ITEM 2. MANAGEMENT’S DISCUSSION
AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward looking statement notice
Statements made in this Form 10-Q that
are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section
27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often
can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate,"
"estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements
be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward- looking
statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur
in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could
cause actual results and events to differ materially from historical results of operations and events and those presently anticipated
or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after
the date of such statement or to reflect the occurrence of anticipated or unanticipated events.
Financial information contained
in this quarterly report and in our unaudited interim financial statements is stated in United States dollars and are prepared in accordance
with United States generally accepted accounting principles.
DESCRIPTION OF BUSINESS
Brief description of Crona Corp. for last five years
The Company was incorporated on October
6, 2016 under the laws of the State of Nevada. We are engaged in recording services business. Andrei Gurduiala has served as our President,
Treasurer and as a Director, from October 6, 2016, until March 21, 2018. On March 21, 2018, our board appointed Robert T. Malasek as a
Director, Chief Executive Officer, Chief Financial Officer and Secretary of the Company. On March 20, 2020, our board appointed initial
Incorporator of the Company Andrei Gurduiala as a Director, President, Treasurer and Secretary of the Company. As of date these financial
statements were issued, our board of directors is comprised of one person: Andrei Gurduiala.
We are authorized to issue 75,000,000
shares of common stock, par value $0.001 per share. On November 25, 2016, Andrei Gurduiala, our former President and a Director purchased
an aggregate of 5,000,000 shares of common stock at $0.001 per share, for aggregate proceeds of $5,000.
General description of our activity
We can book as little as one hour
or as many as 24 hours per day, allowing the business to focus on providing recording services for record labels, music producers, and
recording artists. The facility and its equipment are rented on either an hourly, daily, weekly, or monthly basis as dictated by the clients’
needs. In addition to studio and engineer/producer services, and in the course of ongoing business, it is customary in the recording industry
that the Studio will occasionally enter into certain licensing agreements that will provide revenue over and above the rental and services
income. There is no particular standard as to the frequency or amount of this revenue and it is negotiated on an individual basis. These
licensing agreements can include, but are not limited to, production agreements, writer agreements, and performing agreements, all yielding
a percentage of revenue earned through the exploitation of the product produced.
Our target markets are artists, organizers
of various events and representatives of various industries of show business (TV, cinema, and entertainment clubs).
We expect to face strong competition
from well-established companies and small independent companies like our self that may result in price reductions and decreased demand
for service of music studios. There are several companies in Romania in our industry, such as: DAW.RO, INES Studios, and Harmonix Recording
Studio. Management believes that we can develop ourselves in the industry, once we attract customers and become profitable.
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From time to time the Company may enter
into licensing agreements with music production and distribution companies. The license agreements may typically grant the production
and distribution company rights to a music single or all of an act's music in a particular country or region with a term of three to fifteen
years. The production or distribution company can then distribute the music in record or CD format, mp3, ring tone, or any other music
media licensed in the agreement.
The Company will typically receive
royalties of a negotiated percentage between 18% and 75% of sales of the production and Distribution Company’s published dealer
price less certain packaging deductions. In addition, the Company may receive between 18% and 75% of net royalty receipts received in
the particular nation or region. In connection with the license agreement, the Company may receive a cash advance.
Crona Corp is engaged in negotiations
for the purchase of mobile app code in the Java programming language. The code will contain the functionality development that will help
create a song recognition app. The application will provide a user with an API library of artists to quickly find the song they are hearing.
It will also offer an option of viewing the lyrics and sharing a song.
RESEARCH AND DEVELOPMENT EXPENDITURES
We have not incurred any research expenditures since our
incorporation.
BANKRUPTCY OR SIMILAR PROCEEDINGS
There has been no bankruptcy, receivership or similar proceeding.
COMPLIANCE WITH GOVERNMENT REGULATION
We will be required to comply with
all regulations, rules and directives of governmental authorities and agencies applicable to the construction and operation of any facility
in any jurisdiction which we would conduct activities.
We do not believe that any existing
or probable government regulation on our business, including any applicable export or import regulation or control imposed by China or
Romania will have a material impact on the way we conduct our business.
FACILITIES
Our previously leased office was
located at Strada C. A. Rosetti 5, Bucharest 030167 Romania. Our current office is located at Jean-Louis Calderon 31, Bucharest, 030167,
Romania. Our telephone number is +40371700093.
EMPLOYEES AND EMPLOYMENT AGREEMENTS
We have no employees as of the date
of this prospectus. Our sole officer and director, Andrei Gurduiala, currently devotes approximately 20 hours per week to company matters.
After receiving funding, Andrei Gurduiala plans to devote, as much time to the operation of the Company as he determines is necessary
for him to manage the affairs of the Company. As our business and operations increase, we will assess the need for full time management
and administrative support personnel.
LEGAL PROCEEDINGS
There are no pending legal proceedings
to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of
more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material
interest adverse to the Company.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
This section includes a number of forward-looking
statements that reflect our current views regarding the future events and financial performance of Crona Corp.
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We qualify as an “emerging growth
company” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements.
For so long as we are an emerging growth company, we will not be required to:
Have an auditor report on our internal controls
over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
Comply with any requirement that
may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s
report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis) unless
the SEC determines that the application of such additional requirements is necessary or appropriate in the public interest, after considering
protection of investors, and whether the action will promote efficiency, competition and capital formation; Submit certain executive compensate
on matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency;”
Disclose certain executive compensation
related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to
median employee compensation.
In addition, Section 107 of the JOBS
Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B)
of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the
adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage
of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that
comply with such new or revised accounting standards.
We will remain an “emerging
growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual
gross revenues exceed $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under
the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds
$700 million as of the last business day of our most recently completed second fiscal quarter or the date on which we have issued more
than $1 billion in non-convertible debt during the preceding three year period.
RESULTS OF OPERATION
Results of Operations for the three and
nine months ended September 30, 2021 and 2020:
Revenue and cost of goods sold
For the three months ended September 30, 2021 and 2020 Crona
Corp. had not generated any revenue.
For the nine months ended September 30, 2021 and 2020 Crona
Corp. had not generated any revenue.
Operating expenses
Total operating expenses for the three
months ended September 30, 2021 were $3,119. The operating expenses for the three months ended September 30, 2021 included general and
administrative expenses of $1,113 and professional fees of $2,006.
Total operating expenses for the three months
ended September 30, 2020 were $10,081. The operating expenses for the three months ended September 30, 2020 included audit fees of $10,005
and professional fees of $76.
Total operating expenses for the nine
months ended September 30, 2021 were $14,854. The operating expenses for the nine months ended September 30, 2021 included general and
administrative expenses of $8,715 and professional fees of $6,139.
Total operating expenses for the nine months
ended September 30, 2020 were $17,381. The operating expenses for the nine months ended September 30, 2020 included audit fees of $15,005
and professional fees of $2,376.
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The Company had no rent expense for
the nine months ended September 30, 2020. This has resulted in an increase in operating expenses for the nine months ended September 30,
2021 compared to the operating expenses for the nine months ended September 30, 2020.
Net Loss
The net loss for the three months ended September 30, 2021 and
2020 was $3,119 and $10,081, respectively.
The net loss for the nine months ended
September 30, 2021 and 2020 was $14,854 and $14,381, respectively. On March 19, 2020, Robert T. Malasek advanced to the Company $3,000
to cover the costs on professional services of Globex Transfer, LLC. On March 19, 2020 Robert T. Malasek forgave the mentioned indebtedness.
This resulted in a gain on debt forgiveness of $3,000.
Liquidity and capital resources
As of September 30, 2021, our total assets were $2,742.
As of September 30, 2021, our total liabilities were $44,458.
As of September 30, 2021, we had a working capital deficit
of $43,716.
CASH FLOWS FROM OPERATING ACTIVITIES
We have not generated positive
cash flows from operating activities. For the nine months ended September 30, 2021 net cash flows from operating activities was $8,699.
CASH FLOWS FROM INVESTING ACTIVITIES
For the nine months ended September 30, 2021 we generated
$0 in investing activities.
CASH FLOWS FROM FINANCING ACTIVITIES
For the nine months ended September 30, 2021 net cash flows from
financing activities was $8,699, which was due to related party advances.
OFF-BALANCE SHEET ARRANGEMENTS
We have no 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.
