10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2014

OR

¨ TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE EXCHANGE ACT OF 1934

For the transition period from ___________ to ____________.

Commission File Number 000-29935

CROWN EQUITY HOLDINGS INC.

(Exact name of registrant as specified in its charter)

Nevada	33-0677140
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

11226 Pentland Downs Road, Las Vegas, NV 89141

(Address of principal executive offices)

(702) 448-1543

(Issuer's telephone number)

5440 West Sahara Avenue, Suite 205, Las Vegas, NV 89146

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the Company (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the Company was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes x No ¨

Indicate by check mark whether the Company is a large accelerated filer, an accelerated file, non-accelerated filer, or a smaller reporting company.

Large accelerated filer	¨	Accelerated filed	¨
Non-accelerated filer	¨	Smaller reporting company	x

Indicate by check mark whether the Company is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of November 21, 2014, there were 545,292 shares of Common Stock of the issuer outstanding.

TABLE OF CONTENTS

		Page
PART I: FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets as of September 30, 2014 and December 31, 2013 (Unaudited)		3
	Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2014 and 2013 (Unaudited)		4
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2014 and 2013 (Unaudited)		5
	Notes to Consolidated Financial Statements (Unaudited)		6
Item 2.	Management’s Discussion and Analysis and Plan of Operation		11
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		13
Item 4T.	Controls and Procedures		13
PART II: OTHER INFORMATION
Item 1.	Legal Proceedings		14
Item 1A.	Risk Factors		14
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		14
Item 3.	Defaults upon Senior Securities		14
Item 4.	Mine Safety Information		14
Item 5.	Other Information		14
Item 6.	Exhibits		15
Signatures			16

2

PART I: FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Crown Equity Holdings, Inc.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30,			December 31,
	2014			2013
Assets
Current assets
Cash	$	7,239		$	1,088
Marketable securities		7,500			10,500
Marketable securities held in related party		70,000			70,000
Loans to related parties		17,640			1,500
Total Current Assets		102,379			83,088
Property, plant and equipment, net of accumulated depreciation of $65,555 and $63,869		1,180			2,866
Total Assets	$	103,559		$	85,954
Liabilities and Stockholders’ Deficit
Current liabilities
Accounts payable and accrued expenses	$	206,193		$	171,789
Accounts payable related party		5,026			5,026
Notes payable related parties		151,885			134,219
Derivative liability		76,696			-
Notes payable, net of unamortized discount of $30,627 and $0		87,541			15,068
Total Current Liabilities		527,341			326,102
Stockholders’ deficit
Preferred stock, $0.001 par value, 10,000,000 shares authorized, 9,000,000 shares undesignated authorized		-			-
Series A convertible preferred stock, $0.001 par value, 1,000,000 shares authorized, 100,000 and no shares issued and outstanding		100			-
Common stock, $0.001 par value, 490,000,000 shares authorized 459,596 and 439,096 shares issued and outstanding		460			439
Additional paid-in capital		9,555,084			8,818,705
Accumulated deficit		(9,979,426	)		(9,059,292	)
Total stockholders’ deficit		(423,782	)		(240,148	)
Total liabilities and stockholders’ deficit	$	103,559		$	85,954

The accompanying notes are an integral part of these unaudited consolidated financial statements.

3

Crown Equity Holdings, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2014			2013			2014			2013
Revenue	$	-		$	150		$	-		$	44,530
Revenue from related party		-			20,000			-			20,000
Total revenue		-			20,150			-			64,530
Direct material costs		-			-			-			151
Operating expenses		61,525			92,801			475,310			153,976
Loss from operations		(61,525	)		(72,651	)		(475,310	)		(89,597	)
Other income (expense)
Interest expense		(16,937	)		(4,329	)		(32,021	)		(12,897	)
Losses on equity method investment - related party		-			-			-			(132,988	)
Loss on related party debt conversion		(370,806	)		-			(370,806	)		-
Loss on derivative liability		(36,696	)		-			(36,696	)		-
Other income (expense)		230			686			(2,301	)		3,127
Unrealized gain (loss) on marketable securities		(6,500	)		77,250			(3,000	)		34,450
Total Other Income (Expense)		(430,709	)		73,607			(444,824	)		(108,308	)
Net loss	$	(492,234	)	$	956		$	(920,134	)	$	(197,905	)
Net loss per share - basic and diluted		(1.07	)		0.00			(2.02	)		(0.45	)
Weighted average number of common shares outstanding - basic and diluted		459,596			439,096			455,766			439,464

The accompanying notes are an integral part of these unaudited consolidated financial statements.

4

Crown Equity Holdings, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended
	September 30,
	2014			2013
Cash flows from operating activities
Net loss	$	(920,134	)	$	(197,905	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		1,686			16,781
Common stock issued for services		266,500			-
Loss on conversion of related party debt		370,806			-
Loss on derivative liability		36,696			-
Amortization of debt discount		9,373			-
Unrealized loss (gain) on marketable securities		3,000			(34,450	)
Loss on equity method investments in related party		-			132,988
Marketable securities received for revenue		-			(25,550	)
Changes in operating assets and liabilities:
(Increase) decrease accounts receivable		-			(1,650	)
(Increase) decrease prepaid expenses		-			35,000
Increase (decrease) in accounts payable and accrued expenses		54,414			56,987
Net cash used in operating activities		(177,659	)		(17,799	)
Cash flows from investing activities
Advances to related parties		(16,140	)		-
Net cash used in investing activities		(16,140	)		-
Cash flows from financing activities
Payments on notes payable		-			(2,000	)
Payments on related party notes payable		(3,500	)		(4,000	)
Borrowings on notes payable		103,100			18,567
Borrowings on related party notes payable		100,350			6,100
Net cash provided by financing activities		199,950			18,667
Net increase in cash		6,151			868
Cash, beginning of period		1,088			1,209
Cash, end of period	$	7,239		$	2,077
Supplemental disclosure of cash flow information
Interest paid	$	22		$	45
Income taxes paid		-			-
Noncash investing and financing activities
Common stock returned and cancelled	$	-		$	2,133
Related party debt and accrued interest converted to preferred stock		99,194			-
Debt discount due to derivative liability		40,000			-

The accompanying notes are an integral part of these unaudited consolidated financial statements.

5

Crown Equity Holdings, Inc.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 – BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements of Crown Equity Holdings Inc. (“Crown Equity”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in Crown Equity’s December 31, 2013 Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year end December 31, 2013 as reported on Form 10-K, have been omitted. Certain prior period amounts have been reclassified to conform to current period presentation.

NOTE 2 – GOING CONCERN

As shown in the accompanying financial statements, Crown Equity has an accumulated deficit of $9,979,426, and a working capital deficit of $424,962 as of September 30, 2014. Unless profitability and increase in shareholders’ equity continues, these conditions raise substantial doubt as to Crown Equity's ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if Crown Equity is unable to continue as a going concern.

Crown Equity continues to review its expense structure reviewing costs and their reduction to move towards profitability. The Company’s expenses are planned to decrease as a percent of revenue resulting in profitability and increased shareholders’ equity.

NOTE 3 – MARKETABLE SECURITIES

Marketable securities are classified as available-for-sale and are presented in the consolidated balance sheet at fair market value.

Per Accounting Standards Codification 820 “ Fair Value Measurement ”, fair values defined establishes a framework for measuring fair value under generally accepted accounting principles and expands disclosures about fair value measurements. ASC 820 does not require any new fair value measurements.

6

ASC 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

Level 1: Quoted market prices in active markets for identical assets or liabilities

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data

Level 3: Unobservable inputs that are not corroborated by market data

Crown Equity has classified these marketable securities at level 1 with a fair value of $77,500 and $80,500 as of September 30, 2014 and December 31, 2013, respectively.

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of September 30, 2014:

Description	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance as of September 30, 2014
Assets:
Marketable securities	$	7,500	$	-	$	-	$	7,500
Marketable securities held in related party		70,000		-		-		70,000
Total	$	77,500	$	-	$	-	$	77,500

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of December 31, 2013:

Description	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance as of December 31, 2013
Assets:
Marketable securities	$	10,500	$	-	$	-	$	10,500
Marketable securities held in related party		70,000		-		-		70,000
Total	$	80,500	$	-	$	-	$	80,500

7

Per Accounting Standards Codification 825 “ The Fair Value Option for Financial Assets and Financial Liabilities—Including an Amendment of FASB Statement No. 115 ”, an entity is permitted to irrevocably elect fair value on a contract-by-contract basis for new assets or liabilities within the scope of ASC 825 as the initial and subsequent measurement attribute for those financial assets and liabilities and certain other items including property and casualty insurance contracts. Entities electing the fair value option are required to (i) recognize changes in fair value in earnings and (ii) expense any up-front costs and fees associated with the item for which the fair value option is elected. Entities electing the fair value option are required to distinguish, on the face of the statement of financial position, the fair value of assets and liabilities for which it has elected the fair value option, and similar assets and liabilities measured using another measurement attribute. An entity can accomplish this either by reporting the fair value and non-fair-value carrying amounts as separate line items or by aggregating those amounts and disclosing parenthetically the amount of fair value included in the aggregate amount. Crown Equity adopted ASC 825 during the third quarter of fiscal 2009 and elected the fair value option for their marketable securities.

NOTE 4 – EQUITY METHOD INVESTMENT IN RELATED PARTY

The Company’s ownership percentage in Cleantech Transit, Inc. was 43% as of September 30, 2014 and December 31, 2013, respectively. During late 2012, the Company’s ownership percentage exceeded 20% and the Company began accounting for this investment under the equity method. It was accounted for as an available-for-sale investment during the nine months ended September 30, 2014.

Cleantech has had no revenues since inception. Enterprise valuation was used to value this inactive entity and the equity method is used for ongoing reporting.

As of September 30, 2014 and December 31, 2013, the carrying value of the equity method investment held in related party was zero.

NOTE 5 – RELATED PARTY TRANSACTIONS

As of December 31, 2013, the company had outstanding notes payable to related parties of $134,219. During the nine months ended September 30, 2014, the Company borrowed an additional $100,350 under related party notes and made aggregate payments on these notes payable of $3,500. The notes are unsecured, bear interest between 0% and 12% and mature between November 19, 2012 and on demand. As of September 30, 2014 and December 31, 2013, $96,209 of these notes was past due and in default bearing interest at 18% per annum. As of September 30, 2014, the aggregate outstanding balance under these related party notes payable was $151,885. These notes payable are with various officers and directors of the Company and with entities controlled by officers or directors of the Company including Montse Zaman, Phoenix Consulting Services Inc., Tisa Capital Corp., Ken Bosket, Mark Vega and Almulfo Saucedo.

During the nine months ended September 30, 2014, a related party converted debt of $79,184 and accrued interest of $20,010 into 100,000 shares of Series A preferred stock. The fair value of the preferred stock was determined to be $470,000 resulting in a loss on the conversion of related party debt of $370,806.

8

In July 2013 the Company entered into a management consultant contract with Cleantech Transit, Inc., a related party, for consulting services through June 30, 2014. The terms of the agreement call for $20,000 per month to be paid in two equal installments of cash and may be terminated by either party 30 days after written notice is given. Due to the nature of the close relationship between the parties, the Company will record this income upon receipt of the actual cash payments. There were no cash receipts and there was no revenue recognized under this agreement during the nine months ended September 30, 2014.

As of September 30, 2014 and December 31, 2013, the Company held an aggregate of 7,000,000 common shares of American Video Teleconferencing, Inc. valued at $70,000 as of September 30, 2014 and December 31, 2013. American Video Teleconferencing, Inc. became a related party in 2014 due to common officers and Directors.

During 2013, the Company loaned $1,500 to Cleantech Transit. The loan is unsecured, bears no interest and is due on demand. The $1,500 was outstanding as of September 30, 2014 and December 31, 2013.

During the nine months ended September 30, 2014, the Company made advances to related party entities controlled by officers or directors of the Company of $16,140. This balance was outstanding as of September 30, 2014 and it bears no interest and is due on demand.

As of September 30, 2014 and December 31, 2013, the Company had a payable of $5,026 to Montse Zaman. The payable is unsecured, bears no interest and due on demand.

NOTE 6 – NOTES PAYABLE

During the nine months ended September 30, 2014 and September 30, 2013, the Company borrowed $103,100 and $18,567, respectively from non-related third parties. The notes are unsecured, due on demand and do not bear interest. $40,000 of the borrowings during the nine months ended September 30, 2014 is convertible into common stock of the Company at a 50% discount to the quoted market price for the Company’s common stock. This conversion option qualifies as a derivative liability and was accounted for as such (see Note 8). As of September 30, 2014 and December 31, 2013, the aggregate unpaid principal balance under these notes was $87,541 and $15,068, net of unamortized debt discount of $30,627 and $0, respectively.

NOTE 7 – EQUITY

During the nine months ended September 30, 2014, the Company issued an aggregate of 20,500 common shares for services valued at $266,500.

The Company effected a 2,000 for 1 reverse split of its common stock on June 9, 2014 and amended its authorized stock to include 490,000,000 shares of common stock and 10,000,000 shares of preferred stock. All share and per share amounts herein have been retroactively restated to reflect the split.

The Company issued 100,000 shares of Series A preferred stock on September 23, 2014 to a related party for the conversion of debt and accrued interest (see Note 5). These shares carry a conversion right of 100 shares of common stock for each preferred share held.

NOTE 8 – DERIVATIVE LIABILITY

The Company accounts for derivative financial instruments in accordance with ASC 815, which requires that all derivative financial instruments be recorded in the balance sheets either as assets or liabilities at fair value.

The Company’s derivative liability is an embedded derivative associated with one of the Company’s convertible promissory notes. The convertible promissory note was issued on July 14, 2014, (the "Note"), is a hybrid instruments which contain an embedded derivative feature which would individually warrant separate accounting as a derivative instrument under Paragraph 815-10-05-4. The embedded derivative feature includes the conversion feature to the Note. Pursuant to Paragraph 815-10-05-4, the value of the embedded derivative liability have been bifurcated from the debt host contract and recorded as a derivative liability resulting in a reduction of the initial carrying amount (as unamortized discount) of the notes, which are amortized as debt discount to be presented in other (income) expenses in the statements of operations using the effective interest method over the life of the notes.

The embedded derivative within the note have been valued using the Black Scholes approach, recorded at fair value at the date of issuance; and marked-to-market at each reporting period end date with changes in fair value recorded in the Company’s statements of operations as “change in the fair value of derivative instrument”.

As of July 14, 2014 and September 30, 2014, the estimated fair value of derivative liability was determined to be $56,003 and $76,696, respectively. On July 14, 2014, the derivative liability was recognized with a debt discount of $40,000 and a loss on derivative liabilities of $16,003. During the nine months ended September 30, 2014, amortization of $9,373 was recorded against the discount. The change in the fair value of derivative liabilities for the nine months ended September 30, 2014 was $20,693 resulting in an aggregate loss on derivative liabilities of $36,969.

9

Summary of Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis

Financial assets and liabilities measured at fair value on a recurring basis are summarized below and disclosed on the balance sheets:

			Fair Value Measurement Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Derivative liabilities on conversion feature		76,696		-		-		76,696		76,696
Total derivative liabilities	$	76,696	$	-	$	-	$	76,696	$	76,696

Summary of the Changes in Fair Value of Level 3 Financial Liabilities

The table below provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, 2014:

	Derivative Liability
Fair value, December 31, 2013	$	-
Additions		56,003
Change in fair value		20,693
Transfers in and/or out of Level 3		-
Fair value, September 30, 2014	$	76,696

NOTE 9 – SUBSEQUENT EVENTS

During October 2014, the Company issued an aggregate of 85,969 common shares for the conversion of debt totaling $75,218.

10

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS

This report contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Crown Equity’s actual results could differ materially from those set forth on the forward looking statements as a result of the risks set forth in Crown Equity’s filings with the Securities and Exchange Commission, general economic conditions, and changes in the assumptions used in making such forward looking statements.

OVERVIEW

Crown Equity Holdings Inc. (”Crown Equity”) was incorporated in August 1995 in Nevada. The Company is offering its services to companies seeking to become public entities in the United States. It has launched a website, www.crownequityholdings.com, which offers its services in a wide range of fields. The Company provides various consulting services to companies and individuals dealing with corporate structure and operations globally. The Company also provides public relations and news dissemination for publicly and privately held companies.

In December, 2010, the Company formed two wholly owned subsidiaries Crown Tele Services, Inc. and Crown Direct, Inc. Crown Tele Services, Inc. was formed to provide voice over internet (“VoIP”) services to clients at a competitive price and Crown Direct, Inc. was formed to provide direct sales to customers. Both entities had minimum sales during the quarter.

In March, 2011, the Company formed a wholly owned subsidiary CRWE Real Estate, Inc. as a subsidiary to engage in potential real estate holdings. The entity had minimal activity during the quarter.

The Company has focused its primary vision to using its network of websites to provide advertising and marketing services, as a worldwide online media advertising publisher, dedicated to the distribution of quality branding information. The Company offers Internet media-driven advertising services, which cover and connect a wide range of marketing specialties, as well as search engine optimization for clients interested in online media awareness. As part of its operations, the Company has utilized the services of software and hardware technicians in developing its websites and adding additional websites. This allows the Company to disseminate news and press releases for its customers as well as general news and financial information on a much bigger scale than it did previously. The Company markets its services to companies seeking market awareness of them and the services or goods that they offer. The Company then publishes information concerning these companies on its many websites. The Company is paid in cash and/or stock of the customer companies. The Company has numerous consulting and service customers and is therefore not dependent on any particular customer for a majority of its revenue.

Crown Equity’s office is located at 11226 Pentland Down Road, Las Vegas, NV 89146.

As of September 30, 2014, Crown Equity had five employees and was utilizing the services of one independent contractor and consultant.

11

RESULTS OF OPERATIONS

Three Months Ended September 30, 2014 Compared to the Three Months Ended September 30, 2013

For the three month period ended September 30, 2014, revenues were $0 and $20,150 for the same period in 2013. Net loss was $492,234 for the three month period ended September 30, 2014 and net income of $956 was recorded for the three months ended September 30, 2013. Operating expenses were $61,525 for the three months ended September 30, 2014 and $92,801 for the same period in 2013. Other income and expenses for the three month period ended September 30, 2014 were other expenses of $430,709 and other income of $73,607 for the same quarter in 2013.

The Company incurred unrealized losses on its marketable securities during the three months ended September 30, 2014 of $6,500 compared to unrealized gains of $77,250 for the same period ended September 30, 2013.

Interest for the three months ended September 30, 2014 and 2013 was $16,937 and $4,329, respectively.

Nine Months Ended September 30, 2014 Compared to the Nine Months Ended September 30, 2013

For the nine month period ended September 30, 2014, revenues were $0 and $64,530 for the same period in 2013. Net loss was $920,134 for the nine month period ended September 30, 2014 and net losses of $197,905 were recorded for the nine months ended September 30, 2013. Operating expenses were $475,310 for the nine months ended September 30, 2014 and $153,976 for the same period in 2013. Other income and expenses for the nine month period ended September 30, 2014 were other expenses of $444,824 and other expenses of $108,308 for the same nine months in 2013.

The Company incurred unrealized losses on its marketable securities during the nine months ended September 30, 2014 of $3,000 compared to unrealized gains of $34,450 for the same period ended September 30, 2013. The majority of our operating expenses in the nine months ended September 30, 2014 was $266,500 in stock issued for services. Other operating expenses included a loss on conversion of related party debt of $370,806 and loss on derivative liability of $36,696 for the 2014 period. Interest expense incurred during the nine month period ended September 30, 2014 was $32,021 compared to $12,897 for the same period in 2013.

LIQUIDITY AND CAPITAL RESOURCES

At September 30, 2014, Crown Equity had current assets of $102,379 and current liabilities of $527,341, resulting in working capital deficit of $424,962. Stockholders' deficit as of September 30, 2014 was $423,782.

Net cash used in operating activities for the nine months ended September 30, 2014 was $177,659 compared to net cash provided of $17,999 for the same period in 2013, a net change of $159,860.

Net cash used in investing activities was $16,140 and zero for the nine months ended September 30, 2014 and 2013, respectively.

12

Net cash provided by financing activities during the nine months ended September 30, 2014 was $199,950 compared to net cash provided of $18,667 in 2013, an increase of $181,283. Cash received from borrowings on notes payable and notes payable to related parties constituted all of the funds raised in both periods presented.

Our existing capital may not be sufficient to meet Crown Equity's cash needs, including the costs of compliance with the continuing reporting requirements of the Securities Exchange Act of 1934, as amended. This condition raises substantial doubt as to Crown Equity's ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if Crown Equity is unable to continue as a going concern.

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “smaller reporting company” as defined by Item 12b-2 of the securities exchange act of 1934 (the "exchange act") and are not requires to provide information required under this Item.

ITEM 4T: CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures

Based on their evaluation of our disclosure controls and procedures(as defined in Rule 13a-15e under the Securities Exchange Act of 1934 the "Exchange Act"), our principal executive officer and principal financial officer have concluded that as of the end of the period covered by this quarterly report on Form 10-Q such disclosure controls and procedures were not effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms because of the identification of a material weakness in our internal control over financial reporting which we view as an integral part of our disclosure controls and procedures. The material weakness relates to the lack of segregation of duties in financial reporting, as our financial reporting and all accounting functions are performed by an external consultant with no oversight by a professional with accounting expertise. Our CEO and CFO do not possess accounting expertise and our company does not have an audit committee. This weakness is due to the company’s lack of working capital to hire additional staff. To remedy this material weakness, we intend to engage another accountant to assist with financial reporting as soon as our finances will allow.

Changes in Internal Control over Financial Reporting

Except as noted above, there have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during our first quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

13

PART II – OTHER INFORMATION

ITEM 1: LEGAL PROCEEDINGS.

None

ITEM 1A: RISK FACTORS

There have been no material changes to Crown Equity’s risk factors as previously disclosed in our most recent 10-K filing for the year ending December 31, 2013.

ITEM 2: SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

During the nine months ended September 30, 2014, Crown Equity issued 20,500 common shares for services with a total value of $266,500 as follows:

· 3,300 shares of common stock for compensation for $42,900;

· 1,000 shares of common stock for consulting services for $13,000.

· 16,200 shares of common stock for professional services for $210,600.

ITEM 3: DEFAULTS UPON SENIOR SECURITIES.

None

ITEM 4: MINE SAFETY INFORMATION

None

ITEM 5: OTHER INFORMATION.

None

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ITEM 6: EXHIBITS

EXHIBIT 31.1	Certification of Principal Executive Officer
EXHIBIT 31.2	Certification of Principal Financial Officer
EXHIBIT 32.1	Certification of Compliance to Sarbanes-Oxley
EXHIBIT 32.2	Certification of Compliance to Sarbanes-Oxley

101.INS **	XBRL Instance Document
101.SCH **	XBRL Taxonomy Extension Schema Document
101.CAL **	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF **	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB **	XBRL Taxonomy Extension Label Linkbase Document
101.PRE **	XBRL Taxonomy Extension Presentation Linkbase Document

____________

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

15

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. 

	CROWN EQUITY HOLDINGS INC.
Date: November 19, 2014	By:	/s/ Kenneth Bosket
		Kenneth Bosket, CEO
	By:	/s/ John Scrudato
		John Scrudato, CFO

16

EX-31.1

EXHIBIT 31.1

FORM OF CERTIFICATION

PURSUANT TO RULE 13a-14 AND 15d-14

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

CERTIFICATION

I, Kenneth Bosket, certify that:

1.	I have reviewed this Form 10-Q of Crown Equity Holdings Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 (e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change to the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 19, 2014	By:	/s/ Kenneth Bosket
	Name:	Kenneth Bosket
	Title:	CEO

EX-31.2

EXHIBIT 31.2

FORM OF CERTIFICATION

PURSUANT TO RULE 13a-14 AND 15d-14

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

CERTIFICATION

I, John Scrudato, certify that:

1.	I have reviewed this Form 10-Q of Crown Equity Holdings Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 (e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change to the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date November 19, 2014	By:	/s/ John Scrudato
	Name:	John Scrudato
	Title:	CFO

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Crown Equity Holdings Inc. on Form 10-Q for the period from ended September 30, 2014 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, in the capacities and on the dates indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

Dated: November 19, 2014	By:	/s/ Kenneth Bosket
		Kenneth Bosket
		CEO

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Crown Equity Holdings Inc. on Form 10-Q for the period from ended September 30, 2014 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, in the capacities and on the dates indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Crown Equity.

Dated: November 19, 2014	By:	/s/ John Scrudato
		John Scrudato
		CFO

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Crown Equity for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

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DERIVATIVE LIABILITY (Details 1) (Derivative Liability [Member], USD $)	Sep. 30, 2014
Derivative Liability [Member]
Fair value, December 31, 2013
Additions	56,003
Change in fair value	20,693
Transfers in and/or out of Level 3
Fair value, September 30, 2014	$ 76,696

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EQUITY METHOD INVESTMENT IN RELATED PARTY

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 4 - EQUITY METHOD INVESTMENT IN RELATED PARTY

The Company’s ownership percentage in Cleantech Transit, Inc. was 43% as of September 30, 2014 and December 31, 2013, respectively. During late 2012, the Company’s ownership percentage exceeded 20% and the Company began accounting for this investment under the equity method. It was accounted for as an available-for-sale investment during the nine months ended September 30, 2014.

Cleantech has had no revenues since inception. Enterprise valuation was used to value this inactive entity and the equity method is used for ongoing reporting.

As of September 30, 2014 and December 31, 2013, the carrying value of the equity method investment held in related party was zero.

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MARKETABLE SECURITIES

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 3 - MARKETABLE SECURITIES

Marketable securities are classified as available-for-sale and are presented in the consolidated balance sheet at fair market value.

Per Accounting Standards Codification 820 “ Fair Value Measurement ”, fair values defined establishes a framework for measuring fair value under generally accepted accounting principles and expands disclosures about fair value measurements. ASC 820 does not require any new fair value measurements.

ASC 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

Level 1: Quoted market prices in active markets for identical assets or liabilities

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data

Level 3: Unobservable inputs that are not corroborated by market data

Crown Equity has classified these marketable securities at level 1 with a fair value of $77,500 and $80,500 as of September 30, 2014 and December 31, 2013, respectively.

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of September 30, 2014:

Description	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance as of September 30, 2014
Assets:
Marketable securities	$	7,500	$	-	$	-	$	7,500
Marketable securities held in related party		70,000		-		-		70,000
Total	$	77,500	$	-	$	-	$	77,500

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of December 31, 2013:

Description	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance as of December 31, 2013
Assets:
Marketable securities	$	10,500	$	-	$	-	$	10,500
Marketable securities held in related party		70,000		-		-		70,000
Total	$	80,500	$	-	$	-	$	80,500

Per Accounting Standards Codification 825 “ The Fair Value Option for Financial Assets and Financial Liabilities—Including an Amendment of FASB Statement No. 115 ”, an entity is permitted to irrevocably elect fair value on a contract-by-contract basis for new assets or liabilities within the scope of ASC 825 as the initial and subsequent measurement attribute for those financial assets and liabilities and certain other items including property and casualty insurance contracts. Entities electing the fair value option are required to (i) recognize changes in fair value in earnings and (ii) expense any up-front costs and fees associated with the item for which the fair value option is elected. Entities electing the fair value option are required to distinguish, on the face of the statement of financial position, the fair value of assets and liabilities for which it has elected the fair value option, and similar assets and liabilities measured using another measurement attribute. An entity can accomplish this either by reporting the fair value and non-fair-value carrying amounts as separate line items or by aggregating those amounts and disclosing parenthetically the amount of fair value included in the aggregate amount. Crown Equity adopted ASC 825 during the third quarter of fiscal 2009 and elected the fair value option for their marketable securities.

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CONSOLIDATED BALANCE SHEETS (USD $)	Sep. 30, 2014	Dec. 31, 2013
ASSETS
Cash	$ 7,239	$ 1,088
Marketable securities	7,500	10,500
Marketable securities held in related party	70,000	70,000
Loans to related parties	17,640	1,500
Total Current Assets	102,379	83,088
Property, plant and equipment, net of accumulated depreciation of $65,555 and $63,869	1,180	2,866
Total Assets	103,559	85,954
Liabilities Stockholders' Deficit
Accounts payable and accrued expenses	206,193	171,789
Accounts payable to related party	5,026	5,026
Notes payable related parties	151,885	134,219
Derivative liability	76,696
Notes payable, net of unamortized discount of $30,627 and $0	87,541	15,068
Total Current Liabilities	527,341	326,102
Stockholders' Deficit:
Preferred stock, $0.001 par value, 10,000,000 shares authorized, 9,000,000 shares undesignated authorized
Series A convertible preferred stock, $0.001 par value, 1,000,000 shares authorized, 100,000 and no shares issued and outstanding	100
Common stock, $0.001 par value, 490,000,000 shares authorized 459,596 and 439,096 shares issued and outstanding	460	439
Additional paid-in capital	9,555,084	8,818,705
Accumulated deficit	(9,979,426)	(9,059,292)
Total Stockholder's Deficit	(423,782)	(240,148)
Total Liabilities and Stockholders' Deficit	$ 103,559	$ 85,954

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BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements of Crown Equity Holdings Inc. (“Crown Equity”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in Crown Equity’s December 31, 2013 Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year end December 31, 2013 as reported on Form 10-K, have been omitted. Certain prior period amounts have been reclassified to conform to current period presentation.

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NOTES PAYABLE (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Notes Payable Details Narrative
Unpaid principal balance	$ 87,541		$ 15,068
Borrowings convertible into common stock of the Company	40,000
Borrowed from non-related third parties	103,100	18,567
Unamortized debt discount	$ 30,627		$ 0

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DERIVATIVE LIABILITY (Details) (USD $)	Sep. 30, 2014
Derivative liabilities on conversion feature	$ 76,696
Total derivative liabilities	76,696
Level 1 [Member]
Derivative liabilities on conversion feature
Total derivative liabilities
Level 2 [Member]
Derivative liabilities on conversion feature
Total derivative liabilities
Level 3 [Member]
Derivative liabilities on conversion feature	76,696
Total derivative liabilities	76,696
Carrying Value [Member]
Derivative liabilities on conversion feature	76,696
Total derivative liabilities	$ 76,696

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GOING CONCERN

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 2 - GOING CONCERN

As shown in the accompanying financial statements, Crown Equity has an accumulated deficit of $9,979,426, and a working capital deficit of $424,962 as of September 30, 2014. Unless profitability and increase in shareholders’ equity continues, these conditions raise substantial doubt as to Crown Equity's ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if Crown Equity is unable to continue as a going concern.

Crown Equity continues to review its expense structure reviewing costs and their reduction to move towards profitability. The Company’s expenses are planned to decrease as a percent of revenue resulting in profitability and increased shareholders’ equity.

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Sep. 30, 2014	Dec. 31, 2013
Consolidated Balance Sheets Parenthetical
Accumulated depreciation	$ 65,555	$ 63,869
Unamortized discount	$ 30,627	$ 0
Stockholders' Equity (Deficit):
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, undesignated authorized	9,000,000	9,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Series A convertible preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Series A convertible preferred stock, shares authorized	1,000,000	1,000,000
Series A convertible preferred stock, shares issued	100,000	0
Series A convertible preferred stock, shares outstanding	100,000	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	490,000,000	490,000,000
Common stock, shares issued	459,596	439,096
Common stock, shares outstanding	459,596	439,096

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GOING CONCERN (Details Narrative) (USD $)	Sep. 30, 2014
Going Concern Details Narrative
Accumulated deficit	$ 9,979,426
Working capital deficit	$ 424,962

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Document and Entity Information	9 Months Ended
	Sep. 30, 2014	Nov. 21, 2014
Document And Entity Information
Entity Registrant Name	Crown Equity Holdings, Inc.
Entity Central Index Key	0001103833
Document Type	10-Q
Document Period End Date	Sep. 30, 2014
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		545,292
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2014

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MARKETABLE SECURITIES (Details) (USD $)	Sep. 30, 2014	Dec. 31, 2013
Assets:
Marketable securities	$ 7,500	$ 10,500
Marketable securities held in related party	70,000	70,000
Total	77,500	80,500
Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) [Member]
Assets:
Marketable securities	7,500	10,500
Marketable securities held in related party	70,000	70,000
Total	77,500	80,500
Significant Other Observable Inputs (Level 2) [Member]
Assets:
Marketable securities
Marketable securities held in related party
Total
Significant Unobservable Inputs (Level 3) [Member]
Assets:
Marketable securities
Marketable securities held in related party
Total

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CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Consolidated Statements Of Operations
Revenue		$ 150		$ 44,530
Revenue from related party		20,000		20,000
Total revenue		20,150		64,530
Direct material costs				151
Operating expenses	61,525	92,801	475,310	153,976
Loss from operations	(61,525)	(72,651)	(475,310)	(89,597)
Other income (expenses)
Interest expense	(16,937)	(4,329)	(32,021)	(12,897)
Loss on equity method investment - related party				(132,988)
Loss on related party debt conversion	(370,806)		(370,806)
Loss on derivative liability	(36,696)		(36,696)
Other income (expense)	230	686	(2,301)	3,127
Unrealized gain (loss) on marketable securities	(6,500)	77,250	(3,000)	34,450
Total Other Income (expense)	(430,709)	73,607	(444,824)	(108,308)
Net loss	$ (492,234)	$ 956	$ (920,134)	$ (197,905)
Net loss per share - basic and diluted	$ (1.07)	$ 0	$ (2.02)	$ (0.45)
Weighted average number of common shares outstanding - basic and diluted	459,596	439,096	455,766	439,464

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EQUITY

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 7 - EQUITY

During the nine months ended September 30, 2014, the Company issued an aggregate of 20,500 common shares for services valued at $266,500.

The Company effected a 2,000 for 1 reverse split of its common stock on June 9, 2014 and amended its authorized stock to include 490,000,000 shares of common stock and 10,000,000 shares of preferred stock. All share and per share amounts herein have been retroactively restated to reflect the split.

The Company issued 100,000 shares of Series A preferred stock on September 23, 2014 to a related party for the conversion of debt and accrued interest (see Note 5). These shares carry a conversion right of 100 shares of common stock for each preferred share held.

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NOTES PAYABLE

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 6 - NOTES PAYABLE

During the nine months ended September 30, 2014 and September 30, 2013, the Company borrowed $103,100 and $18,567, respectively from non-related third parties. The notes are unsecured, due on demand and do not bear interest. $40,000 of the borrowings during the nine months ended September 30, 2014 is convertible into common stock of the Company at a 50% discount to the quoted market price for the Company’s common stock. This conversion option qualifies as a derivative liability and was accounted for as such (see Note 8). As of September 30, 2014 and December 31, 2013, the aggregate unpaid principal balance under these notes was $87,541 and $15,068, net of unamortized debt discount of $30,627 and $0, respectively.

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EQUITY (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2014
Equity Details Narrative
Common stock issued for services, shares	20,500
Common stock issued for services, Amount	$ 266,500

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MARKETABLE SECURITIES (Details Narrative) (USD $)	Sep. 30, 2014	Dec. 31, 2013 Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) [Member]
Marketable securities	$ 77,500	$ 80,500

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MARKETABLE SECURITIES (Tables)

9 Months Ended

Sep. 30, 2014

Marketable Securities Tables

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of September 30, 2014:

Description	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance as of September 30, 2014
Assets:
Marketable securities	$	7,500	$	-	$	-	$	7,500
Marketable securities held in related party		70,000		-		-		70,000
Total	$	77,500	$	-	$	-	$	77,500

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of December 31, 2013:

Description	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance as of December 31, 2013
Assets:
Marketable securities	$	10,500	$	-	$	-	$	10,500
Marketable securities held in related party		70,000		-		-		70,000
Total	$	80,500	$	-	$	-	$	80,500

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DERIVATIVE LIABILITY

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 8 - DERIVATIVE LIABILITY

The Company accounts for derivative financial instruments in accordance with ASC 815, which requires that all derivative financial instruments be recorded in the balance sheets either as assets or liabilities at fair value.

The Company’s derivative liability is an embedded derivative associated with one of the Company’s convertible promissory notes. The convertible promissory note was issued on July 14, 2014, (the "Note"), is a hybrid instruments which contain an embedded derivative feature which would individually warrant separate accounting as a derivative instrument under Paragraph 815-10-05-4. The embedded derivative feature includes the conversion feature to the Note. Pursuant to Paragraph 815-10-05-4, the value of the embedded derivative liability have been bifurcated from the debt host contract and recorded as a derivative liability resulting in a reduction of the initial carrying amount (as unamortized discount) of the notes, which are amortized as debt discount to be presented in other (income) expenses in the statements of operations using the effective interest method over the life of the notes.

The embedded derivative within the note have been valued using the Black Scholes approach, recorded at fair value at the date of issuance; and marked-to-market at each reporting period end date with changes in fair value recorded in the Company’s statements of operations as “change in the fair value of derivative instrument”.

As of July 14, 2014 and September 30, 2014, the estimated fair value of derivative liability was determined to be $56,003 and $76,696, respectively. On July 14, 2014, the derivative liability was recognized with a debt discount of $40,000 and a loss on derivative liabilities of $16,003. During the nine months ended September 30, 2014, amortization of $9,373 was recorded against the discount. The change in the fair value of derivative liabilities for the nine months ended September 30, 2014 was $20,693 resulting in an aggregate loss on derivative liabilities of $36,969.

 Summary of Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis

Financial assets and liabilities measured at fair value on a recurring basis are summarized below and disclosed on the balance sheets:

			Fair Value Measurement Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Derivative liabilities on conversion feature		76,696		-		-		76,696		76,696
Total derivative liabilities	$	76,696	$	-	$	-	$	76,696	$	76,696

Summary of the Changes in Fair Value of Level 3 Financial Liabilities

The table below provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, 2014:

	Derivative Liability
Fair value, December 31, 2013	$	-
Additions		56,003
Change in fair value		20,693
Transfers in and/or out of Level 3		-
Fair value, September 30, 2014	$	76,696

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SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 9 - SUBSEQUENT EVENTS

During October 2014, the Company issued an aggregate of 85,969 common shares for the conversion of debt totaling $75,218.

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DERIVATIVE LIABILITY (Tables)

9 Months Ended

Sep. 30, 2014

Derivative Liability Tables

Summary of Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis

Financial assets and liabilities measured at fair value on a recurring basis are summarized below and disclosed on the balance sheets:

			Fair Value Measurement Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Derivative liabilities on conversion feature		76,696		-		-		76,696		76,696
Total derivative liabilities	$	76,696	$	-	$	-	$	76,696	$	76,696

Summary of the Changes in Fair Value of Level 3 Financial Liabilities

The table below provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, 2014:

	Derivative Liability
Fair value, December 31, 2013	$	-
Additions		56,003
Change in fair value		20,693
Transfers in and/or out of Level 3		-
Fair value, September 30, 2014	$	76,696

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RELATED PARTY TRANSACTIONS (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Related Party Transactions Details Narrative
Outstanding notes payable to related parties	$ 151,885	$ 134,219
Additional borrowing from Related parties	100,350
Aggregate payments on these notes payable	3,500
Related party converted debt	79,184
Accrued interest	20,010
Fair value of the preferred stock	470,000
Loss on the conversion of related party debt	370,806
Notes payable due	70,000	70,000
Past due amount of bearing interest	96,209	96,209
Default bearing interest	18.00%	18.00%
Aggregate common shares	7,000,000	7,000,000
Loan Outstanding	1,500	1,500
Company made advances to related party entities controlled by officers or directors of the Company	16,140
Payable of the company	$ 5,026

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DERIVATIVE LIABILITY (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Notes to Financial Statements
Estimated fair value of derivative liability	$ 76,696	$ 56,003
Amortization of derivative liability		9,373
change in the fair value of derivative liabilities	20,693
Aggregate loss on derivative liabilities	$ 36,969

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Cash flows from operating activities
Net loss	$ (920,134)	$ (197,905)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	1,686	16,781
Common stock issued for services	266,500
Loss on conversion of related party debt	370,806
Loss on derivative liability	(36,696)
Amortization of debt discount	9,373
Unrealized (gain) loss on marketable securities	3,000	(34,450)
Loss on equity method investment held in related party		132,988
Marketable securities received for revenue		(25,550)
Changes in operating assets and liabilities:
(Increase) decrease accounts receivable		(1,650)
(Increase) decrease prepaid expenses		35,000
Increase (decrease) in accounts payable and accrued expenses	54,414	56,987
Net cash used in operating activities	(177,659)	(17,799)
Cash flows from investing activities
Advances to related parties	(16,140)
Net cash used in investing activities	(16,140)
Cash flows from financing activities
Payments on notes payable		(2,000)
Payments on related party notes payable	(3,500)	(4,000)
Borrowings on notes payable	103,100	18,567
Borrowings on related party notes payable	370,806
Net cash provided by financing activities	199,950	18,667
Net increase in cash	6,151	868
Cash, beginning of year	1,088	1,209
Cash, end of year	7,239	2,077
Supplemental disclosures of cash flow information
Interest paid	22	45
Income taxes paid
Noncash investing and financing activities
Common stock returned and cancelled		2,133
Related party debt and accrued interest converted to preferred stock	99,194
Debt discount due to derivative liability	$ 40,000

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RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

NOTE 5 - RELATED PARTY TRANSACTIONS

As of December 31, 2013, the company had outstanding notes payable to related parties of $134,219. During the nine months ended September 30, 2014, the Company borrowed an additional $100,350 under related party notes and made aggregate payments on these notes payable of $3,500. The notes are unsecured, bear interest between 0% and 12% and mature between November 19, 2012 and on demand. As of September 30, 2014 and December 31, 2013, $96,209 of these notes was past due and in default bearing interest at 18% per annum. As of September 30, 2014, the aggregate outstanding balance under these related party notes payable was $151,885. These notes payable are with various officers and directors of the Company and with entities controlled by officers or directors of the Company including Montse Zaman, Phoenix Consulting Services Inc., Tisa Capital Corp., Ken Bosket, Mark Vega and Almulfo Saucedo.

During the nine months ended September 30, 2014, a related party converted debt of $79,184 and accrued interest of $20,010 into 100,000 shares of Series A preferred stock. The fair value of the preferred stock was determined to be $470,000 resulting in a loss on the conversion of related party debt of $370,806.

In July 2013 the Company entered into a management consultant contract with Cleantech Transit, Inc., a related party, for consulting services through June 30, 2014. The terms of the agreement call for $20,000 per month to be paid in two equal installments of cash and may be terminated by either party 30 days after written notice is given. Due to the nature of the close relationship between the parties, the Company will record this income upon receipt of the actual cash payments. There were no cash receipts and there was no revenue recognized under this agreement during the nine months ended September 30, 2014.

As of September 30, 2014 and December 31, 2013, the Company held an aggregate of 7,000,000 common shares of American Video Teleconferencing, Inc. valued at $70,000 as of September 30, 2014 and December 31, 2013. American Video Teleconferencing, Inc. became a related party in 2014 due to common officers and Directors.

During 2013, the Company loaned $1,500 to Cleantech Transit. The loan is unsecured, bears no interest and is due on demand. The $1,500 was outstanding as of September 30, 2014 and December 31, 2013.

During the nine months ended September 30, 2014, the Company made advances to related party entities controlled by officers or directors of the Company of $16,140. This balance was outstanding as of September 30, 2014 and it bears no interest and is due on demand.

As of September 30, 2014 and December 31, 2013, the Company had a payable of $5,026 to Montse Zaman. The payable is unsecured, bears no interest and due on demand.

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EQUITY METHOD INVESTMENT IN RELATED PARTY (Details Narrative) (USD $)	Sep. 30, 2014	Dec. 31, 2013
Carrying value of the equity method investment held in related party	$ 0	$ 0
Cleantech Transit, Inc [Member]
Ownership percentage	43.00%	43.00%