NOTES TO CONDENSED
FINANCIAL STATEMENTS
FOR THE THREE
AND NINE MONTHS ENDED FEBRUARY 29, 2016
(Currency expressed
in United States Dollars (“US$”), except for number of shares)
NOTE
-
1
BASIS OF PRESENTATION
The
accompanying condensed financial statements have been prepared by management in accordance with accounting principles generally
accepted in the United States (“GAAP”). The preparation of financial statements in conformity with GAAP requires management
to make estimates and assumptions that affect amounts reported in the condensed financial statements and accompanying notes. Actual
amounts may differ from these estimated amounts. Certain information and disclosures normally included in financial statements
prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The principles for
condensed financial information do not require the inclusion of all the information and footnotes required by GAAP for complete
financial statements. Therefore, these financial statements should be read in conjunction with the financial statements and notes
for the year ended May 31, 2015.
NOTE
-
2
ORGANIZATION AND BUSINESS BACKGROUND
Band
Rep Management Inc. (“BNRM” or the “Company”) was incorporated in the State of Nevada as a for-profit
Company on May 4, 2012 and established a fiscal year end of May 31. The Company intends to find and manage new music talents and
bands for a 25% take of the earnings. The Company is currently in the initial start-up stage and all activities of the Company
to date relate to its organization, initial funding and share issuances. The Company has not yet commenced or generated any significant
operations.
NOTE
-
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.
For the nine months ended
February 29, 2016, the Company has incurred a net loss of $18,950 with an accumulated deficit of $88,597 as of that date. The
continuation of the Company is dependent upon the continuing financial support of its shareholders. Management believes this funding
will continue, and is also actively seeking new investors. Management believes the existing stockholders will provide the additional
cash to meet the Company’s obligations as they become due. However, there is no assurance that the Company will be successful
in securing sufficient funds to sustain the operations.
These
and other factors raise substantial doubt about the Company’s ability to continue as a going concern. These condensed financial
statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets
or the amounts and classification of liabilities that may result in the Company not being able to continue as a going concern.
NOTE
-
4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
l
Basis of presentation
These accompanying condensed
financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America
(“US GAAP”).
l
Use of estimates and assumptions
In preparing these condensed
financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in
the balance sheet and revenues and expenses during the periods reported. Actual results August differ from these estimates.
l
Shell company
The Company has not operated
or commenced any significant business with no nominal assets. It is currently considered as a shell company.
BAND REP MANAGEMENT,
INC.
NOTES TO CONDENSED
FINANCIAL STATEMENTS
FOR THE THREE
AND SIX MONTHS ENDED NOVEMBER 30, 2015
(Currency expressed
in United States Dollars (“US$”), except for number of shares)
l
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.
l
Income taxes
The
Company adopted the provisions of paragraph 740-10-25-13 of the FASB Accounting Standards Codification. Paragraph
740-10-25-13 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be
recorded in the financial statements. Under paragraph 740-10-25-13, the Company August recognize the tax benefit from an
uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the
taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements
from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood
of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification,
interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no
material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph
740-10-25-13.
The estimated future tax effects
of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well
as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded
on its balance sheets and provides valuation allowances as management deems necessary.
l
Uncertain tax positions
The Company did not take any
uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the provisions of Section
740-10-25 for the three and nine months ended February 29, 2016 and 2015.
l
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 income by the weighted-average number of common shares outstanding during the period. Diluted
loss 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.
There
were no potentially outstanding dilutive shares for the three and nine months ended February 29, 2016 and 2015.
l
Related parties
The Company follows subtopic
850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related party
transactions.
Pursuant
to section 850-10-20 the related parties include a) affiliates of the Company; b) entities for which investments in their equity
securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825–10–15,
to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and
Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management
of the Company; f) other parties with which the Company August deal if one party controls or can significantly influence the management
or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its
own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting
parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent
that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.
BAND REP MANAGEMENT,
INC.
NOTES TO CONDENSED
FINANCIAL STATEMENTS
FOR THE THREE
AND SIX MONTHS ENDED NOVEMBER 30, 2015
(Currency expressed
in United States Dollars (“US$”), except for number of shares)
The financial statements
shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and
other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation
of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature
of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts
were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary
to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for
each of the periods for which income statements are presented and the effects of any change in the method of establishing the
terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet
presented and, if not otherwise apparent, the terms and manner of settlement.
l
Commitments and contingencies
The
Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Certain
conditions August exist as of the date the financial statements are issued, which August result in a loss to the Company but which
will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities,
and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings
that are pending against the Company or un-asserted claims that August result in such proceedings, the Company evaluates the perceived
merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected
to be sought therein.
If
the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability
can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment
indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be
estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material,
would be disclosed.
Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case
the guarantees would be disclosed. Management does not believe, based upon information available at this time, that these matters
will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there
is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and
results of operations or cash flows.
l
Fair value of financial instruments
The Company follows paragraph
825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has
adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure
the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a
framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value
measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37
of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques
used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted)
in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair
value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:
Level 1
|
Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
|
Level 2
|
Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable
as of the reporting date.
|
Level 3
|
Pricing inputs that are generally observable inputs and not corroborated
by market data.
|
Financial assets are considered
Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and
at least one significant model assumption or input is unobservable.
The fair value hierarchy gives
the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority
to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described
above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.
BAND REP MANAGEMENT,
INC.
NOTES TO CONDENSED
FINANCIAL STATEMENTS
FOR THE THREE
AND SIX MONTHS ENDED NOVEMBER 30, 2015
(Currency expressed
in United States Dollars (“US$”), except for number of shares)
The carrying amounts of the
Company’s financial assets and liabilities, such as other payable and accrued liabilities, approximate their fair values
because of the short maturity of these instruments.
l
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
August be expected to cause a material impact on its financial condition or the results of its operations.
NOTE
-
5
AMOUNT DUE TO A RELATED PARTY
As
of February 29, 2016, the balance represented temporary advances made by a director, Xiaoying Lei to the Company
for its working capital purposes, which were unsecured, interest free and with no fixed terms of repayment.
NOTE
-
6
STOCKHOLDERS’ DEFICIT
The
Company is authorized to issue an aggregate of 200,000,000 common shares with a par value of $0.001 per share. No preferred shares
have been authorized or issued.
As
of February 29, 2016, the Company had a total of 110,022,572 shares of its common stock issued and
outstanding.
NOTE
-
7
INCOME TAXES
As of February 29, 2016, the
Company incurred $88,632 of cumulative net operating losses which can be carried forward to offset future taxable income. The net
operating loss carryforwards begin to expire between 2034 and 2035, if unutilized. The Company has provided for a full valuation
allowance against the deferred tax assets of $31,021 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.
The
following table sets forth the significant components of the aggregate deferred tax assets of the Company as of February 29, 2016
and May 31, 2015:
|
|
February 29,
2016
|
|
|
May 31,
2015
|
|
Deferred tax assets:
|
|
|
|
|
|
|
|
|
Net operating loss carryforwards
|
|
$
|
31,021
|
|
|
$
|
24,196
|
|
Less: valuation allowance
|
|
|
(31,021
|
)
|
|
|
(24,196
|
)
|
Deferred tax assets
|
|
$
|
–
|
|
|
$
|
–
|
|
Management
believes that it is more likely than not that the deferred tax assets will not be fully realizable in the future.
Accordingly, the Company provided for a full valuation allowance against its deferred tax assets as of February 29,
2016. In 2015, the valuation allowance increased by $6,825, primarily relating to net operating loss carryforwards from the
local tax regime.
The Company is delinquent
in filing its United States corporation income tax returns for the periods from inception to 2014. The Company does not expect
any tax to be due upon filing of these delinquent returns.
NOTE
-
8
RELATED PARTY TRANSACTIONS
For
the three and nine months ended February 29, 2016, the Company utilized office space occupied by a director and
stockholder at no charge. Such costs are immaterial to the financial statements and accordingly are not reflected herein.
NOTE
-
9
SUBSEQUENT EVENTS
The Company evaluated subsequent
events through the date the financial statements were issued. There were no subsequent events that required recognition or disclosure.