The Company leases its new office in Hollywood, Florida facility under a lease commencing from May 1, 2011 through April 30, 2012 at a minimum annual rent of $ 12,720 (payable monthly) inclusive of related sale taxes and utilities. The Company terminated the lease at its old Location on April 29, 2010
The following tables set forth our selected historical financial data for the periods indicated. The selected statement of operations data for the years ended December 31, 2011 and 2010, and the selected balance sheet data as of December 31, 2011 and 2010, have been derived from our audited financial statements and related notes thereto included elsewhere in this annual report.
REVENUES. During fiscal 2011 and 2010, we had revenues of $602,379 and $603,007 respectively. We experienced a decline in revenue due to the number of claims from past hurricane seasons tapering off and previously being settled.
OPERATING EXPENSES. Our operating expenses consist primarily of payroll and related taxes, professional and consulting services, expenses for executive and administrative personnel and insurance, telephone and communications, facilities expenses, travel and related expenses, and other general corporate expenses. Our operating expenses for fiscal 2011 were $843,390 compared to fiscal year 2010 operating expenses of $771,344 a increase of $72,046 related mainly to a increase in general and administrative expense discussed below.
NET LOSS. We had a net loss of ($252,641) in fiscal year 2011 compared to a net loss of ($185,229) in fiscal 2010. The increase in net loss is primarily attributable to the decrease in revenues partially offset by reduced operating expenses as discussed above.
ASSETS. At December 31, 2011, we had total assets of $78,646 compared to total assets of $101,921 as of December 31, 2010. The decrease is mainly attributable to lower accounts receivable.
The current assets at December 31, 2011, were $62,997 compared to $76,666 at December 31, 2010. As of December 31, 2011, we had $865 of cash and cash equivalents compared to $4,174 at December 31, 2010.
LIABILITIES. At December 31, 2011, we had total liabilities of $226,547 compared to total liabilities of $236,280 as of December 31, 2010. The increase is attributable to an increase of $100,000 in deferred compensation to an officer, and $ 20,676 of higher accounts payable. This was partially offset by $11,946 of decreases in accounts payable to insured and lower notes payable of $39,866 (attributable to normal payments and the disposal of an automobile)
As shown in the accompanying financial statements, the Company incurred net losses for the years ended December 31, 2011 and 2010 of $ 252,641, and $185,229, respectively. Cumulative losses since inception are $ 365,887. The Company has a working capital deficit at December 31, 2011 of $ 140,504. There is no guarantee whether the Company will be able to generate enough revenue and/or raise capital to support its operations. This raises substantial doubt about the Company’s ability to continue as a going concern. Management states that they are confident that they can improve operations and raise the appropriate funds to grow their underlying business. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.
We have audited the accompanying balance sheets of AAA Public Adjusting Group, Inc., as of December 31, 2011, and the related statements of operations, stockholders’ equity (deficit) and cash flows for the year in the period ended December 31, 2011. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audit in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
In the unlikely event that an uncertain tax position exists in which the Company could incur income taxes, the Company would evaluate whether there is a probability that the uncertain tax position taken would be sustained upon examination by the taxing authorities. Reserves for uncertain tax positions would be recorded if the Company determined it is probable that a position would not be sustained upon examination or if payment would have to be made to a taxing authority and the amount is reasonably estimate. As of December 31, 2010, the Company does not believe it has any uncertain tax positions that would result in the Company having a liability to the taxing authorities. The Company’s tax returns are subject to examination by the federal and state tax authorities for the years ended 2006 through 2011.
Certain prior years’ comparative figures have been reclassified to conform to the financial statement presentation adopted for this year.
As shown in the accompanying financial statements, the Company incurred net losses for the years ended December 31, 2010 and 2011 of $ 185,229, and $252,642, respectively. Cumulative losses since inception are $ 545,589. The Company has a working capital deficit at December 31, 2011 of $139,678. There is no guarantee whether the Company will be able to generate enough revenue and/or raise capital to support its operations. This raises substantial doubt about the Company’s ability to continue as a going concern. Management states that they are confident that they can improve operations and raise the appropriate funds to grow their underlying business. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.
The following is a summary of property and equipment at December 31, 2010 and December 31, 2011:
The Company leases its new office in Hollywood, Florida facility under a lease commencing from May 1, 2011 through April 30, 2012 at a minimum annual rent of $ 12,720 (payable monthly) inclusive of related sale taxes and utilities. The Company terminated the lease at its old Location on April 29, 2010.
Rent expense for the years ended December 31, 2010 and 2009 was $ 14,932 and $ 34,206 respectively.
In the year ending December 31, 2010, the company sold 11,250,000 shares of restricted company stock for $35,500 cash and a stock subscription receivable of $1,500. During the year ending December 31, 2010, the company issued 2,275,000 shares of restricted company stock for services values of $6,030.
For financial statement purposes for the period ending December 31, 2010 and 2009, the reported provision for income taxes differs from the amount computed by applying the statutory U.S. Federal income tax rate of 34% to the loss before income taxes as follows: