ITEM
1. FINANCIAL STATEMENTS
The
Tradeshow Marketing Company, Ltd.
Balance
Sheet
(unaudited)
|
|
|
|
November
30
|
|
|
|
|
|
|
|
|
2006
|
|
|
(Audited
)
|
|
|
|
|
|
(Unaudited)
|
|
|
(Restated
)
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
|
|
Cash
and Cash Equivalents
|
|
$
|
18,330
|
|
$
|
43,538
|
|
|
Accounts
Receivable
|
|
|
20,017
|
|
|
-
|
|
|
Inventory
|
|
|
23,104
|
|
|
36,436
|
|
|
|
|
|
|
|
|
|
|
|
Total
Current Assets
|
|
|
61,451
|
|
|
79,974
|
|
|
|
|
|
|
|
|
|
|
|
Long
Term Assets
|
|
|
|
|
|
|
|
|
Equipment
- Net
|
|
|
22,139
|
|
|
28,805
|
|
|
Vehicles
- Net
|
|
|
12,091
|
|
|
14,305
|
|
|
Network
Infrastructure & Software
|
|
|
40,676
|
|
|
43,763
|
|
|
Other
Assets
|
|
|
3,653
|
|
|
3,673
|
|
|
|
|
|
|
|
|
|
|
|
Total
Long Term Assets
|
|
|
78,559
|
|
|
90,546
|
|
|
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
$
|
140,010
|
|
$
|
170,520
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Accounts
Payable
|
|
$
|
769
|
|
$
|
46,423
|
|
|
Shareholder
Loan - Related Party
|
|
|
|
|
|
28,673
|
|
|
Current
Portion - Vehicle Loan
|
|
|
5,739
|
|
|
5,484
|
|
|
|
|
|
|
|
|
|
|
|
Total
Current Liabilities
|
|
|
6,508
|
|
|
80,580
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle
Loan
|
|
|
9,797
|
|
|
13,069
|
|
|
Loan
from Shareholder
|
|
|
166,689
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Liabilities
|
|
|
182,994
|
|
|
93,649
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock, authorized
|
|
|
|
|
|
|
|
|
50,000,000
shares, par value $0.0001,
|
|
|
|
|
|
|
|
|
issued
and outstanding on November 30,
|
|
|
|
|
|
|
|
|
2006
and May 31, 2006 is 17,915,053
|
|
|
|
|
|
|
|
|
and
17,869,283 respectively
|
|
|
1,794
|
|
|
1,789
|
|
|
Paid
in Capital
|
|
|
547,924
|
|
|
510,913
|
|
|
Subscription
Receivable
|
|
|
-
|
|
|
-
|
|
|
Accumulated
Currency Translation
|
|
|
-
|
|
|
14,141
|
|
|
Accumulated
Deficit
|
|
|
(592,702
|
)
|
|
(449,972
|
)
|
|
|
|
|
|
|
|
|
|
|
Total
Stockholders' Equity
|
|
|
(42,984
|
)
|
|
76,871
|
|
|
|
|
|
|
|
|
|
|
|
Total
Liabilities and Stockholders' Equity
|
|
$
|
140,010
|
|
$
|
170,520
|
|
The
accompanying notes are an integral part of these statements
The
Tradeshow Marketing Company, Ltd.
Statments
of Operations
(unaudited)
|
|
|
|
Six Months
Ended
|
|
|
Three
Months
Ended
|
|
|
|
|
|
November
30,
|
|
|
November
30,
|
|
|
|
|
|
2006
|
|
|
2005
|
|
|
2006
|
|
|
2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
198,697
|
|
$
|
77,982
|
|
$
|
66,157
|
|
$
|
69,934
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
117,279
|
|
|
63,417
|
|
|
38,590
|
|
|
59,205
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
81,418
|
|
|
14,565
|
|
|
27,567
|
|
|
10,729
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General
and Administrative
|
|
|
195,095
|
|
|
228,781
|
|
|
111,503
|
|
|
122,979
|
|
|
Professional
Fees
|
|
|
29,053
|
|
|
61,042
|
|
|
25,731
|
|
|
8,774
|
|
|
Officer
Compensation
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Expenses
|
|
|
224,148
|
|
|
289,823
|
|
|
137,234
|
|
|
131,753
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(142,730
|
)
|
$
|
(275,258
|
)
|
$
|
(109,667
|
)
|
$
|
(121,024
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency
Translation
|
|
|
-
|
|
|
3,570
|
|
|
-
|
|
|
3,570
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(142,730
|
)
|
$
|
(271,688
|
)
|
$
|
(109,667
|
)
|
$
|
(117,454
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
per Share
|
|
$
|
(0.01
|
)
|
$
|
(0.02
|
)
|
$
|
(0.01
|
)
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number
of Shares
|
|
|
17,885,810
|
|
|
17,440,232
|
|
|
17,885,810
|
|
|
17,440,232
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
company relocated its home office to the U.S. and adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
the
foreign currency translation to contributed capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(14,141
|
)
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part of these statements
The
Tradeshow Marketing Company, Ltd.
Restated
Statements of Stockholders' Equity
(unaudited)
Dec
5, 2003 (Inception) to November 30, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
|
|
|
|
|
|
|
|
|
Common Stock
|
|
Paid
in
|
|
|
Subscriptions
|
|
|
Currency
|
|
|
Accumulated
|
|
|
Total
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Receivable
|
|
|
Translation
|
|
|
Deficit
|
|
|
Equity
|
|
|
Shares
Issued to Founders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
at
$0.0001 per share
|
|
|
51,000,000
|
|
$
|
5,100
|
|
$
|
4,900
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
10,000
|
|
|
Deposits
received for
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
stock
subscriptions
|
|
|
|
|
|
|
|
|
|
|
|
89,264
|
|
|
|
|
|
|
|
|
89,264
|
|
|
Currency
Translation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,115
|
|
|
|
|
|
1,115
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(29,058
|
)
|
|
(29,058
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance,
May 31, 2004
|
|
|
51,000,000
|
|
|
5,100
|
|
|
4,900
|
|
|
89,264
|
|
|
1,115
|
|
|
(29,058
|
)
|
|
71,321
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
Issued for Cash at
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0.15
per share
|
|
|
666,667
|
|
|
67
|
|
|
99,933
|
|
|
(89,264
|
)
|
|
|
|
|
|
|
|
10,736
|
|
|
Shares
Issued for Cash at
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0.001
per share
|
|
|
5,300,000
|
|
|
530
|
|
|
4,470
|
|
|
|
|
|
|
|
|
|
|
|
5,000
|
|
|
Founders
Shares Cancelled
|
|
|
(41,000,000
|
)
|
|
(4,100
|
)
|
|
4,100
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
Shares
Issued for Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
at
$0.35 per share
|
|
|
38,592
|
|
|
4
|
|
|
13,503
|
|
|
|
|
|
|
|
|
|
|
|
13,507
|
|
|
Shares
Issued for Cash and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
subscriptions
receivable
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
at
$0.15 per share
|
|
|
746,704
|
|
|
75
|
|
|
111,930
|
|
|
(87,527
|
)
|
|
|
|
|
|
|
|
24,478
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency
Translation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,612
|
|
|
|
|
|
2,612
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(58,941
|
)
|
|
(58,941
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance,
May 31, 2005
|
|
|
16,751,963
|
|
|
1,676
|
|
|
238,836
|
|
|
(87,527
|
)
|
|
3,727
|
|
|
(87,999
|
)
|
|
68,713
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Received on
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subscription
Receivable
|
|
|
|
|
|
|
|
|
|
|
|
87,527
|
|
|
|
|
|
|
|
|
87,527
|
|
|
Shares
Issued for Cash for
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0.15
per share
|
|
|
291,400
|
|
|
29
|
|
|
43,681
|
|
|
|
|
|
|
|
|
|
|
|
43,710
|
|
|
Shares
issued for Acqusition
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
at
$1.00 per share
|
|
|
15,000
|
|
|
2
|
|
|
14,998
|
|
|
|
|
|
|
|
|
|
|
|
15,000
|
|
|
Shares
Issued for Cash for
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0.25
per share
|
|
|
420,000
|
|
|
42
|
|
|
104,958
|
|
|
|
|
|
|
|
|
|
|
|
105,000
|
|
|
Shares
issued for Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
at
$0.10 per share
|
|
|
295,000
|
|
|
30
|
|
|
29,470
|
|
|
|
|
|
|
|
|
|
|
|
29,500
|
|
|
Shares
Issued for Cash at
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0.25
per share
|
|
|
275,920
|
|
|
28
|
|
|
68,952
|
|
|
|
|
|
|
|
|
|
|
|
68,980
|
|
|
Shares
Issued for Cash at
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0.50
per share
|
|
|
20,000
|
|
|
2
|
|
|
9,998
|
|
|
|
|
|
|
|
|
|
|
|
10,000
|
|
|
Shares
returned and Cancelled
|
|
|
(200,000
|
)
|
|
(20
|
)
|
|
20
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
Currency
Translation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,414
|
|
|
|
|
|
10,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(361,973
|
)
|
|
(361,973
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance,
May 31, 2006
|
|
|
17,869,283
|
|
|
1,789
|
|
|
510,913
|
|
|
-
|
|
|
14,141
|
|
|
(449,972
|
)
|
|
76,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contributed
Capital
|
|
|
|
|
|
|
|
|
14,141
|
|
|
|
|
|
(14,141
|
)
|
|
|
|
|
-
|
|
|
Shares
Issued for Cash at
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$0.50
per share
|
|
|
20,000
|
|
|
2
|
|
|
9,998
|
|
|
|
|
|
|
|
|
|
|
|
10,000
|
|
|
Shares
issued for Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
at
$0.10 per share
|
|
|
25,750
|
|
|
3
|
|
|
12,872
|
|
|
|
|
|
|
|
|
|
|
|
12,875
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(142,730
|
)
|
|
(142,730
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance,
November 30, 2006
|
|
|
17,915,033
|
|
$
|
1,794
|
|
$
|
547,924
|
|
$
|
-
|
|
$
|
-
|
|
$
|
(592,702
|
)
|
$
|
(42,984
|
)
|
The
accompanying notes are an integral part of these statements
The
Tradeshow Marketing Company, Ltd.
Statements
of Cash Flows
(unaudited)
|
|
|
|
Six
Months Ended
|
|
|
Three
Months Ended
|
|
|
|
|
|
2006
|
|
|
2005
|
|
|
2006
|
|
|
2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Profit / (Loss)
|
|
$
|
(142,730
|
)
|
$
|
(275,258
|
)
|
$
|
(109,667
|
)
|
$
|
(121,024
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Significant
Non-Cash Transactions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
issued for service
|
|
|
12,875
|
|
|
50
|
|
|
12,875
|
|
|
50
|
|
|
Contributed
Capital
|
|
|
-
|
|
|
18,096
|
|
|
-
|
|
|
-
|
|
|
Stock
Cancelled
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
Subscriptions
Receivable
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
Depreciation
/ Amortization Expense
|
|
|
8,567
|
|
|
2,020
|
|
|
4,343
|
|
|
1,010
|
|
|
Foreign
Currency Translation
|
|
|
-
|
|
|
(6,151
|
)
|
|
|
|
|
1,146
|
|
|
Changes
in Assets and Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Increase)/Decrease
in Inventory
|
|
|
13,332
|
|
|
(11,758
|
)
|
|
8,282
|
|
|
(74
|
)
|
|
(Increase)/Decrease
in Accounts Receivable
|
|
|
(20,017
|
)
|
|
(22,693
|
)
|
|
966
|
|
|
33,986
|
|
|
(Increase)/Decrease
in Other Assets
|
|
|
20
|
|
|
3,609
|
|
|
|
|
|
259
|
|
|
Increase/(Decrease)
in Payables
|
|
|
(45,654
|
)
|
|
(16,945
|
)
|
|
(30,615
|
)
|
|
(4,978
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash (Used) by Operating Activities
|
|
|
(173,607
|
)
|
|
(309,030
|
)
|
|
(113,816
|
)
|
|
(89,625
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase
of Network Infastructure
|
|
|
(2,072
|
)
|
|
-
|
|
|
-
|
|
|
-
|
|
|
Equipment
Purchase
|
|
|
5,727
|
|
|
(11,521
|
)
|
|
-
|
|
|
(6,222
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Used by Investment Activities
|
|
|
3,655
|
|
|
(11,521
|
)
|
|
-
|
|
|
(6,222
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from Shareholder Loans
|
|
|
138,016
|
|
|
2,519
|
|
|
104,606
|
|
|
1,767
|
|
|
Proceeds/(Payments)
- Equipment Financing
|
|
|
(3,272
|
)
|
|
(1,548
|
)
|
|
(1,456
|
)
|
|
(1,272
|
)
|
|
Proceeds
from sale of Common Stock
|
|
|
10,000
|
|
|
243,736
|
|
|
-
|
|
|
20,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Provided by Financing Activities
|
|
|
144,744
|
|
|
244,707
|
|
|
103,150
|
|
|
20,495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Increase / (Decrease) in Cash
|
|
|
(25,208
|
)
|
|
(75,844
|
)
|
|
(10,666
|
)
|
|
(75,352
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash,
Beginning of Period
|
|
|
43,538
|
|
|
86,876
|
|
|
28,996
|
|
|
86,384
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash,
End of Period
|
|
$
|
18,330
|
|
$
|
11,032
|
|
$
|
18,330
|
|
$
|
11,032
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Significant
Non-Cash Transactions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
company relocated its home office to the U.S. and adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
the
foreign currency translation to contributed capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(14,141
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Paid
|
|
$
|
4,437
|
|
$
|
1,422
|
|
$
|
4,437
|
|
$
|
1,422
|
|
|
Income
Taxes Paid
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
The
accompanying notes are an integral part of these
statements
THE
TRADESHOW MARKETING COMPANY INC
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
(November
30, 2006 and May 31, 2006)
|
NOTE
1.
|
GENERAL
ORGANIZATION AND BUSINESS
|
The
Tradeshow Marketing Company, Inc. (the Company) was organized in the state
of
Nevada on December 3, 2003. The Company was formed to marketing specialty
products at tradeshows, infomercials, specialty product shops and kiosks in
malls. The Company through August 31, 2006 has only been selling at tradeshows
and in malls.
On
August
31, 2005, the Company purchased the inventory and executed a sublease agreement
with two small retail stores in the Arrowhead and Paradise Valley Malls in
Phoenix, Arizona.
The
Company operates on a May 31 fiscal year end.
These
statements have been adjusted to reflect the restatement of the Company’s May
31, 2006 and 2005 audited financial statements.
|
NOTE
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING
PRACTICES
|
The
relevant accounting policies and procedures are listed below.
Adjustments
within Financial Statements
These
statements have been adjusted to reflect the restatement of the Company’s May
31, 2006 and 2005 audited financial statements. Please refer to the restated
financials for May 21, 1006 and 2005 for details.
The
Balance Sheet and Statement of Stockholders’ Equity for the current six month
period ended November 30, 2006 has been adjusted to reflect the increase in
Paid
in Capital of $14,141 to eliminate the $14,141 accumulated foreign currency
translation.
Accounting
Basis
The
statements were prepared following generally accepted accounting principles
of
the United States of America consistently applied.
Cash
and Cash Equivalents
Cash
and
cash equivalents consist of cash and deposits in transit.
Dividends
The
Company has not yet adopted any policy regarding payment of dividends. No
dividends have been paid during the periods shown.
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 reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those
estimates.
Translation
of Currency
The
company’s headquarters were in Canada through May 31, 2006 and maintained its
financial records in $CDN. For the sake of reporting the Balance Sheet, amounts
were converted to United States dollars using the exchange rate at the end
of
each period. Income statement amounts were converted using an average rate
for
the period resulting in a translation gain or loss for each period
shown.
On
June
1, 2006 the Company relocated its headquarters to Phoenix, Arizona and
established its accounts in U.S. Banks and adopted the U.S. Dollar as its
functional currency. The company has eliminated its accumulated adjustment for
foreign currency translation to contributed capital.
Inventory
The
company inventories finished products it has purchased for resale.
Revenue
Recognition and Accounts Receivable
All
the
sales for the Company are on a point of sale/cash and carry basis. The Company
does not carry receivables for any sales. All sales are final. Revenue is
recognized when a sale is made. No warranties are expressed or offered on any
goods except that of the manufacturer, which they support directly.
Advertising
Expense
Advertising,
promotion and marketing costs are expensed as incurred. Advertising expense
for
the period ended November 30, 2006 and May 31, 2006 was $6,215 and $4,327
respectively.
Income
Taxes
The
provision for income taxes is the total of the current taxes payable and the
net
of the change in the deferred income taxes. Provision is made for the deferred
income taxes where differences exist between the period in which transactions
affect current taxable income and the period in which they enter into the
determination of net income in the financial statements.
Equipment
Equipment
is stated at cost. Depreciation is computed using the straight-line method
over
the assets useful lives, which are 5 year to 7 years. Maintenance and repairs
are charged to expense as incurred.
|
|
|
|
30-Nov-06
|
|
|
31-May-06
|
|
|
Equipment
|
|
$
|
27,050
|
|
$
|
32,387
|
|
|
Accumulated
Depreciation
|
|
|
(4,911
|
)
|
|
(3,582
|
)
|
|
Equipment
- Net
|
|
$
|
22,139
|
|
$
|
28,805
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle
|
|
$
|
23,906
|
|
$
|
24,041
|
|
|
Accumulated
Depreciation
|
|
|
(11,815
|
)
|
|
(9,736
|
)
|
|
Vehicle
- Net
|
|
$
|
12,091
|
|
$
|
14,305
|
|
|
|
|
|
|
|
|
|
|
|
Network
Infrastructure
|
|
$
|
54,100
|
|
$
|
52,028
|
|
|
Accumulated
Depreciation
|
|
|
(13,424
|
)
|
|
(8,265
|
)
|
|
Network
Infrastructure - Net
|
|
$
|
40,676
|
|
$
|
43,763
|
|
The
difference in the value of the vehicle is reflective of the change in the
foreign currency rate
Earnings
per Share (EPS)
The
basic
earnings (loss) per share are calculated by dividing the Company’s net income
available to common shareholders by the weighted average number of common shares
during the year. The diluted earnings (loss) per share are calculated by
dividing the Company’s net income (loss) available to common shareholders by the
diluted weighted average number of shares outstanding during the year. The
diluted weighted average number of shares outstanding is the basic weighted
number of shares adjusted as of the first of the year for any potentially
dilutive debt or equity.
The
Company has not issued any options or warrants since inception, or other
dilutive securities.
The
numerators and denominators used in the computations of basic and diluted EPS
are presented in the following table:
|
November
30,
|
|
|
2006
|
|
|
2005
|
|
|
|
|
|
|
|
|
|
|
|
Numerators
for Basic and Diluted EPS
|
|
|
|
|
|
|
|
|
Net
income/(loss) to common shareholders
|
|
$
|
(142,730
|
)
|
$
|
(271,688
|
)
|
|
|
|
|
|
|
|
|
|
|
Denominators
for Basic and Diluted EPS
|
|
|
|
|
|
|
|
|
Weighted
average of shares outstanding
|
|
|
17,885,810
|
|
|
17,440,232
|
|
|
|
|
|
|
|
|
|
|
|
Basic
and Diluted Earnings/(Loss) Per Share
|
|
$
|
(0.01
|
)
|
$
|
(0.02
|
)
|
|
NOTE
3.
|
STOCKHOLDERS’
EQUITY
|
Common
Stock
The
Company is authorized 50,000,000 common shares with a $0.0001 par
value.
Year
Ended May 31, 2004
At
inception the Company Issued 51,000,000 million shares to the founder for an
investment of $5,100. After year end the founder returned and the Company
cancelled 41,000,000 common shares leaving a net of 10,000,00 for the
founder.
During
the year ended May 31, 2004 cash deposits on private placement stock
subscriptions in the amount of $89,264 were received the stock was not issued
until July 8, 2004.
Year
Ended May 31, 2005
On
July
8, 2004, the Company issued 666,667 common shares in a private placement at
$0.15 per share for a total of $100,000 cash less $89,264 deposits previously
received.
On
August
1, 2004, the Company issued 5,300,000 common shares under a previously committed
Regulation D 504 offering and raised $5,000. These funds were used to pay legal
fees.
On
August
1, 2004, the Company received and cancelled 41,000,000 common shares from its
founder.
On
April
30, 2005, the Company issued 38,592 common shares for consulting services valued
at $13,507 or $0.35 per share.
On
May
31, 2005, the Company issued 746,407 common shares at $0.15 per share in a
private placement and received $28,578 cash and $83,427 subscriptions
Receivable.
Year
Ended May 31, 2006
On
July
15, 2005, the Company issued 291,400 common shares at $0.15 per share in a
private placement for cash in the amount of $43,710.
Between
August 15 and August 30, 2005 the Company issued 420,000 common shares at $0.25
per share in a private placement for cash in the amount of $105,000.
During
the period ended May 31, 2006, the Company issued 310,000 common shares at
$0.10
per share for director and consulting services valued at $31,000.
On
December 1, 2005 the Company issued 275,920 common shares at $0.25 per share
in
a private placement for $68,980 cash.
On
February 20, 2006 the Company issued 20,000 common shares at $0.50 per share
in
a private placement for $10,000 cash.
On
February 28, 2006 the Company received and cancelled 200,000 common shares
that
were issued in error.
Period
Ended November 30, 2006
On
June
1, 1006 the Company recorded $14,141 contributed capital to eliminate the
accumulated foreign currency translation balance.
On
August
30, 2006 the Company issued 20,000 con shares in a private placement for
$10,000.
On
October 15, 2006 the Company issued 25,750 shares of its common stock to two
consultants for services valued at $12,875. The services performed by the
consultants involved accounting and management services, for the period from
June 06 to Oct 06.
|
NOTE
4.
|
NOTES
PAYABLE - RELATED PARTY
TRANSACTION
|
Following
are the notes payable as of November 30, 2006 and May 31, 2006. The Current
portion of vehicle loan is estimated using the $CDN payment times the 2006
average exchange rate to $US:
|
|
|
|
30-Nov-
06
|
|
|
31-May-
06
|
|
|
Installment
note on vehicle,
|
|
|
|
|
|
|
|
|
$537
($CDN) payment for 60 months,
|
|
|
|
|
|
|
|
|
Annual
interest rate at 7.39%
|
|
$
|
15,536
|
|
$
|
18,553
|
|
|
Less:
Current Portion
|
|
|
(5,739
|
)
|
|
(5,484
|
)
|
|
Long-Term
Portion
|
|
|
9,797
|
|
|
14,253
|
|
|
|
|
|
|
|
|
|
|
|
Demand
note, non-interest,
|
|
|
|
|
|
|
|
|
Related
Party
|
|
|
166,689
|
|
|
28,673
|
|
|
|
|
|
|
|
|
|
|
|
Notes
Payable
|
|
$
|
176,486
|
|
$
|
41,742
|
|
A
shareholder has provided operational financing to the company on an unsecured,
non-interest bearing, demand note.
|
NOTE
5.
|
PROVISION
FOR INCOME
TAXES
|
The
Company provides for income taxes under Statement of Financial Accounting
Standards NO. 109, Accounting for Income Taxes. SFAS No. 109 requires the use
of
an asset and liability approach in accounting for income taxes. Deferred tax
assets and liabilities are recorded based on the differences between the
financial statement and tax bases of assets and liabilities and the tax rates
in
effect when these differences are expected to reverse.
SFAS
No.
109 requires the reduction of deferred tax assets by a valuation allowance
if,
based on the weight of available evidence, it is more likely than not that
some
or all of the deferred tax assets will not be realized. The total deferred
tax
asset is $98,994 as of May 31, 2006, which is calculated by multiplying a 22%
estimated tax rate by the cumulative NOL of $449,972. The total valuation
allowance is a comparable $98,994.
The
provision for income taxes is comprised of the net changes in deferred taxes
less the valuation account plus the current taxes payable as shown in the chart
below.
|
May
31,
|
|
|
2006
|
|
|
2005
|
|
|
Net
changes in Deferred Tax Benefit
|
|
$
|
79,634
|
|
$
|
12,967
|
|
|
Valuation
account
|
|
|
(79,634
|
)
|
|
(12,967
|
)
|
|
Current
Taxes Payable
|
|
|
0
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
Net
Provision for Income Taxes
|
|
$
|
0
|
|
$
|
0
|
|
Below
is
a chart showing the estimated federal net operating losses and the years in
which they will expire.
|
|
|
|
Year
|
|
|
Amount
|
|
|
Expiration
|
|
|
|
|
|
2004
|
|
$
|
29,058
|
|
|
2024
|
|
|
|
|
|
2005
|
|
|
58,941
|
|
|
2025
|
|
|
|
|
|
2006
|
|
|
361,973
|
|
|
2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
$
|
449,972
|
|
|
|
|
|
NOTE
6.
|
OPERATING
LEASES AND OTHER
COMMITMENTS:
|
The
Company has two operating subleases for retail outlets located in the Arrowhead
and Paradise Valley Malls in Phoenix, Arizona with aggregate monthly payment
of
$8,045 or $96,450 per year. The Arrowhead sub-lease expired in December 2006
and
was subsequently renewed for a period of two years until December 2008 and
Paradise Valley sub-lease will expire in December 2008.The numbers shown below
assume that the company will be able to renew its lease or sublease and continue
to operate these facilities at the current rate:
|
|
|
|
Year
1
|
|
|
Year
2
|
|
|
Year
3
|
|
|
Year
4
|
|
|
Year
5
|
|
|
Retail
Outlets
|
|
$
|
96,450
|
|
$
|
96,450
|
|
$
|
96,450
|
|
$
|
96,450
|
|
$
|
96,450
|
|
The
accompanying financial statements have been prepared assuming that the company
will continue as a going concern. The Company has accumulated a total loss
of
$592,702 since inception. This raises substantial doubt about the Company’s
ability to continue as a going concern. The financial statements do not include
any adjustments that might result from this uncertainty.
Management
continues to seek funding from its shareholders and other qualified investors
to
pursue its business plan of developing specialty retail products, purchasing
retail stores in malls and developing product infomercials.
|
NOTE
8.
|
THE
EFFECT OF RECENTLY ISSUED ACCOUNTING
STANDARDS
|
Below
is
a listing of the most recent accounting standards SFAS 150-154 and their effect
on the Company.
Stat
ement
No.
150
Accounting
for Certain Financial Instruments with Characteristics of both Liabilities
and
Equity (Issued 5/03)
This
Statement establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity.
Statement
No. 151
Inventory
Costs-an amendment of ARB No. 43, Chapter 4 (Issued
11/04)
This
statement amends the guidance in ARB No. 43, Chapter 4,
Inventory
Pricing
,
to
clarify the accounting for abnormal amounts of idle facility expense, freight,
handling costs, and wasted material (spoilage). Paragraph 5 of ARB 43, Chapter
4, previously stated that “…under some circumstances, items such as idle
facility expense, excessive spoilage, double freight and re-handling costs
may
be so abnormal as to require treatment as current period charges….” This
Statement requires that those items be recognized as current-period charges
regardless of whether they meet the criterion of “so abnormal.” In addition,
this Statement requires that allocation of fixed production overheads to the
costs of conversion be based on the normal capacity of the production
facilities.
Statement
No. 152
Accounting
for Real Estate Time-Sharing Transactions (an amendment of FASB Statements
No.
66 and 67)
This
Statement amends FASB Statement No. 66,
Accounting
for Sales of Real Estate
,
to
reference the financial accounting and reporting guidance for real estate
time-sharing transactions that is provided in AICPA Statement of Position (SOP)
04-2,
Accounting
for Real Estate Time-Sharing Transactions
.
This
Statement also amends FASB Statement No. 67, Accounting
for
Costs and Initial Rental Operations of Real Estate Projects
,
states
that the guidance for (a) incidental operations and (b) costs incurred to sell
real estate projects does not apply to real estate time-sharing transactions.
The accounting for those operations and costs is subject to the guidance in
SOP
04-2.
Statement
No. 153
Exchanges
of Non-monetary Assets (an amendment of APB Opinion No. 29)
The
guidance in APB Opinion No. 29,
Accounting
for Non-monetary Transactions
,
is
based on the principle that exchanges of non-monetary assets should be measured
based on the fair value of the assets exchanged. The guidance in that Opinion,
however, includes certain exceptions to the principle. This Statement amends
Opinion 29 to eliminate the exception for non-monetary exchanges of similar
productive assts and replaces it with a general exception for exchanges of
non-monetary assets that do not have commercial substance. A non-monetary
exchange has commercial substance if the future cash flows of the entity are
expected to change significantly as a result of the exchange.
Statement
No. 154
Accounting
Changes and Error Corrections (a replacement of APB Opinion No. 20 and FASB
Statement No. 3)
This
Statement replaces APB Opinion No. 20,
Accounting
Changes,
and FASB
Statement No. 3,
Reporting
Accounting Changes in Interim Financial Statements,
and
changes the requirements for the accounting for and reporting of a change in
accounting principle. This Statement applies to all voluntary changes in
accounting principle. It also applies to changes required by an accounting
pronouncement in the unusual instance that the pronouncement does not include
specific transition provisions. When a pronouncement includes specific
transition provisions, those provisions should be followed.
The
adoption of these new Statements is not expected to have a material effect
on
the Company’s current financial position, results or operations, or cash flows.
|
ITEM
2.
|
MANAGEMENT'S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
|
Nature
of Business
The
Tradeshow Marketing Company was incorporated on December 03, 2003. Over the
past
twenty years, Tradeshow’s management team and demonstration professionals have
worked in the direct sales industry marketing a variety of products directly
to
consumers at trade shows, malls (kiosks), fairs and exhibitions throughout
Canada and the United States. The Company’s product categories include specialty
household, beauty and fitness, home and garden and electronics products. The
products we retail are considered small ticket items, are innovative and are
highly desired by the target audience. Price points for our products typically
start in the $50 range and our target demographic is in the $50,000 - $100,000
annual income range.
Products
from various suppliers that we have sold in the past included:
a)
Ontel
Products: “As Seen On TV” products that include the Swivel Sweeper, Glass Wizard
and AB Master;
b)
American Direct (TriStar): product supplied includes the Lateral Thigh Trainer
and Jack Lalanne’s Power Juicer;
c)
Cava
Industries: supplies the Cold Heat Soldering Tool and Smart Spin
containers;
d)
ITW
Space Bags: supplies Space Bags for storage;
e)
Orange
Glow International: suppliers of cleaning products OxiClean, Orange Glo,
and Kaboom, among others;
f)
Overbreak: supplies toys that include Hover Disc, Hover Copter and Rainbow
Art.
Sales
volumes for products fluctuate increasing significantly during the holiday
season. Typically, the Company experiences the highest sales volume for products
that are demonstrated via infomercials, during those periods when the
infomercials are advertised on television. No one particular product represents
a material portion of our revenues for the entire fiscal year. Rather, annual
gross sales are derived from numerous products, with eight to ten feature
products, on average, being the biggest sellers.
For
the
period ended November 30, 2006 the bulk of our sales revenue has come from
our
retail stores and Internet sales. Both sales channels are experiencing moderate
growth. Store sales continue to lead Internet sales.
Measures
Tradeshow has taken to build infrastructure
To
date,
Tradeshow has sold product at a number of venues that includes trade shows,
malls (kiosks) fairs, exhibitions in the following cities: Canada: Vancouver,
Abbotsford, Victoria, Nanaimo (includes mall kiosks), Calgary, Edmonton, Regina,
Saskatoon, Winnipeg, Toronto (every second year); United States: Puyallup,
WA,
Tacoma, WA, Pomona, CA, Phoenix, AZ.
On
August
31, 2005, Tradeshow acquired the assets and sub-leases of two retail stores
in
the Arrowhead and Paradise Valley Malls in Phoenix, Arizona. Following the
acquisition, the Company changed the name of the two stores to “Sandstrom OnTV”.
The Company’s Sandstrom OnTV stores feature a unique and diverse mix of
innovative consumer products, which includes the same merchandise that the
Company demonstrates and sells at tradeshow venues.
On
December 23, 2005 the company announced the launch of its first eCommerce
website for ON TV products. The site, located at www.ontvco.com, offers direct
access to classic and the most popular ON TV Items. The site is managed buy
the
companies Chief Technical Officer and orders are fulfilled thru the Paradise
Valley retail store in Phoenix Arizona.
Acquisition
of productive assets
The
acquisition of the two retail stores was an acquisition of productive assets,
as
the Company purchased the assets of, and assumed the sub-leases for, both
retail businesses. The Company also received the rights to use the “As Seen On
TV” trade name for the stores, but has decided to use the name Sandstrom OnTV”
instead. The Company acquired $35,000 dollars of stock and equipment in the
acquisition. The assets acquired included an inventory of “as seen on TV”
like products valued at the time of the transaction at $25,000 (based on the
products wholesale prices; the retail value is approximately double that
figure), and store fixtures, such as shelving, displays casing video
surveillance equipment, computers, a cash register and a credit card machine,
the value of which was deemed to be $10,000.
Currently,
each store is fully operational and is open for business during regular mall
hours. Both stores are staffed. There are four full-time employees (as at
November 30, 2006).
The
approximate square footage of each store is 530 sq feet.
The
Company has two operating subleases for retail outlets located in the Arrowhead
and Paradise Valley Malls, Arizona with aggregate monthly payment of $8,045
or
$96,450 per year. The lease on Paradise Valley store expires in December 2008,
and the lease on Arrowhead store expires in December 2006. The numbers shown
below assume that the Company will be able to renew its lease or sublease and
continue to operate these facilities at the current rate:
|
|
|
|
Year
1
|
|
|
Year
2
|
|
|
Year
3
|
|
|
Year
4
|
|
|
Year
5
|
|
|
Retail
Outlets
|
|
$
|
96,450
|
|
$
|
96,450
|
|
$
|
96,450
|
|
$
|
96,450
|
|
$
|
96,450
|
|
Tradeshow
assumed the leases for both store locations. The Arrowhead Mall lease expires
Dec 2006(in the Company’s 2007 fiscal year) and Paradise Valley Mall lease
expires Dec 2008(in the Company’s 2009 fiscal year).
Results
of Operations
Second
quarter of 2006 Compared to Second Quarter of 2005
The
following overview provides a summary of key information concerning our
financial results for the second quarter of our fiscal year ending May
31
st
,2007:
|
|
|
Three
Months Ended
|
|
|
|
|
|
|
November
30,
|
|
Increase
|
|
|
|
|
|
2006
|
|
|
2005
|
|
|
(Decrease
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
66,157
|
|
$
|
69,934
|
|
$
|
(3,777
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of Sales
|
|
|
38,590
|
|
|
59,205
|
|
|
(20,615
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
27,567
|
|
|
10,729
|
|
|
16,838
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
General
and Administrative
|
|
|
111,503
|
|
|
122,979
|
|
|
(11,476
|
)
|
|
Professional
Fees
|
|
|
25,731
|
|
|
8,774
|
|
|
16,957
|
|
|
Officer
Compensation
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Expenses
|
|
|
137,234
|
|
|
131,753
|
|
|
5,481
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Profit / (Loss)
|
|
$
|
(109,667
|
)
|
$
|
(121,024
|
)
|
|
11,357
|
|
Revenue
Total
revenue for the second quarter of 2006 decreased by $ 3,777 due to a slight
drop
in sales.
Expenses
There
was
a decrease o f $ 11,476 in general and administrative expenses for the second
quarter of 2006 compared to the second quarter of 2005, but an increase of
$16,957 for professional fees incurred in the process restating our
financials.
Net
Loss
Our
net
loss for the second quarter of 2006 and 2005 was $(109,667) and $ (121,024)
respectively , for a decrease loss of $11, 357.
Results
of Operations for First Six months of 2006 compared to First Six Months of
2005
The
following overview provides a summary of key information concerning our
financial results for the first six months of our fiscal year ending May
31
st
,2007:
|
|
|
|
Six
Months Ended
November
30,
|
|
|
|
|
|
|
|
|
2006
|
|
|
2005
|
|
|
(Decrease)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
198,697
|
|
$
|
77,982
|
|
$
|
120,715
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
Cost
of Sales
|
|
|
117,279
|
|
|
63,417
|
|
|
53,862
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
Gross
Profit
|
|
|
81,418
|
|
|
14,565
|
|
|
66,853
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
0
|
|
|
General
and Administrative
|
|
|
195,095
|
|
|
228,781
|
|
|
(33,686
|
)
|
|
Professional
Fees
|
|
|
29,053
|
|
|
61,042
|
|
|
(31,989
|
)
|
|
Officer
Compensation
|
|
|
-
|
|
|
-
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
Total
Expenses
|
|
|
224,148
|
|
|
289,823
|
|
|
(65,675
|
)
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
Net
Profit / (Loss)
|
|
$
|
(142,730
|
)
|
$
|
(275,258
|
)
|
$
|
132,528
|
|
Revenue
The
Company generated revenue of $77,982 from operations for the six months ended
November 30,2005. From operations for the six months ended November 30, 2006,
we
generated revenue of $198,697, an increase of $120,715 over the six months
ended
November 30, 2005. The increase in sales is attributable to
the
addition of the online sales channel (
www.ontvco.com
),
as
well as healthy retail sales at the retail outlets.
Expenses
There
was
a decrease o f $33,686 in general and administrative expenses for the first
six
months of 2006 compared to the first six months of 2005,and also a decrease
of
$31,989 for professional fees.
Net
Loss
Our
net
loss for the second quarter of 2006 and 2005 was $(109,667) and $ (121,024)
respectively , for a decrease loss of $11, 357. The decrease in operating loss
between the six months ended November 30, 2005 and the six months ended November
30, 2006 was due to our increased revenue, as well as a decrease in the
professional and consulting fees that we incurred as part of our start up
costs.
For
the
six month periods that ended November 30, 2006 and November 30, 2005, there
was
no officer compensation .
Limited
Operating History; Need for Additional Capital
There
is
no historical financial information about the Company upon which to base an
evaluation of our performance. The Company is a development stage corporation
and has not generated any revenues from operations. We cannot guarantee that
we
will be successful in our business operations. The Company’s business is subject
to risks inherent in the establishment of a new business enterprise. See “Item
1. Description of Business - Risk Factors”.
The
Company has no assurance that future financing will be available to us on
acceptable terms. If financing is not available on satisfactory terms, the
Company may not be unable to continue, develop or expand operations. Equity
financing could result in additional dilution to existing shareholders.
Liquidity
and Financial Condition
The
Company had cash on hand of $18,330 as of November 30, 2006.
The
Company has not attained profitable operations and is dependent upon obtaining
additional financing. For these reasons our auditors have stated in their report
that they have substantial doubt that we will be able to continue as a going
concern.
The
financial statements accompanying this quarterly report contemplate the
Company’s continuation as a going concern. However, the Company has sustained
substantial losses and is still in the development stage. Additional funding
will be necessary to continue development and marketing of our products. The
Company intends to arrange for the sale of additional shares of our common
stock
to obtain additional operating capital for at least the next twelve months.
Off-
Balance Sheet Arrangements
The
Company has no significant off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on the Company’s financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources that are
material to stockholders.
CRITICAL
ACCOUNTING POLICIES AND ESTIMATES
Our
financial statements are based on accounting principles generally accepted
in
the United States of America, many of which require management to make
significant estimates and assumptions. We believe that the following are some
of
the more critical judgment areas in the application of our accounting policies
that currently affect our financial condition and results of operation.
Revenue
recognition
.
We
recognize revenue at the point of sale at our retail stores, at our tradeshows
and over the Internet. We do not carry any accounts receivable and all sales
are
final. No warranties are expressed or offered on any goods except that of the
manufacturer, which they support directly.
Merchandise
inventories
.
We
record inventory at lower of cost (first-in, first-out method) or market value.
We reduce the carrying value of our inventory for estimated obsolescence or
unmarketable inventory by an amount equal to the excess of the cost of inventory
over the estimated market value based upon assumptions about future demand
and
market conditions. If actual market conditions are less favorable than those
projected by management, additional reserves may be required.
Income
taxes
.
The
provision for income taxes is the total of the current taxes payable and the
net
of the change in the deferred income taxes. Provision is made for the deferred
income taxes where differences exist between the period in which transactions
affect current taxable income and the period in which they enter into the
determination of net income in the financial statements.
Stock
Based Compensation:
The
Company accounts for its stock based compensation based upon provisions in
SFAS
No. 123,
Accounting
for Stock-Based Compensation
.
In this
statement stock based compensation is divided into two general categories,
based
upon who the stock receiver is, namely: employees/directors and
non-employees/directors. The employees/directors category is further divided
based upon the particular stock issuance plan, namely compensatory and
non-compensatory. The employee/directors non-compensatory securities are
recorded at the sales price when the stock is sold. The compensatory stock
is
calculated and recorded at the securities’ fair value at the time the stock is
given. SFAS 123 also provides that stock compensation paid to non-employees
be
recorded with a value which is based upon the fair value of the services
rendered or the value of the stock given, whichever is more reliable. The
Company has selected to utilize the fair value of the stock issued as the
measure of the value of services obtained.
Risk
Factors
An
investment in our common stock involves a high degree of risk. You should
carefully consider the risks described below and the other information in this
Annual Report before investing in our common stock. If any of the following
risks occur, our business, operating results and financial condition could
be
seriously harmed. The trading price of our common stock could decline due to
any
of these risks, and you may lose all or part of your investment.
Our
accountants believe there is substantial doubt about our ability to continue
as
a going concern.
The
Company incurred a loss in the amount of $592,702 for the period from inception
November 30, 2006. Net loss from operations for the six months ended November
30, 2005 was $$275,28
Net
loss
from operation for the six months ended November 30, 2006, was $142,730. The
decrease in operating loss of $132,528 between the six months ended November
30,
2005 and November 30, 2006 was due to our increased revenue, as well as a
decrease in the professional and consulting fees that we incurred as part of
our
start up costs. For the six month periods that ended November 30, 2006 and
2005,
there was no officer compensation.
The
Company will require additional financing if the costs of our operations are
greater than anticipated. We will also require additional financing to sustain
our business operations if we are not successful in earning revenues. We
currently do not have any arrangements for financing and we may not be able
to
obtain financing when required. The Company’s future is dependent upon our
ability to obtain financing and upon future profitable operations from the
development of our business. Obtaining additional financing would be subject
to
a number of factors. These factors may make the timing, amount, terms or
conditions of additional financing unavailable to the Company.
Since
this is a new direction for the business, we face a high risk of business
failure due to our inability to predict the success of our business
The
Company has just begun the initial stages of our new business, and thus we
have
no way to evaluate the likelihood that we will be able to operate the business
successfully. The Company was incorporated on December 3, 2003, and to date
has
been involved primarily in the sale of a diverse mix of innovative merchandise
via tradeshows, malls (kiosks), fairs, exhibitions. Tradeshow will also sell
the
same merchandise as part of its offerings in its two new mall-based
stores.
The
Company faces a high risk of business failure because of the unique difficulties
and uncertainties inherent in new ventures.
Potential
investors should be aware of the difficulties normally encountered by commencing
a new business venture and the high rate of failure of such enterprises. The
likelihood of success must be considered in light of the problems, expenses,
difficulties, complications and delays encountered in connection with the
business the Company plans to undertake.
Our
stock is a “penny stock”, with the result that trading of our common stock in
any secondary market may be impeded.
The
SEC
has adopted rules that regulate broker-dealer practices in connection with
transactions in penny stocks. Penny stocks are generally equity securities
with
a price of less than $5.00, other than securities registered on certain national
securities exchanges or quoted on the Nasdaq system, provided that current
price
and volume information with respect to transactions in such securities is
provided by the exchange or system. The penny stock rules require a
broker-dealer, prior to a transaction in a penny stock, to deliver a
standardized risk disclosure document prepared by the Commission, that: (a)
contains a description of the nature and level of risk in the market for penny
stocks in both public offerings and secondary trading; (b) contains a
description of the broker's or dealer's duties to the customer and of the rights
and remedies available to the customer with respect to a violation to such
duties or other requirements of Securities' laws; (c) contains a brief, clear,
narrative description of a dealer market, including bid and ask prices for
penny
stocks and the significance of the spread between the bid and ask price; (d)
contains a toll-free telephone number for inquiries on disciplinary actions;
(e)
defines significant terms in the disclosure document or in the conduct of
trading in penny stocks; and (f) contains such other information and is in
such
form, including language, type, size and format, as the Commission shall require
by rule or regulation. The broker-dealer also must provide, prior to effecting
any transaction in a penny stock, the customer with: (a) bid and offer
quotations for the penny stock; (b) the compensation of the broker-dealer and
its salesperson in the transaction; (c) the number of shares to which such
bid
and ask prices apply, or other comparable information relating to the depth
and
liquidity of the market for such stock; and (d) a monthly account statements
showing the market value of each penny stock held in the customer's account.
In
addition, the penny stock rules require that prior to a transaction in a penny
stock not otherwise exempt from those rules; the broker-dealer must make a
special written determination that the penny stock is a suitable investment
for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading
activity in the secondary market for our stock as it is subject to these penny
stock rules. Therefore, stockholders may have difficulty selling those
securities.
FORWARD
LOOKING STATEMENTS
All
statements contained in this Form 10-SB, other than statements of historical
facts, that address future activities, events or developments are
forward-looking statements, including, but not limited to, statements containing
the words "believe," "anticipate," "expect" and words of similar import. These
statements are based on certain assumptions and analyses made by us in light
of
our experience and our assessment of
historical
trends, current conditions and expected future developments as well as other
factors we believe are appropriate under the circumstances. However, whether
actual results will conform to the expectations and predictions of management
is
subject to a number of risks and uncertainties that may cause actual results
to
differ materially.
Such
risks include, among others, the following: international, national and local
general economic and market conditions: our ability to sustain, manage or
forecast our growth; raw material costs and availability; new product
development and introduction; existing government regulations and changes in,
or
the failure to comply with, government regulations; adverse publicity;
competition; the loss of significant customers or suppliers; fluctuations and
difficulty in forecasting operating results; changes in business strategy or
development plans; business disruptions; the ability to attract and retain
qualified personnel; the ability to protect technology; and other factors
referenced in this and previous filings.
Consequently,
all of the forward-looking statements made in this Form 10-SB are qualified
by
these cautionary statements and there can be no assurance that the actual
results anticipated by management will be realized or, even if substantially
realized, that they will have the expected consequences to or effects on our
business operations.
As
used
in this Form 10-SB, unless the context requires otherwise, “Tradeshow” or
“Tradeshow Marketing” or "we" or "us" or the "Company" means The Tradeshow
Marketing Company, Ltd.
Employees
The
Company has 4 employees as of the date of this Quarterly Report other than
our
Directors. The Company conducts its business largely through agreements with
consultants and arms-length third parties.
Research
and Development Expenditures
The
Company has not incurred any research or development expenditures since its
incorporation.
Patents
and Trademarks
The
Company does not own, either legally or beneficially, any patent or trademark.
Seasonality
The
Companies sales are quite seasonal, increasing with the shopping trends
associated with the retail industry of sales peaking during the holiday season.
In the past year, a substantial portion of our total revenues and all or most
of
our earnings came in the first quarter ending February 28. The results of
operations for this quarterly period are not necessarily indicative of the
results for the full fiscal year.
