NOTES
TO FINANCIAL STATEMENTS
OCTOBER 31, 2002
NOTE
1 - SIGNIFICANT ACCOUNTING POLICIES
Organization
and Operations
The
Company was incorporated under the laws of the State of Nevada on
February 3, 1999 with authorized common stock of
200,000,000 shares at $0.001 par value.
The
Company was organized formerly for the purpose of establishing a
multimedia internet bases communication
network between the healthcare industry manufacturers and the key
base managers in the medical field to advertise and
promote the manufacturers products.
As
of March 26, 2002, the Company as a result of it abandonment of its
patent rights and termination of its previous
consulting agreements, will not pursue its previous business plan
involving multimedia internet bases. The
company intends to engage in internet related business ventures.
On
March 26, 2002, pursuant to the "Stock Exchange and Merger
Agreement" the Company
consummated a "reverse acquisition" and changed its name
to Gold Entertainment Group, Inc.
Basis
of Accounting
The
Company's policy is to prepare its financial statements using the
accrual basis of accounting in accordance with
generally accepted accounting principles. The Company has elected
January 31 at the annual year-end.
Interim
Financial Information
The
condensed unaudited interim financial statements included herein have
been prepared without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. The
condensed
financial statements and notes are presented as permitted on Form
10-SB and do not contain information included in the Company's annual
statements and notes. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
accounting principles generally accepted in the United States of
America have been condensed or omitted pursuant to such rules and
regulation, although the Company believes that the disclosures are
adequate to make the information presented not misleading. It is
suggested that these condensed financial statements be read in
conjunction with the January 31, 2002 audited financial statements
and the accompanying notes thereto. While management believes the
procedures followed in preparing these condensed financial
statements are reasonable, the accuracy of the amounts are in some
respect dependent upon the facts that will exist, and procedures that
will be accomplished by the Company later in the year.
These
condensed unaudited financial statements reflect all adjustments,
including normal recurring adjustments which, in the opinion of
management, are necessary to present fairly the consolidated
operations and cash flows for the periods presented. The results of
operations for the periods ending October 31, 2002 and 2001 may not
be indicative of a full years results.
F5
GOLD
ENTERTAINMENT GROUP INC.
(FORMERLY
ADVANCED MEDICAL TECHNOLOGIES, INC.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO FINANCIAL STATEMENTS
OCTOBER
31, 2002
NOTE
1 - SIGNIFICANT ACCOUNTING POLICIES (Continued)
Use
of Estimates
The
preparation of financial statements in conformity with generally
accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those estimates.
Cash
and Equivalent
Cash
and cash equivalents include cash and cash in banks. The Company
maintains cash and cash equivalent balances at a
financial institution that is insured by the Federal Deposit
Insurance Corporation up to $100,000.
Organization
Costs
The
Company has incurred various expenditures in the formation of its
corporate and organizational
structure. In accordance with SOP98-5 these costs will be expenses as
incurred.
Revenue
Recognition
The
Company will recognize revenue upon completion of its services to be
rendered or delivery of products to its
customers. The Company has not generated revenues since
inception
Development
Stage
The
Company is in its development stage. The Company since inception has
not commenced its operations, nor has generated
sufficient working capital to pursue its business objectives.
The accumulated deficit during its development stage is
$658,210.
Net
Earnings (Losses) Per Share
The
Company reports its net earnings (losses) per share in accordance
with SFAS No. 128 "Earnings Per Share".
Basic net earnings (losses) per share is computed by dividing net
income (loss) available to common
stockholders by the weighted averaged number of
common shares outstanding. Diluted earnings (losses) per
share is computed similar to basic earnings (losses)
per share except that the denominator is increased to include the
number of additional common shares that would have
been outstanding. As of July 31,2002, there are no
outstanding stock options or stock warrants that would have affected
our computation.
GOLD
ENTERTAINMENT GROUP, INC.
(FORMERLY
ADVANCED MEDICAL TECHNOLOGIES, INC.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO FINANCIAL STATEMENTS
OCTOBER
31, 2002
NOTE
2 - INCOME TAX
In
February 1992, the Financial Standards Board issued Statement of
Financial Accounting Standards No. 109,
"Accounting for Income Taxes." Under SFAS No. 109, deferred
assets and liabilities are recognized for the
estimated future tax consequences between the financial
statement carrying amounts of the existing assets and their
respective basis.
Deferred
assets and liabilities are measured using enacted tax rates in effect
for the year in which temporary differences are
expected to be recovered or settled. Under SFAS No. 109,
the effect on deferred assets and liabilities of a change in
tax rates is recognized in the period that includes
the enactment date.
Nine
Months Ending October 31, 2002
Statutory
federal income tax rate and effective tax rate 34%
The
amount recorded as a deferred tax asset as of October 31, 2002,
approximately $658,000. The Company has established a 100% valuation allowance against this
deferred tax asset, as the Company has no history of
profitable operations.
The
Company has a net operating loss carry forward as of October 31, 2002
of approximately $658,210 which is offset by a 100% valuation allowance due to the
uncertainty surrounding the ultimate realization of these assets. The loss carry-forward expires progressively in 15 years from commencement in 1999
NOTE
3 - RELATED PARTY TRANSACTIONS
The Company has informally assumed the obligation for monthly lease payments of $ 689 for its office faculty entered into originally by a related party. The majority stockholder and officer of the Company advanced as of October 31, 2002 $ 79,200 for working capital. This loan is unsecured, non -interest bearing and has no maturity date.
Effective
September 30, 2002, a related party contributed to capital $
194,832. This represents the balance of accrued consulting fees outstanding. Additionally, this related party received the rights to certain company owned patents and intellectual property.
GOLD
ENTERTAINMENT GROUP, INC.
(FORMERLY
ADVANCED MEDICAL TECHNOLOGIES, INC.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
OCTOBER
31, 2002
NOTE
4 - MERGERS AND ACQUISITIONS
Merger Agreement
On
March 26, 2002, the Company entered into a merger agreement with
Gold Entertainment
Group,
Inc. (a Nevada Corporation). As part of the agreement, the Company
will divest itself of all its assets, a new Board of
Directors will be nominated and "Gold" shareholders shall
exchange their shares for the shares of
Advanced Medical Technology, Inc.
Additionally,
"Gold" will cease to exist and "Advanced" will be
the survivor corporation and will change its name
to Gold Entertainment Group, Inc.
The
stock for stock exchange will be a tax free transaction pursuant to
Internal Revenue Code Section 368(a)(1)(4). The
merger agreement was ratified by the Board of Directors on April 4, 2002.
NOTE
5 CAPITAL TRANSACTIONS
On
March 25, 2002, the Board of Directors adopted a resolution for a 1
for 25 reverse split of the Company's common shares.
On
March 26, 2002, the Company issued 9,210,000 shares of common stock
pursuant to a Merger agreement
On March 2002, the Company sold 118,648 shares of common stock for $131,659
On
September 2, 2002 the Company President and majority shareholder of
the company, donated 6 million shares back to
the company (which were canceled).
On
September 26, 2002, the Company initiated a 2.5:1 forward stock
split
The
stock splits did not change the par value of the Company's common
stock. All common stock financial data has been
appropriately restated
GOLD
ENTERTAINMENT GROUP, INC.
(FORMERLY
ADVANCED MEDICAL TECHNOLOGIES, INC.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO FINANCIAL STATEMENTS
OCTOBER
31, 2002
NOTE
6 - GOING CONCERN
As
shown in the accompanying financial statements, the Company incurred
substantial net losses for the period February 3, 1999 to October 31,
2002. There is no guarantee whether the Company will be able to
generate enough revenue and/or raise capital to support those
operations. This raises substantial doubt about the Company's ability
to continue as a going concern.
Management
also states that they are confident that they can improve operations
and raise the appropriate funds to grow their underlying business and
acquire other businesses.
The
financial statements do not include any adjustments that might result
from the outcome of these uncertainties.
NOTE
7 - NEW ACCOUNTING PRONOUNCEMENTS
In
December 2002, the FASB issued Statement of Financial Accounting
Standards No. 148, "Accounting for Stock-Based Compensation" Transition and Disclosure an Amendment of FASB
Statement No. 123 (SFAS 148). SFAS 148 amends SFAS 123
"Accounting for Stock-Based Compensation," providing for an alternative method of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation.
Additionally, it amends the disclosure requirements of SFAS 123 to require prominent disclosures in both
annual and interim financial statements about the method of accounting for stock-based employee compensation and
the effect of the method used on reported results. SFAS 148 is effective for fiscal years beginning after
December 15, 2002. The interim disclosure provisions are effective for financial reports containing
financial statements for interim periods beginning after December 15, 2002. The Company's
adoption of the interim disclosure provisions of
SFAS 148 did not affect its financial position.
In
May 2003, the FASB issued Statement of Financial Accounting Standards
No. 150, "Accounting for Certain Financial Instruments with Characteristics of both
Liabilities and Equity" (SFAS 150). SFAS sets standards for an issuer as to how to
classify and measure financial instruments with characteristics of both liabilities and equity. SFAS 150 is
effective for financial instruments entered into after May 31, 2003, and is effective after June 15, 2003. Adoption of SFAS 150 is not expected to have a material
effect on the Company.
ITEM 2. MANAGEMENT'S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Forward Looking
Statements
This
Quarterly Report on form 10-QSB contains forward-looking statements.
Such forward-looking statements are generally accompanied by words
such as "intends," "projects," "strategies," "believes,"
"anticipates," "plans," and similar terms that convey the
uncertainty of future events or outcomes. The forward-looking
statements contained herein are subject to certain risks and
uncertainties that could cause actual results to differ materially
from those reflected in the forward-looking statements.
OVERVIEW
We were incorporated under
the laws of the State of Nevada on February 3, 1999. We were
organized primarily for the purpose of establishing a website
information system specializing in the medical industry.
This
concept was terminated by management during the latter part of the
year 2000 and all rights to the Company's previous website was transferred to the Company's former President, Irving Abrams.
In
January 2001, we acquired from James J. Reidy an exclusive license to
patents relating to technology that produces pure drinking water
directly from the air. At this time, we entered into a consulting agreement
with Mr. Reidy who will assist the Company in arranging for the
manufacture and sale of WaterStar machines that are based on the
acquired technology. In March 2002, we decided to abandon this
business.
On
April 5, 2002, we entered into a Stock Exchange and Merger Agreement
with Gold Entertainment Group, Inc. (the "Company"). In
connection with this merger, our previous management team resigned
and a new management team, consisting of Hamon Francis Fytton and
Marc Boyer joined our company. New management intends to engage in
the business of providing pre-paid Internet access cards to be
marketed through retail locations. We further intends to establish a
network of distributors to market a variety of the Company's pre-paid
Internet access cards through their existing channels. To accomplish
this, the Company intends to build on existing relationships with
potential distributors and to focus on strategic partnerships for
distribution, marketing and billing systems. The Company took initial
steps to develop this business during the nine months ended October
31, 2003.
RESULTS OF OPERATIONS
We are a development stage
company and have not had any revenues from the date of inception
through October 31, 2002. Our business focus changed on March 26,
2002 when new management acquired control of our company. We are now
focused on developing the business of providing pre-paid Internet
access cards to be marketed through retail locations.
Our
operating expenses were $105,547 during the nine months ended October
31, 2002 and $369,323 during the nine months ended October 31, 2001.
Our operating expenses in the nine months ended October 31, 2002 were
related to accounting, audit and legal expenses. Our operating expenses in the nine months
ended October 31, 2001 were expenses related to debt reduction.
Our net loss for the nine
months ended October 31, 2002 was $105,547 compared to a net loss of
$369.323 during the nine months ended October 31, 2001. Our net loss
from inception, February 3, 1999 through October 31, 2002 is
$658,210.
As of October 31, 2002, we had $96 cash on hand. Our total liabilities are $201,630,
consisting of $122,430 in accounts payable and $79,200 due to our
Chief Executive Officer for a loan that he advanced to our company in
March 2002.
We have satisfied our
capital requirements during this time period by related party contributions and
expect to use director loans to finance our operations.
In connection with the
Merger, we implemented a 1 for 25 reverse stock split of our common
stock on February 25, 2002 and issued 9, 210,000 shares of our common
stock to the shareholders of Gold Entertainment one day later. On
September 2, 2002, Francis Fytton, our President and majority
shareholder donated 6 million shares of our common stock to our
company, which were subsequently cancelled. Effective as of September
26, 2002, we implemented a 2.5 for 1 forward stock split. As of
October 31, 2002, we have 10,426,362 shares of our common stock
issued and outstanding.
ITEM 3. CONTROLS AND
PROCEDURES
Evaluation of
Disclosure Controls and Procedures
We did not prepare
financial statements for the nine months ended October 31, 2002 until
November 2004 so we were not able to carry out an evaluation of the
effectiveness of our disclosure controls and procedures as of October
31, 2002. However, Hamon Francis Fytton, our Chief Executive Officer and
Chief Financial Officer, did conduct an evaluation as of December 14,
2004. Based upon that evaluation, our Chief Executive Officer and
Chief Financial Officer was able to conclude that our disclosure
controls and procedures were effective in accumulating and
communicating to our management, material information required to be
included in the reports we file or submit under the Securities
Exchange Act of 1934 as appropriate to allow timely decisions
regarding required disclosures.
Changes in Internal
Control over Financial Reporting
Based on an evaluation,
under the supervision and with the participation of our management,
there has been no change in our internal control over financial
reporting during our last fiscal quarter, identified in connection
with the evaluation, 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
involved in any other litigation, other than those actions arising
from the normal course of business, and for which management does not
believe will have a material effect on the Company's operations,
except for the matters described below:
ITEM 2. UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
1
ITEM 3. DEFAULTS UPON
SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF
MATTER TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.