10-K 1 alarmingdevices10k-053110.htm ALARMING DEVICES 10K 053110 alarmingdevices10k-053110.htm



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
           
FORM 10-Q
 
           
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
     
For the quarterly period ended:
May 31, 2010
 
           
[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
     
 
For the transition period from
___________
to
____________
 
           
 
Commission file number:
333-157010
   
           
 
ALARMING DEVICES, INC.
 
 
(Exact name of registrant as specified in its charter)
 
           
 
Nevada
   
26-3062327
 
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
           
 
112 North Curry Street, Carson City, NV   89703-4934
 
 
(Address of principal executive offices)   (Zip Code)
 
           
 
775-284-3707
 
 
(Registrant’s telephone number, including area code)
 
 
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
 
Yes |X| No |_|
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
 
Large accelerated filer  [   ]
Accelerated filer [   ]
Non-accelerated filer [   ]  (Do not check if a smaller reporting company)
    Smaller reporting company [X]
 
Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act).
 
Yes  [|X]| No [|  ]
 

Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date:  As of May 31, 2010, the registrant had 5,340,000 shares of common stock, $0.001 par value, issued and outstanding.
 


 
 

 

 




Index

                   
Page
PART  I - FINANCIAL  INFORMATION
         
Number
                     
Item 1.
Financial Statements
             
3
                     
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of
   
 
Operations
             
13
                     
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
     
14
                     
Item 4.
Controls and Procedures
           
15
                     
                     
PART II - OTHER INFORMATION
             
                     
Item 1.
Legal Proceedings
             
16
                     
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
     
16
                     
Item 3.
Defaults Upon Senior Securities
         
16
                     
Item 4.
Submission of  Matters to a Vote of  Security Holders
     
16
                     
Item 5.
Other Information
             
16
                     
Item 6.
Exhibits
               
17
                     



 
- 2 -

 

 






ALARMING DEVICES, INC.
(A Development Stage Company)

FINANCIAL STATEMENTS

MAY 31, 2010

















REPORT OF INDEPENDENT PUBLIC ACCOUNTING FIRM

BALANCE SHEETS

STATEMENTS OF OPERATIONS

STATEMENT OF STOCKHOLDERS’ EQUITY

STATEMENTS OF CASH FLOWS
 
NOTES TO FINANCIAL STATEMENTS

 
- 3 -

 



 



ALARMING DEVICES, INC.
(A Development Stage Company)

BALANCE SHEETS



   
May 31, 2010
   
August 31, 2009
 
   
(Unaudited)
       
ASSETS
           
             
CURRENT ASSETS
           
Cash
  $ 10,270     $ 2,805  
TOTAL ASSETS
  $ 10,270     $ 2,805  
                 
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)
               
                 
CURRENT LIABILITIES
               
Accounts payable and accrued liabilities
  $ 10,700     $ 7,628  
Due to related party
    22,565       9,395  
TOTAL CURRENT LIABILITIES
  $ 33,265     $ 17,023  
                 
                 
STOCKHOLDER’S EQUITY (DEFICIT )
               
Capital stock (Note 5)
               
Authorized
               
75,000,000 shares of common stock, $0.001 par value,
               
Issued and outstanding
               
5,340,000 and 5,00,000 shares of common stock as of May 31, 2010 and August 31, 2009)
    5,340       5,000  
Additional Paid-in Capital
    9,860       -  
Deficit accumulated during the development stage
    (38,195 )     (19,218 )
Total stockholder’s (deficit)
  $ (22,995 )     (14,218 )
Total Liabilities and Stockholder’s Equity (Deficit)
    10,270     $ 2,805  






The accompanying notes are an integral part of these financial statements

 
- 4 -

 



ALARMING DEVICES, INC.
(A Development Stage Company)

STATEMENTS OF OPERATIONS
 (Unaudited)



   
Three months
May 31, 2010
     
Three months
May 31,
2009
Nine months
May 31, 2010
     
Nine months
May 31,
2009
From July 22, 2008 (date of inception) to May 31, 2010
 
 
 
 
 
                       
                       
REVENUE
                     
   Revenue
  $ -     $ -     $ -     $ -     $ -  
Total revenue
    -       -       -       -       -  
                                             
EXPENSES
                                           
Office and general
    973       -       10,477       2,135       13,807  
Professional fees
    3,500       -       8,500       10,388       24,388  
Total operating expense
    4,473       -       18,977       12,523       38,195  
                                             
NET INCOME (LOSS)
  $ (4,473 )   $ -     $ (18,977 )   $ (12,523 )   $ (38,195 )
                                             
                                             
                                             

BASIC AND DILUTED NET LOSS PER COMMON SHARE
  $ 0.00     $ 0.00     $ 0.00     $ 0.00       
                                         
WEIGHTED AVERAGE NUMBER OF BASIC AND DILUTED COMMON SHARES OUTSTANDING
    5,340,000       5,000,000       5,217,835       5,000,000       















The accompanying notes are an integral part of these financial statements

 
- 5 -

 



ALARMING DEVICES, INC.
(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)
FROM INCEPTION (July 22, 2008) TO MAY 31, 2010




   
Common Stock
                         
   
Number of shares
   
Amount
   
Additional Paid-in Capital
   
 
Share Subscription Receivable
   
Deficit Accumulated During the Development Stage
   
Total
 
                                     
Balance July 22, 2008
    -     $ -     $ -     $ -     $ -     $ -  
                                                 
Stock issued for cash on August 11, 2008 at $0.001
    5,000,000       5,000        -       (5,000 )     -       -  
Net Loss for the period ended August 31, 2008
                                    -       -  
Balance, August 31, 2008
    5,000,000       5,000               (5,000 )     -       -  
Share subscription received
                            5,000               5,000  
Net Loss for the year ended August 31, 2009
                                    (19,218 )     (19,218 )
Balance, August 31, 2009
    5,000,000     $ 5,000     $ -       -     $ (19,218 )-   $ (14,218 )
Stock issued for Cash  on December 2009 at $0.03
    340,000       340       9,860                       10,200  
Net Loss for the nine months ended May 31, 2010
                                    (18,977 )     (18,977 )
Balance, May 31 ,2010 (Unaudited)
    5,340,000     $ 5,340     $ 9,860       -     $ ( 38,195 )   $ (22,995 )
















The accompanying notes are an integral part of these financial statements

 
- 6 -

 

ALARMING DEVICES, INC.
(A Development Stage Company)

STATEMENTS OF CASH FLOWS
 (Unaudited)




 
 
 
Nine months Ended May 31, 2010
 
 
Nine months Ended May 31, 2009
July 22, 2008 (date of inception) to
May 31, 2010
       
       
CASH FLOWS FROM OPERATING ACTIVITIES
     
Net loss
$    (18,977)
$    (12,523)
$        (38,195)
Adjustment to reconcile net loss to net cash used in
operating activities
     
Increase (decrease) in accrued expenses
               3,072
                5,128
              10,700
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
(15,905)
(7,395)
(27,495)
       
CASH PROVIDE FROM INVESTING ACTIVITIES
-
-
-
       
CASH FLOWS FROM FINANCING ACTIVITIES
     
  Increase in Related Party Loan
              13,170
             2,395
22,565
Proceeds from sale of common stock
             10,200
            5,000
15,200
       
NET CASH PROVIDED BY FINANCING ACTIVITIES
            23,370
            7,395
37,765
       
NET INCREASE (DECREASE) IN CASH
              7,465
             -
10,270
       
CASH, BEGINNING OF PERIOD
             2,805
              -
-
       
CASH, END OF PERIOD
$           10,270
$                  -
$           10,270
       



Supplemental cash flow information and noncash financing activities:
Cash paid for:
Interest
$                   -
$                 -
 

Income taxes
$                   -
$                 -
 






The accompanying notes are an integral part of these financial statements

 
- 7 -

 



ALARMING DEVICES, INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)

May 31, 2010

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Alarming Devices, Inc. (“Company”) is in the initial development stage and has incurred losses since inception totalling $38,195 The Company was incorporated on July 22, 2008 in the State of Nevada and established a fiscal year end of August.  The Company is a development stage company and intends to import from China and supply a reliable and affordable home and commercial wireless alarm system.


NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation
The financial statements present the balance sheet, statements of operations, stockholders' equity (deficit) and cash flows of the Company. These financial statements are presented in United States dollars and have been prepared in accordance with accounting principles generally accepted in the United States.

Use of Estimates and Assumptions
Preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.

Income Taxes
The Company follows the liability method of accounting for income taxes in accordance with ASC 740. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances.  Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.

Net Loss per Share
Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period.  Dilutive loss per share reflects the potential dilution of securities that could share in the losses of the Company.  Because the Company does not have any potentially dilutive securities, the accompanying presentation is only of basic loss per share. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items in the Company.
 

 
- 8 -

 
ALARMING DEVICES, INC.
A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)

May 31, 2010

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Foreign Currency Translation
The financial statements are presented in United States dollars.  In accordance with ASC 830, "Foreign Currency Translation", foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date.  Non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expenses are translated at average rates of exchange during the periods presented.  Related translation adjustments are reported as a separate component of stockholder’s equity (deficit), whereas gains or losses resulting from foreign currency transactions are included in results of operations

Stock-based Compensation
The Company has not adopted a stock option plan and has not granted any stock options.  Accordingly no stock-based compensation has been recorded to date.

Share Based Expenses
In December 2004, the Financial Accounting Standards Board (“FASB”) issued ASC 718 and 505 “Share Based Payment.” This statement requires a public entity to expense the cost of employee services received in exchange for an award of equity instruments. This statement also provides guidance on valuing and expensing these awards, as well as disclosure requirements of these equity arrangements.  The Company adopted ASC 718 and 505 upon creation of the company and expenses share based costs in the period incurred.

Recent Accounting Pronouncements
In May 2009, FASB issued ASC 855, Subsequent Events, which establishes general standards of for the evaluation, recognition and disclosure of events and transactions that occur after the balance sheet date. Although there is new terminology, the standard is based on the same principles as those that currently exist in the auditing standards. The standard, which includes a new required disclosure of the date through which an entity has evaluated subsequent events, is effective for interim or annual periods ending after June 15, 2009.  The adoption of ASC 855 did not have a material effect on the Company’s financial statements.

In June 2009, the FASB issued guidance now codified as ASC 105, Generally Accepted Accounting Principles as the single source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with U.S. GAAP, aside from those issued by the SEC. ASC 105 does not change current U.S. GAAP, but is intended to simplify user access to all authoritative U.S. GAAP by providing all authoritative literature related to a particular topic in one place.  The adoption of ASC 105 did not have a material impact on the Company’s financial statements, but did eliminate all references to pre-codification standards.
 




 
- 9 -

 
ALARMING DEVICES, INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)

May 31, 2010

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

In  February  2010,  the FASB issued  Accounting  Standards  Update  ("ASU") No.2010-09,  "Amendments to Certain Recognition and Disclosure  Requirements" ("ASU2010-09"),  which is included in the FASB Accounting Standards Codification (the "ASC") Topic 855 (Subsequent Events). ASU 2010-09 clarifies that an SEC filer is required to evaluate subsequent events through the date that the financial statements are issued.  ASU 2010-09 is effective upon the issuance of the final update and did not have a significant impact on the Company's financial statements.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.


Going concern

The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern.  This contemplates the realization of assets and the liquidation of liabilities in the normal course of business.  Currently, the Company does not have cash nor material assets, nor does it have operations or a source of revenue sufficient to cover its operation costs giving substantial doubt for it to continue as a going concern.  The Company will be dependent upon the raising of additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company.  There can be no assurance that the Company will be successful in either situation in order to continue as a going concern.  The officers and directors have committed to advancing certain operating costs of the Company.

The ability of the Company to continue as a going concern is dependent on raising capital to fund its business plan and ultimately to attain profitable operations.  Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern.  The Company is funding its initial operations by way of issuing Founder’s shares.   As of May 31, 2010, the Company had issued 5,000,000 Founder’s shares at $0.001 per share for net funds received by the Company of $5,000 and 340,000 common shares at $0.03 per share for net funds received of $10,200










 
- 10 -

 

ALARMING DEVICES, INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)

May 31, 2010



NOTE 3 - FAIR VALUE OF FINANCIAL INSTRUMENTS

 
In accordance with the requirements of ASC 825 and ASC 820, the Company has determined the estimated fair value of financial instruments using available market information and appropriate valuation methodologies.  The fair value of financial instruments classified as current assets or liabilities approximate their carrying value due to the short-term maturity of the instruments.
 


NOTE 4 – STOCK TRANSACTION

The Company’s capitalization is 75,000,000 common shares with a par value of $0.001 per share.  No preferred shares have been authorized or issued.

As of May 31, 2010, the Company has not granted any stock options and has not recorded any stock-based compensation.

On August 11, 2008, the Company issued 5,000,000 shares of the common stock in the Company at $0.001 per share for $5,000 to the director of the Company.  During December, 2009 the Company issued 340,000 Common Shares at $0.03 per share for $10,200


NOTE 5 – STOCKHOLDERS’ EQUITY

The stockholders’ equity section of the Company contains the following classes of capital stock as of May 31, 2010:
Common stock, $ 0.001 par value: 75,000,000 shares authorized; 5,340,000 shares issued and outstanding

NOTE 6 – INCOME TAXES

 
We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. When it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit.  We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carryforwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carryforward period.
 
 

 
 

 
- 11 -

 
ALARMING DEVICES, INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Unaudited)

May 31, 2010

NOTE 6 – INCOME TAXES (continued)

 
The components of the Company’s deferred tax asset as of May 31, 2010 are as follows:
 
 

 
   
May 31, 2010
 
Net operating loss carry forward
  $ 38,195  
Tax at statutory rate
    35 %
Deferred tax asset
  $ 13,368  
Valuation allowance
    (13,368 )
Net deferred tax asset
  $ 0  
 


The net federal operating loss carry forward will expire between 2027 and 2028.  This carry forward may be limited upon the consummation of a business combination under IRC Section 381.


NOTE 7 – Related - Party Transactions

As of May 31, 2010, the Company received advances from a Director in the amount of $22,565. The amounts due to the related party are unsecured and non-interest bearing with no set terms of repayment.


NOTE 8– Subsequent Events

The Company has evaluated subsequent events through the date the financial statements were issued and filed with the Securities and Exchange Commission. The Company has determined that there were no such events that warrant disclosure or recognition in the financial statements.






Item 2. Management`s Discussion and Analysis of Financial Condition and Results of Operations

This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance.  Forward looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions or words which, by their nature, refer to future events.  You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report.  These forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.

 
- 12 -

 

 

Overview

Alarming Devices, Inc. ("Alarming Devices", "the Company", “our” or "we") was incorporated in the State of Nevada as a for-profit company on July 22, 2008. We are a development stage company that intends to import from China and supply a reliable and affordable home and commercial wireless alarm system to resellers and distributors in North America. The company will import and distribute through certified resellers that will install and provide end user support. The company will also allow resellers to customer label the products so they could have the opportunity to create their own “house” brand. The Company would import and hold products with a shipping agent that would pick and ship for the company contractually to help control fixed costs.

The Company intends to seek a master distributor in North America who already supplies the alarm industry. The Master Distributor will have exclusive reseller rights throughout the territory; product manufactured specifically for Alarming Devices will be shipped directly from the manufacturer to the master distributor.


Plan of Operation

The Company has not yet generated any revenue from its operations.  As of the fiscal quarter ended May 31, 2010 we had $10,270 of cash on hand. We incurred operating expenses in the amount of $38,195 since July 22, 2008 to May 31, 2010. These operating expenses were comprised of professional fees and office and general expenses.

Our current cash holdings will not satisfy our liquidity requirements and we will require additional financing to pursue our planned business activities.  We have registered 2,000,000 of or our common stock for sale to the public.  Our registration statement became effective on November 30, 2009 and we are in the process of seeking equity financing to fund our operations over the next 12 months.

Management believes that if subsequent private placements are successful, we will generate sales revenue within the following twelve months thereof. However, additional equity financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements.

If Alarming Devices is unsuccessful in raising the additional proceeds through a private placement offering it will then have to seek additional funds through debt financing, which would be very difficult for a new development stage company to secure. Therefore, the company is highly dependent upon the success of the anticipated private placement offering described herein and failure thereof would result in Alarming Devices having to seek capital from other resources such as debt financing, which may not even be available to the company. However, if such financing were available, because Alarming Devices is a development stage company with no operations to date, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing and determine whether the business could sustain operations and growth and manage the debt load. If Alarming Devices cannot raise additional proceeds via a private placement of its common stock or secure debt financing it would be required to cease business operations. As a result, investors in Alarming Devices common stock would lose all of their investment.

 
- 13 -

 


Our specific goal is to import and supply an affordable wireless alarm system.  We intend to accomplish the foregoing through the following milestones:

1.  
Our president plans to begin secure a licensing/purchase agreement with a company that owns some proprietary radio technology that would become the backbone of the Company’s product line. Then the President would contact factories in China and then travel to negotiate prices, approve prototypes and do all the necessary arrangements. We expect to complete this step within 120 days after we have raised enough funds.

2.  
We intend to search for a suitable location for storage, to order some of alarms and have them shipped from China and stored for future sales. Even though the Company would prefer to drop ship from our manufacturer in directly to our distributors the Company will have to store some inventory back up in case of manufacturing delays in China. We also intend to hire an outside web designer to develop our website. We expect to have our products in stock and our website ready within 300 days after we have raised enough funds.

3.  
As soon as our website is operational, we will begin to market our product on TV commercials. Marketing is an ongoing matter that will continue during the life of our operations

In summary, we anticipate that we will be fully operational within 360 days after we have raised enough funds.

THREE MONTH PERIOD ENDING MAY 31, 2010  AS COMPARED TO THE THREE MONTH PERIOD ENDING MAY 31, 2009
 
The Company incurred a net loss of $4,473 for the three-month period ended May 31, 2010, compared with no net loss for the three month period ended May 31, 2009. This was mainly due to lower audit and accounting and initial legal costs, offset by filing and transfer fees.
 
 
NINE  MONTH PERIOD ENDING MAY 31, 2010 AS COMPARED TO THE NINE MONTH PERIOD ENDING MAY 31, 2009
 
 
The Company incurred a net loss of $18,977 for the nine-month period ended May 31, 2010, compared with a net loss of $12,523 for the nine-month period ended May 31, 2009.  This too was mainly due to lower audit and accounting and legal costs, offset again by filing and transfer fees.
 

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not required.

Item 4. Controls and Procedures

The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as required by Sarbanes-Oxley (SOX) Section 404 A. The Company’s internal control over financial reporting is a process designed under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with U.S. generally accepted accounting principles.


 
- 14 -

 

 
As of May 31, 2010 management assessed the effectiveness of the Company’s internal control over financial reporting based on the criteria for effective internal control over financial reporting established in SEC guidance on conducting such assessments.  Based on that evaluation, they concluded that, during the period covered by this report, such internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules as more fully described below. This was due to deficiencies that existed in the design or operation of our internal control over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.

The matters involving internal controls and procedures that the Company’s management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee and lack of a majority of outside directors on the Company's board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; (3) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (4) ineffective controls over period end financial disclosure and reporting processes. The aforementioned material weaknesses were identified by the Company's Chief Financial Officer in connection with the review of our financial statements as May 31, 2010 and communicated the matters to our management.

Management believes that the material weaknesses set forth in items (2), (3) and (4) above did not affect the Company's financial results. However, management believes that the lack of a functioning audit committee and lack of a majority of outside directors on the Company's board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures can affect the Company's results and its financial statements for the future years.
 
We are committed to improving our financial organization. As part of this commitment, we will create a position to  segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to the Company: i) Appointing one or more outside directors to our board of directors who shall be appointed to the audit committee of the Company resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures; and ii) Preparing and implementing sufficient written policies and checklists which will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.
 
Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on the Company's Board. In addition, management believes that preparing and implementing sufficient written policies and checklists will remedy the following material weaknesses (i) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (ii) ineffective controls over period end financial close and reporting processes. Further, management believes that the hiring of additional personnel who have the technical expertise and knowledge will result proper segregation of duties and provide more checks and balances within the department. Additional personnel will also provide the cross training needed to support the Company if personnel turn over issues within the department occur. This coupled with the appointment of additional outside directors will greatly decrease any control and procedure issues the company may encounter in the future.
 
 
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We will continue to monitor and evaluate the effectiveness of our internal controls and procedures and our internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

 
There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rules 13a-15 or 15d-15 under the Exchange Act that occurred during the small business issuer's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
 


PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Company is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated.

No director, officer, or affiliate of the issuer and no owner of record or beneficiary of more than 5% of the securities of the issuer, or any security holder is a party adverse to the small business issuer or has a material interest adverse to the small business issuer.



Item 2. Unregistered Sales of Equity Securities and  Use of Proceeds

        None.



Item 3. Defaults Upon Senior Securities

        None

Item 4. Submission of Matters to a Vote Security Holders

        None

Item 5. Other Information

    None

Item 6. Exhibits

3.1           Articles of Incorporation [1]

3.2           By-Laws [1]

 
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31.1          Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executivel Officer

31.2           Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer *

32.1           Section 1350 Certification of Chief Executive Officer

32.2           Section 1350 Certification of Chief Financial Officer **

 
[1]     Incorporated by reference from the Company’s filing with the Commission on January 29, 2009.
*     Included in Exhibit 31.1
**    Included in Exhibit 32.1
 
 
SIGNATURES

Pursuant to the requirements of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


 

ALARMING DEVICES, INC.
 
BY:       /s/ Andre Luiz Nascimento Moreira
Andre Luiz Nascimento Moreira
President, Secretary Treasurer, Principal Executive Officer,
Principal Financial Officer
 

Dated:  June 23, 2010.
 
 
 
 
 
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