We lease approximately 1,000 square feet of furnished office space at 1095 Budapest, Soroksari ut 94-96, , Hungary. The offices are leased on a monthly basis for a fee of $500.
Our plan of operation is to generate revenue on iGlue’s semantic technology through semantic advertisement targeting, semantic recommendation engine and semantic affiliate marketing. Our current focus is getting our product known to consumers by internationally marketing its design and functionality. Currently, we are advertising through the use of our website and plan to promote our product through social media networking.
General and administrative expenses for the year ended December 31, 2012, was $ 6,629,983 as compared to $237,752 for the year ended December 31, 2011. The $6,392,231 increase is attributable to an increase in compensation costs of personnel enganged in the administration to complete the commercial roll out of iGlue. Compensation costs in total of $ 6,429,000, in 2012, relate to stock based payments. The total number of shares issued and outstanding in respect to stock based compensations are detailed in Note 9 in the financial statements.
Loss from operations for December 31, 2012, was $(7,575,106) as compared to $(621,845) for the year ended December 31, 2011. The increase of $6,953,261 in operating loss is primarily attributable to the increase of general and administrative expenses while revenue generation has not commenced.
The following table summarizes total current assets, liabilities and working capital at December 31, 2010, compared to December 31, 2009.
At December 31, 2012, we had a working capital deficit of $932,564, as compared to working capital of $749,928 at December 31, 2011, an increase in working capital deficit of $182,636. The increase of the deficit is attributable to an increase of total liabilities, including accrued interest related to the $750,000 note payable to Park Slope, LLC.
Net cash used for operating activities for the year ended December 31, 2012 and 2011 was $(226,654) and $(600,918) respectively. The net loss for year ended December 31, 2012 and December 31, 2011 was $(7,664,922) and $(632,584) respectively. The Company’s cash used in operations decreased primarily due to shortage of liquid resources.
As reflected in the accompanying financial statements, the Company had a net loss of $(7,664,922) and net cash used in operations of $(226,654) for the year ended December 31, 2012, and working capital and stockholders’ deficit of $(932,564) and $(928,763) respectively, at December 31, 2012. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
As of December 31, 2012 and 2011, consolidated cash and equivalent balances totaled $565 and $42,477, respectively. As of December 31, 2012 the Company’s cash balance is located in jurisdictions outside of the U.S. The Company’s ability to efficiently access cash balances in foreign jurisdictions is subject to local regulatory and statutory requirements.
In the two-statement approach, an entity is required to present components of net income and total net income in the statement of net income. The statement of other comprehensive income should immediately follow the statement of net income and include the components of other comprehensive income and a total for other comprehensive income, along with a total for comprehensive income. Regardless of whether an entity chooses to present comprehensive income in a single continuous statement or in two separate but consecutive statements, the entity is required to present on the face of the financial statements reclassification adjustments for items that are reclassified from other comprehensive income to net income in the statement(s) where the components of net income and the components of other comprehensive income are presented. The amendments in this update do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. The amendments do not change the option for an entity to present components of other comprehensive income either net of related tax effects or before related tax effects, with one amount shown for the aggregate income tax expense or benefit related to the total of other comprehensive income items. In both cases, the tax effect for each component must be disclosed in the notes to the financial statements or presented in the statement in which other comprehensive income is presented. The amendments in this update are effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2011. The adoption of this standard will not have a material impact on its financial position, results of operations or cash flows.
The amendments in this update are effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2011. The adoption of this standard did not have a material impact on its financial position, results of operations or cash flows.