UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549



FORM 10-Q

|(Mark one)
|----------
|          
|[x]       

For the Quarterly Period Ended August 31,
2012

OR

|[ ] | 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: 000-54440
|                                 

CLOUD STAR CORPORATION

(Exact name
of registrant as specified in its charter)

|Nevada                            |  | 27-4479356         
|--------------------------------- |  | -------------------
|(State or Other Jurisdiction      |  | (I.R.S. Employer   
|of Incorporation or Organization) |  | Identification No.)



|9891 Irvine Center Drive, Suite 200, Irvine, CA |  | 92618     
|----------------------------------------------- |  | ----------
|(Address of principal executive offices)        |  | (Zip Code)

(866) 250-2999(Registrant’s telephone number, including area code)



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 [ ] No [ ] Not Applicable

Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

|Large accelerated filero | Accelerated filero | Non-accelerated filero | Smaller reporting company [X]
|------------------------ | ------------------ | ---------------------- | -----------------------------

Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). YesoNo [X]

Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of October 15, 2012, the registrant’s outstanding
common stock consisted of 97,200,000 shares, $0.001 par value.









Table of Contents

Cloud Star Corporation

Index to Form 10-Q

For the Quarterly Period Ended August 31, 2012

|PART I   | Financial Information                                                                 | 3 
|-------- | ------------------------------------------------------------------------------------- | --
|         |                                                                                       |   
|ITEM 1.  | Unaudited Balance Sheets                                                              | 3 
|         | Unaudited Statements of Operations                                                    | 4 
|         | Unaudited Statement of Stockholders’ Deficit                                          | 5 
|         | Unaudited Statements of Cash Flows                                                    | 6 
|         | Notes to the Unaudited Financial Statements                                           | 7 
|         |                                                                                       |   
|         |                                                                                       |   
|         |                                                                                       |   
|ITEM 2.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 12
|         |                                                                                       |   
|ITEM 3.  | Quantitative and Qualitative Disclosures About Market Risk                            | 20
|         |                                                                                       |   
|ITEM 4T. | Controls and Procedures                                                               | 20
|         |                                                                                       |   
|PART II  | Other Information                                                                     | 23
|         |                                                                                       |   
|ITEM 1.  | Legal Proceedings                                                                     | 23
|         |                                                                                       |   
|ITEM 1A. | Risk Factors                                                                          | 23
|         |                                                                                       |   
|ITEM 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                           | 23
|         |                                                                                       |   
|ITEM 3   | Defaults Upon Senior Securities                                                       | 23
|         |                                                                                       |   
|ITEM 4   | Submission of Matters to a Vote of Security Holders                                   | 23
|         |                                                                                       |   
|ITEM 5   | Other Information                                                                     | 23
|         |                                                                                       |   
|ITEM 6   | Exhibits                                                                              | 24
|         |                                                                                       |   
|         | SIGNATURES                                                                            | 25
|         |                                                                                       |   









2









PART I - FINANCIAL INFORMATION



Item I. Financial Statements.





CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

BALANCE SHEETS

(Unaudited)



|                                                                                                                                                                                 | August 31, 2012        |  | February 29, 2012     
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------- |  | ----------------------
|ASSETS                                                                                                                                                                           |                        |  |                       
|Current assets:                                                                                                                                                                  |                        |  |                       
|Cash                                                                                                                                                                             | $                  169 |  | $             13,658  
|Total current assets                                                                                                                                                             | 169                    |  | 13,658                
|                                                                                                                                                                                 |                        |  |                       
|Website and software costs, net                                                                                                                                                  | 61,279                 |  | 31,279                
|TOTAL ASSETS                                                                                                                                                                     | $             61,448   |  | $             44,937  
|                                                                                                                                                                                 |                        |  |                       
|LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                                                                                            |                        |  |                       
|Current liabilities:                                                                                                                                                             |                        |  |                       
|Accounts payable                                                                                                                                                                 | $             27,344   |  | $                    -
|Accrued payroll and related                                                                                                                                                      | 38,200                 |  | 100                   
|Related party convertible note payable                                                                                                                                           | 14,854                 |  | 100,000               
|Total liabilities                                                                                                                                                                | 80,398                 |  | 100,100               
|                                                                                                                                                                                 |                        |  |                       
|Commitments and contingencies                                                                                                                                                    |                        |  |                       
|                                                                                                                                                                                 |                        |  |                       
|Stockholders' deficit:                                                                                                                                                           |                        |  |                       
|Preferred stock, $0.001 par value, 10,000,000 shares authorized; none issued                                                                                                     |                        |  |                       
|and outstanding at August 31, 2012 and February 29, 2012                                                                                                                         | -                      |  | -                     
|Common stock, $0.001 par value, 190,000,000 shares authorized; 97,200,000 and 60,000,000 shares    issued and outstanding at August 31, 2012 and February 29, 2012, respectively | 97,200                 |  | 60,000                
|Additional paid-in capital                                                                                                                                                       | 125,596                |  | 15,000                
|Deficit accumulated during the development stage                                                                                                                                 | (241,746)              |  | (130,163)             
|Total stockholders' deficit                                                                                                                                                      | (18,950)               |  | (55,163)              
|TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                                                                                      | $             61,448   |  | $             44,937  





See accompanying notes to unaudited financial
statements.



3









CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

STATEMENTS OF OPERATIONS

(Unaudited)



|                                                                                                                          | For the Three Months Ended August 31, 2012 |  | For the Six Months Ended August 31, 2012 |  | For the Period from October 17, 2011 ("Inception") to August 31, 2012
|------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ |  | ---------------------------------------- |  | ---------------------------------------------------------------------
|Revenue                                                                                                                   | $                       -                  |  | $                             -          |  | $                       -                                            
|                                                                                                                          |                                            |  |                                          |  |                                                                      
|General and administrative [a]                                                                                            | 52,491                                     |  | 102,211                                  |  | 172,374                                                              
|                                                                                                                          |                                            |  |                                          |  |                                                                      
|Loss from operations                                                                                                      | (52,491)                                   |  | (102,211)                                |  | (172,374)                                                            
|                                                                                                                          |                                            |  |                                          |  |                                                                      
|Interest expense - related party                                                                                          | 230                                        |  | 518                                      |  | 618                                                                  
|                                                                                                                          |                                            |  |                                          |  |                                                                      
|Net loss                                                                                                                  | $               (52,721)                   |  | $                   (102,729)            |  | $             (172,992)                                              
|                                                                                                                          |                                            |  |                                          |  |                                                                      
|Weighted average shares basic and diluted                                                                                 | 97,200,000                                 |  | 80,621,739                               |  |                                                                      
|Weighted average basic and diluted loss     per common share                                                              | $                  (0.00)                  |  | $                        (0.00)          |  |                                                                      
|                                                                                                                          |                                            |  |                                          |  |                                                                      
|[a] Includes stock-based compensation of $0, $20,000, and $20,000 for three months ended August 31, 2012,                 |                                           
|six months ended August 31, 2012, and for the period from October 17, 2011 ("Inception") to August 31, 2012, respectively





See accompanying notes to unaudited financial
statements.



4



CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

STATEMENT OF STOCKHOLDERS’ DEFICIT

(Unaudited)



|                                        |  |              |  |                          |  | Additional               |  | Deficit Accumulated During the Development Stage |  | Total Stockholders' Deficit
|--------------------------------------- |  | ------------ |  | ------------------------ |  | ------------------------ |  | ------------------------------------------------ |  | ---------------------------
|                                        |  | Common Stock |  | Paid-in                  |  |                         
|                                        |  | Shares       |  | Amount                   |  | Capital                  |  |                                                 
|Balance at October 17, 2011 (Inception) |  | -            |  | $                      - |  | $                      - |  | $                              -                 |  | $                      -   
|Founders shares issued                  |  | 60,000,000   |  | 60,000                   |  | -                        |  | (59,900)                                         |  | 100                        
|Contributed services                    |  | -            |  | -                        |  | 15,000                   |  | -                                                |  | 15,000                     
|Net loss                                |  | -            |  | -                        |  | -                        |  | (70,263)                                         |  | (70,263)                   
|Balance at February 29, 2012            |  | 60,000,000   |  | 60,000                   |  | 15,000                   |  | (130,163)                                        |  | (55,163)                   
|Net shares retained by stockholders     |  |              |  |                          |  |                          |  |                                                  |  |                            
|of Accend Media in May 2012             |  | 37,000,000   |  | 37,000                   |  | (34,800)                 |  | (8,854)                                          |  | (6,654)                    
|Fully vested stock issued to Director   |  |              |  |                          |  |                          |  |                                                  |  |                            
|($0.10 per share) in May 2012           |  | 200,000      |  | 200                      |  | 19,800                   |  | -                                                |  | 20,000                     
|Contributed capital from related party  |  |              |  |                          |  |                          |  |                                                  |  |                            
|convertible note payable in August 2012 |  | -            |  | -                        |  | 125,596                  |  | -                                                |  | 125,596                    
|Net loss                                |  | -            |  | -                        |  | -                        |  | (102,729)                                        |  | (102,729)                  
|Balance at August 31, 2012              |  | 97,200,000   |  | $               97,200   |  | $             125,596    |  | $                   (241,746)                    |  | $             (18,950)     





See accompanying notes to unaudited financial
statements.



5

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

STATEMENTS OF CASH FLOWS

(Unaudited)



|                                                                               | For the Six Months Ended           |  | For the Period from October 17, 2011 ("Inception") to
|------------------------------------------------------------------------------ | ---------------------------------- |  | -----------------------------------------------------
|                                                                               | August 31, 2012                    |  | August 31, 2012                                      
|Cash flows from operating activities:                                          |                                    |  |                                                      
|Net loss                                                                       | $                    (102,729)     |  | $                    (172,992)                       
|Adjustments to reconcile net loss to net cash    used in operating activities: |                                    |  |                                                      
|Contributed services                                                           | -                                  |  | 15,000                                               
|Stock compensation                                                             | 20,000                             |  | 20,000                                               
|Changes in operating assets and liabilities:                                   |                                    |  |                                                      
|Accounts payable                                                               | 20,690                             |  | 20,690                                               
|Accrued liabilities                                                            | 38,696                             |  | 38,796                                               
|Net cash used in operating activities                                          | (23,343)                           |  | (78,506)                                             
|                                                                               |                                    |  |                                                      
|Cash flows from investing activities:                                          |                                    |  |                                                      
|Website and software costs                                                     | (30,000)                           |  | (61,279)                                             
|Net cash used in investing activities                                          | (30,000)                           |  | (61,279)                                             
|                                                                               |                                    |  |                                                      
|Cash flows from financing activities:                                          |                                    |  |                                                      
|Proceeds from issuance of founders shares                                      | -                                  |  | 100                                                  
|Proceeds from related party convertible note payable                           | 39,854                             |  | 139,854                                              
|Net cash provided by financing activities                                      | 39,854                             |  | 139,954                                              
|                                                                               |                                    |  |                                                      
|Net change in cash                                                             | (13,489)                           |  | 169                                                  
|Cash, beginning of period                                                      | 13,658                             |  | -                                                    
|Cash, end of period                                                            | $                             169  |  | $                             169                    
|                                                                               |                                    |  |                                                      
|Supplemental disclosures of cash flow information                              |                                    |  |                                                      
|Cash paid during the period for:                                               |                                    |  |                                                      
|Interest                                                                       | $                                - |  | $                                -                   
|Taxes                                                                          | $                                - |  | $                                -                   
|                                                                               |                                    |  |                                                      
|Non-cash investing and financing activities:                                   |                                    |  |                                                      
|Contributed capital from related party convertible note payable                | $                      125,596     |  | $                                -                   





See accompanying notes to unaudited
financial statements



6

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS



Note 1 - Organization and Business



Cloud Star Corporation (“Cloud Star”
or the “Company”) was incorporated in the State of Nevada on October 17, 2011 (“Inception”) with operations
located in California. The Company’s Chief Executive Officer assigned its rights and interests in technology named “The
VirtualKey Desktop Solution” (or “MyComputerKey”). The Company’s principal business has been the research
and development (“R&D”) of the MyComputerKey. Cloud Star is currently developing the software infrastructure and
interface with the internet.



The MyComputerKey provides a simple and secure
platform for enterprise customers and government agencies of all sizes to access their desktop infrastructure through the internet
often referred to as the “cloud”. The product offers a person access to their desktop from any location, at any time,
with no configuration requirements and no administration effort. A user inserts the MyComputerKey into a personal computer or “PC”
or Mac USB port to gain instant access directly to their desktop that is familiar and pre-configured to their business needs. The
user’s own desktop image with a standardized operating system, business and productivity applications, and related security
safeguards is available from any corporate or remote site.



Merger



On May 22, 2012,
Cloud Star entered into anAcquisition Agreement and Plan of Mergeragreement with Accend Media
(“Accend”). Prior to this period, Accend generated limited revenues from internet lead generation and marketing landing
pages. Subsequent to the merger, Accend discontinued its business plan.

The Merger was accounted for as a reverse acquisition
in accordance with Accounting Standards Codification (“ASC”) 805 Business Combinations. In connection with this
agreement, Scott Gerardi and another shareholder of Accend transferred or canceled 118,000,000 of their 120,000,000 shares as follows:
60,000,000 shares transferred to acquire Cloud Star; 2,800,000 shares returned to Accend; 200,000 shares transferred to a new director;
5,000,000 shares to be transferred to a third party for contributed capital for the Company and 50,000,000 shares returned to Accend
for cancellation.  Immediately prior to the merger, Accend had 150,000,000 shares outstanding after giving effect for the
five for one stock split approved by its board of directors on March 22, 2012. Immediately after the merger, 97,200,000 shares
are outstanding with the sole shareholder of Cloud Star owning 60,000,000 shares.



The acquisition of Cloud Star resulted in a
change in reporting entity, whereby the financial statements of Cloud Star are reported at historical costs.  As a result,
the accompanying statement of shareholders’ deficit reflects the legal capital structure and shares of Accend.  This
assumes and reports the shares of Accend issued at the time Cloud Star shares were originally issued beginning on October
17, 2011.  Accordingly, the shares totaling 37,000,000 retained by the shareholders of Accend on May 22, 2012 are reflected
as effectively issued in the accompanying statement of shareholders’ deficit and the related assumption of net liabilities
$6,654.  The assets and liabilities of Accend were reported at fair value.



7

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS



The historical share data of Accend were retroactively
adjusted to reflect the five-for-one forward stock split effected on May 7, 2012 in contemplation of the acquisition. The following
is a schedule of Accend assets acquired and liabilities assumed at the date of acquisition:



|Assets acquired:        |  |                        
|----------------------- |  | -----------------------
|Accounts receivable     |  | $                   335
|                        |  |                        
|Liabilities assumed:    |  |                        
|Accounts payable        |  | 6,989                  
|                        |  |                        
|Net liabilities assumed |  | $              (6,654) 
|                        |  |                        

The following unaudited pro forma information
was prepared as if the merger had taken place at the beginning of the period for the six months ended August 31, 2012:



|                                          | Pro Forma Combined              
|----------------------------------------- | --------------------------------
|                                          | Six Months Ended August 31, 2012
|                                          | (Unaudited)                     
|                                          |                                 
|Net loss                                  | $             (102,729)         
|                                          |                                 
|Weighted average shares basic and diluted | 97,200,000                      
|Weighted average shares basic and diluted |                                 
|loss per common share                     | $                  (0.00)       



Cloud Star did not have operations during the corresponding period
in the preceding year.



8

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS



Note 2 - Summary of Significant Accounting Policies



Basis of Presentation

The accompanying
unaudited interim financial statements have been prepared by the Company pursuant to the rules and regulations of the United States
Securities Exchange Commission. Certain information and disclosures normally included in the annual financial statements prepared
in accordance with the accounting principles generally accepted in the Unites States of America have been condensed or omitted
pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation
of these financial statements have been included. Such adjustments consist of normal recurring adjustments. These interim financial
statements should beread in conjunction with the historical financial statements and related notes thereto of the Company
filed with the Securities and Exchange Commission including our Annual Report on Form 10-K for the fiscal year ended February 29,
2012 and the Form 8-K filed on May 22, 2012. The results of operations for the three and six months
ended August 31, 2012, are not necessarily indicative of the results that may be expected for the full year.



We are a development-stage company under ASC
915 - Development Stage Entities with no commercial revenues achieved to date.



Going Concern Considerations and Management’s Plans

The accompanying financial statements have
been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplate continuation
of the Company as a going concern. The Company has incurred net losses of $172,992 since Inception. The Company currently has limited
liquidity, limited access to capital, and no revenue generating activities. These factors raise substantial doubt about our ability
to continue as a going concern. If the Company is unable to obtain adequate capital, it could be forced to cease operations.



Management anticipates the Company will be
dependent, for the foreseeable future, on additional capital to fund further development of our infrastructure and to fund operations
until such time we have sufficient revenues to meet our cost structure. The Company has received $139,854 in funding from inception
to August 31, 2012 from a company controlled by an officer and director. Additional capital is required in order to launch products
in the marketplace. In light of Management’s efforts, there are no assurances that the Company will be successful in obtaining
sufficient capital to continue as a going concern.



The ability of the Company to continue as a
going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually
secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments
that might be necessary if the Company is unable to continue as a going concern.



9



CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS



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 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.



Basic Loss per Common Share

Basic loss per share is calculated by dividing
the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period.
Diluted earnings per share is calculated by dividing the Company’s net income 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 for any potentially dilutive debt or equity. As of August 31, 2012, the Company had 148,540
shares of potentially dilutive shares that have been excluded from the diluted loss per share computations as they would be antidilutive
for the periods presented.



Website and Software

Website and software development costs are
expensed as incurred, except for internal use website and software development costs that qualify for capitalization as described
below, and include compensation and related expenses, costs of computer hardware and software, and costs incurred in developing
features and functionality.



The Company accounts for the costs of computer
software obtained or developed for internal use in accordance with Accounting Standards Codification 350, Intangibles –
Goodwill and Other  (formerly Statement of Position No. 98-1).  Accordingly, the Company expenses costs incurred
in the preliminary project and post implementation stages of software development and capitalizes costs incurred in the application
development stage and costs associated with significant enhancements to existing internal use website and software applications. 
Costs incurred related to less significant modifications and enhancements as well as maintenance are expensed as incurred.



As of August 31, 2012, the Company had capitalized
internal use website and software costs of $61,279.  As of August 31, 2012, there was no accumulated amortization in connection
with these costs as the website and software had not been placed into service.



New Accounting Pronouncements

The Financial Accounting Standards Board issues
Accounting Standard Updates (“ASU”) to amend the authoritative literature in ASC. There have been a number of ASUs
to date that amend the original text of ASC. The Company believes those issued to date either (i) provide supplemental guidance,
(ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on
the Company.



10

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS



Note 3 – Related Party Convertible Notes Payable

The Company received advances from, and had
expenses paid on its behalf by, Leeward Ventures, a Company controlled by Walter Grieves, a director of the Company, totaling $139,854
from Inception through August 31, 2012 to fund software and website development, and provide working capital. The note bears interest
at 1% per annum and is convertible into shares of existing issued common stock at a rate of $0.10 per share. The notes were originally
due on or about August 9, 2012. On such date, $125,000 along with accrued interest of $596 was converted through transfer of Cloud
Star’s shares by an existing shareholder at $0.10 per share or 1,250,000 shares and thus no new shares were issued. As a
result, $125,596 has been recorded as contributed capital in the accompanying financial statements.



Note 4 - Commitments and Contingencies



Operating Lease

On February 23, 2012, the Company entered into
an operating lease for its corporate office for a period of six months for $800 per month. On August 23, 2012, the lease expired.
A new lease has not been entered into as of August 31, 2012.



Employment Agreements



Safa Movassaghi, the Company’s Chief
Executive Officer has provided services valued at $7,500 per month. As of August 31, 2012, the Company has accrued $20,500 in unpaid
salary and $4,500 in accrued payroll taxes for Mr. Movassaghi’s employment agreement in the accompanying balance sheet.



When Accend Media and Cloud Star merged, Scott
Gerardi, then CEO of Accend Media agreed to exchange the majority of his personal shares in exchange for an employment agreement
as the Company’s Chief Compliance Officer and is entitled to $4,000 per month. As of August 31, 2012, the Company has accrued
$12,000 and $1,200 for Mr. Gerardi’s employment agreement and related payroll taxes, respectively, in the accompanying balance
sheet.



Note 5 - Stockholders’ Deficit



Authorizations and Designations

The Company is authorized to issue 190,000,000
shares of its $0.001 par value common stock and 10,000,000 shares of its $ 0.001 par value preferred stock. To date, no preferred
stock is issued.



Common Stock

As of May 22, 2012, the existing shareholders
of Accend retained 37,000,000 shares of its common stock in connection with the merger of Accend. At such date, net liabilities
assumed were $6,654, which are reflected as a reduction of paid-in capital and the deficit accumulated during the development stage
in the accompanying statement of stockholders’ deficit.



During the period from Inception to August
31, 2012, the Company issued 200,000 shares to a director for services rendered. The shares were fully vested on the date of issuance
and stock compensation expense of $20,000 was recorded during the three months ended May 31, 2012. The compensation expense was
determined based on the estimated fair value of the common stock which was deemed to be the conversion price of the convertible
note payable.



11

Contributed Capital

During the period from Inception to August 31, 2012, services were
provided by a director of the Company. During this period, the Chief Executive Officer forgave his salary for two months during
the commencement of operations, valued at $7,500 per month. These unpaid services are considered contributed service to the Company.
The fair value of contributed services totaled $15,000 and has been recognized in the accompanying statement of stockholders’
deficit as contributed services, and the accompanying statement of operations as general and administrative expense.



Note 6 – Subsequent Events



Subsequent to August 31, 2012, the Company had expenses paid on
its behalf by, Leeward Ventures, a Company controlled by Walter Grieves, a director of the Company, totaling $11,500 used operations.



12

Item 2. - Management's Discussion and Analysis of Financial Condition
and Results of Operations



Forward-Looking Information



The Company from time to time may make written
or oral "forward-looking statements" including statements contained in this report and in other communications by the
Company, which are made in good faith by the Company pursuant to the "safe harbor" provisions of the Private Securities
Litigation

Reform Act of 1995.



These forward-looking statements include statements
of the Company's plans, objectives, expectations, estimates and intentions, which are subject to change based on various important
factors (some of which are beyond the Company's control). The following factors, in addition to others not listed, could cause
the Company's actual results to differ materially from those expressed in forward looking statements: the strength of the domestic
and local economies in which the Company conducts operations, the impact of current uncertainties in global economic conditions
and the ongoing financial crisis affecting the domestic and foreign banking system and financial markets, including the impact
on the Company's suppliers and customers, changes in client needs and consumer spending habits, the impact of competition and technological
change on the Company, the Company's ability to manage its growth effectively, including its ability to successfully integrate
any business which it might acquire, and currency fluctuations. All forward-looking statements in this report are based upon information
available to the Company on the date of this report. The Company undertakes no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events, or otherwise, except

as required by law.



Critical Accounting Policies



We developed software for use in our key product,
which was previously tested and proven to be operational. We began integrating the product with our website and internal systems,
and to increase effectiveness and functionality. Such costs incurred have been capitalized. Recently, we began development of our
software to accommodate different operating system platforms. As we perform development of our software, we are incurring costs
which are related to software to sold or marketed, which has different accounting because of technology changes and feasibility.
To the extent we incur costs for development that have not yet reached technological feasibility, we will expense these costs until
such time it is achieved.



Results of Operations



Overview of Current Operations



Cloud Star Corporation was organized December
20, 2010 under the laws of the State of Nevada, as Accend Media. On or about May 22, 2012, Accend Media, and Cloud Star Corporation,
a privately-held Nevada corporation headquartered in California, entered into an Acquisition Agreement and Plan of Merger.



Our Business



Cloud Star is an information technology services
and software company that delivers immediate, easy and secure access to computer desktops and other consumer electron devices from
remote locations.



Overview



Cloud Star's flagship product, MyComputerKeyTM
is a proprietary, patent-pending technology that provides a secure multi-factor validation and authentication system for cloud-based
infrastructures and protects data accessed from remote locations worldwide. The product is a custom-designed USB keycard programmed
to connect via the Internet to users' desktop or server seamlessly, which provides the user immediate access to files, personalized
environments, data, programs and applications. Said differently, MyComputerKeyTM allows a user to access his or her
base computer from different locations utilizing the internet cloud through a separate computer (the “remote computer”).
Working models were manufactured and a successful beta test was completed with the employees from three corporations.



Status of Product Development



MyComputerKeyTM has been in various forms
of Beta for the last 3 Quarters. The latest version of the product is currently undergoing field tests and the results have exceeded
the Company’s expectations. In addition to MyComputerKeyTM, Cloud Star Corp has also developed Secure IP to IP connection
technology, MyTabletKeyTM and MyMobilekeyTM. The Company intends to expand its Beta tests not only with MyComputerKeyTM,
but also the aforementioned products currently under development. Cloud Star Corp intends to being releasing its products to the
retail market in late Q1 or Q2 of 2013.



Key Advantages MyComputerKeyTM



·Users always access their same, consistent and familiar desktopwhere all of
their customized and personal applications and files reside



·No need for software installation on the remote computer and customization—just
plug-inMyComputerKeyTM



·Enhances compliance, and audit capabilities, of Risk Management and Legal



·User desktop images can be backed up on hosting servers and restoredin
case of a disaster and existingcorporate virus software provides continuous scans,
monitoring, andvirus protection against malwareand
virus attacks



There
is an encryption between the host and remote computer as well as a paring feature between the connecting devices.



All information is stored on basis of expiration
therefore avoiding an unauthorized access or codes between the connecting computers.



MyComputerKey also includes our own connection
software that provides the actual connection between the user’s desktop and the host computer the user is using to connect.
This software is fully supportive in all Microsoft TM based computers with quick installation and full security and protection
for the computer.



Cloud Star’s Goals and Objectives



Cloud
Star's goal is to become a provider of customizable, secure,multi-factor validation
and authentication systems.



To do so, it will aggressively
pursue the followingobjectives:



·Initiate a direct marketing campaign

·Establish strategic alliances with key channel partners

·Establish a recognized position in the market

·Protect and expand its intellectual property

·Introduce new products and product upgrades



The discussion that follows conveys these objectives.



For business users, a second version of the
key has been designed that allows the user's information technology (“IT”) departmentto set the security parameters appropriate to thedatabase
to be protected. The modifications consistof creating a user friendly "dashboard"
to make iteasier for the customer to set up the system and createcustomized
features and tokens—as well as de-activate keys in the event they are lost or stolen.
This business-to-business sectoris more competitive. In order to competitively differentiate itself, Cloud Star plans to
develop strategic partnerships tobuild its market
share of the lesscompetitive retail market. Management expects thatusers will find thefollowing characteristics very appealing:



·Cloud Star’s USB keycard is 100% independent and self-contained—no software downloads, configurations,
or synchronizations are required on the remote computer.



·Various user-specific authentication, memory, or pre-set protocol access codes can
be programmedinto this solid-state hardware.



·This technology is user-specific, allows information flow tracking, and can be used
toaccess any pre-determined database, application, fileor user-selected desktop
that is cloud based.



·This technology works universally on both Apple and PC systems. In addition, once the
respectiveuser has finished with the cloud access, there is no trace on the remote
computer that the base computer has used. This is particularly important when using
public computers while travelling.



Cloud
Star’s Sales Strategy



While
virtual USBs have been on the market for severalyears, to date, management is not
aware of any company whohas targeted the mass consumer. Rather, providershave
focused on IT professionals, most likely due tothe perceived complexity of virtualization and security issues.
Cloud Star instead has simplified the processand through an integrated marketing approach,advertises this simplicity to general consumers for avariety
of applications. The sales strategy is to offer a product that is easy to use and utilizes plug and play technology.Cloud
Star wants toimplement this very simple sales strategy.Cloud
Starplans to market and sell their product through several partnerson
a distribution level relationship.



Through a combination of online
marketing, radio and television, consumers aredriven to the website where they can
complete a 100%automated purchase. Cloud Star plans to provide support though
phone sales and telephone call-in technical support. MyComputerKey is a high margin product
soCloud Staris ableto outsource
its fulfillment and customer support while still driving a high margin on all sales. This will
allowCloud Starto focus on product development
and developing marketing strategies with its channel partners.



Cloud
Starplans to market a version II keywith
enhanced security to businesses, government and educational entities that (i) have a mobile workforce (ii)currently
utilize the cloud to increase the effectivenessand reduce costs associated with providing
informationtechnology to its employees, customers and suppliersand
(iii) entities that are considering doing so but havebeen reluctant to do so because
of security concerns.The market potential forCloud
Star's products encompassesseveral market
segments, includinghealthcare facilities, government, media and telecom,manufacturing,
educational facilities, consulting, legaland accounting and aerospace and defense.
The Company successfully completed its Betatests with three such companies and is
currently implementing thisenterprise model.





Cloud Star’s Market
Strategy



Cloud
Star's strategy is based on three targetmarkets:
(i) Direct-to-Consumer; (ii) Retail; and (iii)Business-to-Business (B2B)—including enterprise and the
small and medium-size business market (SMB). Theproduct is the same for each market
segment.



Direct-to-Consumer
(DTC)



Management
believes the internet is thecornerstone to Cloud Star’s marketing effort.
Managementestimates at least 50%of Cloud Star’s
sales will come from the internet and believes $0.50of every dollar spent on marketing
will drive consumersonline to compare, research, sample and buy.



The internetstrategy will focus on driving traffic (consumers) to offer pages by means of a series of
internet marketing platforms including banners,sponsored links, social bookmarking, blogs, surveys, etc. Additionally,
Cloud Star will focus on affiliate marketing roll out with thegoal
of the aforementioned internet marketing strategyto ultimately create an affiliatenetwork.



Television



Management believes that it is not one tool
or media platform that is the answer, but the right mix of media and relevant content delivered
real-time.After management has all its infrastructure tested andproven,
Cloud Star plans to test direct-responsetelevision with 30, 60 and 120 second spots,as well as a possible 30-minute long form infomercial nationally.



There are
many companies that focus on TV as a medium andprovide an array of services besides production. Some
generally participate via revenue share, thus reducingany upfront costs to the advertiser.
The key is toresearch those firms that have experience with similar products, know
what sells and when to sell it. In otherwords, firms that have a good handle on the
marketing mix, specifically the target market, how to reach them,and pricing.



Retail



Cloud Star
plans to offer MyComputerKey through retailstores by selling a secure access and data
protectionservice. This will involve the same product (a key anda disk to
program the key and the computer) where the user could program his or her computer and the
keyand then have secure access to his computer from any other computer in the world.
This would also protectthe user from unauthorized access by others who might have
access to his computer in his absence. This willrequire Cloud Star to set up
a cloud service to authenticate the keys.



Traditional Retail – Point of Purchase



Cloud Staris already in talks with 3 nationalretailers and is considering an early launch versuswaiting until the product reaches greater marketpenetration.Cloud Starhas already begun to develop
retail demand through all of its marketing and advertisingefforts which will be leveraged by management to gain
lower cost retail entry, excellent placement andshelf space. Cloud Star plans
to hire a retail team that will work closely with all retail buyers, retail marketing directorsand store managers to educate their employees and customers about the benefits of MyComputerKey.



Point-of-
Purchase (“POP”) is not just displays, but a wider variety of printedmaterial
that communicates the products messageat the point of purchase. Besides floor stands,
wingracks, and counter unit displays, there are shelf talkers,product
hang tags, shelf signage, ceiling signage,inflatable signage, in-store blimps, video
end-caps, check out signage, window banners, in-store flyers, table tents and informational pamphlets, all vying for the attention
of the time starved consumer who viewsclose to 1,000 items per minute during their 24 minute shopping
trip.



Cloud
Star plans to employ a "PUSH" – "PULL"promotional &
advertising strategy when buildingbrand awareness, generating trial/sampling purchasesand gaining distribution of MyComputerKey. Cloud Star three
stage "go-to-market" approach will first educatethe consumer about the product
through a direct response advertising and marketing initiatives, thenmake the product
readily available with directdistribution and finally implement programs tomotivate
consumers to buy MyComputerKey.



"PUSH",
or "getting the product on the shelf", provides the programs necessary to gain distribution andsecure
product placement on limited retailer shelves. Itconsists of customer marketing funds
(CMF) designedto support the customer's best promotional and consumption building vehicles
as well as employeeincentive and training programs while providingmaterials
that clearly communicate MyComputerKey'sunique selling points. These materials consist
of avariety of "communication messages", including thoselisted
above as well as shelf signs, neck hangers,window banners, floor displays with header
cards,table tents and possibly logo apparel.



"PULL",
or getting the product "off the shelf" and intothe hands of consumers, answers
the biggestquestion posed by on-premise and off-premise buyers; "What are you
doing to drive consumers into my storeto purchase your product?" Pull programs
are designed to entice the customer and educate the consumerwhile motivating them
to sell or purchase our product.Various Pull programs include advertising directedtowards the consumer (print, radio, TV, internet, direct mail, etc), instant redeemable
or mail-in coupons,mail-in money back rebates, retailer loyalty programs, co-branding
with complementary products and wetsampling events.



The key strategy for MyComputerKey's growth
is to understand consumer and channel member needs in orderto satisfy them. In addition,
focus communicationswithin channels that meet primary target consumers and increase
brand image, superior quality andperformance attributes and leverage the brand forstrategic product initiatives. Again,Cloud
Star plans touse theabove advertising
and promotional strategies to driveawareness, trials and new usage.



Business
to Business (B2B)



The business
to business marketconsists of large businesses, educational or governmententities.
These entities utilize private, public orhybrid clouds and will have an infrastructure in place, complete
with firewalls and other security systems.They also have an IT organization to operateand maintain the company's computer systems,networks
and data on behalf of the company. The ITorganization generally will be headed by
a CIO or IT Director.Although the CIO's recommendations will generallybe
reviewed and approved by the CEO, the CIO orIT Director will be the primary decision
maker withrespect to IT matters.



Management believes that in the enterprise
market, CIOs are looking for solutions, not technology. They typically have a staff of IT
experts toevaluate technology. Selling in the enterprise marketrequires
enough industry and company expertise to understand specific problems for which a CIO isseeking solutions. For these reasons,
a successful market entry strategy in the enterprise market needsto
be focused on selected vertical market segments,primarily in the professional service
and medicalpractice sectors.



Small
and medium size businesses may use the cloud for limited purposes, such as Gmail or Office 365, butmay
not yet maintain their data and other programs in the cloud. These companies may want to takeadvantage
of the opportunities offered by the cloud,but may not yet have the infrastructure to
do so. Theymay also have security concerns about using theCloud,
particularly with a mobile workforce. Attractiveinitial markets will include financial, legal, medical and educational
institutions.



Pricing



Initial
pricing for the basic key is $49.99, whichincludes the USB unit and the first year's
subscriptionto the hosting service. In conjunction with the productlaunch,
theCloud Starplans to experiment with
differentoffers, such as:



·Simultaneous purchase of 2nd unit and subscription at 50% off

·	Bundled annual subscriptions, for example:One
year 	= 	$ 49.99

Two year 	= 	$ 69.99

Three
year = 	$ 79.99

·Free 30-day trial with automatic billing on the 31st day unless cancelled



RESULTS OF OPERATIONS FOR THE THREE MONTHS
ENDED AUGUST 31, 2012



For the three month period ending August 31,
2012, the Company recognized no revenues. The Company focused its activities during the three month period ended August 31, 2012
on the development of a software and encryption technology for its flagship
product, MyComputerKeyTMand building its corporate infrastructure. Management believes that revenues will commence
during the first half of the fiscal year ended February 28, 2014, and it will cost an additional $50,000 to release its flagship
product.



The Company incurred total operating expenses
of $52,491 during the three month period ending August 31, 2012. The operating expenses consisted of general and administrative
fees of $52,491. The major components of general and administrative expenses during the three month period ended August 31, 2012
included $2,408 in rent and $37,988 in payroll costs.



RESULTS OF OPERATIONS FOR THE SIX MONTHS
ENDED AUGUST 31, 2012



For the six month period ending August 31,
2012, and for the period from October 17, 2011 (Inception) to August 31, 2012 the Company recognized no revenues. The Company focused
its activities during the six month period ended August 31, 2012 on the merger between Accend Media and Cloud Star Corp., the development
of a software and encryption technology for its flagship
product, MyComputerKeyTMand building its corporate infrastructure. Management believes that revenues will commence
during the first half of the fiscal year ended February 28, 2014, and it will cost an additional $50,000 to release its flagship
product.



The Company incurred total operating expenses
of $102,211 and $172,374 during the six month period ending August 31, 2012 and the period from Inception to August 31, 2012, respectively.
The operating expenses consisted of general and administrative fees of $102,211. The major components of general and administrative
expenses during the six month period ended August 31, 2012 included $20,000 in stock-based compensation, $4,486 in rent and $62,738
in payroll costs.



The Company used net cash in operations of
$23,343 during the six months ended August 31, 2012. The Company used cash in investing activities for the development of software
of $30,000 during the same period, which was provided by cash of $39,854 from financing activities from Leeward Ventures, an entity
controlled by a director of the Company.









Management’s Plan of Operation



Management does not believe that the Company
will be able to generate any significant profit during the coming year. Management believes that general and administrative costs,
as well as building its infrastructure will most likely curtail any significant profits.



Notwithstanding, the Company anticipates it
will continue to generate losses and therefore it may be unable to continue operations in the future. Management anticipates it
will need to raise $25,000 to implement its business plan. As a result, Cloud Star will have to issue debt or equity or enter into
a strategic arrangement with a third party to meet its funding requirements. There can be no assurance that additional capital
will be available to Cloud Star, especially with the current economic environment.



Management believes it has sufficient cash
reserves to keep the Company operational through the third quarter of 2012. Management will need to obtain outside funding to keep
the Company operational beyond the second quarter. There are no assurances that management will be able to secure outside funding.
Management anticipates that the Company will need to spend a minimum of $15,000 over the next twelve months to pay for audit and
legal fees to keep the company fully reporting. Failure to secure additional funding can result in the company being fully reporting,
nonoperational or both non-operational and fully reporting. The Company will require additional funds to build its business infrastructure.
In order to fulfill its capital requirements and execute on its business plan, the Company will be required to raise additional
funds through the issuance of debt or equity securities. There are no assurances additional capital will be available or if available,
on acceptable terms.



Summary of any product research and development
that we will perform for the term of our plan of operation.



We do not anticipate performing any additional
significant product research and development under our current plan of operation.



Expected purchase or sale of plant and significant
equipment



We do not anticipate the purchase or sale of
any plant or significant equipment; as such items are not required by us at this time.



Significant changes in the number of employees



As of August 31, 2012, we had two employees,
our Chief Executive Officer and Chief Compliance Officer. We are dependent upon officers and directors for our future business
development. As our operations expand we anticipate the need to hire additional employees, consultants and professionals; however,
the exact number is not quantifiable at this time.



Liquidity and Capital Resources



The Company has limited financial resources
available, which has had an adverse impact on the Company's liquidity, activities and operations. These limitations have adversely
affected the Company's ability to obtain certain projects and pursue additional business. Without realization of additional capital,
it would be unlikely for the Company to continue as a going concern. In order for the Company to remain a Going Concern it will
need to find additional capital. Additional working capital may be sought through additional debt or equity private placements,
additional notes payable to banks or related parties (officers, directors or stockholders), or from other available funding sources
at market rates of interest, or a combination of these. The ability to raise necessary financing will depend on many factors, including
the nature and prospects of any business to be acquired and the economic and market conditions prevailing at the time financing
is sought. No assurances can be given that any necessary financing can be obtained on terms favorable to the Company, or at all.



As of August 31, 2012, our current assets were
$169 and our current liabilities were $80,398. As of August 31, 2012, our total assets were $61,448 compared to total assets of
$44,937 as of February 29, 2012. Total assets as of August 31, 2012 consisted of $169 in cash and $61,279 in website and internal
use software costs incurred with the development of MyComputerKey. As of August 31, 2012, our total liabilities were $80,398 compared
to current and total liabilities of $100,100 as of February 29, 2012. Our liabilities consisted of $27,322 in accounts payable,
$38,200 in payroll related liabilities, $22 of accrued interest to a related party, and $14,854 for a related party convertible
note payable.



We have not generated positive cash flows from
operating activities. For the six months ended August 31, 2012, net cash flow used in operating activities was $23,343, our net
cash flow used in investing activities was $30,000, and our net cash flows provided by financing activities was $39,854.



Going Concern



Our ability to continue as a going concern
is contingent upon the successful completion of additional financing arrangements and our ability to achieve and maintain profitable
operations.



Therefore, management plans to raise equity
capital to finance the operating and capital requirements of the Company. While the Company is devoting its best efforts to achieve
the above plans, there is no assurance that any such activity will generate funds that will be available for operations. These
conditions raise substantial doubt about the Company's ability to continue as a going concern.



Off-Balance Sheet Arrangements



We do not have any off-balance sheet arrangements
that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.



Item 3. Quantitative and Qualitative Disclosures
about Market Risk.



Not applicable.



Item 4T. Controls and Procedures



Evaluation of Disclosure Controls and Procedures



Our disclosure controls and procedures, as
defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are
designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded,
processed, summarized, and reported within the time periods specified in rules and forms adopted by the SEC, and that such information
is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, to allow
timely decisions regarding required disclosures.



Management, with the participation of the Chief
Executive Officer and the Chief Financial Officer, who is also the sole member of our Board of Directors, has evaluated the effectiveness
of our disclosure controls and procedures as of the end of the period covered by this report. Based on such evaluation, the Chief
Executive Officer and the Chief Financial Officer concluded that, our disclosure controls and procedures were not effective. Our
disclosure controls and procedures were not effective because of the "material weaknesses" described below under "Management's
report on internal control over financial reporting," which are in the process of being remediated as described below under
"Management Plan to Remediate Material Weaknesses."



Management's Report on Internal Control
over Financial Reporting



Our management is responsible for establishing
and maintaining adequate internal control over financial reporting. Internal control over financial reporting, as defined in rules
promulgated under the Exchange Act, is a process designed by, or under the supervision of, our Chief Executive Officer and Chief
Financial Officer and affected by our Board of Directors, management and other personnel to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP.
Internal control over financial reporting includes those policies and procedures that:



- pertain to the maintenance of records that
in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

- provide reasonable assurance that transactions
are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures
are being made only in accordance with authorizations of our management and our Board of Directors; and

- provide reasonable assurance regarding prevention
or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial
statements



Because of its inherent limitations, a system
of internal control over financial reporting can provide only reasonable, not absolute, assurance that the objectives of the control
system are met and may not prevent or detect misstatements. Internal control over financial reporting is a process that involves
human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control
over financial reporting also can be circumvented by collusion or improper override. Because of such limitations, there is a risk
that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However,
these inherent limitations are known features of the financial reporting process, and it is possible to design into the process
safeguards to reduce, though not eliminate, this risk. Further, over time control may become inadequate because of changes in conditions
or the degree of compliance with the policies or procedures may deteriorate.



Our management assessed the effectiveness of
our internal control over financial reporting as of May 31, 2012. In making its assessment, management used the criteria established
in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").
Based on its assessment, management has concluded that we had certain control deficiencies described below that constituted material
weaknesses in our internal controls over financial reporting. As a result, our internal control over financial reporting was not
effective as of May 31, 2012.



A "material weakness" is defined
under SEC rules as a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there
is a reasonable possibility that a material misstatement of a company's annual or interim financial statements will not be prevented
or detected on a timely basis by the company's internal controls. As a result of management's review of the investigation issues
and results, and other internal reviews and evaluations that were completed after the end of quarter related to the preparation
of management's report on internal controls over financial reporting required for this quarterly report on Form 10-Q, management
concluded that we had material weaknesses in our control environment and financial reporting process consisting of the following:



1)lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside
directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal
controls and procedures;



2)insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and
application of US GAAP and SEC disclosure requirements;



We do not believe the material weaknesses described
above caused any meaningful or significant misreporting of our financial condition and results of operations for the quarter ended
May 31, 2012. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside
directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls
and procedures, which could result in a material misstatement in our financial statements in future periods.



Management Plan to Remediate Material Weaknesses



Management believes that the material weaknesses
set forth in item (2) above did not have an effect on our financial results. However, management believes that the lack of a functioning
audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the
establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our
financial statements in future periods. In an effort to remediate the identified material weaknesses and other deficiencies and
enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:



We plan to appoint one or more outside directors
to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will
undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and
approving estimates and assumptions made by management when funds are available to us.



We believe the remediation measures described
above will remediate the material weaknesses we have identified and strengthen our internal control over financial reporting. We
are committed to continuing to improve our internal control processes and will continue to diligently and vigorously review our
financial reporting controls and procedures. As we continue to evaluate and work to improve our internal control over financial
reporting, we may determine to take additional measures to address control deficiencies or determine to modify, or in appropriate
circumstances not to complete, certain of the remediation measures described above.



Changes in Internal Control over Financial
Reporting



There were no changes in our internal control
over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent
fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.

This quarterly report does not include an attestation
report of the Corporation's registered public accounting firm regarding internal control over financial reporting. Management's
report was not subject to attestation by the Corporation's registered public accounting firm pursuant to temporary rules of the
SEC that permit the Corporation to provide only the management's report in this quarterly report.









PART II. OTHER INFORMATION



Item 1 - Legal Proceedings



From time to time, we may become involved in
various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent
uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.



We are not presently a party to any material
litigation, nor to the knowledge of management is any litigation threatened against us, which may materially affect us.



Item 1A - Risk Factors



See Risk Factors set forth in Part I, Item
1A of the Company's Annual Report on Form 10-K for the fiscal year ended February 29, 2012 and the discussion in Item 1, above,
under "Liquidity and Capital Resources."



Item 2 - Unregistered Sales of Equity Securities
and Use of Proceeds



None.



Item 3 - Defaults Upon Senior Securities



None.



Item 4 - Submission of Matters to a Vote of
Security Holders



None.



Item 5 - Other Information



Cloud Star Corporation common stock is currently
listed on the OTC-BB. Following the merger with Accend Media, on May 24, 2012, the Company changed its trading symbol from ACNM
to CLDS.



















23







Item 6 - Exhibits





|Exhibit Number |  | Ref |  | Description of Document                                                                                                                                                                     
|-------------- |  | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|               |  |     |  |                                                                                                                                                                                             
|               |  |     |  |                                                                                                                                                                                             
|31.1           |  |     |  | Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                     
|               |  |     |  |                                                                                                                                                                                             
|32.1           |  |     |  | Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.       
|               |  |     |  |                                                                                                                                                                                             
|101            |  | *   |  | The following materials from this Quarterly Report on Form 10-Q for the quarter ended August 31, 2012, formatted in XBRL (eXtensible Business Reporting Language):                          
|               |  |     |  |                                                                                                                                                                                             
|               |  |     |  | (1)Balance Sheets at August 31, 2012 (unaudited), and February 29, 2012 (audited)                                                                                                           
|               |  |     |  |                                                                                                                                                                                             
|               |  |     |  | (2)Unaudited
        Statements of Operations for the three and six-month periods ended
        August 31, 2012, and the period from October
        17, 2011 (Inception) to August 31, 2012
|               |  |     |  |                                                                                                                                                                                             
|               |  |     |  | (3)Unaudited
        Statements of Stockholders’Deficit from October 17, 2011 (Inception)
        to August 31, 2012                                                                        
|               |  |     |  |                                                                                                                                                                                             
|               |  |     |  | (4)Unaudited
        Statements of Cash Flows for the six-month periods ended August 31,
        2012, and the period from October 17, 2011
        (Inception) to August 31, 2012          
|               |  |     |  |                                                                                                                                                                                             
|               |  |     |  | (5)    Notes to the financial statements.                                                                                                                                                   
|               |  |     |  |                                                                                                                                                                                             



* Pursuant to Rule 406T of Regulation S-T,
these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11
or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange
Act of 1934, as amended, and otherwise are not subject to liability under those sections.





24







SIGNATURES



Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.



Date: October 15, 2012

| | Cloud Star Corporation                                                                  
| | ----------------------------------------------------------------------------------------
| | By: /s/ Safa Movassaghi                                                                 
| | Safa Movassaghi Director and CEO (principal executive, financial and accounting officer)































25