U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
Mark One
[X][ X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGEEXCHANEG ACT OF 1934
For the period ended June 30,
20082009
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from
___________________ to___________________
Commission File No. 333-144509
Bosco Holdings, Inc. (Name of small business issuer in its charter) Nevada 98-0534794 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 26 Utkina Street, Suite 10 Irkutsk, Russia 664007 (Address of principal executive offices) 7-3952-681-878 (Issuer's telephone number) Securities registered pursuant to Name of each exchange on Section 12(b) of the Act: which registered: ------------------------- ----------------- None Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.001 (Title of Class)
Bosco Holdings, Inc.
(Name of small business issuer in its charter)Nevada
(State or other jurisdiction of incorporation
or organization)98-0534794
(I.R.S. Employer Identification No.)26 Utkina Street, Suite 10
Irkutsk, Russia 664007
(Address of principal executive offices)7-3952-681-878
(Issuer’s telephone number)Securities registered pursuant to Section
12(b) of the Act:Name of each exchange on which
registered:None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $0.001
(Title of Class)
Indicate by checkmark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [No[ ]
1 |Page
Indicate by check mark whether the registrant is a large accelerated filed, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer [ ]
Accelerated filer [ ]
Non-accelerated filer [ ]
Smaller reporting company [X]
Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
Applicable Only to Issuer Involved in Bankruptcy Proceedings During the Preceding Five Years.
N/A
Indicate by checkmark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act of 1934 after the distribution of securities under a plan confirmed by a court. Yes[ ] No[ ]
Applicable Only to Corporate Registrants
Indicate the number of shares outstanding of each of the
issuer'sissuer’s classes of common stock, as of the most practicable date:Class Outstanding as of August 11, 2008 ----- --------------------------------- Common Stock, $0.001 26,200,000
Class
Outstanding as of August 10, 2009
Common Stock, $0.001
26,200,000
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BOSCO HOLDINGS, INC.
Form 10-Q
Part 1 FINANCIAL INFORMATION Item 1.
Part 1
FINANCIAL INFORMATION
Item 1
3
3
4
5
6
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
13
Item 3.
17
Item 4.
17
Part II.
OTHER INFORMATION
Item 1
19
Item 2.
19
Item 3
19
Item 4
19
Item 5
19
Item 6
20
20
3
Balance Sheets Statements of Operations Statements of Cash Flows Notes to Financial Statements Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Item 3. Quantitative and Qualitative Disclosures About Market Risk 16 Item 4. Controls and Procedures 16 Part II. OTHER INFORMATION Item 1 Legal Proceedings 17 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 17 Item 3. Defaults Upon Senior Securities 18 Item 4. Submission of Matters to a Vote of Security Holders 18 Item 5. Other Information 18 Item 6. Exhibits 19 2|Page
PART
I. FINANCIAL INFORMATIONI
ITEM 1. FINANCIAL STATEMENTS
BOSCO HOLDINGS, INC
(A Development Stage Company)
Balance Sheets
Assets
June 30
March 31
2009
2009
(Unaudited)
(Audited)
Current Assets
Cash
$
8,004
$
12,527
Total Assets
$
8,004
$
12,527
Liabilities and Stockholders’ Equity (deficit)
Current Liabilities
Accounts payables and accrues liabilities
$
5,547
$
5,360
Loans from related party
$
39,000
$
39,000
Total Current Liabilities
$
44,547
$
44,360
Stockholders’ Equity (deficit)
Common stock, $0.001par value, 75,000,000 shares authorized;
26,200,000 shares issued and outstanding
26,200
26,200
Additional paid-in-capital
(800)
(800)
Deficit accumulated during the development stage
(61,943)
(57,233)
Total stockholders’ equity (deficit)
(36,543)
(31,833)
Total liabilities and stockholders’ equity (deficit)
$
8,004
$
12,527
The accompanying notes are an integral part of these financial statements.
4 |Page
BOSCO HOLDINGS, INC
(A Development Stage Company)
Statements of Operations
(Unaudited)
Three Months Ended
June 30, 2009
Three Months Ended
June 30, 2008
From Inception on
December 13,
2006 to
June 30, 2009
Expenses
General and Administrative Expenses
$
4,710
$
1,653
$
61,943
Total Expenses
$
4,710
$
1,653
$
61,943
Net (loss) before Income Taxes
$
(4,710)
$
(1,653)
$
(61,943)
Income Tax Expenses
$
-
$
-
$
-
Net (loss)
$
(4,710)
$
(1,653)
$
(61,943)
(Loss) per common share – Basic and diluted
$
(0.00)
$
(0.00)
$
Weighted Average Number of Common Shares Outstanding
26,200,000
26,200,000
The accompanying notes are an integral part of these financial statements.
5 |Page
BOSCO HOLDINGS, INC
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
Three Months Ended
June 30, 2009
Three Months Ended
June 30, 2008
From Inception on
December 13,
2006 to
June 30, 2009
Operating Activities
Net (loss)
$
(4,710)
$
(1,653)
$
(61,943)
Accounts payables and accrues liabilities
187
-
5,547
Net cash (used) for operating activities
(4,523)
(1,653)
(56,396)
Financing Activities
Loans from related party
-
-
39,000
Sale of common stock
-
-
25,400
Net cash provided by financing activities
-
-
64,400
Net increase (decrease) in cash and equivalents
(4,523)
(1,653)
8,004
Cash and equivalents at beginning of the period
12,527
9,643
-
Cash and equivalents at end of the period
$
8,004
$
7,990
$
8,004
Supplemental cash flow information:
Cash paid for:
Interest
$
-
$
-
$
-
Taxes
$
-
$
-
$
-
Non-Cash Activities
$
-
$
-
$
-
The accompanying notes are an integral part of these financial statements.
6 |Page
BOSCO HOLDINGS, INC
(A(A Development Stage Company)
Balance Sheets - --------------------------------------------------------------------------------
June 30, March 31, 2008 2008 -------- -------- (Unaudited) (Audited)ASSETS CURRENT ASSETS Cash $ 7,990 $ 9,643 -------- -------- TOTAL ASSETS $ 7,990 $ 9,643 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT LIABILITIES Accounts payables and accrues liabilities $ 3,000 $ 3,000 Loans from related party 10,000 10,000 -------- -------- TOTAL CURRENT LIABILITIES $ 13,000 $ 13,000 ======== ======== STOCKHOLDERS' EQUITY (DEFICIT) Common stock, $0.001par value, 75,000,000 shares authorized; 26,200,000 shares issued and outstanding 26,200 26,200 Additional paid-in-capital (800) (800) Deficit accumulated during the development stage (30,410) (28,757) -------- -------- TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (5,010) (3,357) -------- -------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 7,990 $ 9,643 ======== ========The accompanying notes are an integral part of these financial statements. 3BOSCO HOLDINGS, INC (A Development Stage Company) Statements of Operations (Unaudited) - --------------------------------------------------------------------------------
Three Months Three Months From Inception on Ended Ended December 13, 2006 to June 30, June 30, June 30, 2008 2007 2008 ----------- ----------- -----------EXPENSES General and Administrative Expenses $ 1,653 $ 8,365 $ 30,410 ----------- ----------- ----------- Total Expenses 1,653 8,365 30,410 ----------- ----------- ----------- Net (loss) before Income Taxes (1,653) (8,365) (30,410) Income Tax Expenses -- -- -- ----------- ----------- ----------- Net (loss) $ (1,653) $ (8,365) $ (30,410) =========== =========== =========== (LOSS) PER COMMON SHARE - BASIC AND DILUTED $ (0.00) $ (0.00) =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 26,200,000 26,200,000 =========== ===========The accompanying notes are an integral part of these financial statements. 4BOSCO HOLDINGS, INC (A Development Stage Company) Statements of Cash Flows (Unaudited) - --------------------------------------------------------------------------------
Three Months Three Months From Inception on Ended Ended December 13, 2006 to June 30, June 30, June 30, 2008 2007 2008 -------- -------- --------OPERATING ACTIVITIES Net (loss) $ (1,653) $ (8,365) $(30,410) Accounts payables and accrues liabilities -- -- 3,000 -------- -------- -------- Net cash (used) for operating activities (1,653) (8,365) (27,410) -------- -------- -------- FINANCING ACTIVITIES Loans from related party -- -- 10,000 Sale of common stock -- -- 25,400 -------- -------- -------- Net cash provided by financing activities -- -- 35,400 -------- -------- -------- Net increase (decrease) in cash and equivalents (1,653) (8,365) 7,990 Cash and equivalents at beginning of the period 9,643 25,502 -- -------- -------- -------- Cash and equivalents at end of the period $ 7,990 $ 17,137 $ 7,990 ======== ======== ======== SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for: Interest $ -- $ -- $ -- ======== ======== ======== Taxes $ -- $ -- $ -- ======== ======== ======== NON-CASH ACTIVITIES $ -- $ -- $ -- ======== ======== ========The accompanying notes are an integral part of these financial statements. 5BOSCO HOLDINGS, INC (A Development Stage Company)Notes To The Financial Statements
June 30,
2008 - --------------------------------------------------------------------------------2009
1. NATURE AND CONTINUANCE OF OPERATIONS
Bosco Holdings, Inc.
("(“theCompany"Company”) was incorporated under the laws of the State of Nevada, U.S. on December 13, 2006. The Company is in the development stage as defined under Statement on Financial Accounting Standards No. 7, Development Stage Enterprises("(“SFASNo.7"No.7”) and its efforts are primarily devoted marketing and distributing laminate flooring to the wholesale and retail markets throughout North America. The Company has not generated any revenue to date and consequently its operations are subject to all risks inherent in the establishment of a new business enterprise. For the period from inception, December 13, 2006 through June 30,20082009 the Company has accumulated losses of$30,410.$61,943.The 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 losses since inception resulting in an accumulated deficit of
$30,410$61,943 as at June 30,20082009 and further losses are anticipated in the development of its business raising substantial doubt about theCompany'sCompany’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand and loans from directors and or private placement of common stock.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
Basis of Presentation
The 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.
CASH AND CASH EQUIVALENTSCash and Cash equivalents
For purposes of Statement of Cash Flows the Company considers all highly liquid debt instruments purchased with a maturity date of three months or less to be cash equivalent.
USE OF ESTIMATES AND ASSUMPTIONS
Use of Estimates and Assumptions
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 assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.
FOREIGN CURRENCY TRANSLATION
Foreign Currency Translation
The financial statements are presented in United States dollars. In accordance with Statement of Financial Accounting Standards No. 52,
"Foreign“Foreign CurrencyTranslation"Translation”, foreign denominated monetary assets and liabilities are translated into their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Non monetary assets and liabilities are translated at the exchange rates prevailing on the transaction date. Revenue and expenses are translated at average rates of exchange during the year. Gains or losses resulting from foreign currency transactions are included in results of operations.FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair Value of Financial Instruments
The carrying value of cash and accounts payable and accrued liabilities approximates their fair value because of the short maturity of these instruments. Unless otherwise noted, it is
management'smanagement’s opinion the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.6
7 |Page
BOSCO HOLDINGS, INC
(A(A Development Stage Company)
Notes To The Financial Statements
June 30,
2008 - --------------------------------------------------------------------------------2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED) INCOME TAXES(continued)
Income Taxes
The Company follows the liability method of accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for the estimated tax consequences attributable to differences between the financial statement carrying values and their respective income tax basis (temporary differences). The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
At June 30,
20082009 a full-deferred tax asset valuation allowance has been provided and no deferred tax asset has been recorded.BASIC AND DILUTED LOSS PER SHARE
Basic and Diluted Loss Per Share
The Company computes loss per share in accordance with SFAS No. 128,
"Earnings“Earnings perShare"Share” which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted 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.The Company has no potential dilutive instruments and accordingly basic loss and diluted loss per share are equal.
CASH AND CASH EQUIVALENTS
Cash and Cash Equivalents
For purposes of the Statements of Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity date of three months or less to be cash equivalents.
LONG-LIVED ASSETS
Long-Lived Assets
The Company has adopted Statement of Financial Accounting Standards No. 144
("(“SFAS144"144”). The Statement requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period. The Company evaluates the recoverability of long-lived assets based upon forecasted undiscounted cash flows. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. SFAS No. 144 also requires assets to be disposed of be reported at the lower of the carrying amount or the fair value less costs to sell.RESEARCH AND DEVELOPMENT
Research and Development
The Company accounts for research and development costs in accordance with the Financial Accounting Standards
Board'sBoard’s Statement of Financial Accounting Standards No. 2("(“SFAS2"2”),"Accounting“Accounting for Research and DevelopmentCosts"Costs”. Under SFAS 2, all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and developments costs are expensed when the contracted work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. The Company incurred expenditures $0 the period from December 13, 2006 (date of inception) to June 30,2008. CONCENTRATIONS OF CREDIT RISK2009.
Concentrations of Credit Risk
Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and related party receivables. The Company places its cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit. The Company periodically reviews its trade receivables in determining its allowance for doubtful accounts. The Company does not have accounts receivable and allowance for doubtful accounts at June 30,
2008. 72009.
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BOSCO HOLDINGS, INC
(A(A Development Stage Company)
Notes To The Financial Statements
June 30,
2008 - --------------------------------------------------------------------------------2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED) REVENUE RECOGNITION(continued)
Revenue Recognition
The Company will recognize revenue in accordance with Staff Accounting Bulletin No. 104, REVENUE RECOGNITION ("SAB104"), which superseded Staff Accounting Bulletin No. 101, REVENUE RECOGNITION IN FINANCIAL STATEMENTS ("SAB101"). SAB 101 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectibility is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the selling prices of the products delivered and the collectibility 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
CompanyCompan y 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.SAB 104 incorporates Emerging Issues Task Force 00-21 ("EITF 00-21"), MULTIPLE-DELIVERABLE REVENUE ARRANGEMENTS. EITF 00-21 addresses accounting for arrangements that may involve the delivery or performance of multiple products, services and/or rights to use assets. The effect of implementing EITF 00-21 on the Company's consolidated financial position and results of operations was not significant.
From the date of inception through June 30,
2008,2009, the Company has not generated any revenue to date.ADVERTISING
Advertising
The Company follows the policy of charging the costs of advertising to expenses incurred. The Company incurred $0 in advertising costs during the period ended June 30,
2008. LIQUIDITY2009.
Liquidity
As shown in the accompanying financial statements, the Company has incurred a net loss of
$30,410$61,943 for the period ended June 30,2008.2009. As of June 30,2008,2009, the Company's has excess of current liabilities over its current assets by$5,010,$36,543, with cash and cash equivalents representing$7,990. STOCK-BASED COMPENSATION$8,004.
Stock-based Compensation
In December 2004, the FASB issued SFAS No. 123R,
"Share-Based Payment"“Share-Based Payment”, which replaced SFAS No. 123,"Accounting“Accounting for Stock-BasedCompensation"Compensation” and superseded APB Opinion No. 25,"Accounting“Accounting for Stock Issued toEmployees"Employees”. In January 2005, the Securities and Exchange Commission("SEC"(“SEC”) issued Staff Accounting Bulletin("SAB"(“SAB”) No. 107,"Share-Based Payment"“Share-Based Payment”, which provides supplemental implementation guidance for SFAS No. 123R. SFAS No. 123R requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on the grant date fair value of the award. SFAS No. 123R was to be effective for interim or annual reporting periods beginning on or after June 15, 2005, but in April 2005 the SEC issued a rule that will permit most registrants to implement SFAS No. 123R at the beginning of their next fiscal year, instead of the next reporting period as required by SFAS No. 123R. The pro-forma disclosures previously permitted under SFAS No. 123 no longer will be an alternative to financial statement recognition. Under SFAS No. 123R, the Company must determine the appropriate fair value model to be used for valuing share-based payments, the amortization method for compensation cost and the transition method to be used at date of adoption.The transition methods include prospective and retroactive adoption options. Under the retroactive options, prior periods may be restated either as of the beginning of the year of adoption or for all periods presented. The prospective method requires that compensation expense be recorded for all unvested stock options and restricted stock at the beginning of the first quarter of adoption of SFAS No. 123R, while the retroactive methods would record compensation expense for all unvested stock options and restricted stock beginning with the first period restated. The Company adopted the modified prospective approach of SFAS No. 123R for the period beginning December 13, 2006. The Company did not record any compensation expense in the year of
20082009 because there were no stock options outstanding prior to the adoption or at June 30,2008. 82009.
9 |Page
BOSCO HOLDINGS, INC
(A(A Development Stage Company)
Notes To The Financial Statements
June 30,
2008 - --------------------------------------------------------------------------------2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED) RECENT ACCOUNTING PRONOUNCEMENTS(continued)
Recent Accounting Pronouncements
In
February 2006,May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts-and interpretation of FASB Statement No. 60”. SFAS No. 163 clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement of premium revenue and claims liabilities. This statement also requires expanded disclosures about financial guarantee insurance contracts. SFAS No. 163 is effective for fiscal years beginning on or after December 15, 2008, and interim periods within those years. SFAS No. 163 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.In May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles”. SFAS No. 162 sets forth the level of authority to a given accounting pronouncement or document by category. Where there might be conflicting guidance between two categories, the more authoritative category will prevail. SFAS No. 162 will become effective 60 days after the SEC approves the PCAOB’s amendments to AU Section 411 of the AICPA Professional Standards. SFAS No. 162 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
In March 2008, the Financial Accounting Standards Board, or FASB, issued SFAS No.
155, "Accounting for Certain Hybrid Financial Instruments-an amendment of FASB Statements No. 133 and 140", to simplify and make more consistent the accounting for certain financial instruments. SFAS No. 155 amends SFAS No. 133, "Accounting for161, Disclosures about Derivative Instruments and HedgingActivities", to permit fair value re-measurement for any hybrid financial instrument with an embedded derivative that otherwise would require bifurcation, provided that the whole instrument is accounted for on a fair value basis. SFAS No. 155 amends SFAS No. 140, "Accounting for the Impairment or Disposal of Long-Lived Assets", to allow a qualifying special-purpose entity to hold a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. SFAS No. 155 applies to all financial instruments acquired or issued after the beginning of an entity's first fiscal year that begins after September 15, 2006, with earlier application allowed. This standard is not expected to have a significant effect on the Company's future reported financial position or results of operations. In March 2006, the FASB issued SFAS No. 156, "Accounting for Servicing of Financial Assets,Activities—an amendment of FASB Statement No.140, Accounting133. This standard requires companies to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted forTransfersunder Statement 133 andServicing of Financial Assetsits related interpretations, andExtinguishments of Liabilities". This statement requires all separately recognized servicing assets(c) how derivative instruments andservicing liabilities be initially measured at fair value, if practicable, and permits for subsequent measurement using either fair value measurement with changes in fair value reflected in earnings or the amortization and impairment requirements of Statement No. 140. The subsequent measurement of separately recognized servicing assets and servicing liabilities at fair value eliminates the necessity for entities that manage the risks inherent in servicing assets and servicing liabilities with derivatives to qualify for hedge accounting treatment and eliminates the characterization of declines in fair value as impairments or direct write-downs. SFAS No. 156 is effective forrelated hedged items affect anentity's first fiscal year beginning after September 15, 2006. This adoption of this statement is not expected to have a significant effect on the Company's future reportedentity’s financial position,or results of operations. On July 13, 2006, the FASB issued FASB Interpretation No. 48, "Accounting for Uncertainty in Income Taxes-an Interpretation of FASB Statement No. 109" ("FIN No. 48"). FIN No. 48 clarifies what criteria must be met prior to recognition of thefinancialstatement benefit of a position taken in a tax return. FIN No. 48 will require companies to include additional qualitativeperformance, andquantitative disclosures within their financial statements. The disclosures will include potential tax benefits from positions taken for tax return purposes that have not been recognized for financial reporting purposes and a tabular presentation of significant changes during each period. The disclosures will also include a discussion of the nature of uncertainties, factors which could cause a change, and an estimated range of reasonably possible changes in tax uncertainties. FIN No. 48 will also require a company to recognize a financial statement benefit for a position taken for tax return purposes when it will be more-likely-than-not that the position will be sustained. FIN No. 48 will be effective for fiscal years beginning after December 15, 2006. On September 15, 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" ("SFAS No. 157"). SFAS No. 157 addresses how companies should measure fair value when they are required to use a fair value measure for recognition and disclosure purposes under generally accepted accounting principles. SFAS No. 157 will require the fair value of an asset or liability to be based on a market based measure which will reflect the credit risk of the company. SFAS No. 157 will also require expanded disclosure requirements which will include the methods and assumptions used to measure fair value and the effect of fair value measures on earnings. SFAS No. 157 will be applied prospectively and will be effective for fiscal years beginning after November 15, 2007 and to interim periods within those fiscal years. 9BOSCO HOLDINGS, INC (A Development Stage Company) Notes To The Financial Statements June 30, 2008 - -------------------------------------------------------------------------------- 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) In September 2006, the Financial Accounting Standards Board issued FASB Statement No. 158, "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans" ("SFAS 158"). SFAS 158 requires the Company to record the funded status of its defined benefit pension and other postretirement plans in its financial BOSCO HOLDINGS, INC (A Development Stage Company) Notes To The Financial Statements June 30, 2008 statements. The Company is required to record an asset in its financial statements if a plan is over funded or record a liability in its financial statements if a plan is under funded with a corresponding offset to shareholders' equity. Previously unrecognized assets and liabilities are recorded as a component of shareholders' equity in accumulated other comprehensive income, net of applicable income taxes. SFAS 158 also requires the Company to measure the value of its assets and liabilities as of the end of its fiscal year ending after December 15, 2008. The Company has implemented SFAS 158 using the required prospective method. The recognition provisions of SFAS 158 are effective for the fiscal year ending after December 15, 2006. The Company does not expect its adoption of this new standard to have a material impact on its financial position, results of operations orcash flows.In December 2006, the FASB issued FSP EITF 00-19-2, Accounting for Registration Payment Arrangements ("FSP 00-19-2") which addresses accounting for registration payment arrangements. FSP 00-19-2 specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate agreement or included as a provision of a financial instrument or other agreement, should be separately recognized and measured in accordance with FASBThis StatementNo. 5, Accounting for Contingencies. FSP 00-19-2 further clarifies that a financial instrument subject to a registration payment arrangement should be accounted for in accordance with other applicable generally accepted accounting principles without regard to the contingent obligation to transfer consideration pursuant to the registration payment arrangement. For registration payment arrangements and financial instruments subject to those arrangements that were entered into prior to the issuance of EITF 00-19-2, this guidanceis effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The Company has not yet adopted the provisions of SFAS No. 161, but does not expect it to have a material impact on its consolidated financial position, results of operations or cash flows.In December
15, 20062007, the SEC issued Staff Accounting Bulletin (SAB) No. 110 regarding the use of a "simplified" method, as discussed in SAB No. 107 (SAB 107), in developing an estimate of expected term of "plain vanilla" share options in accordance with SFAS No. 123 (R), Share-Based Payment. In particular, the staff indicated in SAB 107 that it will accept a company's election to use the simplified method, regardless of whether the company has sufficient information to make more refined estimates of expected term. At the time SAB 107 was issued, the staff believed that more detailed external information about employee exercise behavior (e.g., employee exercise patterns by industry and/or other categories of companies) would, over time, become readily available to companies. Therefore, the staff stated in SAB 107 that it would not expect a company to use the simplified method for share option grants after December 31, 2007. The staff unders tands that such detailed information about employee exercise behavior may not be widely available by December 31, 2007. Accordingly, the staff will continue to accept, under certain circumstances, the use of the simplified method beyond December 31, 2007. The Company currently uses the simplified method for “plain vanilla” share options and warrants, and will assess the impact of SAB 110 for fiscal year 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements—an amendment of ARB No. 51. This statement amends ARB 51 to establish accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. Before this statement was issued, limited guidance existed for reporting noncontrolling interests. As a result, considerable diversity in practice existed. So-called minority interests were reported in the consolidated statement of financial position as liabilities or in the mezzanine section between liabilities and equity. This statement improves comparability by eliminating that diversity. This statement is effective for fiscal years, and interim periods within those
fiscal years.f iscal years, beginning on or after December 15, 2008 (that is, January 1, 2009, for entities with calendar year-ends). Earlier adoption is prohibited. The effective date of this statement is the same as that of the related Statement 141 (revised 2007). The Companyhaswill adopt this Statement beginning March 1, 2009. It is notyet determined the impactbelieved thatthe adoption of FSP 00-19-2this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
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BOSCO HOLDINGS, INC
(A Development Stage Company)
Notes To The Financial Statements
March 31, 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
In December 2007, the FASB, issued FAS No. 141 (revised 2007), Business Combinations.’This Statement replaces FASB Statement No. 141, Business Combinations, but retains the fundamental requirements in Statement 141. This Statement establishes principles and requirements for how the acquirer: (a) recognizes and measures in its financial
statements.statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; (b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (c) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. An entity may not apply it bef ore that date. The effective date of this statement is the same as that of the related FASB Statement No. 160, Noncontrolling Interests in Consolidated Financial Statements. The Company will adopt this statement beginning March 1, 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
In February 2007, the FASB, issued SFAS No. 159,
"TheThe Fair Value Option for Financial Assets andFinancial Liabilities." SFAS 159Liabilities—Including an Amendment of FASB Statement No. 115. This standard permitsentitiesan entity to choose to measure many financial instruments and certain other items at fair value.SFASThis option is available to all entities. Most of the provisions in FAS 159 are elective; however, an amendment to FAS 115 Accounting for Certain Investments in Debt and Equity Securities applies toreporting periodsall entities with available for sale or trading securities. Some requirements apply differently to entities that do not report net income. SFAS No. 159 is effective as of the beginning of an entities first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of the previous fiscal year provided that the entity makes that choice in the first 120 days of that fiscal year and also elects to apply the provisions of SFAS No. 157 Fair Value Measurements . The Company will adopt SFAS No. 159 beginning March 1, 2008 and is currently evaluating the potential impact the adoption of this pronouncement will have on its consolidated financial statements.
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements This statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. This statement applies under other accounting pronouncements that require or permit fair value measurements, the Board having previously concluded in those accounting pronouncements that fair value is the relevant measurement attribute. Accordingly, this statement does not require any new fair value measurements. However, for some entities, the application of this statement will change current practice. This statement is effective for financial statements issued for fiscal years beginning after November 15,
2007.2007, and interim periods within those fiscal years. Earlier application is encouraged, provided that the reporting entity has not yet issued financial statements for that fiscal year, including fina ncial statements for an interim period within that fiscal year. Theadoption of SFAS 159Company will adopt this statement March 1, 2008, and it is notexpected tobelieved that this will havea materialan impact on theCompany'sCompany’s consolidated financialcondition orposition, results ofoperations.operations or cash flows.
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BOSCO HOLDINGS, INC
(A Development Stage Company)
Notes To The Financial Statements
June 30, 2009
3. COMMON STOCK
The total number of common shares authorized that may be issued by the Company is 75,000,000 shares with a par value of one tenth of one cent ($0.001) per share and no other class of shares is authorized. As of June 30,
20082009 and the company has issued and outstanding 26,200,000 shares of common stock.
During the year March 31, 2007, the Company issued 26,200,000 shares of common stock for total cash proceeds of $25,400. At June 30,
20082009 there were no outstanding stock options or warrants.
On February 21, 2008, the Company's Board of Directors authorized and declared a five-for-one forward stock split of the Company's common stock. The stock split was effected in the form of a stock dividend distribution on March 27, 2008 to the stockholders on record on close of business February 21, 2008. The Stockholders received four additional shares of common stock for each share of common stock held as of the close of business on the record date. All shares and per-share data have been restated to reflect this stock
split 10BOSCO HOLDINGS, INC (A Development Stage Company) Notes To The Financial Statements June 30, 2008 - --------------------------------------------------------------------------------split.
4. INCOME TAXES
As of June 30,
2008,2009, the Company had net operating loss carry forwards of approximately$30,410$61,943 that may be available to reduce futureyears'years’ taxable income through 2028. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.
5. MARKETING AND SALES DISTRIBUTION AGREEMENT
The Company entered into a Marketing and Sales Distribution Agreement with Bossco-Laminate Co., LTD to market and distribute the laminate flooring products in North America.
11
6. RELATED PARTY TRANSACTIONS
On October 8, 2008 related party had loaned the Company $7,500 at the interest rate of 10%. The loan due upon demand and unsecured.
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FORWARD LOOKING STATEMENTS
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,
uncertaintiesuncertain ties 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.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION
GENERAL
Bosco Holdings, Inc. was incorporated under the laws of the State of Nevada in December 13, 2006. We are engaged in the business of marketing and distributing laminate flooring in both the mass wholesale and retail markets throughout North America. As of the date of this
AnnualReport, we have not commenced business operations other than the execution of a marketing and sales distribution agreement with our supplier, Bossco-Laminate Co., Ltd., a private Russian company.
Our shares of common stock trade on the Over-the-Counter Bulletin Board under the symbol
"BCHO:OB"“BCHO:OB”.
Please note that throughout this
AnnualReport, and unless otherwise noted, the words "we," "our," "us," the "Company," or "Bosco Holdings, Inc."” refers to Bosco Holdings, Inc.RECENT DEVELOPMENTS APRIL 2008 FORWARD STOCK SPLIT On February 21, 2008, our Board of Directors pursuant to minutes of written consent in lieu of a special meeting authorized and approved a forward stock split of five for one (5:1) of our total issued and outstanding shares of common stock (the "Forward Stock Split"). Each of our shareholders holding one share of common stock was entitled to receive an additional four shares of our restricted common stock. The additional shares of our common stock to be issued to the shareholders in accordance with the Forward Stock Split were mailed on approximately April 15, 2008 without any action on the part of the shareholders. The Forward Stock Split was effectuated based on market conditions and upon a determination by our Board of Directors that the Forward Stock Split was in our best interests and of the shareholders. In our judgment the Forward Stock Split resulted in an increase in our trading float of shares of common stock available for sale resulting in facilitation of investor liquidity and trading volume potential. The intent of the Forward Stock Split was to increase the marketability of our common stock. The Forward Stock Split was effectuated with a record date of February 21, 2008 upon filing the appropriate documentation with NASDAQ. The Forward Stock Split was implemented taking into account our authorized share capital and number of 12issued and outstanding shares of common stock as of the Record Date. Total issued and outstanding shares of common stock increased from 5,240,000 shares to 26,200,000 shares. The par value for our shares of common stock remained the same at $0.001.
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CURRENT BUSINESS OPERATIONS
We are engaged in the business of marketing and distributing laminate flooring in both the mass wholesale and retail markets throughout North America. Laminate flooring is a relatively new building material product invented in Sweden in the early 1980's. Management believes that laminate flooring now comprises approximately 10% market share of the flooring product market, which is expanding due to the product's durability and ecological compatibility.
On approximately March 9, 2007, we entered into
Laminate flooring is a
marketingversatile, durable, attractive flooring with the appearance of a hardwood floor. Although laminate flooring looks like wood flooring, there is actually no solid wood used in its construction. Laminate floors are made up of several materials bonded together under high pressure. Most laminate flooring consists of a moisture resistant layer under a layer of HDF (high density fiberboard). This is covered with a high-resolution hotographic image of natural wood flooring. It is then finished with an extremely hard, clear coating made from special resin-coated cellulose to protect the laminate flooring. Our management believes that laminate flooring is perfect for anyone wanting a durable floor for a fraction of the price andsales distribution agreementinstallation time of a hardwood floor, but withBossco (the "Agreement"), pursuantthe attractiveness of real hardwood. Its construction also makes laminate flooring more environmentally friendly as it uses less wood in its production a nd makes more efficient use of wood fiber.
Management believes that both laminate flooring and hardwood flooring can beautify a home. While hardwood is often thought to
which Bossco has agreedbe a superior choice, there are several advantages tomanufacture certainlaminate flooring. Distinct differences between the two types of flooring often make laminate flooring a more attractive alternative. Solid hardwood of any thickness (most is 3/8" to 3/4") should be installed only above grade. Laminate flooring can be installed above or below grade. Some hardwood flooring is engineered, meaning that instead of solid hardwood, it is made of several wood layers with a hardwood veneer. Laminate flooring is usually 7mm to 8mm (5/16" to 3/8") thick and is also made of several layers. These are laminated together for stability and strength. The top surface of laminate flooringproductsis a "photograph" of hardwood. High quality "photographs" faithfully reproduce the grain andfulfill our written purchase orders for these products in a timely manner. In accordance withcolor of natural hardwood an d thetermssurfaces on quality laminate flooring closely resemble real wood. Although many people insist on hardwood flooring, we believe that laminates are long lasting, durable, andprovisionsaffordable and quickly becoming one of theAgreement: (i) Bossco has agreed to manufacture and supply polish and relief surfacemost popular types of flooring.
One obvious advantage is price; laminate flooring
withis typically half thedimensionscost of1200 x 300 x 8 millimeters;traditional hardwood flooring. Sometimes the savings are even greater, depending on the types of flooring in question. Additionally, laminate flooring is designed to be easy to install and(ii) we will pay Bossco $12.00 per square meter of polish surface laminate and $12.5 per each square meter of relief surface laminate. The Agreement providesis generally a good choice for thefollowing additional terms and provisions: (i) we and our assignees may"do-it-yourself" market, where solid hardwood installation requires a higher level of expertise. Installing laminate does not involve nails. More recently the use of glue has been eliminated from themarketing information that Bossco provides usinstallation process inall of our marketing and distribution efforts to sell themany cases. As a result laminate flooringproducts and we agree not to make any marketing claim in regard to the products that are not supported by the information supplied by Bossco; (ii) from time to time Bossco can make reasonable adjustment to the price of the laminate flooring products by giving us written notification of such product price amendments; (iii) although Bossco's price list acts as a guide for purchases made by us, both parties may negotiate discounts on any singular product purchase order provided to Bossco, including the purchase of laminate flooring from a manufacturing overrun situation; (iv) we agree to pay the price of product purchases by letter of credit or wire transfer prior to product shipment and are responsible for all related shipping costs, unless other arrangements have been expressly agreed to; (v) the Agreementcan beterminated upon 60 days' written notice by either party (notwithstanding this provision, we or our assigns willinstalled fairly quickly and inexpensively. Laminate flooring is generally designed to bepermittedscratch-resistant and fade resistant, two areas where solid hardwood flooring is known tosell, market, and distribute all laminate flooring products that have been ordered from Bossco or are in our assigns' possession at termination; and (vi) there are no set minimum quota requirements for product sales under the Agreement in the first year. Bossco willbeobligated to assist in the completion of each sales order on a case-by-base basis, regardless of quantity. Following the first year of the Agreement, both parties will review sales activities during the prior year and review this provision of the Agreement.more vulnerable.
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RESULTS OF OPERATION
We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.
We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.
13THREE MONTH PERIOD ENDED JUNE
Three Month Period Ended June 30, 2009 Compared to Three-Month Period Ended June 30, 2008
COMPARED TO THREE-MONTH PERIOD ENDED JUNE 30, 2007
Our net loss for the three-month period ended June 30,
20082009 was approximately ($1,653)4,710) compared to a net loss of ($8,365)1,653) during the three-month period ended June 30,2007 (a decrease2008 (an increase of$6,712)$3,057). During the three-month periods ended June 30,20082009 and2007,2008, we did not generate any revenue.
During the three-month period ended June 30,
2008,2009, we incurred general and administrative expenses of approximately$1,653$4,710 compared to$8,365$1,653 incurred during the three-month period ended June 30,2007 (a decrease2008 (an increase of$6,712)$3,057). The general and administrative expenses incurred during the three-month period ended June 30,20082009 consisted of corporate overhead, financial and administrative contracted services, marketing, and consulting costs.
Our net loss during the three-month period ended June 30,
20082009 was ($1,653)4,710) or ($0.00) per share compared to a net loss of ($8,365)1,653) or ($0.00) per share during the three-month period ended June 30,2007.2008. The weighted average number of shares outstanding was 26,200,000 for the three-month periods ended June 30, 2009 and 2008,and 2007,respectively.
LIQUIDITY AND CAPITAL RESOURCES
THREE-MONTH PERIOD ENDED JUNE
Three-Month Period Ended June 30,
20082009
As at the three-month period ended
March 31, 2008,June 30, 2009, our current assets were$7,990$8,004 and our current liabilities were$13,000,$44,547, which resulted in a working capital deficiency of ($5,010)36,543). As at the three-month period ended June 30,2008,2009, current assets were comprised of$7,990$8,004 in cash. As at the three-month period ended June 30,2008,2009, current liabilities were comprised of$10,000$39,000 in loan from related party and$3,000$5,547 in accounts payable and accrued liabilities.
As at the three-month period ended June 30,
2008,2009, our total assets were$7,990$8,004 comprised entirely of current assets compared to$9,643$12,527 at fiscal year ended March 31,2008.2009. The decrease in total assets during the three-month period ended June 30,20082009 from fiscal year ended March 31,20082009 was due to a decrease in cash.
As at the three-month period ended June 30,
2008,2009, our total liabilities were$13,000$44,547 comprised entirely of current liabilities compared to$13,000$44,360 at fiscal year ended March 31,2008. Liabilities remained unchanged from fiscal year ended March 31, 2008. Stockholders'2009.
Stockholders’ deficit increased from ($
3,357)31,833) for fiscal year ended March 31,20082009 to ($5,010)36,543) for the three-month period ended June 30,2008. CASH FLOWS FROM OPERATING ACTIVITIES2009.
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Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities. For the three-month period ended June 30, 2009, net cash flows used in operating activities was ($4,523), consisting of a net loss of ($4,710) and accounts payables of $187. For the three-month period ended June 30, 2008, net cash flows used in operating activities was ($1,653), consisting of a net loss of ($1,653).
For the three-month period ended June 30, 2007, net cash flows used in operating activities was ($8,365), consisting of a net loss of ($8,365). CASH FLOWS FROM FINANCING ACTIVITIES
Cash Flows from Financing Activities
We have financed our operations primarily from either advancements or the issuance of equity and debt instruments. For the three-month period ended June 30,
2008,2009, net cash flows provided from financing activities was $-0- compared to $-0- for the three-month period ended June 30,2007. 142008.
We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.
PLAN OF OPERATION AND FUNDING
Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next six months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; and (ii) working capital. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or
privilegespr ivileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.
At June 30,
2008,2009, our current assets consisted of$7,990$8,004 in cash. With these funds, we will only be able to satisfy our cash requirements for approximatelyfoursix months, provided we do not organize any major events during that time period. Accordingly and as discussed above, we will have to raise additional funds in the next twelve months in order to sustain and expand our operations. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We have and will continue to seek to obtain short-term loans from our directors, although no future arrangement for additional loans has been made. We do not have any agreements with our directors concerning these loans. We do not have any arrangements in place for any future equity financing.
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MATERIAL COMMITMENTS
As of the date of this Quarterly Report, and other than our obligations to be incurred under the Agreement, we do not have any other material commitments.
PURCHASE OF SIGNIFICANT EQUIPMENT
We do not intend to purchase any significant equipment during the next twelve months.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Quarterly 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.
GOING CONCERN
The independent auditors' report accompanying our March 31,
20082009 and20072008 financial statements contains 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," which15contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
ITEM
3.III. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.Market risk represents the risk of loss that may impact our financial position, results of operations or cash flows due to adverse change in foreign currency and interest rates. EXCHANGE RATE Our reporting currency is United States Dollars ("USD"). The Russian Ruble has been informally pegged to the USD. However, Russia is under international pressure to adopt a more flexible exchange rate system. If the Russian Ruble were no longer pegged to the USD, rate fluctuations may have a material impact on our financial reporting and make realistic revenue projections difficult. As the Russian Ruble may be our functional currency as it relates to the Agreement, the fluctuation of exchange rates of the Russian Ruble may have positive or negative impacts on our results of operations pertaining to acquisition of flooring. However, since all sales revenue and expenses will be denominated in the USD, the net income effect of appreciation and devaluation of the currency against the US Dollar will be limited to our net operating results. INTEREST RATE Interest rates in Russia are high and unstable and inflation is not well controlled. Any loans will relate primarily to business operations and will be short-term. However debt may be likely to rise with in connection with expansion and were interest rates to rise at the same time, this could become a significant impact on our operating and financing activities. We have not entered into derivative contracts either to hedge existing risks or for speculative purposes.
Not applicable.
ITEM
4.IV. CONTROLS AND PROCEDURES
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the
Commission'sCommission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to theissuer'sissuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
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An evaluation was conducted under the supervision and with the participation of our management, including Mr. Dannikov, our Chief Executive Officer and our Chief Financial Officer of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30,
2008.2009. Based on that evaluation, Mr. Dannikov concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Such officer also confirmed that there was no change in16our internal control over financial reporting during the period ended June 30, 20082009 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
We maintain "disclosure controls and procedures," as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer/Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. We conducted an evaluation (the "Evaluation"), under the supervision and with the participation of our Chief Executive Officer/Chief Financial Officer of the effectiveness of the design and operation of our disclosure controls and procedures ("Disclosure Controls") as of the end of the period covered by this report pursuant to Rule 13a-15 of the Exchange Act. The evaluation of our disclosure controls and procedures included a review of the disclosure
controls'controls’ andprocedures'procedures’ objectives, design, implementation and the effect of the controls and procedures on the information generated for use in this report. In the course of our evaluation, we sought to identify data errors, control problems or acts of fraud and to confirm the appropriate corrective actions, if any, including process improvements, were being undertaken. Our Chief Executive Officer/Chief Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective and were operating at the reasonable assurance level.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Quarterly Report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.
ITEM 2.
CHANGES INUNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDSFORWARD STOCK SPLIT APRIL 2008 FORWARD STOCK SPLIT On February 21, 2008, our Board of Directors pursuant to minutes of written consent in lieu of a special meeting authorized and approved the Forward Stock Split. Each of our shareholders holding one share of common stock was entitled to receive an additional four shares of our restricted common stock. The additional shares of our common stock to be issued to the shareholders in accordance with the Forward Stock Split were mailed on approximately April 15, 2008 without any action on the part of the shareholders. The Forward Stock Split was effectuated based on market conditions and upon a determination by our Board of Directors that the Forward Stock Split was in our best interests and of the shareholders. In our judgment the Forward Stock Split resulted in an increase in our trading float of shares of common stock available for sale resulting in facilitation of investor liquidity and trading volume potential. The intent of the Forward Stock Split was to increase the marketability of our common stock. The Forward Stock Split was effectuated with a record date of February 21, 2008 upon filing the appropriate documentation with NASDAQ. The Forward Stock Split was implemented taking into account our authorized share capital and number of issued and outstanding shares of common stock as of the Record Date. Total 17issued and outstanding shares of common stock increased from 5,240,000 shares to 26,200,000 shares. The par value for our shares of common stock remained the same at $0.001.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
No report required.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No report required.
ITEM 5. OTHER INFORMATION
DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS/ELECTION OF DIRECTORS/ APPOINTMENT OF CERTAIN OFFICERS/COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS Effective June 30, 2008, our Board of Directors accepted the resignation of Alexander Dannikov as our Secretary. Mr. Dannikov remains as our Presidnet/Chief Executive Officer/Chief Financial Officer and a member of our Board of Directors. On the same date, the Board of Directors accepted the consent of Andrey Kryukov to act as our Secretary. Mr. Kryukov graduated with a Bachelor Degree in Business from Baikal State Economic University in December 1998. Since that time, Mr. Kryukov has been self-employed as sole proprietor and owned several home restoration stores. He also provides consulting service for various companies involved in distribution of home restoration goods. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT We had engaged Moore & Associates, Chartered ("Moore") as our principal independent registered public accounting firm effective July 25, 2008. Concurrent with this appointment, we accepted the resignation of RBSM, LLP ("RBSM"), effective July 25, 2008. The decision to change our principal independent registered public accounting firm has been approved by our Board of Directors. The
No report
of RBSM on our financial statements for fiscal year ended March 31, 2008 and the period December 13, 2006 (date of inception) through March 31, 2008 and fiscal year ended March 31, 2007 and the period December 13, 2006 (date of inception) through March 31, 2007 did not contain an adverse opinion or disclaimer of opinion, nor was it modified as to uncertainty, audit scope or accounting principles, other than to state that there is substantial doubt as to our ability to continue as a going concern. During our two most recent fiscal years and any subsequent interim period through the date of change in accountants, there were no disagreements between us and RBSM, whether or not resolved, on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to the satisfaction of RBSM, would have caused RBSM to make reference thereto in its reports on our audited financial statements. During our two most recent fiscal years and any subsequent interim period through the date of change in accountants, there were no reportable events, We provided RBSM with a copy of the Current Report on Form 8-K and requested that RBSM furnish us with a letter addressed to the Securities and Exchange Commission stating whether or not RBSM agrees with the statements made in the Current Report on Form 8-K with respect to RBSM and, if not, stating the aspects with which they do not agree. We received the requested letter from RBSM wherein they have confirmed their agreement to our disclosures in the Current Report with respect to RBSM. A copy of RBSM's letter was filed as an exhibit to the Current Report filed on August 11, 2008. 18In connection with our appointment of Moore as our principal registered accounting firm at this time, we have not consulted Moore on any matter relating to the application of accounting principles to a specific transaction, either completed or contemplated, or the type of audit opinion that might be rendered on our financial statements.required.
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ITEM 6. EXHIBITS
Exhibits:
31.1
Certification of Chief Executive Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
31.2
Certification of Chief Financial Officer pursuant to Securities Exchange Act of 1934
Rule 13a-14(a) or 15d-14(a).
32.1
Certifications pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-
14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
BOSCO HOLDINGS, INC.
Dated: August
13, 200810, 2009By: /s/ Alexander Dannikov
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Alexander Dannikov, President and
Chief Executive Officer
Dated: August
13, 200810, 2009By: /s/ Alexander Dannikov
----------------------------------------------------------------------------------
Alexander Dannikov, Chief Financial
Officer
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