Nevada
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98-0347883
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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224 Fifth Avenue, Suite D144
New York, NY 10022
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(Address of principal executive offices)
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(604) 790-8799
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(Registrant’s telephone number, including area
code)
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Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated filer
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☐ (Do not check if a
smaller reporting company)
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Smaller reporting company
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☒
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Emerging growth company
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☐
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PART I - FINANCIAL INFORMATION
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||
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Item
1.
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Consolidated
Financial Statements (unaudited).
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3
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Item
2.
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operations.
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8
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Item
3.
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Quantitative
and Qualitative Disclosures About Market Risk.
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10
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Item
4.
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Controls
and Procedures.
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10
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PART II - OTHER INFORMATION
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Item
1.
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Legal
Proceedings.
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11
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Item
1A.
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Risk
Factors.
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11
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Item
2.
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Unregistered
Sales of Equity Securities and Use of Proceeds.
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11
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Item
3.
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Defaults
Upon Senior Securities.
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11
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Item
4.
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Mine
Safety Disclosures.
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11
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Item
5.
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Other
Information.
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11
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Item
6.
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Exhibits.
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11
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Signatures
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September
30,
2018
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December
31,
2017
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ASSETS
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Current
Assets:
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|
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Cash
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$4,995
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$5,433
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Due from related
parties
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3,332
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-
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Total
current assets
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8,327
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5,433
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Total
Assets
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$8,327
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$5,433
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LIABILITIES &
STOCKHOLDERS' DEFICIT
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Current
Liabilities:
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Accounts payable
and accrued expenses
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$6,887
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$6,385
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Accrued expenses
– related parties
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74,770
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78,593
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Accrued interest
– stockholders
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48,822
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36,067
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Taxes
payable
|
29,666
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29,933
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Loans from
stockholders
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352,120
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278,255
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Due to related
parties
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-
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17,238
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Total
current liabilities
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512,265
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446,471
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|
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Stockholders'
Deficit:
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|
|
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Common Stock:
authorized 100,000,000 shares of $.001 par value;44,100,816 shares
issued and outstanding
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44,101
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44,101
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Additional paid in
capital
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4,793,552
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4,793,552
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Accumulated
deficit
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(5,346,418)
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(5,283,423)
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Accumulated other
comprehensive income
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5,087
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5,001
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Total
Amanasu Environment Corporation stockholders' deficit
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(503,678)
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(440,769)
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Non-controlling
interest in subsidiary
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(260)
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(269)
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Total
stockholders’ deficit
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(503,938)
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(441,038)
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Total
Liabilities and Stockholders' Deficit
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$8,327
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$5,433
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Three
Months
Ended September
30,
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Nine
Months
Ended September
30,
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||
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2018
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2017
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2018
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2017
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Revenue
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$-
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$-
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$-
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$-
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Cost of
revenue
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-
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-
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-
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-
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Gross
profit
|
-
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-
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-
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-
|
|
|
|
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General and
administrative expenses
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13,128
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$13,753
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50,240
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84,885
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Total operating
expenses
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13,128
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13,753
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50,240
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84,885
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|
|
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Operating
loss
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(13,128)
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(13,753)
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(50,240)
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(84,885)
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|
|
|
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Other
Expense:
|
|
|
|
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Interest expense -
stockholders
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(4,504)
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(3,585)
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(12,755)
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(10,199)
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|
|
|
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Net loss before
income taxes
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(17,632)
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(17,338)
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(62,995)
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(95,084)
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|
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Income
taxes
|
-
|
-
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-
|
-
|
|
|
|
|
|
Net
loss
|
(17,632)
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(17,338)
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(62,995)
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(95,084)
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|
|
|
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Net loss
attributable to non-controlling interest
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-
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-
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-
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-
|
|
|
|
|
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Net loss
attributable to Amanasu Environment
Corporation
Stockholders
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(17,632)
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(17,338)
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(62,995)
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(95,084)
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|
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|
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Other comprehensive
income (loss):
|
|
|
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Foreign currency
translation adjustment
|
279
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22
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95
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(399)
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|
|
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Total comprehensive
loss
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(17,353)
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(17,316)
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(62,900)
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(95,483)
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Comprehensive
income (loss) attributable to
non-controlling
interest
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26
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2
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9
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(36)
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Comprehensive loss
attributable to Amanasu
Environment
Corporation Stockholders
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$(17,379)
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$(17,318)
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$(62,909)
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$(95,447)
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Net loss per share
– basic and diluted
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$(0.00)
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$(0.00)
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$(0.00)
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$(0.00)
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Weighted average
number of shares outstanding – basic and diluted
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44,100,816
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44,100,816
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44,100,816
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44,100,816
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Nine Months
Ended
September
30,
2018
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Nine Months
Ended
September
30,
2017
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CASH
FLOWS FROM OPERATIONS
|
|
|
Net
loss
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$(62,995)
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$(95,084))
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|
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Changes
in assets and liabilities:
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|
|
Accounts payable
and accrued expenses
|
542
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(1,536)
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Accrued expenses
– related parties
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(3,758)
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31,125
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Accrued interest -
stockholders
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12,755
|
10,199)
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Net
cash used in operating activities
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(53,456)
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(55,296))
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CASH
FLOWS FROM FINANCING ACTIVITIES
|
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Loan from
stockholders
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73,865
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41,100
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Due to related
parties
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(20,847)
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13,200
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Net
Cash Provided by Financing Activities
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53,018
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54,300
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Net Change In
Cash
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(438)
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(996))
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Cash balance,
beginning of period
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5,433
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6,038
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Cash balance, end
of period
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$4,995
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$5,042
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Cash paid for
interest
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$0
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$0
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Cash paid for
income taxes
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$0
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$0
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Certification
by the Chief Executive Officer of Registrant pursuant to Section
302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule
15d-14(a)).*Certification Pursuant To Section
302 Of The Sarbanes-Oxley Act Of 2002.
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Certification by the Chief Financial Officer of
Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (Rule 13a-14(a) or Rule 15d-14(a)).*
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Certification
by the Chief Executive Officer pursuant to 18 U.S.C. 1350 as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.*
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|
Certification
by the Chief Financial Officer pursuant to 18 U.S.C. 1350 as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.*
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101
INS
|
XBRL
Instance Document*
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101
SCH
|
XBRL
Schema Document*
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|
|
101
CAL
|
XBRL
Calculation Linkbase Document*
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|
|
101
DEF
|
XBRL
Definition Linkbase Document*
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|
|
101
LAB
|
XBRL
Labels Linkbase Document*
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|
101
PRE
|
XBRL
Presentation Linkbase Document*
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Amanasu Environmental Corporation
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Date: November
14, 2018
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By:
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/s/
Atsushi Maki
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Atsushi
Maki
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Chief
Executive Officer
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Chief
Financial Officer
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Chief
Accounting Officer
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Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Nov. 07, 2018 |
|
Document and Entity Information | ||
Entity Registrant Name | AMANASU ENVIRONMENT CORP | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Entity Central Index Key | 0001142801 | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 44,100,816 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Current Reporting Status | Yes | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Common stock shares authorized | 100,000,000 | 100,000,000 |
Common stock shares par value | $ 0.001 | $ 0.001 |
Common stock shares issued | 44,100,816 | 44,100,816 |
Common stock shares outstanding | 44,100,816 | 44,100,816 |
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
|
CASH FLOWS FROM OPERATIONS | ||
Net loss | $ (62,995) | $ (95,084) |
Changes in assets and liabilities: | ||
Accounts payable and accrued expenses | 542 | (1,536) |
Accrued expenses - related parties | (3,758) | 31,125 |
Accrued interest - stockholders | 12,755 | 10,199 |
Net cash used in operating activities | (53,456) | (55,296) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Loan from stockholders | 73,865 | 41,100 |
Due to related parties | (20,847) | 13,200 |
Net Cash Provided by Financing Activities | 53,018 | 54,300 |
Net Change In Cash | (438) | (996) |
Cash balance, beginning of period | 5,433 | 6,038 |
Cash balance, end of period | 4,995 | 5,042 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 0 | 0 |
Cash paid for income taxes | $ 0 | $ 0 |
1. BASIS OF PRESENTATION |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Disclosure Text Block [Abstract] | |
1. BASIS OF PRESENTATION | The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying unaudited financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly the financial position of the Company as of September 30, 2018, the results of operations for the three and nine months ended September 30, 2018 and 2017, and cash flows for the nine months ended September 30, 2018 and 2017. These results are not necessarily indicative of the results to be expected for the full year or any other period. The December 31, 2017 balance sheet included herein was derived from the audited financial statements included in the Company’s Annual Report on Form 10-K as of that date. Accordingly, the financial statements included herein should be reviewed in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as filed with the Securities and Exchange Commission (“SEC”) on April 10, 2018. |
2. GOING CONCERN |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Disclosure Text Block [Abstract] | |
2. GOING CONCERN | The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the financial statements, the Company had a working capital deficiency of $503,938 and an accumulated deficit of $5,346,418 at September 30, 2018, and a record of continuing losses. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue in operation.
The Company’s operations to date have been limited to conducting various tests on its technologies and seeking financing. The Company will continue to develop and market its technologies, which the Company believes have great market potential. As such, the Company continues to pursue additional sources of financing. Currently the company is exploring various potential investment partners in Japan, as well as China. There can be no assurances that the Company can secure additional financing. . The present plans, the realization of which cannot be assured, to overcome these difficulties also include, but are not limited to, a continuing effort to investigate business acquisitions and joint ventures. |
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Summary Of Significant Accounting Policies | |
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | During the nine months ended September 30, 2018, there have been no material changes in the Company’s significant accounting policies to those previously disclosed in the Annual Report.
No recently issued accounting pronouncements had or are expected to have a material impact on the Company’s consolidated financial statements. |
4. RELATED PARTY TRANSACTIONS |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Disclosure Text Block [Abstract] | |
4. RELATED PARTY TRANSACTIONS | The Company receives periodic advances from its principal stockholders and officers based upon the Company’s cash flow needs. There is no written loan agreement between the Company and the stockholders and officers. All advances bear interest at 4.45% and no repayment terms have been established. As a result, the amount is classified as a current liability. During the nine months ended September 30, 2018, the Company borrowed $73,865 from a stockholder. The balance due as of September 30, 2018 and December 31, 2017 were $352,120 and $278,255, respectively. Interest expense associated with these loans were $3,935 and $11,068 for the three and nine months ended September 30, 2018, respectively, as compared to $3,016 and $8,518 for the three and nine months ended September 30, 2017, respectively. Accrued interest on these loans were $40,429 and $29,361 at September 30, 2018 and December 31, 2017, respectively.
The Company has an arrangement with Lina Maki, a stockholder of the Company, for her management consulting time. The agreement is not written and no payment terms have been established. The fee is $10,000 annually. As of September 30, 2018 and December 31, 2017 amounts due to the stockholder were $17,500 and $10,000, respectively. For the most part, these payments are made by the Company’s affiliate. As such, when the payments are made by the Company’s affiliate or the lease payments are made by the Company on behalf of the affiliate, such amounts are shown as a reduction in or addition to the amount due from affiliate in the accompany balance sheets.
The Company also leases it office space from a stockholder of the Company. At September 30, 2018 and December 31, 2017, amounts due to the stockholder were $58,558 and $56,433, respectively. As such, when the lease payments are made by the Company’s affiliate or the lease payments are made by the Company on behalf of the affiliate, such amounts are shown as a reduction in or addition to the amount due from affiliate in the accompany balance sheets. During the nine months ended September 30, 2018, the Company paid the stockholder $31,500 for accrued rent.
Amanasu Corp. is the principal stockholder of the Company. The balance due to Amanasu Corp. was $50,000 and $50,000 at September 30, 2018 and December 31, 2017, respectively. Interest expense associated with this loan were $569 and $1,687 for the three and nine months ended September 30, 2018 as compared to $569 and $1,687 for the three and nine months ended September 30, 2017. No terms for repayment have been established. As a result, the amount is classified as a current liability. Accrued interest on this loan were $8,393 and $6,706 at September 30, 2018 and December 31, 2017, respectively. |
5. INCOME TAXES |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Income Taxes | |
5. INCOME TAXES | Deferred income taxes are recorded to reflect the tax consequences or benefits to future years of any temporary differences between the tax basis of assets and liabilities, and of net operating loss carryforwards. The Company has experienced losses since its inception. As a result, it has incurred no Federal income tax.
The Company can carry forward net operating losses (NOL's) to be applied against future profits for a period of twenty years in the U.S. and 80% of the NOL can be carried forward for nine years in Japan. The available NOL’s totaled approximately $3.6 million in the U.S. and $36,000 in Japan at December 31, 2017, which will expire in the years 2018 through 2037.
In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets us dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the assessment, management has established a full valuation allowance against all of the deferred tax assets relating to the NOL’s for every period because it is more likely than not that all of the deferred tax assets will not be realized.
On December 22, 2017, legislation commonly known as the Tax Cuts and Jobs Act, or the Tax Act, was signed in to law. The Tax Act, among other changes, reduces the U.S. federal corporate tax rate from 35% to 21%, requires taxpayers to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. On December 31, 2017, we did not have any earnings from foreign subsidiaries and the international aspects of the Tax Act are not applicable.
In connection with the initial analysis of the impact of the Tax Act, we remeasured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. As a result, we recorded a decrease in net deferred tax assets of approximately $500,000 with a corresponding net adjustment to deferred income tax expense. These adjustments were fully offset by a decrease in the valuation allowance. We have completed and recorded the adjustments necessary under Staff Accounting Bulletin No. 118 related to the Tax Act.
Under the Tax Act, the NOL deduction for a tax year is equal to the lesser of (1) the aggregate of the NOL carryovers to such year, plus the NOL carry-backs to such year, or (2) 80% of taxable income (determined without regard to the deduction). Generally, NOLs can no longer be carried back but are allowed to be carried forward indefinitely. The amendments incorporating the 80% limitation apply to losses arising in tax years beginning after Dec. 31, 2017.
The Company had approximately $63,000 NOL generated in the nine months ended September 30, 2018 in the U.S., which can be used to offset 80 percent of future taxable income and can be carried forward indefinitely. |
6. SUBSEQUENT EVENTS |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
6. SUBSEQUENT EVENTS | The Company evaluated subsequent events, which are events or transactions that occurred after September 30, 2018 through the issuance of the accompanying financial statements and determined that no significant subsequent event need to be recognized or disclosed. |
2. GOING CONCERN (Details Narrative) - USD ($) |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Going Concern | ||
Working capital | $ (503,938) | |
Accumulated deficit | $ (5,346,418) | $ (5,283,423) |
4. RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Dec. 31, 2017 |
|
Shareholders And Officers | |||||
Due to related party | $ 352,120 | $ 352,120 | $ 278,255 | ||
Accrued interest | 40,429 | 40,429 | 29,361 | ||
Interest expense | 3,935 | $ 3,016 | 11,068 | $ 8,518 | |
Lina Maki | |||||
Due to related party | 17,500 | 17,500 | 10,000 | ||
Stockholder | |||||
Due to related party | 58,558 | 58,558 | 56,433 | ||
Amanasu Corp. | |||||
Due to related party | 50,000 | 50,000 | 50,000 | ||
Accrued interest | 8,393 | 8,393 | $ 6,706 | ||
Interest expense | $ 569 | $ 569 | $ 1,687 | $ 1,687 |
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