Note
1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
OptiLeaf
Incorporated ("OptiLeaf" or the "Company") was incorporated in Florida in August 2014. The Company has been
in the development stage since inception and has not generated any sales to date. The Company plans to develop, market and sell
integrated software and hardware to the agriculture industry for the seamless tracking and management of growth, task automation
and sale of their clients' products.
Basis
of Presentation
The
accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles
for interim financial information. Certain information and footnote disclosures normally included in annual financial statements
prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to such principles
and regulations of the Securities and Exchange Commission for Form 10-Q. All adjustments, consisting of normal recurring adjustments,
have been made which, in the opinion of management, are necessary for a fair presentation of the results of interim periods. The
results of operations for such interim periods are not necessarily indicative of the results that may be expected for a full year
because of, among other things, seasonality factors in the retail business. The unaudited financial statements contained herein
should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2015.
Cash
and Cash Equivalents
The
Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash
equivalents consisted of money market funds.
Use
of Estimates
The
preparation of financial statements in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.
Property
and Equipment
Property
and equipment are stated at cost. Depreciation is provided over the estimated useful lives (3 years) of the related assets using
the straight line depreciation method.
Maintenance
and repairs are charged to operations when incurred. Betterments and improvements are capitalized. When property and equipment
are sold or otherwise disposed of, the asset account and related accumulated depreciation account are reduced, and any gain or
loss is included in operations.
Revenue
Recognition
In
general, the Company will record revenue when persuasive evidence of an arrangement exists, services have been rendered or product
delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The
following policies reflect specific criteria for the various revenues streams of the Company:
Revenue
will be recognized at the time the product is delivered or services are performed. Provision for sales returns will be estimated
based on the Company's historical return experience. Revenue will be presented net of returns.
Research
and Development
The
cost of research and development are charged to expense when incurred.
Note
1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Net
Loss Per Common Share
Basic
net (loss) income per common share is calculated using the weighted average common shares outstanding during each reporting period.
Diluted net (loss) income per common share adjusts the weighted average common shares for the potential dilution that could occur
if common stock equivalents (convertible debt and preferred stock, warrants, stock options and restricted stock shares and units)
were exercised or converted into common stock. There were no common stock equivalents at September 30, 2016 and December 31, 2015.
Income
Taxes
Deferred
income taxes are recognized for the tax consequences related to temporary differences between the carrying amount of assets and
liabilities for financial reporting purposes and the amounts used for tax purposes at each year end, based on enacted tax laws
and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation
allowance is recognized when, based on the weight of all available evidence, it is considered more likely than not that all, or
some portion, of the deferred tax assets will not be realized. Income tax expense is the sum of current income tax plus the change
in deferred tax assets and liabilities.
ASC
740, Income Taxes, requires a company to first determine whether it is more likely than not (which is defined as a likelihood
of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming
that taxing authorities will examine the position and have full knowledge of all relevant information. A tax position that meets
this more likely than not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty
percent likely to be realized upon effective settlement with a taxing authority.
The
Federal and state income tax returns of the Company for 2015 and 2014 are subject to examination by the internal Revenue Service
and state taxing authorities for three (3) years from the date filed.
Stock-Based
Compensation
The
Company accounts for equity instruments issued to employees in accordance with ASC 718, Compensation - Stock Compensation. ASC
718 requires all share-based compensation payments to be recognized in the financial statements based on the fair value using
an option pricing model. ASC 718 requires forfeitures to be estimated at the time of grant and revised in subsequent periods if
actual forfeitures differ from initial estimates.
Equity
instruments granted to non-employees are accounted for in accordance with ASC 505, Equity. The final measurement date for the
fair value of equity instruments with performance criteria is the date that each performance commitment for such equity instrument
is satisfied or there is a significant disincentive for non-performance.
Fair
Value of Financial Instruments
Pursuant
to ASC No. 820, "Fair Value Measurement and Disclosures", the Company is required to estimate the fair value of all
financial instruments included on its balance sheet as of September 30, 2016 and December 31, 2015. The Company's financial instruments
consist of accounts payable and accrued expenses. The Company considers the carrying value of such amounts in the financial statements
to approximate their fair value due to the short-term nature of these financial instruments.
Note
1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Recent
Pronouncements
In
February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires lessees to recognize most lease liabilities
on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. The update
states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for
the right to use the underlying asset for the lease term. The update is effective for interim and annual periods beginning after
December 15, 2018, and early adoption is permitted. The Company is currently evaluating the impact of this guidance on its financial
statements.
Other
recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified
Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact
on the Company's present or future financial statements.
Note
2. COMPUTER EQUIPMENT (NET)
Equipment
is recorded at cost and consisted of the following at September 30, 2016:
Computer equipment
|
|
$
|
10,514
|
|
Less: accumulated depreciation
|
|
|
(6,978
|
)
|
|
|
$
|
3,536
|
|
Depreciation
expense was $2,629 and $3,996 for the nine months ended September 30, 2016 and 2015, respectively.
Note
3. STOCKHOLDERS' EQUITY
Common
stock
The
Company has authorized 100,000,000 shares of no par value common stock. At September 30, 2016, the number of shares of common
stock issued was 20,210,419.
Treasury
stock
On
September 20, 2016, the Board of Directors authorized the Company to repurchase one million shares of common stock for $40,000.
These treasury stock shares may at anytime be canceled upon the Board of Directors approval. The Board has not made such election.
Note
4. COMMITMENTS AND CONTINGENCIES
The
Company leases its offices in a month to month arrangement. The monthly minimum lease payments $1,144 plus its pro rata share
of operating expenses.
Note
5. INCOME TAXES
The
provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before
provision for income taxes. The sources and tax effects of the differences are as follows:
Income tax provision at the federal
|
|
|
|
statutory rate
|
|
|
15
|
%
|
Effect of operating losses
|
|
|
(15
|
)%
|
|
|
|
0
|
%
|
At
September 30, 2016, the Company has a net operating loss carryforward of approximately $429,840 for Federal and state purposes.
This loss will be available to offset future taxable income. If not used, this carryforward will begin to expire in 2034. The
deferred tax asset relating to the operating loss carryforward has been fully reserved at September 30, 2016 and December 31,
2015. The principal difference between the operating loss for income tax purposes and reporting purposes is disallowed meals and
entertainment and a temporary difference in depreciation expense.
Note
6. GOING CONCERN
The
Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction
of liabilities in the normal course of business.
The
Company has experienced a loss from operations during its development stage as a result of its investment necessary to achieve
its operating plan, which is long-range in nature. For the period from August 11, 2014 (inception) to September 30, 2016, the
Company incurred a net loss of approximately $429,840. In addition, the Company has no revenue generating operations.
The
Company currently believes it has sufficient cash to sustain itself for the next 12 months, and management believes that the funds
currently on hand will be sufficient for management to execute its plan of operations and to continue as a going concern.
Note
7. CONCENTRATION CREDIT RISK
The
Company maintains its cash balances in a local financial institution. Balances at September 30, 2016 were insured by the Federal
Deposit Insurance Corporation (FDIC) up to $250,000. On September 30, 2016 the Company's uninsured cash balances were approximately
$2,100.