NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
December 31, 2016
NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF
PRESENTATION
Kyto Biopharma, Inc. was formed as a Florida corporation on
March 5, 1999. On August 14, 2002, the Company changed
its name from B Twelve, Inc. to Kyto Biopharma, Inc.
The Company is a biopharmaceutical company,
originally formed to acquire and develop innovative minimally toxic
and non-immunosuppressive proprietary drugs for the treatment of
cancer, arthritis, and other proliferate and autoimmune diseases.
The Company is currently in the development stage and has disposed
of its Research and Development in 2012 and is
now
in the process of looking at a number
of strategies
for acquisition and merger to
become active. Once it has settled on the
strategy, the Company will develop a plan for an acquisition and
the means to achieve its goal.
USE OF ESTIMATES
In preparing financial statements, management is required to make
estimates and assumptions that affect the reported amounts of
assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial statements, and revenues
and expenses during the period presented. Actual results may differ
from these estimates.
Significant estimates during 2016 include, the valuation allowance
of deferred tax assets.
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid investments with original
maturities of three months or less at the time of purchase to be
cash equivalents. There were no cash equivalents at December 31,
2016 and March 31, 2016, respectively.
CONCENTRATIONS
The Company maintains its cash in bank deposit accounts, which, at
times, may exceed federally insured limits. As of December 31,
2016, the Company did not have any deposits in excess of federally
insured limits. The Company has not experienced any losses in such
accounts through December 31, 2016 and March 31, 2016,
respectively.
The Company has obtained and continues to obtain a large amount of
its funding from loans and equity funding from a principal
stockholder related to a director of the Company.
NOTE 2 – INTERIM REVIEW REPORTING
The
accompanying unaudited condensed financial statements of Kyto
Biopharma, Inc. (the "Company") have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission
(the "SEC). Certain information and footnote disclosures, normally
included in financial statements prepared in accordance with
accounting principles generally accepted in the United States of
America have been condensed or omitted pursuant to such SEC rules
and regulations. Nevertheless, the Company believes that the
disclosures are adequate to make the information presented not
misleading. These interim unaudited condensed financial statements
should be read in conjunction with the audited financial statements
and notes thereto included in the Company's March 31, 2016 Annual
Report as filed on Form 10K. In the opinion of management, all
adjustments, including normal recurring adjustments necessary to
present fairly the financial position of the Company with respect
to the interim unaudited condensed financial statements and the
results of its operations for the interim period ended December 31,
2016, have been included. The results of operations for interim
periods are not necessarily indicative of the results for a full
year.
KYTO BIOPHARMA, INC.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
December 31, 2016
NOTE 3 – GOING CONCERN
As reflected in the accompanying unaudited condensed financial
statements, the Company has a working capital deficiency of
$202,335, a deficit accumulated of $32,266,125, and a stockholders'
deficit of $202,335 as of December 31, 2016. The ability of the
Company to continue as a going concern is dependent on the
Company's ability to devise a strategy and produces a business
plan. The unaudited condensed financial statements do not include
any adjustments that might be necessary if the Company is unable to
continue as a going concern.
The Company has yet to generate an internal cash flow, and until
the sales of its product begins, the Company is highly dependent
upon debt and equity funding. The Company must successfully
complete its research and development resulting in a saleable
product. However, there is no assurance that once the development
of the product is completed and finally gains Federal Drug and
Administration clearance, that the Company will achieve a
profitable level of operations.
NOTE
4 - ACCOUNTING STANDARDS UPDATES
Significant
Recent Accounting Pronouncements
Management
does not believe that any recently issued, but not yet effective,
accounting standards if currently adopted would have a material
effect on the accompanying unaudited condensed financial
statements.
NOTE 5 –RELATED PARTY TRANSACTIONS
(A)
– Loan
Payable- Related Party
During
the nine months ended December 31, 2016, the Company received a net
loan from a related party in the amount of $29,286. At December 31,
2016 and March 31, 2016, the Company owed $65,018 and $35,732
respectively to a related party of the Company. The loans are
non-interest bearing, unsecured and due on demand. The loans are
included in loans payable, related party on the accompanying
balance sheet.
(B)
– Accrued
liabilities -Related Party
The
Company leases office space and administrative services from a
related party principal stockholder. Rent and administrative
expense for the three months ended December 31, 2016 and 2016 was
$10,000 and $10,000 and for the nine months ended December 31, 2016
and 2015, was $30,000, and $30,000, respectively and is included in
general and administrative expense in the accompanying statements
of operations.
Directors
fees are also included in Accrued liabilities – related
parties. Directors fees for the three months ended December 31,
2016 and 2016 was $6,000 and $6,000, respectively and for the nine
months ended December 31, 2016 and 2015 was $18,000 and $18,000,
respectively and is included in general and administrative expense
in the accompanying statements of operations. As of December 31,
2016, and March 31, 2016, the remaining balance in the accrued
liabilities-related party account for the above services was
$132,000 and $84,000, respectively.
KYTO BIOPHARMA, INC.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
December 31, 2016
NOTE 6
–
EQUITY
(A)
–
Convertible Preferred
Stock.
On May
24 2007, the Company entered into an agreement with Comindus
Finance Corp. a related party, to issue up to 500,000 convertible
preferred shares at $1.00 per share. This agreement is on an
installment basis. During the year ended March 31, 2008 the Company
issued 473,624 shares of convertible preferred stock to Comindus
Finance Corp. for a total of $473,624 to satisfy the related party
loan payable. Convertible preferred stock may be converted into
common shares at the rate of $0.45 per common share. Convertible
preferred stock bears dividend at a rate of five percent per annum.
Preferred convertible stock has the same voting rights as common
stock. On September 12, 2014, the convertible stocks were converted
to common stock at a price of $0.05 per share. As of December 31,
2016, and March 31, 2016, there are no preferred shares of the
Company issued and outstanding.
As of December 31, 2016, and March 31, 2016, 3,139,747 shares of
the Company’s common stock were issued and
outstanding.
NOTE 7
–
SUBSEQUENT EVENT
Management evaluated all activities of the Company through the
issuance date of the Company's interim unaudited condensed
financial statements and concluded that no subsequent events have
occurred that would require adjustments or disclosure into the
interim unaudited condensed financial statements.