UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the quarterly period ended
or
For the transition period from to
Commission
file number:
(Exact name of registrant as specified in its charter)
| State or other jurisdiction of incorporation or organization | (I.R.S. Employer Identification No.) |
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered under Section 12(b) of the Exchange Act:
None
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.
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller 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 | ☐ |
| ☐ | 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.
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by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
shares of common stock are issued and outstanding as of May 26, 2022.
Table of Contents
| INDEX | ||
| Page | ||
| PART I | FINANCIAL INFORMATION | 1 |
| Item 1. | Financial Statements (unaudited) | |
| CONDENSED CONSOLIDATED BALANCE SHEETS as of April 30, 2022 and July 31, 2021 | 2 | |
| 3 | ||
| CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY for the nine months ended April 30, 2022, and three months ended April 30, 2021 | 4 | |
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS for the nine months ended April 30, 2022, and three months ended April 30, 2021 | 5 | |
| NOTES TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS | 6 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 10 |
| Item 3 | Quantitative and Qualitative Disclosures About Market Risk | |
| Item 4. | Controls and Procedures | 13 |
| PART II | OTHER INFORMATION | 14 |
| Item 1. | Legal Proceedings | 14 |
| Item 1A. | Risk Factors | 14 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 14 |
| Item 3. | Defaults Upon Senior Securities. | 14 |
| Item 4 | Mine Safety Disclosures | 14 |
| Item 5. | Other Information | 14 |
| Item 6. | Exhibits | 15 |
| SIGNATURES | 16 | |
i
PART I FINANCIAL INFORMATION
Certain information and footnote disclosures required under accounting principles generally accepted in the United States of America have been condensed or omitted from the following financial statements pursuant to the rules and regulations of the Securities and Exchange Commission. It is suggested that the following financial statements be read in conjunction with the year-end financial statements and notes thereto included in the Company’s Annual Report on Form 10K for the year ended July 31, 2021. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.
The results of operations for the nine months ended April 30, 2022 are not necessarily indicative of the results for the entire fiscal year or for any other period.
1
LIMITLESS PROJECTS INC
UNAUDITED CONSOLIDATED BALANCE SHEET
As of April 30, 2022 and July 31, 2021
| April 30, | July 31, | |||||||
| 2022 | 2021 | |||||||
| $ | $ | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | ||||||||
| Accounts receivables | - | |||||||
| Prepayment and deposits | ||||||||
| Total current assets: | ||||||||
| Fixed assets: | ||||||||
| Office equipment | ||||||||
| Software | ||||||||
| Total fixed assets: | ||||||||
| Other assets: | ||||||||
| Notes receivable | - | |||||||
| Total other assets: | - | |||||||
| Total Assets: | ||||||||
| LIABILITIES & STOCKHOLDER’S EQUITY | ||||||||
| LIABILITIES | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | ||||||||
| Deferred revenue | - | |||||||
| Total current liabilities: | ||||||||
| Total Liabilities: | ||||||||
| STOCKHOLDER’S EQUITY | ||||||||
| Common stock: $ par value, authorized, issued and outstanding as of April 30, 2022 (July 31, 2021 - ) | ||||||||
| Additional paid in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Minority interest | ( | ) | ||||||
| Total Stockholder’s Equity: | ||||||||
| Total Liabilities and Stockholder’s Equity: | ||||||||
(The accompanying notes are an integral part of these condensed unaudited financial statements)
2
LIMITLESS PROJECTS INC
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS
| For the Three Months | For the Three Months | For the Nine Months | From inception November 18, | |||||||||||||
| Ended April 30 | Ended April 30 | Ended April 30 | 2020 to April 30 | |||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Income: | ||||||||||||||||
| General Revenue | ||||||||||||||||
| Total Income: | ||||||||||||||||
| Expenses: | ||||||||||||||||
| General and Administrative | ||||||||||||||||
| Consolidated net loss: | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss attributable to minority interest | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss attributable to Limitless | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss per share – basic and diluted | - | - | - | - | ||||||||||||
| Weighted average shares outstanding – basic and diluted | ||||||||||||||||
(The accompanying notes are an integral part of these condensed unaudited financial statements)
3
LIMITLESS PROJECTS INC
UNAUDITED CONSOLIDATED STATEMENT OF STOCKHOLDER’S EQUITY
For the nine months ended April 30, 2022 and three months ended April 30, 2021
| Common Stock | Additional Paid in | Accumulated | Minority | |||||||||||||||||||||
| Number | Par Value | Capital | Deficit | Interest | Total | |||||||||||||||||||
| $ | $ | $ | $ | $ | ||||||||||||||||||||
| Opening Balance, January 31, 2021 | - | ( | ) | ( | ) | |||||||||||||||||||
| Issued of Share capital for business combination | - | |||||||||||||||||||||||
| Net Loss | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||
| Closing Balance, April 30, 2021 | ( | ) | ( | ) | ||||||||||||||||||||
| Opening Balance - July 31, 2021 | ( | ) | ( | ) | ||||||||||||||||||||
| Opening Balance of Issued of Share capital for business combination | ||||||||||||||||||||||||
| Common Shares issued by Privacy and Value | - | |||||||||||||||||||||||
| Common Shares issued by WarpSpeed Taxi | - | |||||||||||||||||||||||
| Cancellation of Shares by WarpSpeed Taxi | ( | ) | ( | ) | ||||||||||||||||||||
| Other | - | ( | ) | ( | ) | |||||||||||||||||||
| Net Loss | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||
| Closing Balance - April 30, 2022 | ( | ) | ||||||||||||||||||||||
(The accompanying notes are an integral part of these condensed unaudited financial statements)
4
LIMITLESS PROJECTS INC
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
For the nine months period ended April 30, 2022 and three months ended April 30, 2021
| For the Nine Months | For the Three Months | |||||||
| Ended April 30 | Ended April 30 | |||||||
| 2022 | 2021 | |||||||
| $ | $ | |||||||
| Cash flows from operating activities: | ||||||||
| Consolidated net loss | ( | ) | ( | ) | ||||
| Change in operating assets and liabilities | ||||||||
| Accounts receivable | - | |||||||
| Prepayments and deposits | ( | ) | ( | ) | ||||
| Accounts payable and accrued liabilities | ||||||||
| Notes receivable | ( | ) | - | |||||
| Investments | - | |||||||
| Net cash used in operating activities: | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Software development | ( | ) | ||||||
| Net cash used in investing activities: | ( | ) | ||||||
| Cash flows from financing activities: | ||||||||
| Issuance of common stock | - | |||||||
| Additional paid in capital | - | |||||||
| Cash payment of investment purchase | ||||||||
| Net cash used in financing activities: | ||||||||
| Change in cash | ( | ) | ( | ) | ||||
| Cash – beginning of period | ||||||||
| Cash – end of period | ||||||||
| Supplemental cash flow disclosures | - | - | ||||||
| Cash paid For: | ||||||||
| Interest | - | - | ||||||
| Income tax | - | - | ||||||
(The accompanying notes are an integral part of these condensed unaudited financial statements)
5
LIMITLESS
PROJECTS INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
April 30, 2022
(unaudited)
1. NATURE AND CONTINUANCE OF OPERATIONS
Limitless Projects Inc. (the “Company” or “Limitless”) was incorporated in the state of Wyoming on November 18, 2020 (“Inception”). The Company is in the business of developing computer software systems and mobile device applications. The Company’s fiscal year-end is July 31. The Company is developing a ride-hailing and food delivery computer and mobile device application, as well as employee monitoring software that balances employer concerns regarding employee efficiency and productivity with employee privacy.
2. GOING CONCERN
These consolidated
financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge
its liabilities in the normal course of business for the foreseeable future. The Company has incurred a net loss attributable to Limitless
for the three months ended April 30, 2022 of $
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
These 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. The Company has selected July 31 as its year-end. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of its financial position and the results of operations for the period presented have been reflected herein.
Cash and Cash Equivalents
The
Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. The
Company maintains cash and cash equivalent balances at one financial institution that is insured by the FDIC. As April 30, 2022, the
Company had $
Fair Value of Financial Instruments
The Company follows FASB ASC 820, Fair Value Measurements and Disclosures, for all financial instruments and non-financial instruments accounted for at fair value on a recurring basis. This accounting standard establishes a single definition of fair value and a framework for measuring fair value, sets out a fair value hierarchy to be used to classify the source of information used in fair value measurement and expands disclosures about fair value measurements required under other accounting pronouncements. It does not change existing guidance as to whether or not an instrument is carried at fair value. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
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ASC topic 820 “Fair Value Measurements and Disclosures” establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
These tiers include:
Level 1: Defined as observable inputs such as quoted prices in active markets;
Level 2: Defined as inputs other than quoted prices in active markets that are either directly or indirectly observable;
Level 3: Defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
The Company has adopted FASB ASC 825, Financial Instruments, which allows companies to choose to measure eligible financial instruments and certain other items at fair value that are not required to be measured at fair value. The Company has not elected the fair value option for any eligible financial instruments.
Comprehensive Loss
The Company adopted FASB ASC 220, “Reporting Comprehensive Income”, which establishes standards for the reporting and display of comprehensive income and its components in the consolidated financial statements. Comprehensive income consists of net income and other gains and losses affecting stockholders’ equity that are excluded from net income, such as unrealized gains and losses on investments available for sale, foreign currency translation gains and losses and minimum pension liability. Since inception, the Company’s other comprehensive income represents foreign currency translation adjustments.
Revenue Recognition
The Company recognizes revenue in accordance with Accounting Standards Codification No. 606, “Revenue Recognition” (“ASC-606”), ASC-606 requires that five basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists and both parties will perform their respective obligations; (2) can identify each party’s rights regarding goods or services being transferred; (3) the selling price is fixed and determinable; (4) the contract has commercial substance; and (5) collectability is reasonably assured. Determination of criteria (3) and (5) are based on management’s judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.
Because the Company assumes that the reported amounts of assets and liabilities will be recovered and settled, respectively, a difference between the tax basis of an asset or a liability and its reported amount in the balance sheet will result in a taxable or a deductible amount in some future years when the related liabilities are settled or the reported amounts of the assets are recovered, which gives rise to a deferred tax asset. The Company must then assess the likelihood that the deferred tax assets will be recovered from future taxable income and to the extent the Company believes that recovery is not likely, the Company must establish a valuation allowance.
The Company has adopted FASB guidance on accounting for uncertainty in income taxes which provides a consolidated financial statement recognition threshold and measurement attribute for a tax position taken or expected to be taken in a tax return. Under this guidance, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The guidance also extends to de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures.
7
The Company computes income (loss) per share in accordance with FASB ASC 260 “Earnings per Share”. Basic loss per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. As of April 30, 2022 and July 31, 2021, there are no potentially dilutive debt or equity instruments issued or outstanding.
Use of Estimates and Assumptions
The preparation of consolidated 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 of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.
Due to the limited level of operations, the Company has not had to make material assumptions or estimates other than the assumption that the Company is a going concern.
Recently Adopted and Recently Enacted Accounting Pronouncements
The Company adopts new pronouncements relating to accounting principles generally accepted in the United States of America applicable to the Company as they are issued, which may be in advance of their effective date.
Management does not believe that any recently issued, but not yet effective accounting standards, if currently adopted, would have a material effect on the accompanying consolidated financial statements.
In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. This guidance changes how companies account for certain aspects of share-based payments to employees. Among other things, under the new guidance, companies will no longer record excess tax benefits and certain tax deficiencies in additional paid-in-capital (“APIC”), but will instead record such items as income tax expense or benefit in the income statement, and APIC pools will be eliminated. Companies will apply this guidance prospectively. Another component of the new guidance allows companies to make an accounting policy election for the impact of forfeitures on the recognition of expense for share-based payment awards, whereby forfeitures can be estimated, as required today, or recognized when they occur. If elected, the change to recognize forfeitures when they occur needs to be adopted using a modified retrospective approach. The amendment is effective for public entities for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of this guidance, if any, on its financial statements and related disclosures.
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which issued new guidance related to leases that outlines a comprehensive lease accounting model and supersedes the current lease guidance. The new guidance requires lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms of greater than 12 months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. The new guidance must be adopted using the modified retrospective approach and will be effective for the public entities for fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company is currently evaluating the impact of this guidance, if any, on its financial statements and related disclosures.
8
In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. The guidance requires an entity to measure inventory at the lower of cost or net realizable value, which is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation, rather than the lower of cost or market in the previous guidance. This amendment applies to inventory that is measured using first-in, first-out (FIFO). This amendment is effective for public entities for fiscal years beginning after December 15, 2016, including interim periods within those years. A reporting entity should apply the amendments prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the impact of this guidance, if any, on its financial statements and related disclosures.
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers (ASC 606), which creates a single source of revenue guidance under U.S. GAAP for all companies in all industries and replaces most existing revenue recognition guidance in U.S. GAAP. Under the new standard, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the new standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The FASB has issued several amendments to the new standard, including clarification on accounting for licenses of intellectual property and identifying performance obligations.
4. CAPITAL STOCK
The total number of common shares authorized that may be issued by the Company is shares with a par value of $ per share.
During
the nine months ended April 30, 2022, the Company issued shares of common stock for total cash proceeds of $
During the nine months ended April 30, 2022, the Company cancelled shares of common stock at par value of $0.0001 per share related to WarpSpeed Taxi.
As of April 30, 2022, there were no issued and outstanding stock options or warrants.
During
the period ended April 30, 2021, the Company issued shares of common stock for total cash proceeds of $
9
ITEM 2. Management’s Discussion and Analysis of Financial Conditions and Results of Operations.
Forward Looking Statements
This quarterly report contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward-looking statements. You should not place too much reliance on these forward-looking statements. Our actual results are likely to differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in this section.
Background
We were incorporated on November 18, 2020 under the laws of the state of Wyoming. We are involved in the development of computer software systems and mobile device applications for commercial and consumer use. We retain independent computer software and application developers to develop our products to the specifications that we outline. Our president, Daniel Okelo, is responsible for developing the product concepts that the independent developers subsequently design.
We are currently developing a ride-hailing and food delivery computer and mobile device application known as “WarpSpeedTaxi” and employee monitoring software that balances employer concerns regarding employee efficiency and productivity with employee privacy known as “Privacy and Value”. Our intention is to sell these products to third parties who will sell the software to customers and launch the computer applications rather than become involved in the sales and marketing of these products ourselves.
WarpSpeedTaxi Application
We intend to complete the development of a ride-hailing and food delivery computer and mobile device application known as “WarpSpeedTaxi”. Our president commenced the development of the WarpSpeedTaxi application in May 2020 and then transferred it to us by way of a Bill of Sale for nominal consideration after our incorporation. None of the freelance developers or other third parties involved in the creation of the WarpSpeedTaxi application retain any intellectual property rights in the application. Those rights transfer to the purchaser of the application.
The WarpSpeedTaxi application will be used to provide ride-hailing services, also known as an e-taxi or mobility service provider, is a service that, via websites and mobile apps, matches passengers with drivers of vehicles for hire that are not licensed taxi drivers. The computer application that we are developing is intended to provide travelers with convenient door-to-door transport that leverages smart mobility platforms to connect drivers with passengers and lets drivers use their personal vehicles. Ride-hailing, like a traditional taxi service, facilitates drivers providing rides to customers for a fee. However, ride-hailing offers additional capabilities, such as efficient pricing tools, matching platforms, rating systems, and food delivery.
The WarpSpeedTaxi application will allow customers to hire standard and luxury motor vehicles via a smartphone or personal computer for both one-way and round-trips with the price based on the distance travelled and the current level of demand for vehicles. In addition to transporting passengers, the application may also be used for deliveries of goods from restaurants, grocery stores, and other businesses that typically utilize local vehicle courier services.
Customers will use the application to request a ride or the delivery of goods. Drivers will connect with customers via the application, pick up customers or goods to be delivered in accordance with the customer’s request, and then drive the customers or goods to their destination. Customers will pay for the transportation through the application by way of credit card. Drivers will receive payments for each ride or delivery they complete via a weekly direct deposit to their bank accounts. Because we have agreed to sell the WarpSpeedTaxi application, we will not realize any revenue or incur any operation costs from its use since the purchaser will be providing ride-hailing and food delivery services. The consideration that we will receive from the application is limited to $300,000 that the purchaser is required to pay us.
10
Privacy and Value Employee Monitoring Software
We also commenced developing employee monitoring software known as “Privacy and Value” in December 2020 shortly after our incorporation. Our goal is to develop a software product that balances employer concerns regarding employee efficiency and productivity with employee privacy. We will retain all interest in the intellectual property relating to the Privacy and Value software unless we subsequently sell those rights.
As companies are increasingly attempting to meet the demands of employees that want work environment flexibility and are forced to avoid employee congregation in response to the current global Covid-19 pandemic, they are retaining staff that either work from home or they rely on outsourcing to retain employees and independent contractors in other countries. One of the primary concerns with having staff work in a separate location that removes them from the daily, direct oversight of management is that employee productivity will suffer. One of the responses to this concern is for businesses to use some form of worker surveillance in order to ensure that employees are utilizing their work time efficiently. However, businesses may face pushback from their staff due to concerns that their personal privacy is compromised when they are subject to constant monitoring during work hours. They may resist practices such as webcam surveillance or persistent computer screen observation.
To address employer concerns regarding staff efficiency and employee concerns regarding privacy, we intend to develop the Privacy and Value software that has features to monitor worker computer productivity while providing employees with reasonable privacy during their work days. The intended features of the software are as follows:
● the software will monitor the employees’ computer desktops while they are actually working on the system. Surveillance will commence when an employee logs on to his or her computer through our software and will continue until the employee logs out of the system. After an employee signs out of the software, recording and monitoring will cease and the employee can access his or her computer contents and the Internet for personal purposes;
● when the employee is logged in, the software will allow management to maintain real-time access to employee activity and to view each employee’s desktop screen content and the keystrokes that the employee is typing. All of this information will also be recorded and stored for future management use with all information time stamped. The file name for each day’s recording will be the employee’s first name, last name, and the year, month, and day, which will allow a manager to identify the appropriate recording without difficulty; and
● based on employee actions, the software will calculate the amount of time that the employee was logged into the system based on a searchable time period (e.g., a shift, a week, or a month). It will also indicate the length of various time periods during which the employee did not make any keystrokes on his or her computer and allow the manager to quickly access the recording of employee’s desktop at the times when keystrokes commenced and stopped. The software will also provide details of the length of each break that the employee takes during the work period analyzed. It will also have tools that the manager can use, in tabular and graphic form, to compare the efficiency of employees in terms of keystrokes and time logged in to their computer.
We entered into an Asset Purchase and Joint Venture agreement dated March 15, 2021, as amended, whereby Cyber Apps World, Inc. (“Cyber Apps”), a reporting company, has agreed to purchase a 50% interest in the Privacy and Value software for
| 1. | $10,000 upon execution of the agreement, which has been paid; and |
| 2. | an amount equal to the estimation of the value of the 50% interest in Privacy and Value based upon an independent business valuation, less the $10,000 payment, which amount shall be no less than $50,000 and no more than $250,000 and was due by June 15, 2021. |
We obtained an independent valuation of the Privacy and Value software in its present form of development that estimated its value at approximately $2,200,000. Accordingly, the amount that was due from Cyber Apps to Limitless Projects Inc. under the Asset Purchase and Joint Agreement was $250,000.
We and our president, Daniel Okelo, also entered into agreements with Cyber Apps whereby they each will transfer 50,000,000 of our shares, for a total of 100,000,000 to Cyber Apps and its principals for a cash payment of $250,000 that was due on June 15, 2021. Cyber Apps did not make the $250,000 payment by the deadline date of June 15, 2021. The parties are in the process of renegotiating the agreement payment terms. However, there is no guarantee that a revised agreement will be reached.
11
If we complete the sale of the 50% interest in the Privacy and Value software to Cyber Apps, the parties will form a single purpose joint for the purpose of completing, testing, marketing, and selling the Privacy and Value software. The joint venture will be managed by a management committee with each party appointing one member to the committee and those two members jointly appointing an independent third member of the committee.
Results of Operations for the three and nine months Ended April 30, 2022
Our net loss attributable to the Company for the three and nine months ended April 30, 2022 was $188,645 and $342,058 respectively, which consisted of general and administrative fees attributed to our operations less revenue during the periods of $572 and $906 respectively, relating to sales and affiliate revenue from our Privacy and Value software product.
LIQUIDITY AND CAPITAL RESOURCES
As of April 30, 2022, our current assets were $37,384 compared to $116,749 as of July 31, 2021. The decrease in current assets in the current fiscal year is due to expenses related to the development, maintenance, and marketing of our products. As of April 30, 2022, our total assets were $525,172 compared to $378,177 as of July 31, 2021. This is a result of capitalizing more expenses related to the ongoing development of our software during the year, offset by a decrease in notes receivable for $250,000.
As of April 30, 2022, our current liabilities were $524,845 compared to $358,577 as of July 31, 2021. Current liabilities on April 30, 2022 were comprised entirely of accounts payable and accrued liabilities.
We expect we will require additional capital to meet our long-term operating requirements. We expect to raise additional capital through, among other methods, the sale of equity or debt securities.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities. For the nine-month period ended April 30, 2022, net cash flows used in operating activities were $554,826 consisting of a consolidated net loss of $617,208 for the period, which was offset changes in accounts receivable of $40,000, accounts payable and accrued liabilities of $263,282, as well as prepayments and deposits of $15,000 and the write-off of a note receivable of $250,000.
Cash Flows from Investing Activities
For the period ended April 30, 2022, our cash flows used in investing activities were $476,360, which consisted of the purchase costs of fixed assets and software related to the development and sale of the Privacy and Value computer monitoring software and the WarpSpeed Taxi computer application.
Cash Flows from Financing Activities
We have financed our operations from the issuance of our shares of common stock. Net cash flows received from financing activities were $24,100 in the nine-month period ended April 30, 2022, which consisted of $14,100 for the purchase of common stock and $10,000 for an investment purchase.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this report, we do not have any 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 are material to investors.
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GOING CONCERN
The independent auditors’ report accompanying our July 31, 2021 financial statements contained an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared “assuming that we will continue as a going concern,” which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
Item 4. Controls and Procedures.
As supervised by our board of directors and our principal executive and principal financial officer, management has established a system of disclosure, controls and procedures and has evaluated the effectiveness of that system. The system and its evaluation are reported on in the below Management’s Annual Report on Internal Control over Financial Reporting. Our principal executive and financial officer has concluded that our disclosure, controls and procedures (as defined in Securities Exchange Act of 1934 (“Exchange Act”) Rule 13a-15(e)) as of April 30, 2022, were not effective, based on the evaluation of these controls and procedures required by paragraph (b) of Rule 13a-15.
Management’s Annual Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) of the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.
Management assessed the effectiveness of internal control over financial reporting as of April 30, 2022. We carried out this assessment using the criteria of the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework.
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm, pursuant to rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report. Management concluded in this assessment that as of April 30, 2022, our internal control over financial reporting is not effective.
There have been no significant changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the third quarter of our 2023 fiscal year that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety
Not Applicable.
Item 5. Other Information
None.
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PART II
Item 6. Exhibits.
Copies of the following documents are included as exhibits to this report pursuant to Item 601 of Regulation S-K.
| SEC Ref. No. | Title of Document | |
| 101.INS | XBRL Instance Document | |
| 101.SCH | XBRL Taxonomy Extension Schema Document | |
| 101.CAL | XBRL Taxonomy Calculation Linkbase Document | |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | XBRL Taxonomy Label Linkbase Document | |
| 101.PRE | XBRL Taxonomy Presentation Linkbase Document |
The XBRL related information in Exhibits 101 to this Annual Report on Form 10-K shall not be deemed “filed” or a part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, and is not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of those sections.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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Limitless Projects Inc.
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| Dated: June 13, 2022 | By: | /s/ Daniel Okelo |
| Daniel Okelo | ||
| President, Chief Executive Officer, Chief Financial Officer, and director | ||
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