On November 23, 2014, the assets and liabilities of the registrant (not including the common shares of EF Hutton Financial Corp.) were contributed at book value to Liberty Ventures, Inc., its then wholly owned subsidiary and the registrant approved a spin-off of this subsidiary to its shareholders.
The discussion below does not include the operations of the registrant prior to the spin-off.
There are no trends, events or uncertainties that have had or are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. There are no significant elements of income or loss that do not arise from the registrant’s continuing operations. There are no known causes for any material changes from period to period in one or more line items of the registrant’s financial statements.
Investing activities. For the period November 25, 2014 through December 31, 2014, we did not pursue any investing activities.
Financing Activities. For the period November 25, 2014 through December 31, 2014, we received an advance from related party of $13,991 and had $(6,500) due from a shareholder. As a result, for the period November 25, 2014 through December 31, 2014, we had net cash provided by financing activities of $7,491.
The preparation of financial statements in conformity with GAAP requires us to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of expenses during the periods presented.
We make our estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Changes in estimates are recognized in accordance with the accounting rules for the estimate, which is typically in the period when new information becomes available. We believe that our significant estimates, assumptions and judgments are reasonable, based upon information available at the time they were made. Actual results could differ from these estimates, making it possible that a change in these estimates could occur in the near term.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding, including both the common shares and Class B common shares. Warrants, stock options, and common stock issuable upon the conversion of the registrant's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.
The carrying value of the registrant's financial instruments, as reported in the accompanying balance sheet, approximates fair value due to their short term maturities.
Statement of Operations for the period November 25, 2014 through December 31, 2014
Statement of Changes in Stockholders' Equity for the period November 25, 2014 through December 31, 2014
To the Board of Directors and Stockholders of EFH Group, Inc.:
Common stock, $0.001 par value; 90,000,000 shares authorized; 52,982,199 shares issued & outstanding
Class B common stock, $0.001 par value, 10,000,000 shares authorized, 5,797,000 issued and outstanding
On November 23, 2014, the assets and liabilities of the Company were contributed at book value to Liberty Ventures, Inc., a wholly owned subsidiary of the Company. The common shares of EF Hutton Financial Corp., a wholly owned subsidiary of the Company were not included in the spin-off. Effective on November 25, 2014, the Company spun off Liberty Ventures, Inc. to its shareholders as of November 24, 2014.
The preparation of financial statements in conformity with GAAP requires the Company to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of expenses during the periods presented.
The Company makes the estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Changes in estimates are recognized in accordance with the accounting rules for the estimate, which is typically in the period when new information becomes available. The Company believes that significant estimates, assumptions and judgments are reasonable, based upon information available at the time they are made. Actual results could differ from these estimates, making it possible that a change in these estimates could occur in the near term.
The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.
The Company recognizes revenue when upon receipt of the fees received for services rendered through its Gateway system.
The Company’s financial statements have been prepared on a going concern basis that assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company’s ability to continue as a going concern depends on its ability to generate profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities when they come due. There is no assurance that these events will be satisfactorily completed.
The Company has adopted the guidance of ASC 820, “Fair Value Measurement” which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:
Level 1-Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
Level 3-Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.
ASC 825, “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company has not elected to apply the fair value option to any outstanding instruments.
The Company’s financial instruments primarily consist of cash, accounts receivable, prepaid rent, customer deposits held, accounts and income taxes payable, accrued liabilities, customer deposits owed, deferred purchase agreement, derivative liabilities, and notes payable. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The carrying amount of cash, accounts receivable, prepaid rent, customer deposits held, accounts and income taxes payable, accrued liabilities, customer deposits owed and deferred purchase agreement approximate fair value because of the short-term nature of these financial instruments. The carrying amounts of its notes payable approximates fair value as of the condensed balance sheets dates presented, because interest rates on these instruments approximate market interest rates after consideration of stated interest rates.
Prior to the purchase, the Company engaged an independent expert to appraise the assets as of July 31, 2014. Based on the asset appraisal, the assets will be held on the balance sheet at value of $157,500,000. The Company issued a total of 52,173,000 restricted common shares and 5,797,000 restricted Class B common shares as consideration for the EFH Wyoming asset purchase.
Pursuant to the asset purchase agreement, the Company issued the 52,173,000 common shares and 5,797,000 Class B common shares to EFH Wyoming, a company controlled by an officer and director of the registrant.
Dividend rights - Fifty percent (50%) of the standard common share dividend
Liquidation rights - Fifty percent (50%) of standard common share liquidation rights
The Company has evaluated subsequent events through the date these condensed financial statements were available to be issued of April 14, 2015, and determined that there are no other reportable subsequent events.