The accompanying notes are an integral part of
these financial statements.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 – NATURE OF BUSINESS AND SUMMARY
OF ACCOUNTING POLICIES
Nature of Business
Public Company Management Corporation
("Company”), a Nevada corporation, was formed on October 26, 2000. On October 1, 2004, MyOffiz, Inc. ("MyOffiz")
entered into an Exchange Agreement with the certain controlling shareholders of GoPublicToday.com,
Inc., Pubco WhitePapers, Inc., and Public Company Management Services, Inc. The Company was the holding company for, and conducted its
operations through, its subsidiary companies. The term "we" and "our" refers to the Company and its subsidiaries unless
otherwise stated.
Pursuant to the Exchange Agreement,
MyOffiz acquired approximately 92.1% of the outstanding shares of GoPublicToday.com, Inc., all
of the outstanding shares of Pubco WhitePapers, Inc., and all of the outstanding shares of Public Company Management Services, Inc in
exchange for the new issuance of an aggregate of 15,326,650 of MyOffiz's common stock. Subsequent to the Exchange Agreement, MyOffiz obtained
100% of the partially owned subsidiaries, changed its fiscal year end from June 30 to September 30, and changed its name to Public Company
Management Corporation.
The Company was a management consulting
firm that educated and assisted small businesses to improve their management, corporate governance, regulatory compliance, and other business
processes, with a focus on capital market participation. The Company offered the following services to its clients at various stages of
the business lifecycle:
| · | Educational products to
improve business processes or explore entering the capital markets; |
| · | Startup consulting to
early-stage companies planning for growth; |
| · | Management consulting
to companies seeking to enter the capital markets via self-underwriting or direct public offering or to move from one capital market to
another; and |
| · | Compliance services to
fully reporting, publicly traded companies. |
The Company generated revenues primarily
from consulting services that it provided to private company clients seeking to become fully reporting, publicly traded companies. The
Company also generated revenue from regulatory compliance services that the Company was providing to public company clients that are required
to file periodic and other reports with the Securities and Exchange Commission (“SEC”). The Company would be paid a flat fee
for these services, which generally consisted of cash and restricted shares of the Company’s clients’ common stock.
Predicated upon the economic recession
of 2008, commencing with the subprime mortgage crisis and bank crisis, a significant increase in housing foreclosures ultimately caused
the stock market to crash in September 2008. At that time, and prior, the Company faced competition from a large number of consulting
firms, investment banks, venture capitalists, merchant banks, financial advisors, and other similar management consulting and regulatory
compliance services firms. Due to (i) the inability to raise funds in the marketplace and (ii) the intense competition in every aspect
of the Company’s business, the Company was unable to operate profitably.
Basis of Preparation
The accompanying financial statements include
the financial information of PCMC Holdings Inc. (“PCMC”, the “Company”) have been prepared in accordance with
the instructions to financial reporting as prescribed by the Securities and Exchange Commission (the “SEC”). The preparation
of these financial statements and accompanying notes in conformity with U.S. generally accepted accounting principles (“GAAP”).
In the opinion of management, the financial statements contained in this report include all known accruals and adjustments necessary for
a fair presentation of the financial position, results of operations, and cash flows for the periods reported herein.
Adoption of New Accounting Standard
PCMC adopted Accounting Standard Update 2014-09,
Revenue from Contracts with Customers, at the start of the first quarter of 2019 using the modified retrospective approach and recorded
a cumulative effect adjustment to retained earnings based on the current terms and conditions for open contracts as of January 1, 2019.
The adoption of the standard did not have a material impact on the Company’s Financial Statements. The comparative information has
not been restated and continues to be reported under the accounting standards in effect for those periods.
Accounting Standards Not Yet Adopted
In June 2016, the FASB issued ASU 2016-3, Financial
Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instructions (ASU 2016-13), which requires
measurement and recognition of expected credit losses for financial assets held. ASU 2016-3 is effective for us in our first quarter of
fiscal 2023, and earlier adoption is permitted. We are currently evaluating the impact of our pending adoption of ASU 2016-13 on our financial
statements.
Use of Estimates
The preparation of financial statements in conformity
with GAAP requires the use of estimates and assumptions by management in determining the reported amounts of assets and liabilities, disclosures
of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates. Estimates are primarily used in our revenue recognition, long-lived asset impairments
and adjustments, deferred tax, stock-based compensation, and reserves for legal matters.
Cash and Cash Equivalents
PCMC considers all highly liquid investments purchased
with an original maturity of three months or less to be cash and cash equivalents.
Stock-Based Compensation
The Company accounts for stock-based compensation
to employees in accordance with ASC 718 requiring employee equity awards to be accounted for under the fair value method. Accordingly,
share-based compensation is measured at grant date, based on the fair value of the award and is recognized as expense over the requisite
employee service period. The Company accounts for stock-based compensation to other than employees in accordance with ASU 2019-07 Equity
instruments issued to other than employees are valued at the earlier of a commitment date or upon completion of the services, based on
the fair value of the equity instruments and is recognized as expense over the service period. The Company estimates the fair value of
share-based payments using the Black-Scholes option-pricing model for common stock options and the closing price of the company’s
common stock for common share issuances.
Revenue Recognition
The core principles of revenue
recognition under ASC 606 include the following five criteria:
|
1. |
Identify the contract with the customer |
|
|
Contract with our customers may be oral, written, or implied. A written and signed invoice stating the terms and conditions is the Company’ preferred method. The terms of a written contract may be contained within the body of an invoice or in an email. No work is commenced without an understanding between the Company and our client that a valid contract exists. |
|
2. |
Identify the performance obligations in the contract |
|
|
Our sales and account management teams define the scope of services to be offered, to ensure all parties are in agreement and obligations are being delivered to the customer as promised. The performance obligation may not be fully identified in a mutually signed contract, but may be outlined in email correspondence, face-to-face meetings, additional proposals or scopes of work, or phone conversations. |
|
3. |
Determine the transaction price |
|
|
Pricing is discussed and identified by the operations team prior to submitting an invoice to the customer. |
|
4. |
Allocate the transaction price to the performance obligations in the contract |
|
|
If a contract involves multiple obligations, the transaction pricing is allocated accordingly, during the performance obligation phase. |
|
5. |
Recognize revenue when (or as) we satisfy a performance obligation |
|
|
The Company uses digital marketing that includes
digital advertising, SEO management and digital ad support. We provide whether presenting a vibrant but simple message about our clients
that will enlighten their audience or deploying an influential digital marketing campaign on our online site or across one or multiple
social media platforms. Revenue is recognized when ads are run on Company’s advertising platform.
The company generates analytical reports monthly
or as required to show how the ad dollars were spent and how the targeting resulted in click-through. The report satisfies the performance
obligation, regardless of the outcome or effectiveness of the campaign. |
Sales are recognized when promised services are
started in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Sales for service
contracts generally are recognized as the services are being provided.
Accounts Receivable and Allowance for Doubtful
Accounts
The Company establishes an allowance for bad debts
through a review of several factors including historical collection experience, current aging status of the customer accounts, and financial
condition of our customers. The Company does not generally require collateral for our accounts receivable. There were no accounts receivable
and allowance for doubtful accounts as of September 30, 2022 and 2021.
General and Administrative Expenses
PCMC’s general and administrative expenses
consisted of the following types of expenses during 2022 and 2021: Compensation expense, payroll expense, rent, travel and entertainment,
legal and accounting, utilities, web sites, office expenses, depreciation and other administrative related expenses.
Property and Equipment
Property and equipment are carried at the cost
of acquisition or construction and depreciated over the estimated useful lives of the assets. Costs associated with repair and maintenance
are expensed as incurred. Costs associated with improvements which extend the life, increase the capacity or improve the efficiency of
our property and equipment are capitalized and depreciated over the remaining life of the related asset. Gains and losses on dispositions
of equipment are reflected in operations. Depreciation is calculated using the straight-line method over the estimated useful lives of
the assets.
Impairment of Long-Lived Assets
The Company reviews the carrying value of its
long-lived assets annually or whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset
may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected
to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an
impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value
of the long-lived asset. Fair value is determined based on either expected future cash flows at a rate we believe incorporates the time
value of money. No indications of impairments were identified in 2022 or 2021.
Basic and Diluted Net (Loss) per Share
Schedule of basic and diluted net (loss) per share | |
| | | |
| | |
| |
Sept 30, Sept 30, | |
| |
2022 | | |
2021 | |
Numerator: | |
| | |
| |
Net (Loss) attributable to common shareholders of PCMC | |
$ | (7,664 | ) | |
$ | (3,025 | ) |
Net (Loss) attributable to PCMC | |
$ | (7,664 | ) | |
$ | (3,025 | ) |
| |
| | | |
| | |
Denominator: | |
| | | |
| | |
Weighted average common and common equivalent shares outstanding – basic and diluted | |
| 34,276,816 | | |
| 34,276,816 | |
| |
| | | |
| | |
Earnings (Loss) per Share attributable to PCMC | |
| | | |
| | |
Basic | |
$ | (0.00 | ) | |
$ | (0.00 | ) |
Diluted | |
$ | (0.00 | ) | |
$ | (0.00 | ) |
When an entity has a net loss, it is prohibited
from including potential common shares in the computation of diluted per share amounts. Accordingly, we have utilized basic shares outstanding
to calculate both basic and diluted loss per share for the three months ended December 31, 2022 and 2021. The number of potential anti-dilutive
shares excluded from the calculation shares for the period ended December 31, 2022 is zero 0.
Income Taxes
Uncertain tax position
The Company also follows the guidance related
to accounting for income tax uncertainties. In accounting for uncertainty in income taxes, the Company recognizes the financial statement
benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following
an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest
benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. No liability
for unrecognized tax benefits was recorded as of December 31, 2022 and September 30, 2021.
Fair Value of Financial Instruments
The ASC guidance for fair value measurements and
disclosure establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy
gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and
the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below:
Level 1 Inputs – Quoted
prices for identical instruments in active markets.
Level 2 Inputs – Quoted
prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and
model-derived valuations whose inputs are observable or whose significant value drivers are observable.
Level 3 Inputs – Instruments
with primarily unobservable value drivers. The Company has no Level 3 Inputs.
The Company’s financial instruments consist
of cash and cash equivalents, accounts payable and debt. The carrying amount of these financial instruments approximates fair value due
either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial
statements.
Related Party Transactions
The Company follows ASC 850, Related
Party Disclosures, for the identification of related parties and disclosure of related party transactions. Related party note and
interest balances as of December 31, 2022 and September 30, 2022 were $415,654 and $413,029, respectively and related party accrued liabilities
as of December 31, 2022 and September 30, 2022 of $32,164 and $32,164, respectively (see Note 4. Related Party Transactions).
Research and Development
The Company spent no money for research and development
cost for the three months ended December 31, 2022 and 2021.
Advertising Cost
The Company spent no money for advertisement for
the three months ended December 31, 2022 and 2021.
Depreciation
The Company had no depreciation expense for the
three months ended December 31, 2022 and 2021, respectively.
NOTE 2 – GOING CONCERN
As shown in the accompanying financial statements,
PCMC has an accumulated deficit of $5,522,699 since its inception and had a working capital deficit of $468,683 and negative cash flows
from operations and limited business operations as of December 31, 2022. These conditions raise substantial doubt as to PCMC’s ability
to continue as a going concern. The financial statements do not include any adjustments that might be necessary if PCMC is unable to continue
as a going concern.
PCMC continues to review its expense structure
reviewing costs and their reduction to move towards profitability. Management plans to continue raising funds through debt and equity
financing to fund expenditures or other cash requirements. There can be no assurance that additional financing will be available to the
Company on acceptable terms or at all. These financial statements do not give effect to adjustments to assets would be necessary for the
Company be unable to continue as going concern
NOTE 3 – NOTES PAYABLE
Schedule of notes payable | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
Original | | |
Due | | |
Interest | | |
June 30, | | |
Sept 30, | |
Name | |
Note Date | | |
Date | | |
Rate | | |
2022 | | |
2021 | |
| |
| | |
| | |
| | |
| | |
| |
Related Party: | |
| | | |
| | | |
| | | |
| | | |
| | |
Specialty Capital Lenders LLC – Related Party | |
| 9/30/2016 | | |
| 10/01/2021 | | |
| 3 | % | |
| 350,000 | | |
| 350,000 | |
During the three months ending December 31, 2022
and 2021, the Company had $2,625 and $2,625 in interest expense, respectively.
On September 30, 2016, the Company
issued a Promissory Note to Stephen Brock, the Company’s Chief Executive Officer and Director, in the principal amount of three
hundred fifty thousand dollars USD ($350,000.00) (see Note 6. Related Party Promissory Note). The unpaid principal accrues interest at
the rate of three percent (3.00%) per annum, and the note matures on October 31, 2023 (the “Maturity Date”). On the Maturity
Date, the Company must pay Brock the outstanding principal balance together with all accrued and unpaid interest.
On August 3, 2020, the promissory note
was assigned by Brock to Specialty Capital Lenders LLC.
As of September 30, 2020, the Company
had entered into an Obligation Extension Agreement (“Extension Agreement”) with Specialty Capital Lenders LLC. Pursuant to
the terms of the Extension Agreement, the original principal will continue to accrue interest at the rate of three (3%) percent per annum
beginning on October 1, 2020. The Extension Agreement shall terminate as of October 1, 2022, at which time all unpaid principal and accrued
interest will be due and payable to Specialty Capital Lenders LLC.
The Company may, at its sole discretion,
at any time prepay all or any part of the principal amount of the Promissory Note, without premium, but with all accrued interest to the
date of prepayment. Partial prepayments will be applied to accrued interest and then to principal.
As of December 31, 2022 and September 30, 2022,
the Company owed $350,000 in principal, and owed $66,654 and $63,029 in accrued interest, respectively.
NOTE 4 – COMMITMENTS AND CONTINGENCIES
The Company is obligated for payments under related
party accrued expenses and notes payable.
NOTE 5 – RELATED PARTY TRANSACTIONS
On August 3, 2020 Specialty Capital Lenders LLC
was assigned a $350,000 promissory note by the former note holder and CEO of the Company. As of September 30, 2021, the balance of the
promissory note outstanding was $350,000. The balance of accrued interest payable on the note was $66,654 and $63,029 as of December 31,
2022 and September 30, 2022, respectively.
As of December 31, 2022 and September 30, 2022,
the Company owed $35,136 and $32,164 respectively to related parties for funds advanced to the Company for general and administrative
expenses.
NOTE 6 – STOCKHOLDERS’ EQUITY
Preferred Stock
The Company has 5,000,000 shares of preferred
stock authorized, $0.001 par value. As of December 31, 2022 and September 30, 2022, the Company has no preferred stock outstanding.
Common Stock
The Company has 50,000,000 shares of common stock
authorized, $0.001 par value. As of December 31, 2022 and September 30, 2022, the Company had 34,276,816 shares of common stock outstanding.
The Company issued no shares of common stock in
the twelve months ended December 31, 2022 and September 30, 2022.
NOTE 7 – INCOME TAXES
The Company follows ASC 740, Accounting for Income Taxes. During 2009,
there was a change in control of the Company. Under section 382 of the Internal Revenue Code such a change in control negates much of
the tax loss carry forward and deferred income tax. Deferred income taxes reflect the net tax effects of (a) temporary differences between
the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes,
and (b) net operating loss carry forwards. For federal income tax purposes, the Company uses the accrual basis of accounting, the same
that is used for financial reporting purposes.
As of December 31, 2022 and September 30, 2022, the Company's accumulated
deficit was $5,522,699 and $5,515,035 respectively. Only $66,147 of this deficit will offset income in the future since all prior net
operating loss deductions are disallowed upon a change of control or if the Company does not continue in the same line of business for
two years following the year of change.
Federal income tax returns have not been examined and reported upon
by the Internal Revenue Service; returns of the years since September 30, 2019 are still open.
NOTE 8 – SUBSEQUENT EVENTS
The Company has evaluated subsequent events as
of the date of the financial statements were available to be issued and has determined that there are no disclosable subsequent events.