0001096906-23-002212.txt : 20231116 0001096906-23-002212.hdr.sgml : 20231116 20231116135010 ACCESSION NUMBER: 0001096906-23-002212 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 49 CONFORMED PERIOD OF REPORT: 20230630 FILED AS OF DATE: 20231116 DATE AS OF CHANGE: 20231116 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SPECTRAL CAPITAL Corp CENTRAL INDEX KEY: 0001131903 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 880472860 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-50274 FILM NUMBER: 231413992 BUSINESS ADDRESS: STREET 1: 4500 9TH AVENUE NE CITY: SEATTLE STATE: WA ZIP: 98105 BUSINESS PHONE: 206-385-6490 MAIL ADDRESS: STREET 1: 4500 9TH AVENUE NE CITY: SEATTLE STATE: WA ZIP: 98105 FORMER COMPANY: FORMER CONFORMED NAME: SPECTRA CAPITAL Corp DATE OF NAME CHANGE: 20100813 FORMER COMPANY: FORMER CONFORMED NAME: FUSA CAPITAL CORP DATE OF NAME CHANGE: 20040707 FORMER COMPANY: FORMER CONFORMED NAME: GALAXY CHAMPIONSHIP WRESTLING INC DATE OF NAME CHANGE: 20010108 10-Q/A 1 fccn-20230630.htm SPECTRAL CAPITAL CORPORATION - FORM 10-Q/A SEC FILING Spectral Capital Corporation - Form 10-Q/A SEC filing
0001131903 --12-31 Yes Spectral Capital Corporation (the 'Company') is filing this Quarterly Report on Form 10-Q/A, Amendment No. 1 (the 'Quarterly Report on Form 10-Q/A') to amend its Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2023; filed with the Securities and Exchange Commission on August 14, 2023 (the 'Original Report'). The purpose of this Quarterly Report on Form 10-Q/A is to amend our disclosure in Part I, Item 4 'Controls and Procedures,' of the Original Report to change an incorrect date listed. The company should have stated that 'our disclosure controls and procedures were not effective as of June 30, 2023' rather than March 31, 2022. The remainder of the Original Report, including the financial statements and supplementary data, remains unchanged. We have made no attempt in this Quarterly Report on Form 10-Q/A to modify or update the disclosures presented in the Original Report other than as noted in the previous paragraph. Except as noted above, this Quarterly Report on Form 10-Q/A does not reflect events occurring after the filing of the Original Report. Accordingly, this Quarterly Report on Form 10-Q/A should be read in conjunction with the Original Report, and the Company's other filings with the Securities and Exchange Commission ('SEC') subsequent to the filing of the Original Report, including any amendments thereto. true 2023 Q2 0001131903 2023-01-01 2023-06-30 0001131903 2023-06-30 0001131903 2022-06-30 0001131903 2023-08-14 0001131903 2022-12-31 0001131903 2023-04-01 2023-06-30 0001131903 2022-04-01 2022-06-30 0001131903 2022-01-01 2022-06-30 0001131903 us-gaap:CommonStockMember 2023-01-01 2023-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-01-01 2023-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2023-01-01 2023-06-30 0001131903 us-gaap:RetainedEarningsMember 2023-01-01 2023-06-30 0001131903 2022-03-31 0001131903 us-gaap:CommonStockMember 2022-03-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-03-31 0001131903 us-gaap:NoncontrollingInterestMember 2022-03-31 0001131903 us-gaap:RetainedEarningsMember 2022-03-31 0001131903 us-gaap:CommonStockMember 2022-04-01 2022-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-04-01 2022-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2022-04-01 2022-06-30 0001131903 us-gaap:RetainedEarningsMember 2022-04-01 2022-06-30 0001131903 us-gaap:CommonStockMember 2022-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2022-06-30 0001131903 us-gaap:RetainedEarningsMember 2022-06-30 0001131903 2021-12-31 0001131903 us-gaap:CommonStockMember 2021-12-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2021-12-31 0001131903 us-gaap:NoncontrollingInterestMember 2021-12-31 0001131903 us-gaap:RetainedEarningsMember 2021-12-31 0001131903 us-gaap:CommonStockMember 2022-01-01 2022-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-01-01 2022-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2022-01-01 2022-06-30 0001131903 us-gaap:RetainedEarningsMember 2022-01-01 2022-06-30 0001131903 2023-03-31 0001131903 us-gaap:CommonStockMember 2023-03-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-03-31 0001131903 us-gaap:NoncontrollingInterestMember 2023-03-31 0001131903 us-gaap:RetainedEarningsMember 2023-03-31 0001131903 us-gaap:CommonStockMember 2023-04-01 2023-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-04-01 2023-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2023-04-01 2023-06-30 0001131903 us-gaap:RetainedEarningsMember 2023-04-01 2023-06-30 0001131903 us-gaap:CommonStockMember 2023-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2023-06-30 0001131903 us-gaap:RetainedEarningsMember 2023-06-30 0001131903 us-gaap:CommonStockMember 2022-12-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-12-31 0001131903 us-gaap:NoncontrollingInterestMember 2022-12-31 0001131903 us-gaap:RetainedEarningsMember 2022-12-31 0001131903 srt:ChiefExecutiveOfficerMember 2023-01-01 2023-06-30 0001131903 srt:ChiefExecutiveOfficerMember 2022-01-01 2022-06-30 0001131903 fil:ChiefExecutiveOfficerAccruedSalariesMember 2023-06-30 0001131903 fil:ChiefExecutiveOfficerAccruedSalariesMember 2022-12-31 0001131903 fil:ChiefExecutiveOfficerOperatingExpendituresMember 2023-06-30 0001131903 fil:ChiefExecutiveOfficerOperatingExpendituresMember 2022-12-31 xbrli:pure iso4217:USD xbrli:shares iso4217:USD xbrli:shares

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q/A

(Mark One)

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

 

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

 

OR

 

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

 

SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

 

Commission File No. 000-50274

 

Spectral Capital Corporation

(Exact name of Registrant as specified in its charter)

 

Nevada

51-0520296

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification Number)

4500 9th Avenue NE, Seattle, WA

98105

(Address of principal executive offices)

(Zip/Postal Code)

(206) 385-6490

(Telephone Number)

___________

(Former name or former address if changed since last report)

 

Check whether the issuer (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 period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

[X] Yes  [  ] NO

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company.  See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

¨

Smaller reporting company

 

Emerging growth company

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.


 

Indicate by check mark whether the registrant has filed a report to its management’s assessment of the effectiveness of its internal control over financial reporting under section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.  

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

 

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

 

As of August 14, 2023, there are issued and outstanding only common equity shares in the amount of 42,017,948 shares, par value $0.0001, of which there is only a single class.  There are 5,000,000 preferred shares authorized and none issued and outstanding. 

 

EXPLANATORY NOTE

 

Spectral Capital Corporation (the “Company”) is filing this Quarterly Report on Form 10-Q/A, Amendment No. 1 (the “Quarterly Report on Form 10-Q/A”) to amend its Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2023; filed with the Securities and Exchange Commission on August 14, 2023 (the “Original Report”). The purpose of this Quarterly Report on Form 10-Q/A is to amend our disclosure in Part I, Item 4 “Controls and Procedures,” of the Original Report to change an incorrect date listed.  The company should have stated that “our disclosure controls and procedures were not effective as of June 30, 2023” rather than March 31, 2022. The remainder of the Original Report, including the financial statements and supplementary data, remains unchanged.

 

We have made no attempt in this Quarterly Report on Form 10-Q/A to modify or update the disclosures presented in the Original Report other than as noted in the previous paragraph. Except as noted above, this Quarterly Report on Form 10-Q/A does not reflect events occurring after the filing of the Original Report. Accordingly, this Quarterly Report on Form 10-Q/A should be read in conjunction with the Original Report, and the Company’s other filings with the Securities and Exchange Commission (“SEC”) subsequent to the filing of the Original Report, including any amendments thereto.

 


SPECTRAL CAPITAL CORPORATION

 

TABLE OF CONTENTS

 

PART I - FINANCIAL INFORMATION

 

 

 

Item 1.

Financial Statements

F-1

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

9

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

10

 

 

 

Item 4.

Controls and Procedures

11

 

 

 

PART II - OTHER INFORMATION

 

 

 

Item 1.

Legal Proceedings

12

 

 

 

Item 1A.

Risk Factors

12

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

12

 

 

 

Item 3.

Defaults Upon Senior Securities

12

 

 

 

Item 4.

Mine Safety Disclosures

12

 

 

 

Item 5.

Other Information

12

 

 

 

Item 6.

Exhibits

12

 

 

 

SIGNATURES

13


 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Form 10-K, press releases and certain information provided periodically in writing or verbally by our officers or our agents contain statements which constitute forward-looking statements. The words “may”, “would”, “could”, “will”, “expect”, “estimate”, “anticipate”, “believe”, “intend”, “plan”, “goal”, and similar expressions and variations thereof are intended to specifically identify forward-looking statements. These statements appear in a number of places in this Form 10-K and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of us, our directors or our officers, with respect to, among other things: (i) our liquidity and capital resources; (ii) our financing opportunities and plans; (iii) our ability to generate revenues; (iv) competition in our business segments; (v) market and other trends affecting our future financial condition or results of operations; (vi) our growth strategy and operating strategy; (vii) the declaration and/or payment of dividends; and (viii) any statements regarding any reserves, potential reserves, potential mineral yield or extraction costs with respect to our mining properties.

 

Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. The factors that might cause such differences include, among others, those set forth in Part II, Item 7 of this annual report on Form 10-K, entitled Management’s Discussion and Analysis or Plan of Operation, including without limitation the risk factors contained therein. Except as required by law, we undertake no obligation to update any of the forward-looking statements in this Form 10-K after the date of this report.

 

 

 


Item 1: Financial Statements

Our unaudited interim financial statements for the three and six months ended June 30, 2023 and 2022 are part of this quarterly report. They are stated in United States Dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.

INDEX TO UNAUDITED FINANCIAL STATEMENTS

 

 

 

Condensed Consolidated Financial Statements of Spectral Capital Corporation, Inc.

 

 

 

 

 

Condensed Consolidated Balance Sheets as of June 30, 2023

 and December 31, 2022 (unaudited)

F-1

 

 

 

 

Condensed Consolidated Statements of Operations for the Three

 and Six Months Ended June 30, 2023 and 2022 (unaudited)

F-2

 

 

 

 

Condensed Consolidated Statements of Stockholders' Deficit for the Three

 and Six Months Ended June 30, 2023 and 2022 (unaudited)

F-3

 

 

 

 

Condensed Consolidated Statements of Cash Flows for the Six

 Months Ended June 30, 2023 and 2022 (unaudited)

F-4

 

 

 

 

Notes to the Condensed Consolidated Financial Statements (unaudited)

F-5


SPECTRAL CAPITAL CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2023 AND DECEMBER 31, 2022

(UNAUDITED)


 

 

June 30, 2023

 

December 31, 2022

Assets:

 

 

 

 

Cash and cash equivalents

 

$1,558  

 

$10,672  

Accounts receivable

 

-  

 

25,000  

Current assets

 

1,558  

 

35,672  

 

 

 

 

 

Total assets

 

$1,558  

 

$35,672  

 

 

 

 

 

Liabilities and Stockholders' Deficit:

 

 

 

 

Current liabilities

 

 

 

 

Accounts payable and accrued liabilities

 

$298,471  

 

$222,174  

Related party advances and accruals

 

5,500  

 

5,500  

Short-term advances

 

17,000  

 

-  

Current liabilities

 

320,971  

 

227,674  

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

Stockholders' Deficit:

 

 

 

 

Preferred stock, par value $0.0001, 5,000,000 shares
authorized, no shares issued and outstanding

 

-  

 

-  

Common stock, par value $0.0001, 1,000,000,000 and 500,000,000 shares authorized, 42,017,948 and 42,017,948 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

 

4,202  

 

4,202  

Additional paid-in capital

 

29,106,804  

 

29,106,804  

Accumulated deficit

 

(29,208,587) 

 

(29,081,212) 

Total stockholders' equity (deficit)

 

(97,581) 

 

29,794  

Non-controlling interest

 

(221,832) 

 

(221,796) 

Total stockholders' deficit - Spectral Capital Corp.

 

(319,413) 

 

(192,002) 

Total liabilities and stockholders' deficit

 

$1,558  

 

$35,672  


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

 

F-1


SPECTRAL CAPITAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023 AND 2022

(UNAUDITED)


 

 

Three Months Ended
June 30, 2023

 

Three Months Ended
June 30, 2022

 

Six Months Ended
June 30, 2023

 

Six Months Ended
June 30, 2022

 

 

 

 

 

 

 

 

 

Revenues

 

$-  

 

$-  

 

$-  

 

$-  

 

 

 

 

 

 

 

 

 

Costs of sales

 

-  

 

156,303  

 

-  

 

57,840  

 

 

 

 

 

 

 

 

 

Gross loss

 

-  

 

(156,303) 

 

-  

 

(57,840) 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Selling, general and administrative

 

27,896  

 

90,139  

 

55,411  

 

138,704  

Wages and benefits

 

36,000  

 

36,000  

 

72,000  

 

72,000  

Total operating expenses

 

63,896  

 

126,139  

 

127,411  

 

210,704  

 

 

 

 

 

 

 

 

 

Net loss before non-controlling interest

 

(63,896) 

 

(282,442) 

 

(127,411) 

 

(268,544) 

 

 

 

 

 

 

 

 

 

Loss attributable to non-controlling interest

 

18  

 

14  

 

36  

 

32  

 

 

 

 

 

 

 

 

 

Net loss attributable to Spectral Capital Corporation

 

$(63,878) 

 

$(282,428) 

 

$(127,375) 

 

$(268,512) 

 

 

 

 

 

 

 

 

 

Basic and diluted loss per common share

 

$(0.00) 

 

$(0.01) 

 

$(0.00) 

 

$(0.01) 

Weighted average shares - basic and diluted

 

42,017,948  

 

38,967,904  

 

42,017,948  

 

27,148,055  


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

 

F-2


SPECTRAL CAPITAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023 AND 2022

(UNAUDITED)


 

Three Months Ended June 30, 2022 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

Shares

 

Amount

 

Additional Paid-in Capital

 

Non-Controlling Interest

 

Accumulated Deficit

 

Total Stockholders' Deficit

March 31, 2022

16,785,762 

 

$1,679 

 

$27,847,718 

 

$(221,742) 

 

$(28,826,308) 

 

$(1,198,653) 

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from sale of common stock

- 

 

- 

 

- 

 

-  

 

-  

 

-  

Conversion of convertible note

25,232,186 

 

2,523 

 

1,259,086 

 

-  

 

-  

 

1,261,609  

Non-controlling interest

- 

 

- 

 

- 

 

(14) 

 

-  

 

(14) 

Net loss

- 

 

- 

 

- 

 

-  

 

(282,428) 

 

(282,428) 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2022

42,017,948 

 

$4,202 

 

$29,106,804 

 

$(221,756) 

 

$(29,108,736) 

 

$(219,486) 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

Shares

 

Amount

 

Additional Paid-in Capital

 

Non-Controlling Interest

 

Accumulated Deficit

 

Total Stockholders' Deficit

December 31, 2021

11,785,762 

 

$1,179 

 

$27,798,288 

 

$(221,724) 

 

$(28,840,224) 

 

$(1,262,481) 

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from sale of common stock

5,000,000 

 

500 

 

49,430 

 

-  

 

-  

 

49,930  

Conversion of convertible note

25,232,186 

 

2,523 

 

1,259,086 

 

-  

 

-  

 

1,261,609  

Non-controlling interest

- 

 

- 

 

- 

 

(32) 

 

-  

 

(32) 

Net loss

- 

 

- 

 

- 

 

-  

 

(268,512) 

 

(268,512) 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2022

42,017,948 

 

$4,202 

 

$29,106,804 

 

$(221,756) 

 

$(29,108,736) 

 

$(219,486) 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2023 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

Shares

 

Amount

 

Additional Paid-in Capital

 

Non-Controlling Interest

 

Accumulated Deficit

 

Total Stockholders' Deficit

March 31, 2023

42,017,948 

 

$4,202 

 

$29,106,804 

 

$(221,814) 

 

$(29,144,709) 

 

$(255,517) 

 

 

 

 

 

 

 

 

 

 

 

 

Non-controlling interest

- 

 

- 

 

- 

 

(18) 

 

-  

 

(18) 

Net loss

- 

 

- 

 

- 

 

-  

 

(63,878) 

 

(63,878) 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2023

42,017,948 

 

$4,202 

 

$29,106,804 

 

$(221,832) 

 

$(29,208,587) 

 

$(319,413) 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2023

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

Shares

 

Amount

 

Additional Paid-in Capital

 

Non-Controlling Interest

 

Accumulated Deficit

 

Total Stockholders' Deficit

December 31, 2022

42,017,948 

 

$4,202 

 

$29,106,804 

 

$(221,796) 

 

$(29,081,212) 

 

$(192,002) 

 

 

 

 

 

 

 

 

 

 

 

 

Non-controlling interest

- 

 

- 

 

- 

 

(36) 

 

-  

 

(36) 

Net loss

- 

 

- 

 

- 

 

-  

 

(127,375) 

 

(127,375) 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2023

42,017,948 

 

$4,202 

 

$29,106,804 

 

$(221,832) 

 

$(29,208,587) 

 

$(319,413) 


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

 

F-3


 

SPECTRAL CAPITAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2023 AND 2022

(UNAUDITED)


 

 

Six Months Ended
June 30, 2023

 

Six Months Ended
June 30, 2022

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

Net loss attributable to Spectral Capital Corporation

 

$(127,375) 

 

$(268,512) 

Adjustments to reconcile net loss to net cash
 provided by (used in) by operating activities:

 

 

 

 

Non-controlling interest

 

(36) 

 

(32) 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

25,000  

 

(2,330,365) 

Due to related parties - accrued salary

 

72,000  

 

72,000  

Accounts payable and accrued expenses

 

4,297  

 

2,565,186  

Net cash provided by (used in) operating activities

 

(26,114) 

 

38,277  

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

Net cash used in investing activities

 

-  

 

-  

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

Intercompany

 

 

 

 

Short-term advances

 

17,000  

 

-  

Proceeds from sale of common stock

 

-  

 

49,930  

Net cash provided by financing activities

 

17,000  

 

49,930  

 

 

 

 

 

Change in cash and cash equivalents

 

(9,114) 

 

88,207  

Cash and cash equivalents, beginning of period

 

10,672  

 

264  

Cash and cash equivalents, end of period

 

$1,558  

 

$88,471  

 

 

 

 

 

Supplemental disclosures of cash flow information:

 

 

 

 

Cash paid for interest

 

$-  

 

$-  

Cash paid for income taxes

 

$-  

 

$-  

 

 

 

 

 

Non-cash investing and financing activities:

 

 

 

 

Exchange of related party advances and accruals for a convertible note payable and subsequent conversion into common stock

 

$-  

 

$1,261,609  

 

 


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

 

F-4


SPECTRAL CAPITAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2023

(UNAUDITED)


NOTE 1 – BUSINESS AND NATURE OF OPERATIONS

 

Spectral Capital Corporation (the "Company" or "Spectral") was incorporated on September 13, 2000 under the laws of the State of Nevada. Spectral is focused on the identification, acquisition, development, financing of technology that has the potential to transform existing industries. The Company looks for technology that can be protected through patents or laws regarding trade secrets.  Spectral has acquired significant stakes in three technology companies currently and actively works with management to drive these companies toward increasing market penetration in their particular verticals.  Spectral intends to own, in full or in part, technology companies whose founders and key management can take advantage of the deep networks and experience in technology development embodied in Spectral management.

 

In January 2022, the Company commenced a new line of business which is providing data and telecommunications reselling services on a global basis.  On February 15, 2022, the Company entered into a telecommunications services agreement with Sky Data PLL OU (Estonia) to provide long distance switching services. The contract does not contain a fixed term or value and is on an as needed basis via invoice for Sky Data PLL OU. We provide business to business (B2) telecommunications interconnection services to mainly Asia, South America and Africa. This is done by negotiating directly with international private and public carriers for telecommunications rates based on certain volume and transaction levels. The company has temporarily paused its telecommunications business and is seeking a new telecommunications partner. We hope to resume this business within the 2023 fiscal year.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  The Company has recently discontinued revenue generating activities and has sustained substantial losses since inception. As of June 30, 2023, the Company has cash on hand of $1,558 and negative working capital of $319,413. The Company expects current cash on hand will not be able to fund operations for a period in excess of 12 months. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

 

To date management has funded its operations through selling equity securities and advances from related parties. The ability of the Company to continue as a going concern is dependent on the Company generating cash from its recently established operations, the sale of its common stock and/or obtaining debt financing and attaining future profitable operations, however, there can be no assurance the Company will be successful in these efforts. As of the date of these consolidated financial statements the Company does not have any firm commitments for capital. Without the required capital, the Company has had to reduce their development expenditures which will delay the completion of products which are expected to generate future revenues.

 

Risks and Uncertainties

The Company has a limited operating history and has not generated revenues from our planned principal operations.

 

The Company's business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company's control could cause fluctuations in these conditions, including the political environment and acts or threats of war or terrorism. Adverse developments in these general business and economic conditions, including through recession, downturn or otherwise, could have a material adverse effect on the Company's consolidated financial condition and the results of its operations.

 

The Company currently has generated limited revenues and limited marketing and/or distribution capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our current and future products. Developing a marketing and sales force is also time consuming and could delay launch of our future products. In addition, the Company will compete with many companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing.

 

The Company's industry is characterized by rapid changes in technology and customer demands. As a result, the Company's products may quickly become obsolete and unmarketable. The Company's future success will depend on


F-5


SPECTRAL CAPITAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2023

(UNAUDITED)


its ability to adapt to technological advances, anticipate customer demands, develop new products and enhance our current products on a timely and cost-effective basis. Further, the Company's products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Company's new products may not be favourably received. Nor may we have the capital resources to further the development of existing and/or new ones.

 

Interim Consolidated Financial Statements

The accompanying unaudited interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission.  Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2022. The results of operations for the six months ended June 30, 2023 are not indicative of the results that may be expected for the full year.

 

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its 60% owned subsidiaries, Noot Holdings, Inc. from its date of incorporation of February 28, 2013, and Monitr Holdings, Inc. from its date of incorporation of December 1, 2013.  All material intercompany accounts and transactions have been eliminated in consolidation.

 

Basis of Presentation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.

 

Fair Value of Financial Instruments

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

 

Level 1

Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

 

 

Level 2

Include other inputs that are directly or indirectly observable in the marketplace.

 

 

Level 3

Unobservable inputs which are supported by little or no market activity.

  

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As of June 30, 2023 and December 31, 2022, the Company does not have any assets or liabilities which would be considered Level 2 or 3.

 

The Company’s financial instruments consist of cash and cash equivalents, investments in technologies and related party advances. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these consolidated financial statements.

 

The Company measures certain assets at fair value on a nonrecurring basis. These assets include cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in an acquisition or in a nonmonetary exchange, and property and equipment and intangible assets that are written down


F-6


SPECTRAL CAPITAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2023

(UNAUDITED)


to fair value when they are held for sale or determined to be impaired. Excluding these items, the Company did not have any significant assets or liabilities that were measured at fair value on a nonrecurring basis in periods subsequent to initial recognition.

 

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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.

 

Revenue Recognition

The Company revenues in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from contracts with customers”. Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues during the six months ended June 30, 2023, were provided primarily to three customers. The loss of these customers would have a significant impact on the Company’s financial statements. At June 30, 2022, the Company paused their operations to improve their internal processes and expected to recommence in second quarter of 2023.

 

Basic Income (Loss) Per Share

Basic loss per share is calculated by dividing the Company’s net income (loss) applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. During the three and six months ended June 30, 2023 and 2022, the Company did not have not dilutive shares.

 

Non-Controlling Interests

Non-controlling interest disclosed within the consolidated statement of operations represents the minority ownership 40% share of net income (losses) of Noot Holdings, Inc. and Monitr Holdings, Inc. incurred during the six months ended June 30, 2023. The following table sets forth the changes in non-controlling interest for the six months ended June 30, 2023:

 

 

 

Non-Controlling Interest

Balance at December 31, 2022

 

$  (221,796)

 

 

 

Net loss attributable to non-controlling interest

 

(36)

Balance at June 30, 2023

 

$  (221,832)

 

Foreign Currency

 

The Company's functional currency is the United States Dollar. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. As a result of these foreign currency transactions in which require payment in a currency other than the United States Dollar, the Company has recorded foreign currency (income) losses within the accompanying condensed consolidated statement of operations.

 

Recent Accounting Pronouncements

 

The FASB issues ASUs to amend the authoritative literature in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company’s financial statement.


F-7


SPECTRAL CAPITAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2023

(UNAUDITED)


NOTE 3– RELATED PARTY TRANSACTIONS

 

Jenifer Osterwalder, the Company's Chief Executive Officer

 

Jenifer Osterwalder charges the Company $12,000 per month beginning January 1, 2021 for services rendered. Total amounts expended in the Company's condensed consolidated financial statements in connection with the CEO's services was $72,000 and $72,000 for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023 and December 31, 2022, amounts due to the CEO related to accrued salaries were $216,000 and $144,000 respectively.

 

From time to time due to the limited cash flow available, the Company's CEO pays certain operating expenditures on behalf of the Company. These advances bear no interest and are due on demand. As of June 30, 2023 and December 31, 2022, the Company's CEO was due $5,500 and $5,500 in connection with these advances, respectively.

 

As noted above, all amounts due to the Chief Executive Officer as December 31, 2021 were converted into a convertible note payable. The note is due and demand and convertible at $0.05 per share. During the three months ended March 31, 2022, the Chief Executive Officer sold the $1,054,653 and $206,956 convertible notes to a third party which was then converted into approximately 25.2 million shares in April 2022.

 

NOTE 4 – STOCKHOLDERS’ DEFICIT

 

Changes in Stockholders' Deficit

 

During the six months ended June 30, 2022, the Company sold 5 million shares of common stock resulting in proceeds of $49,930.

 

See Note 3 for discussion of convertible note converted into common stock.

 

Employee Options

 

The Company accounts for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation – Stock Compensation which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.

 

The Company has adopted a stock option and award plan to attract, retain and motivate its directors, officers, employees, consultants and advisors. Options provide the opportunity to acquire a proprietary interest in the Company and to benefit from its growth. Vesting terms and conditions are determined by the Board of Directors at the time of the grant. The Plan provides for the issuance of up to 15,000,000 common shares for employees, consultants, directors, and advisors. As of June 30, 2023, all options were expired.

 

NOTE 5 – ADVANCES

 

During the six months ended June 30, 2023, the Company received advances of $17,000 from a third party. The advances are due on demand and do not incur interest.

 

NOTE 6 – COMMITMENTS AND CONTINGENCIES

 

The Company leases office space on a three-month basis in Seattle, Washington.

 

NOTE 7– SUBSEQUENT EVENTS

 

In accordance with ASC 855-10, the Company has analyzed its operations subsequent to June 30, 2023 to the date these condensed consolidated financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these consolidated financial statements, other than disclosed above.


F-8



Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis of our financial condition and results of our operations should be read in conjunction with our financial statements and related notes appearing elsewhere in this report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements. The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and related notes included in this report and those in our Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission on March 27, 2023 and all subsequent filings.

 

OVERVIEW

 

Spectral Capital Corporation (“Spectral” or the Company, also “We or Us”) is a technology company focused on the identification, acquisition, development, financing of technology that has the potential to transform existing industries. We look for technology that can be protected through patents or laws regarding trade secrets. Spectral has acquired significant stakes in two technology companies. Spectral intends to own, in full or in part, technology companies whose founders and key management can take advantage of the deep networks and experience in technology development embodied in Spectral management.

 

In January 2022, the Company commenced a new line of business which is providing data and telecommunications reselling services on a global basis.  On February 15, 2022, the Company entered into a telecommunications services agreement with Sky Data PLL OU (Estonia) to provide long distance switching services. The contract does not contain a fixed term or value and is on an as needed basis via invoice for Sky Data PLL OU. The company has temporarily paused its telecommunications business and is seeking a new telecommunications partner. We hope to resume this business within the 2023 fiscal year.

 

RESULTS OF OPERATIONS

 

Comparison of the six months ended June 30, 2023 and 2022

 

Revenues

 

We are currently engaged in a technology development business and recently commenced operations within the telecom industry. Revenues remained the same from $0 for the six months ended June 30, 2022 to $0 for the six months ended June 30, 2023. The amount staying the same is due to the pause of our new business venture.

 

Cost of Revenues

 

We are currently engaged in a technology development business and recently commenced operations within the telecom industry. Cost of revenues decreased from $57,840 for the six months ended June 30, 2022 to $0 for the six months ended June 30, 2023. The decrease was due to the pause of our operations due to our new line of business.

 

Operating Expenses

 

Operating expenses decreased $83,293, from $210,704 for the six months ended June 30, 2022 to $127,411 for the six months ended June 30, 2023. The significant decrease was due to the pause of our operations due to our new line of business.


9



Liquidity and Capital Resources

 

As of June 30, 2023, we had $1,558 cash on hand. We intend to fund operations through the use of cash on hand, cash flows from operations and through debt and equity financings until sufficient cash flows from operations can be achieved.

 

Net cash used in operating, activities increased $64,391, from $38,277 in cash provided during the six months ended June 30, 2022 to $26,114 cash used in the six months ended June 30, 2023. This increase was primarily related to the Company having temporary ceased operations.

 

Net cash provided by financing activities decreased by $32,930 from $49,930 for the six months ended June 30, 2022 to $17,000 for the six months ended June 30, 2023. Net cash provided by financing activities during the six months ended June 30, 2023 and 2022 related to proceeds short-term advances and proceeds from the sale of common stock, respectively.

 

We believe that our current financial resources are not sufficient to meet our working capital requirements over the next year. Additional funding will be necessary in order to expand portfolio operations and to reach our goals. Currently, the Company does not have any commitments or assurances for additional capital nor can the Company provide assurance that such financing will be available to it on favourable terms, or at all. If, after utilizing the existing sources of capital available to the Company, further capital needs are identified and the Company is not successful in obtaining the financing, it may be forced to curtail its existing or planned future operations. In addition, if necessary, we will decrease expenses and redirect our efforts towards a sale of one of more of our assets should funding become inadequate.

 

Our short-term prospects are promising given our success to date in securing the two portfolio companies, Noot and Monitr. We believe we will experience significant operational and financial growth from these and other portfolio companies during the next 12 months.  However, we need significant capital to implement our plan.

 

Off Balance Sheet Arrangements

 

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not required for a smaller reporting company.


10



ITEM 4. CONTROLS AND PROCEDURES

 

(a) Evaluation of disclosure controls and procedures.

 

As required by Rule 13a-15 or Rule 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), our management, including our principal executive officer and principal accounting officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing evaluation, we have concluded that our disclosure controls and procedures were not effective as of June 30, 2023 and that they do not allow for information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission (“SEC”) rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the us in the reports that we file or submit under the Exchange Act is accumulated and communicated to the Company’s management, including its Chief Executive and Principal Accounting & Financial Officers as appropriate to allow timely decisions regarding required disclosure.

 

The material weaknesses were first identified in our annual report on Form 10-K for the year ended December 31, 2012 in which related to a lack of an accounting staff resulting in a lack of segregation of duties necessary for an effective system of internal control. The weakness in segregation of duties will continue to exist until such time as management can retain internal staff to properly segregate duties.  

 

(b) Changes in internal control over financial reporting.

 

There were no changes in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


11



PART II OTHER INFORMATION

 

Item 1. Legal Proceedings

 

None.

 

Item 2. Unregistered Sales of Securities and Use of Proceeds

 

None.

 

Item 3. Defaults Upon Senior Securities

 

Not Applicable.

 

Item 4. Mine Safety Disclosures.

 

None.

 

Item 5. Other Information

 

None.

 

Item 6. Exhibits

 

EXHIBITS

 

List of Exhibits

 

3(i)(1)

Articles of Incorporation of Spectral Capital Corporation, dated September 13, 2000, incorporated by reference to Exhibit 3(a) on Form 10-SB filed May 1, 2003.

 

3(i)(2)

Certificate of Amendment to Articles of Incorporation of Spectral Capital Corporation, dated June 17, 2007, incorporated by reference to Exhibit 2.1 on Form 8-K filed July 7, 2004.

 

3(ii)

By-laws of Spectral Capital Corporation, dated September 14, 2000, incorporated by reference to Exhibit 3(b) on Form 10-SB filed May 1, 2003.

 

31.1

Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002

 

31.2

Certification of Chief Financial and Principal Accounting Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002

 

32.1

Certification of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

32.2

Certification of the Company’s Chief Financial and Principal Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

 


12



SIGNATURE

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

Spectral Capital Corporation

 

 

 

/s/ Jenifer Osterwalder                               

 

Jenifer Osterwalder

 

President and Chief Executive Officer

 

 

 

 

 

 

 

 

Dated: November 16, 2023

 

 

 


13

EX-31.1 2 fccn_ex31z1.htm CERTIFICATION

Exhibit 31.1

 

CERTIFICATE OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Jenifer Osterwalder certify that:

 

1.I have reviewed this 10-Q for the quarter ended June 30, 2023, of Spectral Capital Corporation; 

 

2.Based on my knowledge, this report does not contain any untrue statement of a 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 are 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 conclusions 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 in 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. 

 

 

/s/ Jenifer Osterwalder

Date: November 16, 2023

 

Jenifer Osterwalder President and
Chief Executive Officer

 

EX-31.2 3 fccn_ex31z2.htm CERTIFICATION

Exhibit 31.2

 

CERTIFICATE OF CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 302 OF
THE SARBANES-OXLEY ACT OF 2002

 

I, Stephen Spalding, certify that:

 

1.I have reviewed this 10-Q for the quarter ended June 30, 2023, of Spectral Capital Corporation 

 

2.Based on my knowledge, this report does not contain any untrue statement of a 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 are 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 conclusions 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 in 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. 

 

 

/s/ Stephen Spalding

Date: November 16, 2023

 

Stephen Spalding Chief Financial and
Accounting Officer

 

EX-32.1 4 fccn_ex32z1.htm CERTIFICATION

Exhibit 32.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Spectral Capital Corporation (the "Company") on Form 10-Q for the period ended June 30, 2023, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Jenifer Osterwalder, in my capacity as President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

/s/ Jenifer Osterwalder

Date: November 16, 2023

 

Jenifer Osterwalder President and Chief Executive Officer

 

EX-32.2 5 fccn_ex32z2.htm CERTIFICATION

Exhibit 32.2

 

CERTIFICATION PURSUANT TO

18 U.S.C. 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Spectral Capital Corporation (the "Company") on Form 10-Q for the period ended June 30, 2023, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Stephen Spalding, in my capacity as Chief Financial Officer and Accounting Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

/s/ Stephen Spalding

Date: November 16, 2023

 

Stephen Spalding Chief Financial and
Accounting Officer

 

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Document and Entity Information - shares
6 Months Ended
Jun. 30, 2023
Aug. 14, 2023
Details    
Registrant CIK 0001131903  
Fiscal Year End --12-31  
Registrant Name Spectral Capital Corporation  
SEC Form 10-Q/A  
Period End date Jun. 30, 2023  
Tax Identification Number (TIN) 51-0520296  
Number of common stock shares outstanding   42,017,948
Filer Category Non-accelerated Filer  
Current with reporting Yes  
Interactive Data Current Yes  
Shell Company false  
Small Business true  
Emerging Growth Company false  
Amendment Description Spectral Capital Corporation (the 'Company') is filing this Quarterly Report on Form 10-Q/A, Amendment No. 1 (the 'Quarterly Report on Form 10-Q/A') to amend its Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2023; filed with the Securities and Exchange Commission on August 14, 2023 (the 'Original Report'). The purpose of this Quarterly Report on Form 10-Q/A is to amend our disclosure in Part I, Item 4 'Controls and Procedures,' of the Original Report to change an incorrect date listed. The company should have stated that 'our disclosure controls and procedures were not effective as of June 30, 2023' rather than March 31, 2022. The remainder of the Original Report, including the financial statements and supplementary data, remains unchanged. We have made no attempt in this Quarterly Report on Form 10-Q/A to modify or update the disclosures presented in the Original Report other than as noted in the previous paragraph. Except as noted above, this Quarterly Report on Form 10-Q/A does not reflect events occurring after the filing of the Original Report. Accordingly, this Quarterly Report on Form 10-Q/A should be read in conjunction with the Original Report, and the Company's other filings with the Securities and Exchange Commission ('SEC') subsequent to the filing of the Original Report, including any amendments thereto.  
Document Quarterly Report true  
Document Transition Report false  
Entity File Number 000-50274  
Entity Incorporation, State or Country Code NV  
Entity Address, Address Line One 4500 9th Avenue NE  
Entity Address, City or Town Seattle  
Entity Address, State or Province WA  
Entity Address, Postal Zip Code 98105  
City Area Code 206  
Local Phone Number 385-6490  
Amendment Flag true  
Document Fiscal Year Focus 2023  
Document Fiscal Period Focus Q2  
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Condensed Consolidated Balance Sheets - USD ($)
Jun. 30, 2023
Dec. 31, 2022
Assets    
Cash and cash equivalents $ 1,558 $ 10,672
Accounts receivable 0 25,000
Current assets 1,558 35,672
Total assets 1,558 35,672
Current liabilities    
Accounts payable and accrued liabilities 298,471 222,174
Related party advances and accruals 5,500 5,500
Short-term advances 17,000 0
Current liabilities 320,971 227,674
Stockholders' deficit:    
Preferred shares 0 0
Common shares 4,202 4,202
Additional paid-in capital 29,106,804 29,106,804
Accumulated deficit (29,208,587) (29,081,212)
Total stockholders' equity (deficit) (97,581) 29,794
Non-controlling interest (221,832) (221,796)
Total stockholders' deficit - Spectral Capital Corp (319,413) (192,002)
Total liabilities and stockholders' deficit $ 1,558 $ 35,672
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Condensed Consolidated Balance Sheets - Parenthetical - $ / shares
Jun. 30, 2023
Dec. 31, 2022
Condensed Consolidated Balance Sheets    
Preferred Stock, Par or Stated Value Per Share $ 0.0001 $ 0.0001
Preferred Stock, Shares Authorized 5,000,000 5,000,000
Preferred Stock, Shares Issued 0 0
Preferred Stock, Shares Outstanding 0 0
Common Stock, Par or Stated Value Per Share $ 0.0001 $ 0.0001
Common Stock, Shares Authorized 1,000,000,000 500,000,000
Common Stock, Shares, Issued 42,017,948 42,017,948
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Condensed Consolidated Statements of Operations - USD ($)
3 Months Ended 6 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Jun. 30, 2023
Jun. 30, 2022
Condensed Consolidated Statements of Operations        
Revenues $ 0 $ 0 $ 0 $ 0
Costs of sales 0 156,303 0 57,840
Gross loss 0 (156,303) 0 (57,840)
Operating expenses:        
Selling, general and administrative 27,896 90,139 55,411 138,704
Wages and benefits 36,000 36,000 72,000 72,000
Total operating expenses 63,896 126,139 127,411 210,704
Net loss before non-controlling interest (63,896) (282,442) (127,411) (268,544)
Income (loss) attributable to noncontrolling interest 18 14 36 32
Net loss before non-controlling interest $ (63,878) $ (282,428) $ (127,375) $ (268,512)
Basic income (loss) per common share $ (0.00) $ (0.01) $ (0.00) $ (0.01)
Weighted average shares - basic and diluted 42,017,948 38,967,904 42,017,948 27,148,055
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Condensed Consolidated Statements of Stockholders' Deficit - USD ($)
Common Stock
Additional Paid-in Capital
Noncontrolling Interest
Retained Earnings
Total
Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Dec. 31, 2021 $ 1,179 $ 27,798,288 $ (221,724) $ (28,840,224) $ (1,262,481)
Shares, Outstanding, Beginning Balance at Dec. 31, 2021 11,785,762        
Conversion of convertible note $ 2,523 1,259,086 0 0 1,261,609
Conversion of convertible note - Shares 25,232,186        
Net loss attributable to Spectral Capital Corporation $ 0 0 0 (268,512) (268,512)
Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jun. 30, 2022 $ 4,202 29,106,804 (221,756) (29,108,736) (219,486)
Shares, Outstanding, Ending Balance at Jun. 30, 2022 42,017,948        
Proceeds from sale of common stock $ 500 49,430 0 0 49,930
Proceeds from sale of common stock - shares 5,000,000        
Conversion of convertible note - Shares 25,232,186        
Non-controlling interest $ 0 0 (32) 0 (32)
Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Mar. 31, 2022 $ 1,679 27,847,718 (221,742) (28,826,308) (1,198,653)
Shares, Outstanding, Beginning Balance at Mar. 31, 2022 16,785,762        
Conversion of convertible note $ 2,523 1,259,086 0 0 1,261,609
Conversion of convertible note - Shares 25,232,186        
Net loss attributable to Spectral Capital Corporation $ 0 0 0 (282,428) (282,428)
Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jun. 30, 2022 $ 4,202 29,106,804 (221,756) (29,108,736) (219,486)
Shares, Outstanding, Ending Balance at Jun. 30, 2022 42,017,948        
Proceeds from sale of common stock $ 0 0 0 0 0
Proceeds from sale of common stock - shares 0        
Conversion of convertible note - Shares 25,232,186        
Non-controlling interest $ 0 0 (14) 0 (14)
Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Dec. 31, 2022 $ 4,202 29,106,804 (221,796) (29,081,212) (192,002)
Shares, Outstanding, Beginning Balance at Dec. 31, 2022 42,017,948        
Conversion of convertible note         0
Net loss attributable to Spectral Capital Corporation $ 0 0 0 (127,375) (127,375)
Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jun. 30, 2023 $ 4,202 29,106,804 (221,832) (29,208,587) (319,413)
Shares, Outstanding, Ending Balance at Jun. 30, 2023 42,017,948        
Proceeds from sale of common stock         0
Non-controlling interest $ 0 0 (36) 0 (36)
Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Mar. 31, 2023 $ 4,202 29,106,804 (221,814) (29,144,709) (255,517)
Shares, Outstanding, Beginning Balance at Mar. 31, 2023 42,017,948        
Net loss attributable to Spectral Capital Corporation $ 0 0 0 (63,878) (63,878)
Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jun. 30, 2023 $ 4,202 29,106,804 (221,832) (29,208,587) (319,413)
Shares, Outstanding, Ending Balance at Jun. 30, 2023 42,017,948        
Non-controlling interest $ 0 $ 0 $ (18) $ 0 $ (18)
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Condensed Consolidated Statements of Cash Flows - USD ($)
3 Months Ended 6 Months Ended
Jun. 30, 2022
Jun. 30, 2023
Jun. 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES      
Net loss attributable to Spectral Capital Corporation $ (282,428) $ (127,375) $ (268,512)
Adjustments to reconcile net loss to net cash used in by operating activities:      
Non-controlling interest (14) (36) (32)
Changes in operating assets and liabilities      
Accounts receivable   25,000 (2,330,365)
Due to related parties - accrued salary   72,000 72,000
Accounts payable and accrued expenses   4,297 2,565,186
Net cash provided by (used in) operating activities   (26,114) 38,277
CASH FLOWS FROM INVESTING ACTIVITIES      
Net cash used in investing activities   0 0
CASH FLOWS FROM FINANCING ACTIVITIES      
Short-term advances   17,000 0
Proceeds from sale of common stock 0 0 49,930
Net cash provided by financing activities   17,000 49,930
Change in cash and cash equivalents   (9,114) 88,207
Cash and cash equivalents, beginning of period   10,672 264
Cash and cash equivalents, end of period 88,471 1,558 88,471
Supplemental disclosure of cash flow information      
Cash paid for interest   0 0
Cash paid for income taxes   0 0
Non-cash investing and financing activities      
Exchange of related party advances and accruals for a convertible note payable and subsequent conversion into common stock $ 1,261,609 $ 0 $ 1,261,609
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Note 1 - Business and Nature of Operations
6 Months Ended
Jun. 30, 2023
Notes  
Note 1 - Business and Nature of Operations

NOTE 1 – BUSINESS AND NATURE OF OPERATIONS

 

Spectral Capital Corporation (the "Company" or "Spectral") was incorporated on September 13, 2000 under the laws of the State of Nevada. Spectral is focused on the identification, acquisition, development, financing of technology that has the potential to transform existing industries. The Company looks for technology that can be protected through patents or laws regarding trade secrets.  Spectral has acquired significant stakes in three technology companies currently and actively works with management to drive these companies toward increasing market penetration in their particular verticals.  Spectral intends to own, in full or in part, technology companies whose founders and key management can take advantage of the deep networks and experience in technology development embodied in Spectral management.

 

In January 2022, the Company commenced a new line of business which is providing data and telecommunications reselling services on a global basis.  On February 15, 2022, the Company entered into a telecommunications services agreement with Sky Data PLL OU (Estonia) to provide long distance switching services. The contract does not contain a fixed term or value and is on an as needed basis via invoice for Sky Data PLL OU. We provide business to business (B2) telecommunications interconnection services to mainly Asia, South America and Africa. This is done by negotiating directly with international private and public carriers for telecommunications rates based on certain volume and transaction levels. The company has temporarily paused its telecommunications business and is seeking a new telecommunications partner. We hope to resume this business within the 2023 fiscal year.

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Note 2 - Summary of Significant Accounting Policies
6 Months Ended
Jun. 30, 2023
Notes  
Note 2 - Summary of Significant Accounting Policies

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  The Company has recently discontinued revenue generating activities and has sustained substantial losses since inception. As of June 30, 2023, the Company has cash on hand of $1,558 and negative working capital of $319,413. The Company expects current cash on hand will not be able to fund operations for a period in excess of 12 months. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

 

To date management has funded its operations through selling equity securities and advances from related parties. The ability of the Company to continue as a going concern is dependent on the Company generating cash from its recently established operations, the sale of its common stock and/or obtaining debt financing and attaining future profitable operations, however, there can be no assurance the Company will be successful in these efforts. As of the date of these consolidated financial statements the Company does not have any firm commitments for capital. Without the required capital, the Company has had to reduce their development expenditures which will delay the completion of products which are expected to generate future revenues.

 

Risks and Uncertainties

The Company has a limited operating history and has not generated revenues from our planned principal operations.

 

The Company's business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company's control could cause fluctuations in these conditions, including the political environment and acts or threats of war or terrorism. Adverse developments in these general business and economic conditions, including through recession, downturn or otherwise, could have a material adverse effect on the Company's consolidated financial condition and the results of its operations.

 

The Company currently has generated limited revenues and limited marketing and/or distribution capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our current and future products. Developing a marketing and sales force is also time consuming and could delay launch of our future products. In addition, the Company will compete with many companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing.

 

The Company's industry is characterized by rapid changes in technology and customer demands. As a result, the Company's products may quickly become obsolete and unmarketable. The Company's future success will depend on

its ability to adapt to technological advances, anticipate customer demands, develop new products and enhance our current products on a timely and cost-effective basis. Further, the Company's products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Company's new products may not be favourably received. Nor may we have the capital resources to further the development of existing and/or new ones.

 

Interim Consolidated Financial Statements

The accompanying unaudited interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission.  Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2022. The results of operations for the six months ended June 30, 2023 are not indicative of the results that may be expected for the full year.

 

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its 60% owned subsidiaries, Noot Holdings, Inc. from its date of incorporation of February 28, 2013, and Monitr Holdings, Inc. from its date of incorporation of December 1, 2013.  All material intercompany accounts and transactions have been eliminated in consolidation.

 

Basis of Presentation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.

 

Fair Value of Financial Instruments

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

 

Level 1

Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

 

 

Level 2

Include other inputs that are directly or indirectly observable in the marketplace.

 

 

Level 3

Unobservable inputs which are supported by little or no market activity.

  

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As of June 30, 2023 and December 31, 2022, the Company does not have any assets or liabilities which would be considered Level 2 or 3.

 

The Company’s financial instruments consist of cash and cash equivalents, investments in technologies and related party advances. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these consolidated financial statements.

 

The Company measures certain assets at fair value on a nonrecurring basis. These assets include cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in an acquisition or in a nonmonetary exchange, and property and equipment and intangible assets that are written down

to fair value when they are held for sale or determined to be impaired. Excluding these items, the Company did not have any significant assets or liabilities that were measured at fair value on a nonrecurring basis in periods subsequent to initial recognition.

 

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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.

 

Revenue Recognition

The Company revenues in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from contracts with customers”. Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues during the six months ended June 30, 2023, were provided primarily to three customers. The loss of these customers would have a significant impact on the Company’s financial statements. At June 30, 2022, the Company paused their operations to improve their internal processes and expected to recommence in second quarter of 2023.

 

Basic Income (Loss) Per Share

Basic loss per share is calculated by dividing the Company’s net income (loss) applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. During the three and six months ended June 30, 2023 and 2022, the Company did not have not dilutive shares.

 

Non-Controlling Interests

Non-controlling interest disclosed within the consolidated statement of operations represents the minority ownership 40% share of net income (losses) of Noot Holdings, Inc. and Monitr Holdings, Inc. incurred during the six months ended June 30, 2023. The following table sets forth the changes in non-controlling interest for the six months ended June 30, 2023:

 

 

 

Non-Controlling Interest

Balance at December 31, 2022

 

$  (221,796)

 

 

 

Net loss attributable to non-controlling interest

 

(36)

Balance at June 30, 2023

 

$  (221,832)

 

Foreign Currency

 

The Company's functional currency is the United States Dollar. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. As a result of these foreign currency transactions in which require payment in a currency other than the United States Dollar, the Company has recorded foreign currency (income) losses within the accompanying condensed consolidated statement of operations.

 

Recent Accounting Pronouncements

 

The FASB issues ASUs to amend the authoritative literature in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company’s financial statement.

XML 19 R9.htm IDEA: XBRL DOCUMENT v3.23.3
Note 3 - Related Party Transactions
6 Months Ended
Jun. 30, 2023
Notes  
Note 3 - Related Party Transactions

NOTE 3– RELATED PARTY TRANSACTIONS

 

Jenifer Osterwalder, the Company's Chief Executive Officer

 

Jenifer Osterwalder charges the Company $12,000 per month beginning January 1, 2021 for services rendered. Total amounts expended in the Company's condensed consolidated financial statements in connection with the CEO's services was $72,000 and $72,000 for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023 and December 31, 2022, amounts due to the CEO related to accrued salaries were $216,000 and $144,000 respectively.

 

From time to time due to the limited cash flow available, the Company's CEO pays certain operating expenditures on behalf of the Company. These advances bear no interest and are due on demand. As of June 30, 2023 and December 31, 2022, the Company's CEO was due $5,500 and $5,500 in connection with these advances, respectively.

 

As noted above, all amounts due to the Chief Executive Officer as December 31, 2021 were converted into a convertible note payable. The note is due and demand and convertible at $0.05 per share. During the three months ended March 31, 2022, the Chief Executive Officer sold the $1,054,653 and $206,956 convertible notes to a third party which was then converted into approximately 25.2 million shares in April 2022.

XML 20 R10.htm IDEA: XBRL DOCUMENT v3.23.3
Note 4 - Stockholders' Deficit
6 Months Ended
Jun. 30, 2023
Notes  
Note 4 - Stockholders' Deficit

NOTE 4 – STOCKHOLDERS’ DEFICIT

 

Changes in Stockholders' Deficit

 

During the six months ended June 30, 2022, the Company sold 5 million shares of common stock resulting in proceeds of $49,930.

 

See Note 3 for discussion of convertible note converted into common stock.

 

Employee Options

 

The Company accounts for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation – Stock Compensation which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.

 

The Company has adopted a stock option and award plan to attract, retain and motivate its directors, officers, employees, consultants and advisors. Options provide the opportunity to acquire a proprietary interest in the Company and to benefit from its growth. Vesting terms and conditions are determined by the Board of Directors at the time of the grant. The Plan provides for the issuance of up to 15,000,000 common shares for employees, consultants, directors, and advisors. As of June 30, 2023, all options were expired.

XML 21 R11.htm IDEA: XBRL DOCUMENT v3.23.3
Note 5 - Advances
6 Months Ended
Jun. 30, 2023
Notes  
Note 5 - Advances

NOTE 5 – ADVANCES

 

During the six months ended June 30, 2023, the Company received advances of $17,000 from a third party. The advances are due on demand and do not incur interest.

XML 22 R12.htm IDEA: XBRL DOCUMENT v3.23.3
Note 6 - Commitments and Contingencies
6 Months Ended
Jun. 30, 2023
Notes  
Note 6 - Commitments and Contingencies

NOTE 6 – COMMITMENTS AND CONTINGENCIES

 

The Company leases office space on a three-month basis in Seattle, Washington.

XML 23 R13.htm IDEA: XBRL DOCUMENT v3.23.3
Note 7 - Subsequent Events
6 Months Ended
Jun. 30, 2023
Notes  
Note 7 - Subsequent Events

NOTE 7– SUBSEQUENT EVENTS

 

In accordance with ASC 855-10, the Company has analyzed its operations subsequent to June 30, 2023 to the date these condensed consolidated financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these consolidated financial statements, other than disclosed above.

XML 24 R14.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Going Concern (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Going Concern

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  The Company has recently discontinued revenue generating activities and has sustained substantial losses since inception. As of June 30, 2023, the Company has cash on hand of $1,558 and negative working capital of $319,413. The Company expects current cash on hand will not be able to fund operations for a period in excess of 12 months. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

 

To date management has funded its operations through selling equity securities and advances from related parties. The ability of the Company to continue as a going concern is dependent on the Company generating cash from its recently established operations, the sale of its common stock and/or obtaining debt financing and attaining future profitable operations, however, there can be no assurance the Company will be successful in these efforts. As of the date of these consolidated financial statements the Company does not have any firm commitments for capital. Without the required capital, the Company has had to reduce their development expenditures which will delay the completion of products which are expected to generate future revenues.

XML 25 R15.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Risks and Uncertainties (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Risks and Uncertainties

Risks and Uncertainties

The Company has a limited operating history and has not generated revenues from our planned principal operations.

 

The Company's business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company's control could cause fluctuations in these conditions, including the political environment and acts or threats of war or terrorism. Adverse developments in these general business and economic conditions, including through recession, downturn or otherwise, could have a material adverse effect on the Company's consolidated financial condition and the results of its operations.

 

The Company currently has generated limited revenues and limited marketing and/or distribution capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our current and future products. Developing a marketing and sales force is also time consuming and could delay launch of our future products. In addition, the Company will compete with many companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing.

 

The Company's industry is characterized by rapid changes in technology and customer demands. As a result, the Company's products may quickly become obsolete and unmarketable. The Company's future success will depend on

its ability to adapt to technological advances, anticipate customer demands, develop new products and enhance our current products on a timely and cost-effective basis. Further, the Company's products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Company's new products may not be favourably received. Nor may we have the capital resources to further the development of existing and/or new ones.

XML 26 R16.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Interim Consolidated Financial Statements (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Interim Consolidated Financial Statements

Interim Consolidated Financial Statements

The accompanying unaudited interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission.  Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2022. The results of operations for the six months ended June 30, 2023 are not indicative of the results that may be expected for the full year.

XML 27 R17.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Principles of Consolidation (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Principles of Consolidation

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its 60% owned subsidiaries, Noot Holdings, Inc. from its date of incorporation of February 28, 2013, and Monitr Holdings, Inc. from its date of incorporation of December 1, 2013.  All material intercompany accounts and transactions have been eliminated in consolidation.

XML 28 R18.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Basis of Presentation (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Basis of Presentation

Basis of Presentation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.

XML 29 R19.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Fair Value of Financial Instruments (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Fair Value of Financial Instruments

Fair Value of Financial Instruments

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

 

Level 1

Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

 

 

Level 2

Include other inputs that are directly or indirectly observable in the marketplace.

 

 

Level 3

Unobservable inputs which are supported by little or no market activity.

  

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As of June 30, 2023 and December 31, 2022, the Company does not have any assets or liabilities which would be considered Level 2 or 3.

 

The Company’s financial instruments consist of cash and cash equivalents, investments in technologies and related party advances. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these consolidated financial statements.

 

The Company measures certain assets at fair value on a nonrecurring basis. These assets include cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in an acquisition or in a nonmonetary exchange, and property and equipment and intangible assets that are written down

to fair value when they are held for sale or determined to be impaired. Excluding these items, the Company did not have any significant assets or liabilities that were measured at fair value on a nonrecurring basis in periods subsequent to initial recognition.

XML 30 R20.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Use of Estimates (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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.

XML 31 R21.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Revenue Recognition (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Revenue Recognition

Revenue Recognition

The Company revenues in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from contracts with customers”. Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues during the six months ended June 30, 2023, were provided primarily to three customers. The loss of these customers would have a significant impact on the Company’s financial statements. At June 30, 2022, the Company paused their operations to improve their internal processes and expected to recommence in second quarter of 2023.

XML 32 R22.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Basic (Loss) Per Share (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Basic (Loss) Per Share

Basic Income (Loss) Per Share

Basic loss per share is calculated by dividing the Company’s net income (loss) applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. During the three and six months ended June 30, 2023 and 2022, the Company did not have not dilutive shares.

XML 33 R23.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Non-Controlling Interests (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Non-Controlling Interests

Non-Controlling Interests

Non-controlling interest disclosed within the consolidated statement of operations represents the minority ownership 40% share of net income (losses) of Noot Holdings, Inc. and Monitr Holdings, Inc. incurred during the six months ended June 30, 2023. The following table sets forth the changes in non-controlling interest for the six months ended June 30, 2023:

 

 

 

Non-Controlling Interest

Balance at December 31, 2022

 

$  (221,796)

 

 

 

Net loss attributable to non-controlling interest

 

(36)

Balance at June 30, 2023

 

$  (221,832)

XML 34 R24.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Foreign Currency (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Foreign Currency

Foreign Currency

 

The Company's functional currency is the United States Dollar. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. As a result of these foreign currency transactions in which require payment in a currency other than the United States Dollar, the Company has recorded foreign currency (income) losses within the accompanying condensed consolidated statement of operations.

XML 35 R25.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Recent Accounting Pronouncements (Policies)
6 Months Ended
Jun. 30, 2023
Policies  
Recent Accounting Pronouncements

Recent Accounting Pronouncements

 

The FASB issues ASUs to amend the authoritative literature in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company’s financial statement.

XML 36 R26.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Non-Controlling Interests: Redeemable Noncontrolling Interest (Tables)
6 Months Ended
Jun. 30, 2023
Tables/Schedules  
Redeemable Noncontrolling Interest

 

 

Non-Controlling Interest

Balance at December 31, 2022

 

$  (221,796)

 

 

 

Net loss attributable to non-controlling interest

 

(36)

Balance at June 30, 2023

 

$  (221,832)

XML 37 R27.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Going Concern (Details) - USD ($)
Jun. 30, 2023
Dec. 31, 2022
Details    
Cash and cash equivalents $ 1,558 $ 10,672
Working Capital $ 319,413  
XML 38 R28.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Principles of Consolidation (Details)
Jun. 30, 2023
Details  
Subsidiary, Ownership Percentage, Parent 60.00%
XML 39 R29.htm IDEA: XBRL DOCUMENT v3.23.3
Note 2 - Summary of Significant Accounting Policies: Non-Controlling Interests: Redeemable Noncontrolling Interest (Details) - USD ($)
6 Months Ended
Jun. 30, 2023
Dec. 31, 2022
Details    
Noncontrolling Interest in Variable Interest Entity $ (221,832) $ (221,796)
Net Income (Loss), Including Portion Attributable to Nonredeemable Noncontrolling Interest $ (36)  
XML 40 R30.htm IDEA: XBRL DOCUMENT v3.23.3
Note 3 - Related Party Transactions (Details) - USD ($)
6 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Dec. 31, 2022
Related party advances and accruals $ 5,500   $ 5,500
Chief Executive Officer      
Salary and Wage, Excluding Cost of Good and Service Sold 72,000 $ 72,000  
Chief Executive Officer - Accrued Salaries      
Related party advances and accruals 216,000   144,000
Chief Executive Officer - Operating Expenditures      
Related party advances and accruals $ 5,500   $ 5,500
XML 41 R31.htm IDEA: XBRL DOCUMENT v3.23.3
Note 4 - Stockholders' Deficit (Details) - USD ($)
3 Months Ended 6 Months Ended
Jun. 30, 2022
Jun. 30, 2023
Jun. 30, 2022
Details      
Proceeds from sale of common stock $ 0 $ 0 $ 49,930
XML 42 R32.htm IDEA: XBRL DOCUMENT v3.23.3
Note 5 - Advances (Details) - USD ($)
6 Months Ended
Jun. 30, 2023
Jun. 30, 2022
Details    
Short-term advances $ 17,000 $ 0
XML 43 fccn-20230630_htm.xml IDEA: XBRL DOCUMENT 0001131903 2023-01-01 2023-06-30 0001131903 2023-06-30 0001131903 2022-06-30 0001131903 2023-08-14 0001131903 2022-12-31 0001131903 2023-04-01 2023-06-30 0001131903 2022-04-01 2022-06-30 0001131903 2022-01-01 2022-06-30 0001131903 us-gaap:CommonStockMember 2023-01-01 2023-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-01-01 2023-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2023-01-01 2023-06-30 0001131903 us-gaap:RetainedEarningsMember 2023-01-01 2023-06-30 0001131903 2022-03-31 0001131903 us-gaap:CommonStockMember 2022-03-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-03-31 0001131903 us-gaap:NoncontrollingInterestMember 2022-03-31 0001131903 us-gaap:RetainedEarningsMember 2022-03-31 0001131903 us-gaap:CommonStockMember 2022-04-01 2022-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-04-01 2022-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2022-04-01 2022-06-30 0001131903 us-gaap:RetainedEarningsMember 2022-04-01 2022-06-30 0001131903 us-gaap:CommonStockMember 2022-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2022-06-30 0001131903 us-gaap:RetainedEarningsMember 2022-06-30 0001131903 2021-12-31 0001131903 us-gaap:CommonStockMember 2021-12-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2021-12-31 0001131903 us-gaap:NoncontrollingInterestMember 2021-12-31 0001131903 us-gaap:RetainedEarningsMember 2021-12-31 0001131903 us-gaap:CommonStockMember 2022-01-01 2022-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-01-01 2022-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2022-01-01 2022-06-30 0001131903 us-gaap:RetainedEarningsMember 2022-01-01 2022-06-30 0001131903 2023-03-31 0001131903 us-gaap:CommonStockMember 2023-03-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-03-31 0001131903 us-gaap:NoncontrollingInterestMember 2023-03-31 0001131903 us-gaap:RetainedEarningsMember 2023-03-31 0001131903 us-gaap:CommonStockMember 2023-04-01 2023-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-04-01 2023-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2023-04-01 2023-06-30 0001131903 us-gaap:RetainedEarningsMember 2023-04-01 2023-06-30 0001131903 us-gaap:CommonStockMember 2023-06-30 0001131903 us-gaap:AdditionalPaidInCapitalMember 2023-06-30 0001131903 us-gaap:NoncontrollingInterestMember 2023-06-30 0001131903 us-gaap:RetainedEarningsMember 2023-06-30 0001131903 us-gaap:CommonStockMember 2022-12-31 0001131903 us-gaap:AdditionalPaidInCapitalMember 2022-12-31 0001131903 us-gaap:NoncontrollingInterestMember 2022-12-31 0001131903 us-gaap:RetainedEarningsMember 2022-12-31 0001131903 srt:ChiefExecutiveOfficerMember 2023-01-01 2023-06-30 0001131903 srt:ChiefExecutiveOfficerMember 2022-01-01 2022-06-30 0001131903 fil:ChiefExecutiveOfficerAccruedSalariesMember 2023-06-30 0001131903 fil:ChiefExecutiveOfficerAccruedSalariesMember 2022-12-31 0001131903 fil:ChiefExecutiveOfficerOperatingExpendituresMember 2023-06-30 0001131903 fil:ChiefExecutiveOfficerOperatingExpendituresMember 2022-12-31 pure iso4217:USD shares iso4217:USD shares 0001131903 --12-31 Yes Spectral Capital Corporation (the 'Company') is filing this Quarterly Report on Form 10-Q/A, Amendment No. 1 (the 'Quarterly Report on Form 10-Q/A') to amend its Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2023; filed with the Securities and Exchange Commission on August 14, 2023 (the 'Original Report'). The purpose of this Quarterly Report on Form 10-Q/A is to amend our disclosure in Part I, Item 4 'Controls and Procedures,' of the Original Report to change an incorrect date listed. The company should have stated that 'our disclosure controls and procedures were not effective as of June 30, 2023' rather than March 31, 2022. The remainder of the Original Report, including the financial statements and supplementary data, remains unchanged. We have made no attempt in this Quarterly Report on Form 10-Q/A to modify or update the disclosures presented in the Original Report other than as noted in the previous paragraph. Except as noted above, this Quarterly Report on Form 10-Q/A does not reflect events occurring after the filing of the Original Report. Accordingly, this Quarterly Report on Form 10-Q/A should be read in conjunction with the Original Report, and the Company's other filings with the Securities and Exchange Commission ('SEC') subsequent to the filing of the Original Report, including any amendments thereto. true 2023 Q2 10-Q/A true 2023-06-30 false 000-50274 Spectral Capital Corporation NV 51-0520296 4500 9th Avenue NE Seattle WA 98105 206 385-6490 Yes Non-accelerated Filer true false false 42017948 1558 10672 0 25000 1558 35672 1558 35672 298471 222174 5500 5500 17000 0 320971 227674 0.0001 0.0001 5000000 5000000 0 0 0 0 0 0 0.0001 0.0001 1000000000 500000000 42017948 42017948 4202 4202 29106804 29106804 -29208587 -29081212 -97581 29794 -221832 -221796 -319413 -192002 1558 35672 0 0 0 0 0 156303 0 57840 0 -156303 0 -57840 27896 90139 55411 138704 36000 36000 72000 72000 63896 126139 127411 210704 -63896 -282442 -127411 -268544 -18 -14 -36 -32 -63878 -282428 -127375 -268512 -0.00 -0.01 -0.00 -0.01 42017948 38967904 42017948 27148055 16785762 1679 27847718 -221742 -28826308 -1198653 0 0 0 0 0 0 25232186 2523 1259086 0 0 1261609 0 0 0 -14 0 -14 0 0 0 0 -282428 -282428 42017948 4202 29106804 -221756 -29108736 -219486 11785762 1179 27798288 -221724 -28840224 -1262481 5000000 500 49430 0 0 49930 25232186 2523 1259086 0 0 1261609 0 0 0 -32 0 -32 0 0 0 0 -268512 -268512 42017948 4202 29106804 -221756 -29108736 -219486 42017948 4202 29106804 -221814 -29144709 -255517 0 0 0 -18 0 -18 0 0 0 0 -63878 -63878 42017948 4202 29106804 -221832 -29208587 -319413 42017948 4202 29106804 -221796 -29081212 -192002 0 0 0 -36 0 -36 0 0 0 0 -127375 -127375 42017948 4202 29106804 -221832 -29208587 -319413 -127375 -268512 -36 -32 -25000 2330365 72000 72000 4297 2565186 -26114 38277 0 0 17000 0 0 49930 17000 49930 -9114 88207 10672 264 1558 88471 0 0 0 0 0 1261609 <p style="font:10pt Times New Roman;margin:0"><b>NOTE 1 – BUSINESS AND NATURE OF OPERATIONS </b></p> <p style="font:10pt Times New Roman;margin:0"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">Spectral Capital Corporation (the "Company" or "Spectral") was incorporated on September 13, 2000 under the laws of the State of Nevada. Spectral is focused on the identification, acquisition, development, financing of technology that has the potential to transform existing industries. The Company looks for technology that can be protected through patents or laws regarding trade secrets.  Spectral has acquired significant stakes in three technology companies currently and actively works with management to drive these companies toward increasing market penetration in their particular verticals.  Spectral intends to own, in full or in part, technology companies whose founders and key management can take advantage of the deep networks and experience in technology development embodied in Spectral management.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify">In January 2022, the Company commenced a new line of business which is providing data and telecommunications reselling services on a global basis.  On February 15, 2022, the Company entered into a telecommunications services agreement with Sky Data PLL OU (Estonia) to provide long distance switching services. The contract does not contain a fixed term or value and is on an as needed basis via invoice for Sky Data PLL OU. We provide business to business (B2) telecommunications interconnection services to mainly Asia, South America and Africa. This is done by negotiating directly with international private and public carriers for telecommunications rates based on certain volume and transaction levels. The company has temporarily paused its telecommunications business and is seeking a new telecommunications partner. We hope to resume this business within the 2023 fiscal year. </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES </b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0"><b>Going Concern</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  The Company has recently discontinued revenue generating activities and has sustained substantial losses since inception. As of June 30, 2023, the Company has cash on hand of $1,558 and negative working capital of $319,413. The Company expects current cash on hand will not be able to fund operations for a period in excess of 12 months. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">To date management has funded its operations through selling equity securities and advances from related parties. The ability of the Company to continue as a going concern is dependent on the Company generating cash from its recently established operations, the sale of its common stock and/or obtaining debt financing and attaining future profitable operations, however, there can be no assurance the Company will be successful in these efforts. As of the date of these consolidated financial statements the Company does not have any firm commitments for capital. Without the required capital, the Company has had to reduce their development expenditures which will delay the completion of products which are expected to generate future revenues.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0"><b>Risks and Uncertainties</b></p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company has a limited operating history and has not generated revenues from our planned principal operations.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company's business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company's control could cause fluctuations in these conditions, including the political environment and acts or threats of war or terrorism. Adverse developments in these general business and economic conditions, including through recession, downturn or otherwise, could have a material adverse effect on the Company's consolidated financial condition and the results of its operations.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company currently has generated limited revenues and limited marketing and/or distribution capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our current and future products. Developing a marketing and sales force is also time consuming and could delay launch of our future products. In addition, the Company will compete with many companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company's industry is characterized by rapid changes in technology and customer demands. As a result, the Company's products may quickly become obsolete and unmarketable. The Company's future success will depend on </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">its ability to adapt to technological advances, anticipate customer demands, develop new products and enhance our current products on a timely and cost-effective basis. Further, the Company's products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Company's new products may not be favourably received. Nor may we have the capital resources to further the development of existing and/or new ones.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Interim Consolidated Financial Statements</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The accompanying unaudited interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission.  Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2022. The results of operations for the six months ended June 30, 2023 are not indicative of the results that may be expected for the full year.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Principles of Consolidation</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its 60% owned subsidiaries, Noot Holdings, Inc. from its date of incorporation of February 28, 2013, and Monitr Holdings, Inc. from its date of incorporation of December 1, 2013.  All material intercompany accounts and transactions have been eliminated in consolidation.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Basis of Presentation</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Fair Value of Financial Instruments</b></p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:</p> <p style="font:10pt Times New Roman;margin:0;text-indent:36pt;background-color:#FFFFFF;text-align:justify"> </p> <table style="border-collapse:collapse;width:100%"><tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Level 1</p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.</p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Level 2</p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Include other inputs that are directly or indirectly observable in the marketplace.</p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Level 3</p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Unobservable inputs which are supported by little or no market activity.</p> </td></tr> </table> <p style="font:10pt Times New Roman;margin:0;text-indent:36pt;background-color:#FFFFFF;text-align:justify">  </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As of June 30, 2023 and December 31, 2022, the Company does not have any assets or liabilities which would be considered Level 2 or 3.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company’s financial instruments consist of cash and cash equivalents, investments in technologies and related party advances. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these consolidated financial statements.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company measures certain assets at fair value on a nonrecurring basis. These assets include cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in an acquisition or in a nonmonetary exchange, and property and equipment and intangible assets that are written down </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">to fair value when they are held for sale or determined to be impaired. Excluding these items, the Company did not have any significant assets or liabilities that were measured at fair value on a nonrecurring basis in periods subsequent to initial recognition.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Use of Estimates</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The preparation of financial statements in conformity with generally accepted accounting principles 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.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify"><b>Revenue Recognition</b> </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify">The Company revenues in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from contracts with customers”. Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues during the six months ended June 30, 2023, were provided primarily to three customers. The loss of these customers would have a significant impact on the Company’s financial statements. At June 30, 2022, the Company paused their operations to improve their internal processes and expected to recommence in second quarter of 2023. </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify"><b>Basic Income (Loss) Per Share</b></p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify">Basic loss per share is calculated by dividing the Company’s net income (loss) applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. During the three and six months ended June 30, 2023 and 2022, the Company did not have not dilutive shares.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Non-Controlling Interests</b></p> <p style="font:10pt Times New Roman;margin:0;color:#000000;background-color:#FFFFFF;text-align:justify">Non-controlling interest disclosed within the consolidated statement of operations represents the minority ownership 40% share of net income (losses) of Noot Holdings, Inc. and Monitr Holdings, Inc. incurred during the six months ended June 30, 2023. The following table sets forth the changes in non-controlling interest for the six months ended June 30, 2023:</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <table style="margin:0 auto;border-collapse:collapse;width:362pt"><tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:82pt;border-bottom:0.5pt solid #000000" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:center">Non-Controlling Interest</p> </td></tr> <tr style="height:7.2pt"><td style="background-color:#D3F0FE;width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Balance at December 31, 2022</p> </td><td style="background-color:#D3F0FE;width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="background-color:#D3F0FE;width:82pt;border-bottom:0.5pt solid #000000" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt">$  (221,796)</span></p> </td></tr> <tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:right"> </p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:82pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td></tr> <tr style="height:7.2pt"><td style="background-color:#D3F0FE;width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Net loss attributable to non-controlling interest</p> </td><td style="background-color:#D3F0FE;width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="background-color:#D3F0FE;width:82pt" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt"> (36)</span></p> </td></tr> <tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Balance at June 30, 2023</p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="width:82pt;border-top:0.5pt solid #000000;border-bottom:3px double #000000" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt">$  (221,832)</span></p> </td></tr> </table> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Foreign Currency</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The Company's functional currency is the United States Dollar. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. As a result of these foreign currency transactions in which require payment in a currency other than the United States Dollar, the Company has recorded foreign currency (income) losses within the accompanying condensed consolidated statement of operations.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Recent Accounting Pronouncements</b></p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify">The FASB issues ASUs to amend the authoritative literature in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company’s financial statement.</p> <p style="font:10pt Times New Roman;margin:0"><b>Going Concern</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  The Company has recently discontinued revenue generating activities and has sustained substantial losses since inception. As of June 30, 2023, the Company has cash on hand of $1,558 and negative working capital of $319,413. The Company expects current cash on hand will not be able to fund operations for a period in excess of 12 months. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">To date management has funded its operations through selling equity securities and advances from related parties. The ability of the Company to continue as a going concern is dependent on the Company generating cash from its recently established operations, the sale of its common stock and/or obtaining debt financing and attaining future profitable operations, however, there can be no assurance the Company will be successful in these efforts. As of the date of these consolidated financial statements the Company does not have any firm commitments for capital. Without the required capital, the Company has had to reduce their development expenditures which will delay the completion of products which are expected to generate future revenues.</p> 1558 319413 <p style="font:10pt Times New Roman;margin:0"><b>Risks and Uncertainties</b></p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company has a limited operating history and has not generated revenues from our planned principal operations.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company's business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company's control could cause fluctuations in these conditions, including the political environment and acts or threats of war or terrorism. Adverse developments in these general business and economic conditions, including through recession, downturn or otherwise, could have a material adverse effect on the Company's consolidated financial condition and the results of its operations.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company currently has generated limited revenues and limited marketing and/or distribution capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our current and future products. Developing a marketing and sales force is also time consuming and could delay launch of our future products. In addition, the Company will compete with many companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company's industry is characterized by rapid changes in technology and customer demands. As a result, the Company's products may quickly become obsolete and unmarketable. The Company's future success will depend on </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">its ability to adapt to technological advances, anticipate customer demands, develop new products and enhance our current products on a timely and cost-effective basis. Further, the Company's products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Company's new products may not be favourably received. Nor may we have the capital resources to further the development of existing and/or new ones.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Interim Consolidated Financial Statements</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The accompanying unaudited interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission.  Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2022. The results of operations for the six months ended June 30, 2023 are not indicative of the results that may be expected for the full year.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Principles of Consolidation</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its 60% owned subsidiaries, Noot Holdings, Inc. from its date of incorporation of February 28, 2013, and Monitr Holdings, Inc. from its date of incorporation of December 1, 2013.  All material intercompany accounts and transactions have been eliminated in consolidation.</p> 0.60 <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Basis of Presentation</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Fair Value of Financial Instruments</b></p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:</p> <p style="font:10pt Times New Roman;margin:0;text-indent:36pt;background-color:#FFFFFF;text-align:justify"> </p> <table style="border-collapse:collapse;width:100%"><tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Level 1</p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.</p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Level 2</p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Include other inputs that are directly or indirectly observable in the marketplace.</p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> </td></tr> <tr><td style="width:10%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Level 3</p> </td><td style="width:90%" valign="top"><p style="font:10pt Times New Roman;margin:0;text-align:justify">Unobservable inputs which are supported by little or no market activity.</p> </td></tr> </table> <p style="font:10pt Times New Roman;margin:0;text-indent:36pt;background-color:#FFFFFF;text-align:justify">  </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As of June 30, 2023 and December 31, 2022, the Company does not have any assets or liabilities which would be considered Level 2 or 3.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company’s financial instruments consist of cash and cash equivalents, investments in technologies and related party advances. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these consolidated financial statements.</p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">The Company measures certain assets at fair value on a nonrecurring basis. These assets include cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in an acquisition or in a nonmonetary exchange, and property and equipment and intangible assets that are written down </p> <p style="font:10pt Times New Roman;margin:0;background-color:#FFFFFF;text-align:justify">to fair value when they are held for sale or determined to be impaired. Excluding these items, the Company did not have any significant assets or liabilities that were measured at fair value on a nonrecurring basis in periods subsequent to initial recognition.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Use of Estimates</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The preparation of financial statements in conformity with generally accepted accounting principles 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.</p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify"><b>Revenue Recognition</b> </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify">The Company revenues in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from contracts with customers”. Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues during the six months ended June 30, 2023, were provided primarily to three customers. The loss of these customers would have a significant impact on the Company’s financial statements. At June 30, 2022, the Company paused their operations to improve their internal processes and expected to recommence in second quarter of 2023. </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify"><b>Basic Income (Loss) Per Share</b></p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify">Basic loss per share is calculated by dividing the Company’s net income (loss) applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. During the three and six months ended June 30, 2023 and 2022, the Company did not have not dilutive shares.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Non-Controlling Interests</b></p> <p style="font:10pt Times New Roman;margin:0;color:#000000;background-color:#FFFFFF;text-align:justify">Non-controlling interest disclosed within the consolidated statement of operations represents the minority ownership 40% share of net income (losses) of Noot Holdings, Inc. and Monitr Holdings, Inc. incurred during the six months ended June 30, 2023. The following table sets forth the changes in non-controlling interest for the six months ended June 30, 2023:</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <table style="margin:0 auto;border-collapse:collapse;width:362pt"><tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:82pt;border-bottom:0.5pt solid #000000" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:center">Non-Controlling Interest</p> </td></tr> <tr style="height:7.2pt"><td style="background-color:#D3F0FE;width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Balance at December 31, 2022</p> </td><td style="background-color:#D3F0FE;width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="background-color:#D3F0FE;width:82pt;border-bottom:0.5pt solid #000000" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt">$  (221,796)</span></p> </td></tr> <tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:right"> </p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:82pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td></tr> <tr style="height:7.2pt"><td style="background-color:#D3F0FE;width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Net loss attributable to non-controlling interest</p> </td><td style="background-color:#D3F0FE;width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="background-color:#D3F0FE;width:82pt" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt"> (36)</span></p> </td></tr> <tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Balance at June 30, 2023</p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="width:82pt;border-top:0.5pt solid #000000;border-bottom:3px double #000000" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt">$  (221,832)</span></p> </td></tr> </table> <table style="margin:0 auto;border-collapse:collapse;width:362pt"><tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:82pt;border-bottom:0.5pt solid #000000" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:center">Non-Controlling Interest</p> </td></tr> <tr style="height:7.2pt"><td style="background-color:#D3F0FE;width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Balance at December 31, 2022</p> </td><td style="background-color:#D3F0FE;width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="background-color:#D3F0FE;width:82pt;border-bottom:0.5pt solid #000000" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt">$  (221,796)</span></p> </td></tr> <tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:right"> </p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td><td style="width:82pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0"> </p> </td></tr> <tr style="height:7.2pt"><td style="background-color:#D3F0FE;width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Net loss attributable to non-controlling interest</p> </td><td style="background-color:#D3F0FE;width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="background-color:#D3F0FE;width:82pt" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt"> (36)</span></p> </td></tr> <tr style="height:7.2pt"><td style="width:232pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000">Balance at June 30, 2023</p> </td><td style="width:48pt" valign="bottom"><p style="font:10pt Times New Roman;margin:0;color:#000000"> </p> </td><td style="width:82pt;border-top:0.5pt solid #000000;border-bottom:3px double #000000" valign="bottom"><p style="font:11pt Times New Roman;margin:0;text-align:right"><span style="font-size:10pt">$  (221,832)</span></p> </td></tr> </table> -221796 -36 -221832 <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Foreign Currency</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The Company's functional currency is the United States Dollar. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. As a result of these foreign currency transactions in which require payment in a currency other than the United States Dollar, the Company has recorded foreign currency (income) losses within the accompanying condensed consolidated statement of operations.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>Recent Accounting Pronouncements</b></p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;color:#000000;text-align:justify">The FASB issues ASUs to amend the authoritative literature in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company’s financial statement.</p> <p style="font:10pt Times New Roman;margin:0"><b>NOTE 3– RELATED PARTY TRANSACTIONS</b></p> <p style="font:10pt Times New Roman;margin:0"> </p> <p style="font:10pt Times New Roman;margin:0"><i>Jenifer Osterwalder, the Company's Chief Executive Officer</i></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">Jenifer Osterwalder charges the Company $12,000 per month beginning January 1, 2021 for services rendered. Total amounts expended in the Company's condensed consolidated financial statements in connection with the CEO's services was $72,000 and $72,000 for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023 and December 31, 2022, amounts due to the CEO related to accrued salaries were $216,000 and $144,000 respectively. </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">From time to time due to the limited cash flow available, the Company's CEO pays certain operating expenditures on behalf of the Company. These advances bear no interest and are due on demand. As of June 30, 2023 and December 31, 2022, the Company's CEO was due $5,500 and $5,500 in connection with these advances, respectively.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">As noted above, all amounts due to the Chief Executive Officer as December 31, 2021 were converted into a convertible note payable. The note is due and demand and convertible at $0.05 per share. During the three months ended March 31, 2022, the Chief Executive Officer sold the $1,054,653 and $206,956 convertible notes to a third party which was then converted into approximately 25.2 million shares in April 2022. </p> 72000 72000 216000 144000 5500 5500 <p style="font:10pt Times New Roman;margin:0"><b>NOTE 4 – STOCKHOLDERS’ DEFICIT</b></p> <p style="font:10pt Times New Roman;margin:0"> </p> <p style="font:10pt Times New Roman;margin:0"><i>Changes in Stockholders' Deficit</i></p> <p style="font:10pt Times New Roman;margin:0"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">During the six months ended June 30, 2022, the Company sold 5 million shares of common stock resulting in proceeds of $49,930.</p> <p style="font:10pt Times New Roman;margin:0"> </p> <p style="font:10pt Times New Roman;margin:0">See Note 3 for discussion of convertible note converted into common stock.</p> <p style="font:10pt Times New Roman;margin:0"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><i>Employee Options</i></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The Company accounts for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, <i>Compensation – Stock Compensation </i>which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The Company has adopted a stock option and award plan to attract, retain and motivate its directors, officers, employees, consultants and advisors. Options provide the opportunity to acquire a proprietary interest in the Company and to benefit from its growth. Vesting terms and conditions are determined by the Board of Directors at the time of the grant. The Plan provides for the issuance of up to 15,000,000 common shares for employees, consultants, directors, and advisors. As of June 30, 2023, all options were expired.</p> 49930 <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>NOTE 5 – ADVANCES</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">During the six months ended June 30, 2023, the Company received advances of $17,000 from a third party. The advances are due on demand and do not incur interest.</p> 17000 <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>NOTE 6 – COMMITMENTS AND CONTINGENCIES</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">The Company leases office space on a three-month basis in Seattle, Washington.</p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"><b>NOTE 7– SUBSEQUENT EVENTS</b></p> <p style="font:10pt Times New Roman;margin:0;text-align:justify"> </p> <p style="font:10pt Times New Roman;margin:0;text-align:justify">In accordance with ASC 855-10, the Company has analyzed its operations subsequent to June 30, 2023 to the date these condensed consolidated financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these consolidated financial statements, other than disclosed above.</p> EXCEL 44 Financial_Report.xlsx IDEA: XBRL DOCUMENT begin 644 Financial_Report.xlsx M4$L#!!0 ( $1N<%<'04UB@0 +$ 0 9&]C4')O<',O87!P+GAM M;$V./0L",1!$_\IQO;=!P4)B0-!2L+(/>QLOD&1#LD)^OCG!CVX>;QA&WPIG M*N*I#BV&5(_C(I(/ !47BK9.7:=N')=HI6-Y #OGDK7A.YNJQ<&4GPZ4A!0W_J=0U[R;UEA_6\#MI7E!+ P04 M " !$;G!7?V!&+N\ K @ $0 &1O8U!R;W!S+V-O&ULS9+! 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