Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Nov. 11, 2014 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'RELIABILITY INCORPORATED | ' |
Entity Central Index Key | '0000034285 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Amendment Flag | 'true | ' |
Amendment Description | 'The sole purpose of this Amendment No. 1 to the CompanyÂ’s Report on Form 10-Q for the period ending September 30, 2014, originally filed with the Securities and Exchange Commission on November 13, 2014, is to correct an error in the XBRL (eXtensible Business Reporting Language) Interactive Data File. The reporting date of the Entity Common Stock, Shares Outstanding as reported within the Document and Entity Information was changed to read November 11, 2014. No other changes have been made to the Form 10-Q. The Form 10-Q has not been updated to reflect events occurring subsequent to the original filing date and does not modify or update in any way disclosures made in the original Form 10-Q. | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 16,914,693 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2014 | ' |
Unaudited_Balance_Sheets
Unaudited Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Current assets: | ' | ' |
Cash and cash equivalents | $41,280 | $450 |
Total current assets | 41,280 | 450 |
Total Assets | 41,280 | 450 |
Current liabilities: | ' | ' |
Accounts payable and accrued liabilities | 3,573 | 34,580 |
Total current liabilities | 3,573 | 34,580 |
Long term liabilities: | ' | ' |
Loan from Shareholder | 50,000 | ' |
Total long term liabilities | 50,000 | ' |
Total liabilities | 53,573 | 34,580 |
Stockholders' equity (deficit): | ' | ' |
Common stock, without par value; 300,000,000 shares authorized; 17,268,993 and 13,867,633 shares issued at September 30, 2014 and December 31, 2013, respectively | 9,912,150 | 9,862,150 |
Accumulated deficit | -8,829,926 | -8,801,763 |
Less treasury stock at cost, 354,300 shares | -1,094,517 | -1,094,517 |
Total stockholders' equity (deficit) | -12,293 | -34,130 |
Total liabilities and stockholders' equity (deficit) | $41,280 | $450 |
Unaudited_Balance_Sheets_Paren
Unaudited Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Stockholders' equity (deficit): | ' | ' |
Preferred stock, par value | $0 | $0 |
Preferred stock shares, authorized | 1,000,000 | 1,000,000 |
Preferred stock shares, issued | 0 | 0 |
Preferred stock shares, outstanding | 0 | 0 |
Common stock, par value | $0 | $0 |
Common stock shares, authorized | 300,000,000 | 300,000,000 |
Common stock shares, issued | 17,268,993 | 13,867,633 |
Treasury stock shares | 354,300 | 354,300 |
Unaudited_Statements_of_Operat
Unaudited Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Operating expenses: | ' | ' | ' | ' |
General and administrative | $3,178 | $5,354 | $26,310 | $14,172 |
Interest expense | 1,269 | ' | 1,603 | ' |
Total expenses | 4,447 | 5,354 | 27,913 | 14,172 |
Other income | ' | ' | ' | 15,000 |
Net Income (Loss) Before Income Taxes | ' | ' | -27,913 | 828 |
Income Taxes | ' | ' | 250 | ' |
Net Income (Loss) | ($4,447) | ($5,354) | ($28,163) | $828 |
Basic and Diluted Income (Loss) Per Share | $0 | $0 | $0 | $0 |
Weighted average shares: | ' | ' | ' | ' |
Basic | 16,914,693 | 13,513,333 | 16,740,264 | 13,513,333 |
Diluted | 16,914,693 | 13,513,333 | 16,740,264 | 13,513,333 |
Unaudited_Statements_of_Cash_F
Unaudited Statements of Cash Flows (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Cash flows from operating activities: | ' | ' |
Net income (loss) | ($28,163) | $828 |
Changes in operating assets and liabilities: | ' | ' |
Accounts payable and accrued liabilities | -31,007 | -8,084 |
Net cash used in operating activities | -59,170 | -7,256 |
Cash flows from financing activities: | ' | ' |
Issuance of stock for cash | 50,000 | ' |
Loans from officers | ' | 7,000 |
Loan from shareholder | 50,000 | ' |
Net cash provided by financing activities | 100,000 | 7,000 |
Net increase in cash and cash equivalents | 40,830 | -256 |
Cash and cash equivalents: | ' | ' |
Beginning of period | 450 | 486 |
End of period | 41,280 | 230 |
Cash paid during the period for: | ' | ' |
Interest | 1,603 | ' |
Income taxes | $250 | ' |
Operations_and_Summary_of_Sign
Operations and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2014 | |
Notes to Financial Statements | ' |
Note 1. OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
1. OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Nature of Operations | |
Reliability Incorporated (the “Company”) was incorporated under the laws of the State of Texas in 1953, but the principal business of the Company started in 1971, and was closed down in 2007. The Company has no further operating activities and is now a shell company. | |
Going Concern | |
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The Company has concluded that it should look for acquisitions or identify a merger partner. There can be no assurances that the Company will be successful in completing such a transaction or be able to maintain sufficient liquidity over a period of time that will allow it to carry out these actions, in which case the Company might be forced to liquidate or seek protection under the Federal bankruptcy statutes, or both. | |
The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern. | |
The Company is quoted on the OTCQB of the OTC Marketplace under the symbol “RLBY”. | |
Basis of presentation | |
The (a) balance sheet as of December 31, 2013 has been derived from audited financial statements and (b) the accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with instructions to Form 10-Q. Accordingly they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. | |
For further information, refer to the financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2013. | |
Accounting Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires that management 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 reporting period. Actual results may differ from those estimates. | |
Cash Equivalents | |
For the purposes of the statements of cash flows, the Company considers all highly liquid cash investments that mature in three months or less when purchased, to be cash equivalents. Cash equivalents are stated at cost, which approximates fair value. | |
Stock Options | |
Compensation cost relating to stock-based payments, including grants of employee stock options, is recognized in financial statements based on the fair value of the equity instruments issued on the grant date. The Company recognized the fair value of stock-based compensation awards as compensation expense in its statement of operations on a straight line basis, over the vesting period. | |
Income Taxes | |
Income taxes are provided under the asset and liability method and reflect the net tax effects of temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. The Company establishes valuation allowances when the realization of specific deferred tax assets is subject to significant uncertainty. The Company records no tax benefits on its operating losses, as the losses will have to be carried forward and realization of any benefit is uncertain. | |
Earnings Per Share | |
Basic earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Since the exercise price of the Company’s outstanding stock options exceeded the average market price of its common shares during the periods presented, the options would have been anti-dilutive and were not considered in these calculations. | |
Fair Value of Financial Instruments | |
The carrying values of the Company’s current assets and current liabilities approximated fair value due to their short maturity or nature. It is not practicable to estimate the fair value of the loan from shareholder due to the related party nature of the amount. | |
Recently Issued Accounting Pronouncements | |
In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern, which provides guidance under U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. The ASU is effective for all entities and for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted. The adoption of ASU No. 2014-15 is not expected to have a significant impact on the Company’s financial statements and related disclosures. |
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2014 | |
Notes to Financial Statements | ' |
Note 2. INCOME TAXES | ' |
2. INCOME TAXES | |
The Company has substantial U.S. net operating loss carryforwards that will expire in 2023 through 2030. These carryforwards are subject to certain limitations on annual utilization and in the event of a change in ownership, as defined by tax law. See Note 2 to the Company’s financial statements in its Form 10-K for the year ended December 31, 2013. | |
The Company’s income tax returns remain subject to examination for the years 2010 through 2013 for federal and state purposes. |
Stock_Option_Plan
Stock Option Plan | 9 Months Ended |
Sep. 30, 2014 | |
Notes to Financial Statements | ' |
Note 3. STOCK OPTION PLAN | ' |
3. STOCK OPTION PLAN | |
Under the Company’s Amended and Restated 1997 Stock Option Plan (the “Option Plan”), no further option grants are allowed after February 26, 2007, but options theretofore granted remain in effect until satisfied or terminated pursuant to the Option Plan. | |
At December 31, 2006, all options were fully vested; thus no further stock option expense has been recorded related to the Option Plan. The weighted-average remaining contractual term, as of December 31, 2013, was 2.5 years for outstanding and exercisable options. There were no options exercised and none that expired or were canceled during the years ended December 31, 2013 and 2012 or during the quarter ended September 30, 2014. As of September 30, 2014 and December 31, 2013, there were 370,000 options outstanding under the Company’s Stock Option Plan which are exercisable at a weighted average price of $0.21 until July 19, 2016, when they expire. |
Stockholders_Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2014 | |
Notes to Financial Statements | ' |
Note 4. STOCKHOLDERS' EQUITY | ' |
4. STOCKHOLDERS’ EQUITY | |
As previously reported on the Company’s Form 8-K, on January 15, 2014, the Company issued 3,401,360 shares of common stock to Lone Star Value Investors, LP, an entity controlled by a former director and officer of the Company, for cash proceeds of $50,000. The proceeds of this issuance were used to assist in funding the Company’s operating expenses. |
Loan_From_Shareholder
Loan From Shareholder | 9 Months Ended |
Sep. 30, 2014 | |
Notes to Financial Statements | ' |
Note 5. LOAN FROM SHAREHOLDER | ' |
5. LOAN FROM SHAREHOLDER | |
On June 6, 2014, a shareholder issued a promissory note to the Company in the amount of $50,000. The proceeds of the note will be used for ongoing operating expenses. The loan bears interest at 10% per annum. Interest on the loan is to be paid annually and the full amount of the principal is to be repaid on June 30, 2019. During the three and nine months ended September 30, 2014, the Company recognized interest expense in the amount of $1,269 and $1,603, respectively. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2014 | |
Notes to Financial Statements | ' |
Note 6. SUBSEQUENT EVENTS | ' |
6. SUBSEQUENT EVENTS | |
No material subsequent events have occurred since September 30, 2014 that require recognition or disclosure in the financial statements. |
Operations_and_Summary_of_Sign1
Operations and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Operations And Summary Of Significant Accounting Policies Policies | ' |
Nature of Operations | ' |
Reliability Incorporated (the “Company”) was incorporated under the laws of the State of Texas in 1953, but the principal business of the Company started in 1971, and was closed down in 2007. The Company has no further operating activities and is now a shell company. | |
Going Concern | ' |
Going Concern | |
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The Company has concluded that it should look for acquisitions or identify a merger partner. There can be no assurances that the Company will be successful in completing such a transaction or be able to maintain sufficient liquidity over a period of time that will allow it to carry out these actions, in which case the Company might be forced to liquidate or seek protection under the Federal bankruptcy statutes, or both. | |
The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern. | |
The Company is quoted on the OTCQB of the OTC Marketplace under the symbol “RLBY”. | |
Basis of presentation | ' |
Basis of presentation | |
The (a) balance sheet as of December 31, 2013 has been derived from audited financial statements and (b) the accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with instructions to Form 10-Q. Accordingly they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. | |
For further information, refer to the financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2013. | |
Accounting Estimates | ' |
Accounting Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires that management 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 reporting period. Actual results may differ from those estimates. | |
Cash Equivalents | ' |
Cash Equivalents | |
For the purposes of the statements of cash flows, the Company considers all highly liquid cash investments that mature in three months or less when purchased, to be cash equivalents. Cash equivalents are stated at cost, which approximates fair value. | |
Stock Options | ' |
Stock Options | |
Compensation cost relating to stock-based payments, including grants of employee stock options, is recognized in financial statements based on the fair value of the equity instruments issued on the grant date. The Company recognized the fair value of stock-based compensation awards as compensation expense in its statement of operations on a straight line basis, over the vesting period. | |
Income Taxes | ' |
Income Taxes | |
Income taxes are provided under the asset and liability method and reflect the net tax effects of temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. The Company establishes valuation allowances when the realization of specific deferred tax assets is subject to significant uncertainty. The Company records no tax benefits on its operating losses, as the losses will have to be carried forward and realization of any benefit is uncertain. | |
Earnings Per Share | ' |
Earnings Per Share | |
Basic earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Since the exercise price of the Company’s outstanding stock options exceeded the average market price of its common shares during the periods presented, the options would have been anti-dilutive and were not considered in these calculations. | |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | |
The carrying values of the Company’s current assets and current liabilities approximated fair value due to their short maturity or nature. It is not practicable to estimate the fair value of the loan from shareholder due to the related party nature of the amount. | |
Recently Issued Accounting Pronouncements | ' |
Recently Issued Accounting Pronouncements | |
In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern, which provides guidance under U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. The ASU is effective for all entities and for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted. The adoption of ASU No. 2014-15 is not expected to have a significant impact on the Company’s financial statements and related disclosures. |
Income_Taxes_Details_Narrative
Income Taxes (Details Narrative) | 9 Months Ended |
Sep. 30, 2014 | |
Income Taxes | ' |
Net operating loss carryforwards expiration dates | '2023 through 2030 |
Stock_Option_Plan_Details_Narr
Stock Option Plan (Details Narrative) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2014 | Dec. 31, 2013 | |
Stock Option Plan | ' | ' |
Date after which no further option grants are allowed | 26-Feb-07 | ' |
Weighted-average remaining contractual term | ' | '2 years 6 months |
Options outstanding | 370,000 | 370,000 |
Exercisable at a weighted average price | $0.21 | $0.21 |
Expiration date | 19-Jul-16 | 19-Jul-16 |