The Company is a shell company as defined in Rule 12b-2 of the Exchange Act. Our principal business objective for the next 12 months and beyond such time will be to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings. The Company will not restrict our potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business.
We do not currently intend to retain any entity to act as a “finder” to identify and analyze the merits of potential target businesses.
For the fiscal year ended April 30, 2020, the Company had a net loss of $111,926 which comprised of general and administrative expenses including legal, accounting, audit, and other professional service fees incurred in relation to the filing of the Company’s periodic reports on Form 10-K and Form 10-Q.
As of April 30, 2020, the Company had assets of $100 in respect of an equity investment. As of April 30, 2019, the Company had $4,000 in assets due to certain prepayments. The Company’s current liabilities as of April 30, 2020 totaled $80,474, comprising $36,701 in accounts payable, $16 in advances on bank overdrafts and $43,757 in advances from a related party. This compares with current liabilities of $351,421 as of April 30, 2019, comprising $2,501 in accounts payable and $348,920 in advances from a related party.
We have audited the accompanying consolidated balance sheets of Prevention Insurance.Com (the “Company”) as of April 30, 2020 and 2019, the related consolidated statements of operations, stockholders’ deficit and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of April 30, 2020 and 2019, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Prevention Insurance.Com (the ”Company”) was incorporated under the laws of the State of Nevada in 1975 as Vita Plus Industries, Inc. In March 1999, the Company sold its remaining inventory and changed its name to Prevention Insurance.Com.
On the closing of the above transaction, Mr. Chee Chau Ng, the sole officer of Seller, resigned in all officer capacities from the Company and Anthony Lococo was appointed Chief Executive Officer and Chief Financial Officer of the Company. In addition, Mr. Lococo was appointed a director of the Company.
The summary of significant accounting policies is presented to assist in the understanding of the financial statements. These policies conform to accounting principles generally accepted in the United States of America (“GAAP”) and have been consistently applied.
These consolidated statements include the financial statements of the Company and its subsidiary company, Paramount Capital, Inc., from the date of its incorporation on September 20, 2019. All intercompany balances and transactions have been eliminated in consolidation.
Revenues are recognized when control of promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
Step 5: Recognize revenue when the entity satisfies a performance obligation
At this time, the Company has not identified specific planned revenue streams.
During the years ended April 30, 2020 and 2019, the Company did not recognize any revenue.
The Company expenses advertising costs when advertisements occur. No advertising costs were incurred during the years ended April 30, 2020 and 2019.
The cost of equity instruments issued to non-employees in return for goods and services is measured by the grant date fair value of the equity instruments issued. The cost of employee services received in exchange for equity instruments is based on the grant date fair value of the equity instruments issued.
The COVID-19 pandemic could have an impact on our ability to obtain financing to fund the operations. The Company is unable to predict the ultimate impact at this time.
There were various accounting standards and interpretations issued recently, none of which are expected to a have a material impact on our financial position, operations or cash flows due to our status as a shell corporation.
The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. For the year ended April 30, 2020, the Company reported a net loss of $111,926, negative working capital of $80,474 and an accumulated deficit of $5,048,978 as of April 30, 2020. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of these uncertainties. The Company’s ability to continue as a going concern is dependent upon its ability to develop additional sources of capital, locate and complete a merger with another company and ultimately achieve profitable operations. In the interim, the Company intends to rely upon continued advances from the Company’s majority shareholder to funds its working capital needs. No assurances can be given that the Company will be successful in locating or negotiating with any target company or that the majority shareholder will continue to fund the Company’s working capital needs. As a result, there is substantial doubt about the Company’s ability to continue as a going concern.
As further discussed below in Note 8 Subsequent Events, effective June 30, 2020, ACG completed a fund raising after which the Company’s ownership interest was diluted to less than 1%.
As of April 30, 2019, Metrowork Equity Sdn. Bhd, a company owned by the Company’s then-sole officer and director (“Metrowork”), had advanced funds totaling $348,920 to the Company to meet its working capital requirements. The advances were unsecured, interest free and due on demand.
During the period from May 1, 2019 to June 28, 2019, Metrowork advanced an additional $6,403 to the Company to meet its working capital requirements. Total advances as of June 28, 2019 from Metrowork totaled $355,323.
Effective June 28, 2019, pursuant to the Securities Purchase Agreement entered into by and among the Company, Metrowork, and Copper Hill, Metrowork transferred and conveyed to Copper Hill a promissory note of the Company totaling $355,323.
The terms under which the advances had been made to the Company remained unchanged on assignment of the note by Metrowork to Copper Hill. The advances are unsecured, interest free and due on demand.
Mr. Anthony Lococo, our current sole officer and director, is a controlling party of Copper Hill.
Effective September 25, 2019, the Company entered into a Loan Conversion Agreement with Copper Hill under which Copper Hill converted its outstanding debt of $372,823 with the Company into 5,000,000 shares of the Company’s common stock.
Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company’s U.S. Federal income tax rate is 21%.
The Company's income tax returns are currently open to audit by federal and state jurisdictions for the years ending April 30, 2018 through 2020.
As of April 30, 2020, the Company was authorized to issue 10,000,000 shares of preferred stock with a par value of $0.0001.
- increased the number of its authorized shares of $0.0001 par value common stock from 100,000,000 to 200,000,000, and
- effected a reverse split of its outstanding shares of common stock, $0.0001 par value, on a one (1) post-split share for ten (10) pre-split shares basis
Effective September 25, 2019, the Company entered into a Loan Conversion Agreement with its principal shareholder, Copper Hill, under which Copper Hill converted its outstanding debt of $372,823 with the Company into 5,000,000 shares of the Company’s common stock. The fair value of the shares issued was determined using an enterprise valuation approach.
Effective June 30, 2020, Australian Gold Commodities Ltd, a company in which the Company had previously a 33.33% ownership interest, completed a fund raising after which the Company’s ownership interest was diluted to less than 1%.