and director of the Company, who acquired 50% equity interest, (ii) Mr. Kelvin Chak Wai Man, a relative of the CEO of the Company, who acquired 40% equity interest, and (iii) China Yi Gao Gold Trader Co., Limited, a company incorporated in Hong Kong, which acquired the remaining 10% equity interest, for a consideration of $100.

 

On June 18, 2015, the Company filed an Amendment to its Articles of Incorporation with the Nevada Secretary of State to change its name from Apolo Gold & Energy, Inc. to WincashApolo Gold & Energy, Inc.

 

The Company will continue to anticipate potential mineral property exploration and other energy related investments. As of March 31, 2017, the Company does not hold any mineral property exploration claims.

 

8
   

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED MARCH 31, 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

3. GOING CONCERN UNCERTAINTIES

 

These condensed financial statements have been prepared assuming that the Company will continue as a going concern which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

 

As of March 31, 2017, the Company has suffered the accumulated deficits of $16,114,018 from prior years and with working capital deficit of $131,985. The continuation of the Company as a going concern is dependent upon the continuing financial support from its stockholders or external financing. Management believes the existing stockholders will provide the additional cash to meet with the Company’s obligations as they become due. However, there can be no assurance that the Company will be able to obtain sufficient funds to meet its obligations.

 

These factors raise substantial doubt about the Company’s ability to continue as a going concern. These condensed financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result in the Company not being able to continue as a going concern.

 

4 . SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The accompanying condensed financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed financial statements and notes.

 

Use of estimates

 

Management uses estimates and assumptions in preparing these condensed financial statements that affect the reported amounts of assets and liabilities in the balance sheet, and the revenue and expenses during the periods reported. Actual results may differ from these estimates.

 

Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

 

Stock-based compensation

 

The Company adopts FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation (“ASC Topic 718”) using the fair value method. Under ASC Topic 718, the stock-based compensation is measured using the Black-Scholes Option-Pricing model on the date of grant under the modified prospective method. The fair value of stock-based compensation that are expected to vest are recognized using the straight-line method over the requisite service period. For the nine months ended March 31, 2017, the Company amortized $6,667 to the operations using the straight-line method.

 

9
   

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED MARCH 31, 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

Income taxes

 

Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

 

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

 

Net loss per share

 

The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted income per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.

 

Related parties

 

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

 

10
   

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED MARCH 31, 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

Fair value of financial instruments

 

The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayments, other payables and accrued liabilities, and amount due to a director approximate at their fair values because of the short-term nature of these financial instruments.

 

The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

 

  Level 1: Observable inputs such as quoted prices in active markets;
     
  Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
     
  Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

 

Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

 

Foreign currency translation

 

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

 

The reporting currency of the Company is United States Dollars (“US$”) and the accompanying condensed financial statements have been expressed in US$.

 

Recent accounting pronouncements

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

 

11
   

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED MARCH 31, 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

4. AMOUNT DUE TO A DIRECTOR

 

As of March 31, 2017 and June 30, 2016, the director of the Company has advanced $111,800 and $44,300, respectively for the payment of administrative expenses. The amount is unsecured, bears no interest and is payable upon demand. Imputed interest is considered insignificant.

 

5. COMMON STOCK

 

On December 1, 2015, the Board of Directors of the Company approved to issue 200,000 shares of restricted common stock at $0.08 per share for the rendering of consulting services of $16,000 in a service period of twelve months commencing from December 2015. For the nine months ended March 31, 2017, all 200,000 shares have been issued and the Company amortized $6,667 to the operations using the straight-line method.

 

There were no stock options, warrants or other potentially dilutive securities outstanding as of March 31, 2017 and June 30, 2016.

 

As of March 31, 2017, there were 22,072,118 shares of common stock issued and outstanding.

 

6. INCOME TAX

 

The Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. For the three and nine months ended March 31, 2017, the Company incurred an operating loss of $19,698 and $63,192, respectively. As of March 31, 2017, the operations in the United States of America incurred $16,114,018 of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carryforwards begin to expire in the year 2017 through 2034, if unutilized. The Company has provided for a full valuation allowance of $5,639,906 against the deferred tax assets on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future.

 

7. RELATED PARTY TRANSACTIONS

 

For the three months ended March 31, 2017 and 2016, the Company paid $6,000 and 6,000, respectively to a company controlled by an officer of the Company for accounting services.

 

For the nine months ended March 31, 2017 and 2016, the Company paid $18,000 and $11,750, respectively to a company controlled by an officer of the Company for accounting services.

 

The related party transactions are generally transacted in an arm-length basis at the current market value in the normal course of business.

 

8. COMMITMENTS AND CONTINGENCIES

 

As of March 31, 2017, the Company has no commitments or contingencies involved.

 

9. SUBSEQUENT EVENTS

 

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after March 31, 2017 up through the date the Company issued the condensed financial statements. During the period, there was no subsequent events that required recognition or disclosure.

 

12
   

 

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations/Plan of Operation General Overview

 

Forward Looking Statements

 

This Quarterly Report on Form 10-Q contains forward-looking statements. These statements relate to future events or our future financial performance. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

 

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. We undertake no duty to update any of the forward-looking statements after the date of this report to conform such statements to actual results or to changes in our expectations.

 

Available Information

 

Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports that we file with the U.S. Securities and Exchange Commission (SEC) are available at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. The SEC also maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC.

 

History

 

Wincash Apolo Gold & Energy Inc. (“Company”) was incorporated in March 1997 under the laws of the State of Nevada. Its objective was to pursue mineral properties in South America, Central America, North America and Asia. The Company incorporated a subsidiary: Compania Minera Apologold, C.A in Venezuela to develop a gold/diamond mining concession in Southeastern Venezuela. Project was terminated in August 2001, due to poor testing results and the property abandoned. This subsidiary company has been inactive since 2001 and will not be reactivated.

 

On April 16, 2002, the Company announced the acquisition of the mining rights to a property known as the Napal Gold Property, (“NUP”). This property is located 48 km south-west of Bandar Lampung, Sumatra, Indonesia. The property consisted of 733.9 hectares and possessed a Production Permit (a KP) # KW. 098PP325.

 

The terms of the Napal Gold Property called for a total payment of $375,000 US over a six-year period of which a total of $250,000 have been made to date. Company paid $250,000 over the past 5 years and subsequent to the year ending June 30, 2008 the Company terminated its agreement on the NUP property and returned all exploration rights to the owner.

 

On December 11, 2013, the Company acquired 70% interest in three gold exploration claims located in China’s Xinjiang Province from Yinfu Gold Corp. (“Yinfu”). The Company issued 6,000,000 shares of restricted common stock for the claims at $0.20 per share for the consideration of $1,200,000. On January 19, 2015, the Company and Yinfu reached a mutual agreement to terminate the acquisition at the current market value of $0.10 per share and therefore an investment loss of $600,000 was resulted. On February 3, 2015, all 6,000,000 shares of restricted common stock were returned and effectively cancelled.

 

13
   

 

On December 23, 2013, the Company acquired 24% interest in Jiangxi Everenergy New Material Co., Ltd. (“Everenergy”) for a consideration of $4,000,000. The consideration was settled with the issuance of 8,000,000 shares of restricted common stock at a deemed price of $0.375 per share, plus $1,000,000 in cash.

 

On February 19, 2014, the Company acquired an additional 29% interest in Everenergy for a consideration of $4,950,000. The consideration was settled with the issuance of 11,000,000 shares of restricted common stock at a deemed price of $0.45 per share.

 

On September 17, 2014, the Company cancelled both transactions with Everenergy at the current market value of $0.12 per share and requested the return of $1,000,000 cash payment. The 11,000,000 shares were effectively cancelled on October 21, 2014 and the Company continues to pursue the return and cancellation of the remaining 8,000,000 shares. On October 16, 2016, the Company received and cancelled 6,208,655 shares. For the year ended June 30, 2015, the Company could not recover the $1,000,000 cash payment and therefore a total investment loss of $6,670,000 was resulted.

 

On February 13, 2015, the Company disposed its 100% equity interest in Apolo Gold Direct Limited (formerly Apolo Gold & Energy Asia Limited) to (i) Mr. Tommy Tsap Wai Ping, who acquired 50% equity interest. Mr. Tsap Wai Ping became the Chief Executive Officer (“CEO”) and director of the Company on December 1, 2015. (ii) Mr. Kelvin Chak Wai Man, the former president, CEO and director of the Company and a relative of the current CEO of the Company, acquired 40% equity interest, and (iii) China Yi Gao Gold Trader Co., Limited, a company incorporated in Hong Kong, which acquired the remaining 10% equity interest, for a consideration of $100.

 

On June 4, 2015, the Company issued 6,000,000 shares of restricted common stock at $0.10 per share for the rendering of business and strategic consulting services of $600,000 in a service period of twelve months commencing from June 2015. For the years ended June 30, 2016 and 2015, the Company amortized $550,000 and $50,000, respectively to the operations using the straight-line method.

 

On June 9, 2015, the Company issued 400,000 shares of restricted common stock at $0.10 per share for the rendering of administrative consulting services of $40,000. As of June 9, 2015, the current market value was $0.10 per share.

 

On June 18, 2015, the Company filed an Amendment to its Articles of Incorporation with the Nevada Secretary of State to change its name from Apolo Gold & Energy, Inc. to Wincash Apolo Gold & Energy, Inc.

 

On June 26, 2015, the Board of Directors of the Company approved to issue 340,000 shares of restricted common stock at $0.15 per share to settle a debt of $51,000 owed to the Chief Executive Officer and director of the Company. All 340,000 shares were issued subsequently on July 2, 2015. As of June 26, 2015, the current market value was $0.16 per share.

 

On December 1, 2015, the Board of Directors of the Company approved the issuance of 200,000 shares of restricted common stock at $0.08 per share for the rendering of consulting services of $16,000 in a service period of twelve months commencing from December 2015. For the nine months ended March 31, 2017, all 200,000 shares have been issued and the Company amortized $6,667 to the operations using the straight-line method.

 

The Company continues to pursue opportunities in the natural resource industry and will consider the acquisition of any other business opportunity in order to enhance value for our shareholders.

 

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Results of Operations –Three months ended March 31, 2017 compared to the three months ended March 31, 2016

 

REVENUES: The Company had no revenues generated for the three months ended March 31, 2017 and 2016.

 

EXPENSES:

 

For the three months ended March 31, 2017 and 2016, the Company incurred a net loss of $19,698 and $173,325, respectively.

 

Consulting and professional fees for the three months ended March 31, 2017 amounted to $13,500 compared to $16,500 for the three months ended March 31, 2016, a decrease of $3,000 is mainly attributable from an additional accounting fee charged for the three months ended March 31, 2016.

 

The Company recorded stock-based compensation costs of $nil for the three months ended March 31, 2017, compared to $154,000 for the three months ended March 31, 2016, a decrease of $154,000 due to no stock-based compensation issued for services during the three months ended March 31, 2017.

 

Results of Operations – Nine months ended March 31, 2017 compared to the nine months ended March 31, 2016

 

REVENUES: The Company had no revenues generated for the nine months ended March 31, 2017 and 2016.

 

EXPENSES:

 

For the nine months ended March 31, 2017 and 2016, the Company incurred a net loss of $63,192 and $480,047, respectively.

 

Consulting and professional fees for the nine months ended March 31, 2017 amounted to $40,500 compared to $18,370 for the nine months ended March 31, 2016, an increase of $22,130 is mainly attributable from a forgiveness of consulting fees in the amount of $22,480 during the nine months ended March 31, 2016.

 

The Company recorded stock-based compensation costs of $6,667 for the nine months ended March 31, 2017, compared to $455,333for the nine months ended March 31, 2016, a decrease of $448,666 due to a lower number of shares issued for services.

 

The Company continues to carefully control its expenses, and intends to seek additional financing both for potential business opportunities it may develop. There is no assurance that the Company will be successful in its attempts to raise additional capital.

 

The Company has no employees in its head office at the present time other than its Officers and Directors, and engages personnel through consulting agreements where necessary as well as outside attorneys, accountants and technical consultants.

 

Cash and cash equivalents as of March 31, 2017 and June 30, 2016 was $21,382 and $8,993, respectively and the Company recognizes it may not have sufficient funds to conduct its affairs. It fully intends to seek financing by way of loans, private placements or a combination of both in the coming months. The Company is dependent on its directors to provide necessary funding when required.

 

LIQUIDITY AND CAPITAL RESOURCES

 

Cash Used in Operating Activities

 

Net cash used in operating activities for the nine months ended March 31, 2017 and 2016 was $55,111 and $10,338, respectively, an increase of $44,773. The net cash used in operating activities are mainly attributed from the net loss of $63,192 incurred for the nine months ended March 31, 2017 and offset by stock based compensation of $6,667.

 

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Cash Used in Investing Activities

 

There was no cash used in or generated from investing activities for nine months ended March 31, 2017 and 2016.

 

Cash Provided by Financing Activities

 

Net cash provided by financing activities for the nine months ended March 31, 2017 and 2016 was $67,500 and $31,375, respectively. The net cash provided by financing activities are mainly attributed from the advances from the director of the Company.

 

The Company has financed its development to date by way of sale of common stock and with loans from directors/shareholders of the Company. As of May 2, 2017, the Company had 23,863,463 shares of common stock outstanding, and has raised total capital since inception in excess of $7,500,000.

 

The Company has limited financial resources with cash and cash equivalents of $21,382 and $8,993 as of March 31, 2017 and June 30, 2016, respectively.

 

Other payables and accrued liabilities as of March 31, 2017 amounted to $41,567 compared to $43,067 as of June 30, 2016.

 

As of March 31, 2017, the amount due to a director was $111,800. As of June 30, 2016, the amount due to a director was $44,300. The amounts were unsecured, interest free and have no fixed terms of repayment.

 

While the Company continues to seek out additional capital, there is no assurance that they will be successful in completing this necessary financing. The Company recognizes that it is dependent on the ability of its management team to obtain the necessary working capital required.

 

While in the pursuit of additional working capital, the Company is also very active in reviewing other resource development opportunities and will continue with these endeavors.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements, financings or other relationships.

 

Contractual Obligations and Commitments

 

As of March 31, 2017, we did not have any contractual obligations and commitments.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK .

 

The Company does not have any market risk sensitive financial instruments for trading or other purposes. All Company cash is held in insured deposit accounts.

 

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 March 31, 2017. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of March 31, 2017, our disclosure controls and procedures were not effective due to the presence of material weaknesses in internal control over financial reporting.

 

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A material weakness is a deficiency, or 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 March 31, 2017, our disclosure controls and procedures were not effective: (i) inadequate segregation of duties and effective risk assessment; (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and applications of both US GAAP and SEC guidelines, and (iii) inadequate financial statement closing process.

 

Changes in Internal Control Over Financial Reporting

 

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

 

Part II - Other Information

 

Item 1. Legal Proceedings: There are no proceedings to report.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. None

 

Item 3. Default Upon Senior Securities: There are no defaults to report.

 

Item 4. Mine Safety Disclosures: N/A

 

Item 5. Other Information: None

 

Item 6. Exhibits

 

31.1   Sarbanes Oxley Section 302 Certification from C.E.O./ C.F.O.
     
32.1   Sarbanes Oxley Section 906 Certification from C.E.O./ C.F.O.
     
101   Interactive Data Files

 

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SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: May 12, 2017  
   
  /s/ Tommy Tsap
  Tommy Tsap, President/CEO

 

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Signature   Title Date   Date
         
/s/ Tommy Tsap        
Tommy Tsap   Chairman, President, CEO, Director   May 12, 2017
         
/s/ Edward Low        
Edward Low   Chief Financial Officer   May 12, 2017

 

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