EDGAR 10-K Filing

Company CIK: 1680132
Filing Year: 2024
Filename: 1680132_10-K_2024_0001393905-24-000329.json

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ITEM 1. BUSINESS
Item 1. Description of Business
Cannabis Suisse Corp. (the “Company”, “we” or “our”) is engaged in the rental of commercial office and industrial space. We currently sublease a portion of a commercial building to a third party. We lease the building from a company controlled by our CEO. Since our CEO assumed control of the Company in June 2022, we have no involvement in any aspect of the cannabis industry.
Employees; Identification of Certain Significant Employees
We currently do not have any employees. Our sole officer serves as a consultant to the Company on a part-time basis.

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ITEM 1A. RISK FACTORS
Item 1A. Risk Factors
Risks Related to Our Business.
Limited Operations. Our current business operations consist of subleasing a portion of a building we lease from a company controlled by our CEO. As a result, we currently have limited operations. No assurance can be given that we will have any business operation going forward that sufficiently covers our cost structure.
Lack of Operating Funds-Going Concern. We do not have a bank account. Our CEO, who is also our sole director, pays our expenses through an escrow account set up for the benefit of the Company. In the event this source of funding ceases before we are able to sustainably increase our business operations there is substantial doubt as to the Company’s ability to continue as an ongoing enterprise. In its audited financial statements as of May 31, 2024, the Company was issued a “going concern” opinion, meaning that there is substantial doubt we can continue as an on-going business for the next twelve months unless we obtain additional capital. Our sources for cash at this time are investments by others, loans and advances from our CEO who is our sole director, and very limited revenue from renting. We must raise cash to implement our plan and stay in business.
Limited Management. We have no employees. Our CEO also serves as our CFO on a part-time consultant basis. This lack of personnel adversely affects our ability to develop and grow our business.
Risks Related to our Common Stock
Voting Control is Held by One Stockholder. Our sole Director and CEO holds a majority of the voting stock of the Company. As a result, he will be able to control the election of directors to our Board of Directors and our business and affairs, including any determination with respect to mergers or other business combinations, the acquisition or disposition of any assets, the incurrence of additional indebtedness, the issuance of additional shares of our common and preferred stock or any other equity securities, the recapitalization, repurchase or redemption of our common stock and the payments of any dividends. Our CEO holds convertible promissory notes which enable him to convert all or part of the principal and accrued interest into common stock. In total, the principal amounts of the notes would convert into 85,539,731 shares of our common stock as of May 31, 2024. The notes do not provide for any adjustment in the event of a recapitalization of our common stock.
Penny Stock Considerations Lack of Proprietary Broker-Dealer Quotations. Our shares are “penny stocks” as that term is generally defined in the Securities Exchange Act of 1934 as equity securities with a price of less than $5.00. As a result, the “penny stock rules’ apply. Such rules require, among other things, that brokers who trade “penny stocks” to persons other than “established customers” complete certain documentation, make suitable inquires of investors and provide investors with certain information concerning trading in the security, including a risk disclosure document and quote information under certain circumstances. Many brokers have decided not to trade “penny stocks” and, as a result, the number of broker-dealers willing to act as market makers is limited. Because our securities are subject to the “penny stock” rules, investors will find it more difficult to dispose of our securities because of the requirements. Because our securities are subject to these rules it will make it more difficult to obtain needed capital in the future. Currently, our securities are not eligible for proprietary broker-dealer quotes. Therefore, our securities have a higher risk of wider spreads, increased price volatility and price dislocation. In addition, the liquidity for our securities may be adversely affected with a corresponding decrease in the price of our securities.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments
None.

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ITEM 2. PROPERTIES
Item 2. Description of Property
We do not own any property except minimal office furniture. We lease our office from a company controlled by our CEO. We currently lease four real estate properties from companies controlled by our CEO, one of which is for the office and the others to be subleased for rental income. See Note 9 of the Notes to the Financial Statement appearing elsewhere in this Report.

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ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings
None.

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ITEM 4. MINE SAFETY DISCLOSURE
Item 4. Mine Safety Disclosures
Not applicable.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities.
Market Information
Common stock of the Company is quoted on the OTC Pink tier of the OTC Markets Group Inc under the symbol “CSUI”. The closing price of our common stock on the OTC Pink on September 3, 2024, was $0.02 Set forth below is the high and low bid information of our common stock for each quarter for the last two fiscal years. The quotations reflect inter-dealer prices, without retail markup. Mark-down or commissions and may not represent actual transactions.
FY 2023
High
Low
Quarter ended August 31
$
0.30
$
0.01
Quarter ended November 30
$
0.21
$
0.03
Quarter ended February 28
$
0.15
$
0.03
Quarter ended May 31
$
0.12
$
0.02
FY 2024
High
Low
Quarter ended August 31
$
0.07
$
0.02
Quarter ended November 30
$
0.03
$
0.01
Quarter ended February 28
$
0.02
$
0.01
Quarter ended May 31
$
0.02
$
0.01
Number of Holders
As of September 3, 2024, there were a total of 24 stockholders of record.
Dividends
No cash dividends were paid on our shares of common stock during the fiscal years ended May 31, 2024 and 2023. We do not expect to pay any dividends in the near future.
Authorized Capital Stock
As of September 3, 2024 the Company has 1,000,000,000 shares of common stock, $0.001 par value, and 20,000,000 shares of preferred stock, $0.001 par value, authorized.
Other Stockholder Matters
None.
Sale of Unregistered Securities
On May 7, 2024, we issued 23,976,000 shares of our restricted common stock to our CEO for the conversion of the entire principal ($117,593) and accrued interest ($2,287) of a convertible promissory note. The conversion price was $0.005 per share. We also issued 150,000 restricted shares to Yongqing Ruan, CPA in partial consideration for accounting services provided in prior years, settling accounts payable of $750 and recognizing a loss on settlement of debt of $2,700, and we issued 300,000 restricted shares to John L. Thomas, Esq in partial consideration for legal services provided in prior years, settling accounts payable of $1,500 and recognizing a loss on settlement of debt of $5,400. We relied on Section 4(a) 2 of the Securities Act of 1933, as amended as the exemption from registration under the Act.

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ITEM 6. SELECTED FINANCIAL DATA
Item 6. Climate-Related Disclosure.
N/A

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Background
Since June 2022, the Company has focused its efforts on real estate operations. We have no involvement in any aspect of the cannabis industry. In February 2023, we leased a commercial building from a company controlled by our CEO and subleased a portion of the building to a third party. The term of the sublease was one year and the annual rent was $30,000. Effective March of 2024, the sublease became a month-to-month lease for $2,500 per month.
The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this Annual Report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.
Results of Operations for the years ended May 31, 2024 and 2023
Revenue and Cost of Sales
For the year ended May 31, 2024, the Company generated total revenue of $30,000 from renting. The cost of sales for the year ended May 31, 2024, was $30,067.
For the year ended May 31, 2023, the Company generated total revenue of $10,000. The cost of sales for the year ended May 31, 2023, was $9,166.
The increase in revenues and cost of sale is due to the fact that the Company started its renting business in February 2023. In other words, there were twelve months’ revenue for the year ended May 31, 2024, but four months’ revenue for the year ended May 31, 2023. The cost of sales increase aligns with the increase in revenue.
Operating Expenses
Total operating expenses for the year ended May 31, 2024, were $256,870. The operating expenses for the year ended May 31, 2024, included professional fees of $77,940; depreciation expense of $4,244 and general and administrative expenses of $174,686.
Total operating expenses for the year ended May 31, 2023, were $343,516. The operating expenses for the year ended May 31, 2023, included professional fees of $278,570 which included $78,420 of legal fees, $36,200 in accounting, other consulting fees of $128,700 and $35,250 in audit fees; depreciation expense of $4,244 and general and administrative expenses of $60,702.
The decrease in operating expenses is related to the decrease of the professional fees due to significance of business activities and SEC filings in the year ended May 31, 2023.
Other Income (Expense)
The total other income (expense) for the years ended May 31, 2024 and 2023 were $(1,007,692) and $(8,865), respectively. The other expenses for the year ended May 31, 2024, contained interest expenses of $26,802, loss of $1,808,573 on the settlement of debt, gain of $93,926 on lease extension, and amortization of debt premium of $733,757, while for the year ended May 31, 2023, the other expenses contained only interest expenses of $8,865. The significant increase in other expenses is due to the loss on settlement of debt resulting from the Company prepaying for its lease liabilities with convertible notes that were recorded at their fair value, which were recorded at a premium, during the year ended May 31, 2024.
Net Loss
The net loss for the years ended May 31, 2024 and 2023 was $1,264,629 and $351,547, respectively.
Liquidity and Capital Resources and Cash Requirements
As of May 31, 2024, the Company had cash of $28,562. Furthermore, the Company had a working capital deficit of $212,098 and $329,092 on May 31, 2024 and 2023, respectively.
During the year ended May 31, 2024, the Company used $45,637 of cash in operating activities due to its net loss of $1,264,629 plus its gain on lease extension of $93,926, its amortization of debt premium of $733,757, and a decrease in accounts payable of $4,217; offset by stock issued for services of $20,000, depreciation of $4,244, lease cost, net of repayments of $170,698, loss on settlement of debt of $1,808,574, decrease in prepaid expenses of $20,574, and an increase in accrued expenses of $26,802.
During the year ended May 31, 2023, the Company used $163,960 of cash in operating activities due to its net loss of $351,547 plus an increase in prepaid expenses of $4,500; offset by depreciation of $4,244, stock payment for services of $124,000, increase in accounts payable of $10,770, and an increase in accrued interest of $8,865.
During the years ended May 31, 2024 and 2023 the Company did not have cash in investing activities.
During the year ended May 31, 2024, the Company generated $74,000 of cash in financing activities, which came from advances from related parties of $76,500 and proceeds from stock issuance of $20,000, offset by repayments of related party advances of $22,500.
During the year ended May 31, 2023, the Company generated $164,159 of cash in financing activities, which came from advances of $29,159 from related parties and proceeds from convertible notes of $135,000.
In its audited financial statements as of May 31, 2024, the Company was issued a “going concern” opinion, meaning that there is substantial doubt we can continue as an on-going business for the next twelve months unless we obtain additional capital. Our sources for cash at this time are investments by others, loans and advances from our CEO who is our sole director, and very limited revenue from renting. We must raise cash to implement our plan and stay in business.
Off-Balance Sheet Arrangements
The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Critical Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Leases
The Company follows the accounting for leases under Accounting Standards Codification (“ASC”) 842 Lease Accounting and determines if an arrangement is a lease or contains a lease at inception. Operating leases result in operating lease right-of-use (“ROU”) assets and operating lease liabilities (short term and long term) being recorded on the Company’s balance sheets.
ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses the incremental borrowing rate based on the estimated rate of interest for collateralized borrowings over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when
it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
Rent Revenue Recognition
The Company recognizes rent revenue from the lease of its sub-leased properties in accordance with ASC 842, Leases. The sub-lease is categorized as an operating lease according to ASC criteria for the lease definitions. Rent revenue is recognized on a straight-line basis over the lease term, reflecting the pattern of the economic benefits derived from the lease.
The Company’s leases generally have fixed rental payments over the lease term, with occasional escalations based on predetermined factors. Rent revenue is recognized monthly as the lessor fulfills its obligations under the lease agreement.
Any lease incentives or concessions provided to lessees, such as rent-free periods or tenant improvement allowances, are recognized as a reduction of rent revenue over the lease term.
For the years ended May 31, 2024 and 2023, the Company recognized rent revenue of $30,000 and $10,000, respectively, from its lease agreements.
Recent Accounting Pronouncements
There have been no recent accounting pronouncements or changes in accounting pronouncements during the year ended May 31, 2024, that are of significance or potential significance to the Company.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Not applicable to smaller reporting companies.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8. Financial Statements and Supplementary Data
CANNABIS SUISSE CORP.
FINANCIAL STATEMENTS
Years Ended May 31, 2024 and 2023
Page
Reports of Independent Registered Public Accounting Firm
- Mac Accounting Group & CPAs, LLP (PCAOB ID 6258)
Reports of Independent Registered Public Accounting Firm
- Accell Audit & Compliance, P.A. (PCAOB ID 3289)
Balance Sheets as of May 31, 2024 and 2023
Statements of Operations for the years ended May 31, 2024 and 2023
Statements of Changes in Stockholders’ Deficit for the years ended May 31, 2024 and 2023
Statements of Cash Flows for the years ended May 31, 2024 and 2023
Notes to the Financial Statements
Report of Independent Registered Public Accounting Firm
Board of Directors and Shareholders
Cannabis Suisse Corp.
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Cannabis Suisse Corp. as of May 31, 2024, and the related statements of operations, changes in stockholder’s deficit, and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of Cannabis Suisse Corp. as of May 31, 2024, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the entity will continue as a going concern. As discussed in Note 3 to the financial statements, the entity has limited revenues, has suffered recurring losses from operations, and has not established sufficient revenue to cover its operating costs, therefore will require additional capital to continue operations. These factors raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to Cannabis Suisse Corp. in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Cannabis Suisse Corp. is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the 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 financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Complex Debt Transactions (see Note 8)
During the year under audit the Company entered into convertible notes payable with related parties that prepaid for the leases of certain office space. The Company recognized the convertible notes payable at their fair market value which resulted in a debt premium being recognized, as well as a gain on settlement of debt after removing the associated lease liabilities from the books. Due to the related party and unusual nature of the agreements, ensuring the accounting for the transaction was challenging and required complex auditor judgment, including a detailed analysis and interpretation of accounting literature and the reliance on third party valuation experts.
In order to audit the accounting for the convertible notes payable, we had to perform a significant amount of research and analysis to gain comfort in the accounting of the transaction. Additionally, to gain comfort in the fair value assigned to each note, as determined by a third-party valuation expert, we had to review all estimates and inputs into the valuation model for reasonableness. The detailed analysis performed resulted in material audit adjustments.
/s/ Mac Accounting Group & CPAs, LLP
Mac Accounting Group & CPAs, LLP
We have served as Cannabis Suisse Corp.’s auditor since 2024.
Midvale, Utah
September 13, 2024
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Stockholders of Cannabis Suisse Corp.
Opinion on the Financial Statements
We have audited the accompanying balance sheet of Cannabis Suisse Corp. (the Company) as of May 31, 2023, and the related statements of operations, changes in stockholders’ deficit, and cash flows for the year ended May 31, 2023, and the related notes and schedules (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of May 31, 2023, and the results of its operations and its cash flows for the year ended May 31, 2023, in conformity with accounting principles generally accepted in the United States of America.
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3, the Company has limited revenues and recurring losses as of May 31, 2023 and has not completed its efforts to establish a stabilized source of revenues to cover operating costs over an extended period of time. These factors, and the need for additional financing in order for the Company to meet its business plans, raise substantial doubt about the Company’s ability to continue as a going concern. Our opinion is not modified with respect to that matter.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, 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.
Our audit included performing procedures to assess the risks of material misstatement of the 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 financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
Critical Audit Matters
Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there were no critical audit matters.
/s/ Accell Audit & Compliance, P.A.
Accell Audit & Compliance, P.A.
We have served as the Company’s auditor since 2019.
PCAOB Firm ID#3289
Tampa, Florida
September 12, 2023
3001 N. Rocky Point Dr. East, Suite 200 * Tampa, Florida 33607 * 813.367.3527
CANNABIS SUISSE CORP.
BALANCE SHEETS
May 31,
May 31,
ASSETS
Current Assets
Cash in Escrow Account
$
28,562
$
Prepaid Expenses
140,340
4,500
Total Current Assets
168,902
4,699
Property and Equipment, net
24,612
28,856
Operating Leases Right of Use Assets
625,093
312,748
TOTAL ASSETS
$
818,607
$
346,303
LIABILITIES & STOCKHOLDERS’ DEFICIT
Current Liabilities
Accounts Payable
$
4,304
$
10,770
Accrued Expenses
33,380
8,865
Advances From Related Parties
83,159
29,159
Convertible Notes Payable
50,000
50,000
Convertible Notes Payable - Related Party
85,000
85,000
Operating Lease Liabilities - Long-term
125,157
149,997
Total Current Liabilities
381,000
333,791
Convertible Note Payable - Related Party
1,820,517
135,000
Operating Lease Liabilities - Long-term
40,936
206,959
Total Liabilities
2,242,453
675,750
Commitments and Contingencies (Note 5)
Stockholders’ Deficit
Preferred stock, par value $0.001; 20,000,000 shares
authorized, 5,000,000 shares issued and outstanding
5,000
5,000
Common stock, par value $0.001; 250,000,000 shares
authorized, 70,680,938 and 44,254,938 shares issued and
outstanding as of May 31, 2024, and 2023, respectively
70,681
44,255
Additional Paid-In-Capital
1,179,393
1,055,589
Unearned Compensation
-
(20,000)
Accumulated Deficit
(2,678,920)
(1,414,291)
Total Stockholders’ Deficit
(1,423,846)
(329,447)
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT
$
818,607
$
346,303
The accompanying notes are an integral part of these financial statements.
CANNABIS SUISSE CORP.
STATEMENTS OF OPERATIONS
For the years ended May 31,
REVENUES
Rental income
$
30,000
$
10,000
Cost of goods sold
30,067
9,166
Gross Profit
(67)
OPERATING EXPENSES
Professional fees
77,940
278,570
Depreciation
4,244
4,244
General and administrative expenses
174,686
60,702
TOTAL OPERATING EXPENSES
256,870
343,516
OPERATING LOSS
(256,937)
(342,682)
OTHER INCOME (EXPENSES)
Loss on settlement of debt
(1,808,573)
-
Gain on lease extension
93,926
-
Amortization of debt premium
733,757
-
Interest expense
(26,802)
(8,865)
TOTAL OTHER INCOME (EXPENSE)
(1,007,692)
(8,865)
LOSS BEFORE INCOME TAXES
(1,264,629)
(351,547)
PROVISION FOR INCOME TAXES
-
-
NET LOSS
$
(1,264,629)
$
(351,547)
NET LOSS PER SHARE: BASIC AND DILUTED
$
(0.03)
$
(0.01)
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING: BASIC AND DILUTED
47,316,823
42,035,760
The accompanying notes are an integral part of these financial statements.
CANNABIS SUISSE CORP.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
Preferred Stock
Common Stock
Shares
Amount
Shares
Amount
Additional
Paid-In-
Capital
Unearned
Compensation
Accumulated
Deficit
Total
Stockholders’
Deficit
Balance, May 31, 2022
5,000,000
$
5,000
40,654,938
$
40,655
$
742,997
$
-
$
(1,062,744)
$
(274,092)
Conversion of accrued wages
to equity
-
-
-
-
139,092
-
-
139,092
Contribution of assets
-
-
-
-
33,100
-
-
33,100
Issuance of common stock
for services
-
-
3,600,000
3,600
140,400
(20,000)
-
124,000
Net loss
-
-
-
-
-
-
(351,547)
(351,547)
Balance, May 31, 2023
5,000,000
5,000
44,254,938
44,255
1,055,589
(20,000)
(1,414,291)
(329,447)
Cash for common stock
-
-
2,000,000
2,000
18,000
-
-
20,000
Debt conversion to stock
-
-
23,976,000
23,976
95,904
-
-
119,880
Issuance of common stock
for settlement of accounts payable
-
-
450,000
9,900
-
-
10,350
Amortization of stock-based
compensation
-
-
-
-
-
20,000
-
20,000
Net loss
-
-
-
-
-
-
(1,264,629)
(1,264,629)
Balance, May 31, 2024
5,000,000
$
5,000
70,680,938
$
70,681
$
1,179,393
$
-
$
(2,678,920)
$
(1,423,846)
The accompanying notes are an integral part of these financial statements.
CANNABIS SUISSE CORP.
STATEMENTS OF CASH FLOWS
For the years ended May 31,
OPERATING ACTIVITIES
Net loss
$
(1,264,629)
$
(351,547)
Adjustments to reconcile net loss to net cash used in operations:
Stock issued for services
20,000
124,000
Depreciation
4,244
4,244
Lease cost, net of repayments
170,698
44,208
Loss on settlement of debt
1,808,574
-
Gain on lease extension
(93,926)
-
Amortization of debt premium
(733,757)
-
Changes in assets and liabilities:
Prepaid expenses
20,574
(4,500)
Accounts payable
(4,217)
10,770
Accrued expenses
26,802
8,865
Net cash used in Operating Activities
(45,637)
(163,960)
INVESTING ACTIVITIES
Net cash provided (used) by Investing Activities
-
-
FINANCING ACTIVITIES
Advances from related parties
76,500
29,159
Repayments of related party advances
(22,500)
-
Proceeds from issuance of stock
20,000
-
Proceeds from convertible notes
-
135,000
Net cash provided by Financing Activities
74,000
164,159
Net cash increase (decrease) for period
28,363
Cash at beginning of period
-
Cash at end of period
$
28,562
$
SUPPLEMENTAL
Cash paid for taxes
$
-
$
-
Cash paid for interest
$
-
$
-
Noncash Investing and Financing Information
Operating lease right-of-use assets exchanged for operating leases
$
-
$
330,591
Conversion of accrued wages and other debt to equity
$
-
$
139,092
Contribution of assets
$
-
$
33,100
Stock issued to settle accounts payable
$
2,250
$
-
Increase in ROU asset and lease liability for lease extension
$
130,953
$
-
Recognition of ROU asset and lease liability at lease commencement
$
280,684
$
-
Lease liability extinguished with convertible note payable - related party
$
579,979
$
-
Stock issued for conversion of convertible note payable - related party and accrued interest - related party
$
119,880
$
-
The accompanying notes are an integral part of these financial statements.
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS
Cannabis Suisse Corp. (“Company”) was incorporated in the State of Nevada on February 26, 2016. The Company started its real estate business, and in February 2023, the Company leased two properties from companies owned by the CEO and one of them has been subleased out for rental revenue. In February 2024, the Company leased two additional pieces of real properties from companies owned by the CEO for future expansion. See the details of the terms and conditions in Note 9.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, (GAAP). The Company’s year-end is May 31.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had no cash equivalents as of May 31, 2024 and 2023. The Company had cash in an escrow account of $28,562 and $199 as of May 31, 2024 and 2023.
Property and equipment
Property and equipment are carried at cost less accumulated depreciation. Depreciation is provided over the assets’ estimated useful lives, using the straight-line method. Estimated useful lives of the plant and equipment are as follows:
Equipment, Furniture and fixtures
5-10 years
The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the statements of operations. The cost of maintenance and repairs is charged to the statements of operations as incurred, whereas significant renewals and betterments are capitalized.
Leases
The Company follows the accounting for leases under Accounting Standards Codification (“ASC”) 842 Lease Accounting and determines if an arrangement is a lease or contains a lease at inception. Operating leases result in operating lease right-of-use (“ROU”) assets and operating lease liabilities (short term and long term) being recorded on the Company’s balance sheets.
ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses the incremental borrowing rate based on the estimated rate of interest for collateralized borrowings over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
Impairment of Long-Lived Assets
The Company evaluates the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company’s evaluation is based on an assessment of potential indicators of impairment, such as an adverse change in the business climate that could affect the value of an asset, current or forecasted operating or cash flow losses that demonstrate continuing losses associated with the use of an asset, and a current expectation that, more likely than not, an asset will be disposed of before the end of its previously estimated useful life. Recoverability of assets to be held and used is measured by a comparison of the carrying amount
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.
During the years ended May 31, 2024 and 2023, the Company recognized an impairment of long-lived assets in the amount of $0.
Fair Value of Financial Instruments
ASC 820 Fair Value Measurements and Disclosures establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
These tiers include:
Level 1:defined as observable inputs such as quoted prices in active markets;
Level 2:defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and
Level 3:defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
The carrying value of the Company’s cash, other current assets, accounts payable, accrued expenses and advances from related parties approximates its fair value due to their short-term maturity.
Income Taxes
The Company accounts for its income taxes in accordance with ASC 740, Income Taxes, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases and tax credits and carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.
Rent Revenue Recognition
The Company recognizes rent revenue from the lease of its sub-leased properties in accordance with ASC 842, Leases. The sub-lease is categorized as an operating lease according to ASC criteria for the lease definitions. Rent revenue is recognized on a straight-line basis over the lease term, reflecting the pattern of the economic benefits derived from the lease.
The Company’s leases generally have fixed rental payments over the lease term, with occasional escalations based on predetermined factors. Rent revenue is recognized monthly as the lessor fulfills its obligations under the lease agreement.
Any lease incentives or concessions provided to lessees, such as rent-free periods or tenant improvement allowances, are recognized as a reduction of rent revenue over the lease term.
For the years ended May 31, 2024 and 2023, the Company had only one lease arrangement with a single customer and recognized rent revenue of $30,000 and $10,000, respectively.
Cost of Goods Sold
Cost of goods sold includes direct costs of selling items, direct labor cost, rent expense and electricity.
Stock-Based Compensation
The Company accounts for share-based compensation awards in accordance with ASC 718, “Compensation - Stock Compensation”. The cost of services received from employees and non-employees in exchange for awards of equity instruments is recognized in the statement of operations based on the estimated fair value of those awards on the grant date and amortized on a straight-line basis over the requisite service period or vesting period. The Company records forfeitures as they occur.
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
Basic Income (Loss) Per Share
The Company computes income (loss) per share in accordance with ASC 260, Earnings per Share. Basic loss per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. As of May 31, 2024 and 2023, potentially dilutive debt or equity instruments issued or outstanding included 85,539,731 and 25,596,625 shares, respectively, that could be issued upon the conversion of the Company’s convertible notes payable and accrued interest.
Recent Accounting Pronouncements
There have been no recent accounting pronouncements or changes in accounting pronouncements during the year ended May 31, 2024 that are of significance or potential significance to the Company.
NOTE 3 - GOING CONCERN
The accompanying financial statements have been prepared in conformity with GAAP, which contemplate continuation of the Company as a going concern. However, the Company had limited revenues and recurring losses as of May 31, 2024. The Company has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. The Company intends to position itself so that it will be able to raise additional funds through the capital markets and will rely on related party funding in the meantime. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
NOTE 4 - PROPERTY AND EQUIPMENT
Property and Equipment:
May 31, 2024
May 31, 2023
Office equipment
$
1,400
$
1,400
Furniture
31,700
31,700
Accumulated depreciation
(8,488)
(4,244)
Net property and equipment
$
24,612
$
28,856
For the years ended May 31, 2024 and 2023, the Company recognized depreciation expense in the amount of $4,244.
NOTE 5 - COMMITMENTS AND CONTINGENCIES
During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with ASC 450-20-50, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of May 31, 2024, the Company is not aware of any contingent liabilities that should be reflected in the financial statements.
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
NOTE 6 - RELATED PARTY TRANSACTIONS
During the year ended May 31, 2024, the president, CEO, and sole director advanced to the Company $76,500 and received repayments of $22,500. In February of 2024 the Company entered into notes payable with three different related parties. See Note 8 for details of these transactions.
During the year ended May 31, 2023, the president, CEO, and sole director advanced to the Company $29,159. In November 2022, the Company issued a convertible note payable to the major shareholder in the amount of $135,000 to pay off the funds advanced from and the operating expenses paid by the shareholder. See Notes 7 and 8 Convertible Notes Payable & Convertible Notes Payable - Related Parties for terms and conditions.
The Company has leases with related parties. See Note 9 for terms, conditions, and amounts.
As of May 31, 2024 and 2023, the balances of advances from related parties were $83,159 and $29,159, respectively.
In September 2023, the majority shareholder, who is also the Company’s CEO, paid $20,000 to the Company for 2,000,000 shares of common stock. In May 2024, the Company’s CEO converted his convertible note of the value of $119,880 (principal $117,593 plus interest $2,287) to 23,976,000 shares of common stock at the price of $0.005 per share and $612,105 of unamortized premium was recognized as other income.
NOTE 7 - CONVERTIBLE NOTES PAYABLE
On April 1, 2021, Suneetha Nandana Silva Sudusinghe assigned Serhii Cherniienko $60,000 of his loan to Cannabis Suisse Corp. The Agreement contains a provision that allows Serhii Cherniienko to convert the loan to common stock at a fixed price of $0.01 per share. Beneficial conversion feature was $60,000. Of the $60,000, $30,000 was converted to equity in December 2021, and the rest of $30,000 was assigned to Okie LLC. In November 2022, Okie LLC assigned the convertible note to Clifford Koschnick for consideration. As of May 31, 2024 the balance of the note is $30,000, it is due on demand, and has an interest rate of 0%.
On April 15, 2021, Suneetha Nandana Silva Sudusinghe assigned Noi Tech LLC $30,000 of his loan to Cannabis Suisse Corp. The Agreement contains a provision that allows Noi Tech LLC to convert the loan to common stock at a fixed price of $0.01 per share. Beneficial conversion feature was $30,000. The note was assigned to Okie LLC with a $10,000 discount in May 2022. In November 2022, Okie LLC assigned the convertible note to Clifford Koschnick for consideration. As of May 31, 2024 the balance of the note is $20,000, it is due on demand, and has an interest rate of 0%.
NOTE 8 - CONVERTIBLE NOTES PAYABLE - RELATED PARTIES
In May 2022, Alain Parrik assigned his convertible note of $85,000 the Company owed him to Okie LLC. According to the note terms and conditions, the note can be converted to shares at a fixed price of $0.005 per share. In November 2022, Okie LLC assigned the convertible note to Scott McAlister for consideration. As of May 31, 2024 the balance of the note is $85,000, it is due on demand, and has an interest rate of 0%.
In November 2022, the Company issued a convertible promissory note in the principal of $135,000 to the Company’s CEO for funds he has advanced the Company for expenses. The Note has a term of four years, the interest rate is 12% and the conversion price is $0.04 per share.
In February 20, 2024, the Company issued a convertible promissory note in the amount of $187,852 to 10 N Newnan, LLC, a Company owned by the CEO, for the prepayment of the lease entered in February 2023 for three years from February 2023 to January 2026 for the property at 10 N Newnan Street, Jacksonville, FL 32202. In February 2024, the lease was extended for an additional two years to January 2028. The total payments for the four years are $375,704 and the landlord offered 50% discount for the prepayment. The Company issued this note to pay off the lease. The note has a term of four years, the interest rate is 10% per annum and the conversion price is $0.005 per share of common stock. The maturity date is February 20, 2028. The Company recognized the note at its fair value of $1,126,841, the present value of the lease liabilities that were paid off was $297,229, and prepaid interest of $78,476 was recorded, resulting in a loss on settlement of debt of $751,136. The note was issued with a premium of $938,989,
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
with amortization of $64,913 recognized during the year ended May 31, 2024, and the balance of the note was $874,076 as of May 31, 2024.
In February 20, 2024, the Company issued a convertible promissory note in the amount of $101,760 to 1268 Church Street, LLC, a Company owned by the CEO, for the prepayment of the lease entered in January 2024 for three years from January 2024 to December 2026 for the property at 1268 Church Street, Jacksonville, FL 32202. In February 2024, the lease was extended for an additional two years to December 2028. The total payments for the five years are $203,520 and the landlord offered 50% discount for the prepayment. The Company issued this note to pay off the lease. The note has a term of five years, the interest rate is 10% per annum and the conversion price is $0.005 per share of common stock. The maturity date is February 20, 2029. The Company recognized the note at its fair value of $654,125, the present value the lease liabilities that were paid off was $106,538, and prepaid interest of $18,966 was recorded, resulting in a loss on settlement of debt of $528,621. The note was issued with a premium of $552,365, with amortization of $30,536 recognized during the year ended May 31, 2024, and the balance of the note was $521,829 as of May 31, 2024.
In February 20, 2024, the Company issued a convertible promissory note in the amount of $117,593 to 2600 Blanding Blvd., LLC, a Company owned by the CEO, for the prepayment of the lease entered in February 2024 for five years from February 2024 to January 2029 for the property at 2502 Blanding Blvd, Jacksonville, FL 32210. The total payments for the five years are $235,185 and the landlord offered 50% discount for the prepayment. The Company issued this note to pay off the lease. The note has a term of five years, the interest rate is 10% per annum and the conversion price is $0.005 per share of common stock. The maturity date is February 20, 2029. The Company recognized the note at its fair value of $755,901, the present value of the lease liabilities that were paid off was $176,213, and prepaid interest of $58,973 was recorded, resulting in a loss on settlement of debt of $520,716. The note was issued with a premium of $638,308 with amortization of $26,203 recognized during the year ended May 31, 2023. On May 6, 2024, the note, with a principal balance of $117,593, and its accrued interest of $2,287 was converted to 23,976,000 shares of common stock at the price of $0.005 per share and $612,105 of unamortized premium was recognized as other income.
As of May 31, 2024, the maturities of the long-term convertible notes are as follows:
Year ending
Amount
May 31, 2025
$
May 31, 2026
May 31, 2027
135,000
May 31, 2028
187,852
May 31, 2029
101,760
Total
$
424,612
For the years ended May 31, 2024 and 2023, the interest expenses were $26,802 and $8,865, respectively.
NOTE 9 - LEASES WITH RELATED PARTIES AND THIRD-PARTIES
In February 2023, the Company signed a lease to rent the office at 10 Newnan Street, Jacksonville, FL 32202, with 10 N Newnan LLC, a related party owned by the Company’s CEO. The lease commencement date was February 1, 2023 and the lease term was thirty-six months. In February 2024, the Company extended the lease for an additional two years and the new maturity date became January 31, 2028. In accordance with ASC 842, the Right-of-Use asset (ROU) and lease liability was remeasured at the modification date to be $297,229 based on a 12% discount rate and a $93,926 gain was recorded as a result of the extension. Following the extension the landlord offered a 50% discount for the prepayment of the lease so in February 2024, the Company prepaid the lease with a convertible note payable (see Note 8) and the prepaid rental interest was recorded for $78,476. As of May 31, 2024, the balance of the ROU and prepaid rental interest was $277,516 and $66,880, respectively. During the year ended May 31, 2024 rental expense of $99,360 was recognized related to this lease.
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
In February 2023, the Company signed a lease to rent the property at 2652 Blanding Blvd, Jacksonville, FL 32210, with 2600 Blanding Blvd., LLC, a related party owned by our CEO. The lease commencement date was February 1, 2023 and the lease term is thirty-six months. Based on the criteria and according to ASC 842, the Right-of-Use asset was $145,341 based on a 12% discount rate, and the lease liability and lease commitment was also the same amount. The monthly base rental payment is $5,000, with additional monthly direct costs of $350, with incentives of free-rent for the first three months, and the Company has the option to pay all or a portion of the rent in shares of its common stock. As of May 31, 2024, the balance of the ROU was $87,627 and no monthly payments had been made on the lease, therefore the lease liability was $166,094. During the year ended May 31, 2024 rental expense of $60,133 was recognized related to this lease, of which $30,067 was allocated to cost of sales for the portion of the property that was subleased.
In February 2024, the Company signed a lease to rent the property at 1268 Church Street, Jacksonville, FL 32202, with 1268 Church Street LLC, a related party owned by the Company’s CEO. The lease commencement date was January 1, 2024 and the lease term is sixty months. In accordance with ASC 842 the Right-of-Use asset and lease liability was recorded for $104,472 based on a 12% discount rate. The landlord offered a 50% discount for the prepayment of the lease and the Company made the prepayment for the lease by issuing a convertible promissory note (see Note 8) and prepaid rental interest was recorded for $18,966. As of May 31, 2024, the balance of the ROU and prepaid rental interest was $92,498 and $16,046, respectively. During the year ended May 31, 2024 rental expense of $16,960 was recognized related to this lease.
In February 2024, the Company signed a lease to rent the property at 2502 Blanding Blvd, Jacksonville, FL 32210, with 2600 Blanding Blvd LLC, a related party owned by the Company’s CEO. The lease commencement date was January 1, 2024 and the lease term is sixty months. In accordance with ASC 842 the Right-of-Use asset and lease liability was recorded for $176,213 based on a 12% discount rate. The landlord offered a 50% discount for the prepayment of the lease so the Company made the prepayment for the lease by issuing a convertible promissory note (see Note 8) and prepaid rental interest was recorded for $58,973. As of May 31, 2024, the balance of the ROU and prepaid rental interest was $167,462 and $52,054, respectively. During the year ended May 31, 2024 rental expense of $15,679 was recognized related to this lease.
In February 2023, the Company signed a sub-lease as the lessor to rent a portion of the property at 2652 Blanding Blvd to a third-party private company. The monthly rent was $2,500 which will bring rental revenue of $30,000 annually. The term of the sub-lease was one year from February 2023 to January 2024 and the subtenant was not entitled to exercise any options to extend or renew the term of the lease. The sub-lease is currently on a month-by-month term.
The total lease expenses for the year ended May 31, 2024 were $192,132, including $30,067 recorded as cost of sales and $162,065 recorded in general and administrative expenses in the statements of operations. The total lease expenses for the year ended May 31, 2023 were $44,208, including $9,166 recorded as cost of sales and $35,042 in general and administrative expenses in the statements of operations.
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
The Company’s weighted average remaining lease term is 2.18 years and weighted average discount rate is 12%. The following table summarizes the presentation in the Company’s balance sheet of its operating leases.
As of
May, 2024
As of
May 31, 2023
Assets
Right-of-Use
$
625,093
$
312,748
Liabilities
Lease liabilities - Short-term
$
125,157
$
149,997
Lease liabilities - Long-term
40,936
206,959
Total operating lease liabilities
$
166,093
$
356,956
Future minimum lease payments as of May 31, 2024:
Lease commitments
Jun 2024 - May 2025
$
133,750
Jun 2025 - May 2026
42,800
Jun 2026 - May 2027
-
Jun 2027 - May 2028
-
Jun 2028 - May 2029
-
Total undiscounted lease payments
176,550
Imputed interest
(10,457)
Total operating lease liabilities
$
166,093
NOTE 10 - STOCKHOLDERS’ EQUITY
Preferred Stock
The Company is authorized to issue 20,000,000 shares of preferred stock with a par value of $0.001.
On March 17, 2021, the Board of Directors, along with the majority stockholder, resolved that the 5,000,000 preferred shares with voting rights of 1 to 10 shall be issued to Suneetha Nandana Silva Sudusinghe in exchange for 5,000,000 common shares that Suneetha Nandana Silva Sudusinghe owned previously. The 5,000,000 preferred shares were issued on July 21, 2021. The stock was transferred to Scott McAlister through a stock purchase agreement in May 2022.
Common Stock
The Company is authorized to issue 250,000,000 shares of common stock with a par value of $0.001.
On January 11, 2023, the Company issued 3,600,000 restricted shares of common stock at $0.04 per share to a consultant for services. The value of the 3,600,000 shares of common stock issued was $144,400, of which $124,000 was earned as of May 31, 2023 and the remaining $20,000 was earned during the year ended May 31, 2024.
In September 2023, the Company’s CEO paid $20,000 to the Company for 2,000,000 shares of common stock at a price of $0.01 per share.
In May 2024, the Company’s CEO converted his convertible note with a value of $119,880 (principal $117,593 plus interest $2,287) to 23,976,000 shares of common stock at the price of $0.005 per share and $612,105 of unamortized premium on the note was recognized as other income.
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
Also in May 2024, the Company issued 450,000 shares valued at the market price of $0.023 per share to settle accounts payable of $2,250, resulting in a loss on settlement of debt of $8,100.
As of May 31, 2024, the Company had 70,680,938 shares of common stock issued and outstanding.
NOTE 11 - INCOME TAXES
The Company adopted the provisions of uncertain tax positions as addressed in ASC 740-10-65-1. As a result of the implementation of ASC 740-10-65-1, the Company recognized no increase in the liability for unrecognized tax benefits.
The Company has no tax position at May 31, 2024 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. No such interest or penalties were recognized during the periods presented. The Company had no accruals for interest and penalties at May 31, 2024. The Company’s utilization of any net operating loss carryforward may be unlikely as a result of its intended activities.
The valuation allowance at May 31, 2024 was $313,468. The net change in valuation allowance for the years ended May 31, 2024 and 2023 was $100,323. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.
Based on consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a full valuation allowance as of May 31, 2024 and 2023. All tax years since inception remains open for examination only by taxing authorities of US Federal and state of Nevada.
The Company has a net operating loss carryforward for tax purposes totaling $1,182,899 at May 31, 2024. According to current tax laws, the losses prior to 2018 can carryforward 20 years, and the losses in 2018 or later can carryforward indefinitely. The Company had losses of $43,526 prior to 2018 which can carryforward through fiscal year 2036. The losses of $1,139,373 in years of 2018 and later will carryforward indefinitely. There is a limitation on the amount of taxable income that can be offset by carryforwards after a change in control (generally greater than a 50% change in ownership).
The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the federal statutory rate of 21% to the income tax amount recorded as of May 31, 2023 was as follows:
May 31, 2023
Net operating loss carryforward
$
(1,014,975)
Effective tax rate
21%
Deferred tax asset
213,145
Less: Valuation allowance
(213,145)
Net deferred asset
$
-
CANNABIS SUISSE CORP.
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2024, and 2023
The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the federal statutory rate of 21% plus the state statutory rate of 5.5% to the income tax amount recorded as of May 31, 2024 is as follows:
May 31, 2024
Net operating loss carryforward
$
(1,182,899)
Effective tax rate
26.5%
Deferred tax asset
313,468
Less: Valuation allowance
(313,468)
Net deferred asset
$
-
The income tax provision differs from the amount of income tax determined by applying the statutory income tax rates to pretax income from continuing operations for the year ended May 31, 2024 due to the following:
Book loss
$
(335,127)
26.50%
Unpaid interest to shareholder
7,102
(0.56)%
Unpaid rent to shareholder
18,431
(1.46)%
Stock issued for services
5,300
(0.42)%
Loss on settlement of debt
479,272
(37.90)%
Gain on lease extensions
(24,890)
1.97%
Amortization of debt premium
(194,445)
15.38%
Valuation allowance
44,357
(3.51)%
$
-
NOTE 12 - SUBSEQUENT EVENTS
In accordance with SFAS 165 (ASC 855), Subsequent Events, the Company has analyzed its operations subsequent to May 31, 2024 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose except the following:
Effective June 3, 2024, the Company amended their articles of incorporation to increase their authorized shares of common stock to 1,000,000,000.
On July 7, 2024, we issued 5,000,000 shares of our preferred stock to our CEO. The stock was issued in replacement for the same amount of stock with the same voting rights he received when he purchased the stock from the prior CEO as it was determined the prior issuance of the preferred stock was deficient in that the proper state filing was not made for the original issuance.
On June 28, 2024, the Company issued a convertible note of $186,089 to Scott McAlister, the Company’s CEO, to pay off the unpaid rent of $69,550, advances of $83,159 and the unpaid interest of $33,380 that the Company owed to Scott McAlister. The conversion price shall be $0.005 per share of common stock. The term of the convertible note shall be five years and the interest rate shall be 10% per year.

---

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
On March 14, 2024, the sole director of the registrant dismissed Accell Audit & Compliance, P.A. (“Accell”) as the Registrant’s independent registered public accounting firm. Accell served as the registrant’s independent public accounting firm since 2019. Also on March 14, 2024, the sole director of the registrant appointed Mac Accounting Group & CPAs, LLP (“MAC”) to serve as the registrant’s independent public accounting firm to audit the registrant’s financial statements for the fiscal year ending May 31, 2024.
The audit reports of Accell on the registrant’s financial statements for the fiscal years ended May 31, 2022, and 2023, did not contain an adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principle other than an explanatory paragraph regarding the registrant’s ability to continue as a going concern.
During the registrant’s fiscal years ended May 31, 2022 and 2023, and through. November 31, 2023, there was no disagreement(s) with Accell on any matter of accounting principles or practices, financial statement disclosure or procedure, which disagreement(s), if not resolved to the satisfaction of Accell, would have caused it to make a reference to the subject matter of the disagreement(s) in connection with its report, nor were there any “reportable events”, as such term is described in Item304(a)(1)(v) of Regulation S-K promulgated under the Securities Act of 1934, as amended (the “1934 Act”).
During the registrant’s two most recent fiscal years and through March 14, 2024, the date of the appointment of MAC, neither the registrant nor any person on its behalf has consulted with MAC with respect to either (i) the application of accounting principles to a specified transaction, either contemplated or proposed, or the type of audit opinion that might be rendered on the Registrant’s financial statements or (ii) any matter that was the subject of a “disagreement’ or a “reportable event” as such terms are described in Items 304(a)(1)(iv) or 304(a)(1)(v) respectively of Regulation S-K promulgated under the 1934 Act.

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ITEM 9A. CONTROLS AND PROCEDURES
Item 9A(T) Controls and Procedures
Management’s Report on Internal Controls over Financial Disclosure Controls and Procedures
Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting as of May 31, 2024 using the criteria established in “Internal Control - Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).
A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of May 31, 2024, the Company determined that there were control deficiencies that constituted material weaknesses, as described below.
1.We do not have an adequate control environment or proper corporate governance - We have no risk assessment, information or communication, or monitoring processes in place and have no policies that require formal written approval for related party transactions. Additionally, the Board of Directors does not operate independently of management. Also, while not being legally obligated to have an audit committee, it is the management’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’s financial statements. Currently the Board of Directors acts in the capacity of the Audit Committee, and does not include a member that is considered to be independent of management to provide the necessary oversight over management’s activities.
2.We do not maintain appropriate internal controls - We do not have formal accounting policies and procedures and have not maintained sufficient internal controls over financial reporting. We lack segregation of duties or adequate levels of supervision and review and there are limited accounting resources with the appropriate knowledge of U.S. generally accepted accounting principles or SEC experience to ensure the financial reporting is free from material misstatements.
3.We do not have appropriate information technology controls - We retain copies of all financial data and material agreements; however, there is no formal procedure or evidence of normal backup of the Company’s data or off-site storage of data in the event of theft, misplacement, or loss due to unmitigated factors.
Accordingly, the Company concluded that these control deficiencies resulted in a reasonable possibility that a material misstatement of the 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 the material weaknesses described above, management has concluded that the Company did not maintain effective internal control over financial reporting as of May 31, 2024, based on criteria established in Internal Control- Integrated Framework (2013) issued by COSO.
System of Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of May 31, 2024. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.
Changes in Internal Control over Financial Reporting
There has been no change in the Company’s internal control over financial reporting during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION
Item 9B. Other Information.
None.
PART III

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers, Promoters and Control Persons of the Company
Officers and Directors
The names and ages of our directors and executive officers are set forth below. Also included is their principal occupation(s). The board of directors has no nominating, auditing or compensation committees.
The name, address, age and position of our present officers and directors are set forth below:
Name
Age
Position(s)
Scott McAlister
Director, CEO/CFO
Mr. McAlister has served in his capacity as a Director since June 2022, and as CEO/CFO since September 2022. He has been involved in commercial real estate development for the last fifteen years. Mr. McAlister is a licensed general contractor in Florida. He graduated in 2000, from the University of North Florida, Jacksonville Florida, with a bachelor’s degree in psychology.
Term of Office
A director is appointed to hold office until the next annual meeting of our stockholders or until his respective successor is elected and qualified, or until he resigns or is removed in accordance with the provisions of the Nevada Revised Statues. Our director holds office until removed by the Board or until his resignation appoints our officer.
Corporate Governance
Our Board has not established any committees, including an audit committee, a compensation committee or a nominating committee, or any committee performing a similar function. The functions of those committees are being undertaken by our sole Director.
Director Independence
The Company has adopted the NASDAQ Listing Rules; Rule 5605 and 5605 (a) (20, for determining the independence of its directors. Directors are deemed independent only if the Board affirmatively determines that the director has no material relationship with the Company directly or as an officer, share owner or partner of an entity that has a relationship with the Company or any other relationship which, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Our sole director is also the majority holder of the voting stock of the Company. As such he is not independent as that term is defined under the afore stated NASDAQ Listing Rules.

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ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation
The following table sets forth the compensation paid by us for the years ended May 31, 2024 and 2023 for our executive officers and directors. This information includes the dollar value of base salaries, bonus awards and number of stock options granted, and certain other compensation, if any. The compensation discussed addresses all compensation awarded to, earned by, or paid or named executive officers and directors.
EXECUTIVE COMPENSATION SUMMARY COMPENSATION TABLE
Name and
Principal
Position
Year
Salary
(US$)
Bonus
(US$)
Stock
Awards
(US$)
Option
Awards
(US$)
Non-Equity
Incentive Plan
Compensation
(US$)
Nonqualified
Deferred
Compensation
Earnings
(US$)
All Other
Compensation
(US$)
Total
(US$)
Scott W. McAlister
CEO, CFO
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
Long-Term Incentive Plan Awards
We do not have any long-term incentive plans that provide compensation intended to serve as incentive for performance.
Indemnification
Under our Articles of Incorporation and Bylaws of the corporation, we may indemnify an officer or director who is made a party to any proceeding, including a lawsuit, because of his position, if he acted in good faith and in a manner he reasonably believed to be in our best interest. We may advance expenses incurred in defending a proceeding. To the extent that the officer or director is successful on the merits in a proceeding as to which he is to be indemnified, we must indemnify him against all expenses incurred, including attorney’s fees. With respect to a derivative action, indemnity may be made only for expenses actually and reasonably incurred in defending the proceeding, and if the officer or director is judged liable, only by a court order. The indemnification is intended to be to the fullest extent permitted by the laws of the State of Nevada. Regarding indemnification for liabilities arising under the Securities Act of 1933, which may be permitted to directors or officers under Nevada law, we are informed that, in the opinion of the Securities and Exchange Commission, indemnification is against public policy, as expressed in the Act and is, therefore, unenforceable.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Title of class
Name of
Beneficial Owner
Amount and Nature of
Beneficial Ownership
Percent of
Common Stock
Common Stock
Scott McAlister
116,915,731 (1)
77%
(1)Represents 36,376,000 shares of common stock plus 80,539,731 shares of common stock obtainable through the conversion of four different promissory notes held by Mr. McAlister or companies owned by Mr. McAlister, whereby the Holder has the right to convert all or part of the note and its accrued interest at $0.005 per share as of May 31, 2024.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions
In May 2022, Alain Parrik assigned his convertible note of $85,000 the Company owed him to Okie LLC. According to the note terms and conditions, the note can be converted to shares at a fixed price of $0.005 per share. In November 2022, Okie LLC assigned the convertible note to Scott McAlister for consideration. As of May 31, 2024 the balance of the note is $85,000, it is due on demand, and has an interest rate of 0%.
In November 2022, the Company issued a convertible promissory note in the principal of $135,000 to the Company’s CEO for funds he has advanced the Company for expenses. The Note has a term of four years, the interest rate is 12% and the conversion price is $0.04 per share.
In February 2023, the Company signed a lease to rent the office at 10 Newnan Street, Jacksonville, FL 32202, with 10 N Newnan LLC, a related party owned by the Company’s CEO. The lease commencement date was February 1, 2023 and the lease term was thirty-six months. In February 2024, the Company extended the lease for an additional two years and the new maturity date became January 31, 2028. In February 20, 2024, the Company issued a convertible promissory note in the amount of $187,852 to 10 N Newnan, LLC for the prepayment of the lease. The note has a term of four years, the interest rate is 10% per annum and the conversion price is $0.005 per share of common stock. The maturity date is February 20, 2028. The Company recognized the note at its fair value of $1,126,841, the present value of the lease liabilities that were paid off was $297,229, and prepaid interest of $78,476 was recorded, resulting in a loss on settlement of debt of $751,136. The note was issued with a premium of $938,989, with amortization of $64,913 recognized during the year ended May 31, 2024, and the balance of the note was $874,076 as of May 31, 2024.
In February 2023, the Company signed a lease to rent the property at 2652 Blanding Blvd, Jacksonville, FL 32210, with 2600 Blanding Blvd., LLC, a related party owned by our CEO. The lease commencement date was February 1, 2023 and the lease term is thirty-six months. The monthly base rental payment is $5,000, with additional monthly direct costs of $350, with incentives of free-rent for the first three months, and the Company has the option to pay all or a portion of the rent in shares of its common stock.
In February 2024, the Company signed a lease to rent the property at 1268 Church Street, Jacksonville, FL 32202, with 1268 Church Street LLC, a related party owned by the Company’s CEO. The lease commencement date was January 1, 2024 and the lease term is sixty months. In February 20, 2024, the Company issued a convertible promissory note in the amount of $101,760 to 1268 Church Street, LLC for the prepayment of the lease. The note has a term of five years, the interest rate is 10% per annum and the conversion price is $0.005 per share of common stock. The maturity date is February 20, 2029. The Company recognized the note at its fair value of $654,125, the present value the lease liabilities that were paid off was $106,538, and prepaid interest of $18,966 was recorded, resulting in a loss on settlement of debt of $528,621. The note was issued with a premium of $552,365, with amortization of $30,536 recognized during the year ended May 31, 2024, and the balance of the note was $521,829 as of May 31, 2024.
In February 2024, the Company signed a lease to rent the property at 2502 Blanding Blvd, Jacksonville, FL 32210, with 2600 Blanding Blvd LLC, a related party owned by the Company’s CEO. The lease commencement date was January 1, 2024 and the lease term is sixty months. In February 20, 2024, the Company issued a convertible promissory note in the amount of $117,593 to 2600 Blanding Blvd., LLC for the prepayment of the lease. The note has a term of five years, the interest rate is 10% per annum and the conversion price is $0.005 per share of common stock. The maturity date is February 20, 2029. The Company recognized the note at its fair value of $755,901, the present value of the lease liabilities there were paid off was $176,213, and prepaid interest of $58,973 was recorded, resulting in a loss on settlement of debt of $520,716. The note was issued with a premium of $638,308 with amortization of $26,203 recognized during the year ended May 31, 2023. On May 6, 2024, the note, with a principal balance of $117,593, and its accrued interest of $2,287 was converted to 23,796,000 shares of common stock at the price of $0.005 per share and $612,105 of unamortized premium was recognized as other income.
During the year ended May 31, 2024, our CEO and sole director advanced to the Company $76,500 and received repayments of $22,500.
Subsequent to May 31, 2024, June 28, 2024, the Company issued a convertible note of $186,089 to Scott McAlister, the Company’s CEO, to pay off the unpaid rent of $69,550, advances of $83,159 and the unpaid interest of $33,380 that the Company owed to Scott McAlister. The conversion price shall be $0.005 per share of common stock. The term of the convertible note shall be five years and the interest rate shall be 10% per year.
All of the notes issued cited above to entities controlled by our CEO contain no adjustment in the event of a recapitalization of our capital stock.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accounting Fees and Services
For the fiscal year ended May 31, 2023, we incurred approximately $18,000 in fees to our principal independent accountants Accell Audit & Compliance, P.A. for professional services rendered in connection with annual audit and quarterly reviews.
For the fiscal year ended May 31, 2024, we incurred $19,000 in fees to our principal independent accountants Mac Accounting Group & CPAS, LLP for professional services rendered in connection with the annual audit and quarterly reviews.
For the fiscal years ended May 31, 2024 and 2023 we incurred no audited related fees, tax related fees, or other fees from our principal independent accountants.
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits, Financial Statements Schedules
(a)List of documents filed as part of this Report:
(1)Financial Statements
The financial statements are included under Item 8 of this Annual Report on Form 10-K.
(2)Financial Statement Schedules
All schedules have been omitted because the required information is included in the financial statements included under Item 8 of this Annual Report on Form 10-K or the notes thereto, or because it is not required.
(3)Financial Statement Schedules
See exhibits listed under Part (b) below.
(b)Exhibits
Exhibit
Number
Exhibit Description
3(i)***
Articles of Incorporation, as amended
3(ii)****
ByLaws, as amended
31.1*
Certification of Chief Executive Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
31.2*
Certification of Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
32.1**
Certifications pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS
Inline XBRL Instance Document
101.SCH
Inline XBRL Taxonomy Extension Schema Document
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*** Previously filed as exhibits to Registration Statement on Form S-1 filed August 9, 2016.
**** Previously filed as exhibits to Registration Statement on Form S-1/A filed September 21, 2016.