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| BKSHF > SEC Filings for BKSHF > Form 10-K on 15-Feb-2013 | All Recent SEC Filings |
15-Feb-2013
Annual Report
The following discussion should be read in conjunction with our audited financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or our behalf. We disclaim any obligation to update forward-looking statements.
Year Ended November 30, 2012 Compared to Year Ended November 30, 2011
Our net loss for the year ended November 30, 2012 was $447,309, a decrease of $84,105 or 16% from a net loss of $531,414 during the year ended November 30, 2011. The decrease was due to our decreased operating expenses,
We generated revenue of $22,000 during the year ended November 30, 2011 in accordance with our service agreement with a Poland based customer. This service agreement expired in September, 2011. During the year ended November 30, 2012 we did not have a service agreement in place and did not generate revenue.
During the year ended November 30, 2012, we incurred operating expense of $404,154, a decrease of $149,260 or 27% from $531,414 during the year ended November 30, 2011. Our consulting fees decreased by $385,084 or 82% from $469,503 in the year ended November 30, 2011 to $84,419 in the year ended November 30, 2012 as we incurred significant expenses in 2011 on searching for business opportunities and human resources. Our general and administrative expenses increased by $43,297 or 101% from $42,796 in the year ended November 30, 2011 to $86,093 in the year ended November 30, 2012 as in 2012 we more actively searched for business activities. Professional fees increased from $18,518 in the year ended November 30, 2011 by $49,820 or 269% to $68,338 in the year ended November 30, 2012 largely due to our audit and legal due diligence costs incurred on a potential business acquisition that was not consummated. Management fees increased from $20,472 in the year ended November 30, 2011 by $144,832 or 707% to $165,304 in the year ended November 30, 2012 as the management contract was not effective until the last month of fiscal 2011. During the year ended November 30, 2011, we wrote off bad debt of $2,125, which was absent in 2012.
During the year ended November 30, 2012 we incurred interest expense of $43,155 on three promissory notes with total principal amount of $400,000 sold during the year ended November 30, 2012. During the year ended November 30, 2011 we did not have interest bearing debt.
Liquidity and Capital Resources
As at November 30, 2012, we had no assets and we had current liabilities of $955,743. As at November 30, 2011, our assets consisted only of prepaid expenses of $7,338 and we had current liabilities of $515,772.
We financed our operations during the year ended November 30, 2012 through the sale of three promissory notes during the period for total proceeds of $400,000. During the year ended November 30, 2011, we did not raise funds through financing activities.
During February, 2013 we raised an additional $100,000 through the sale of a promissory note for the amount.
Plan of Operation and Funding
We expect that working capital requirements will continue to be funded through further issuances of equity securities or debt financing. Our working capital requirements are expected to increase in line with the growth of our business.
Over the next twelve months we believe we will need $500,000 to carry out our ongoing operations and to expand our operations which will come from funds currently available and additional financing.
Off-Balance Sheet Arrangements
As of November 30, 2012, we did not have any significant off-balance-sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K.
Going Concern
The audited financial statements for the year ended November 30, 2012, included in this Annual Report, have been prepared on a going concern basis, which implies that we will continue to realize our assets and discharge our liabilities and commitments in the normal course of business. We have generated $22,000 in revenues since inception and have never paid any dividends and are unlikely to pay dividends or generate substantial earnings in the immediate or foreseeable future. Our continuation as a going concern is dependent upon the continued financial support from our shareholders, the ability of our company to obtain necessary equity or debt financing to achieve our operating objectives, and the attainment of profitable operations. As at November 30, 2012, we have accumulated losses of $979,343 since inception. As we do not have sufficient funds for our planned operations, we will need to raise additional funds for operations.
Due to the uncertainty of our ability to meet our operating expenses, in their report on the annual financial statements for the year ended November 30, 2012, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that lead to this disclosure by our independent auditors.
The continuation of our business is dependent upon us raising additional financial support. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.
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