ASSISTED 4 LIVING, INC. - Annual Report: 2019 (Form 10-K)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
November 30, 2019
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TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from ___ to ___
File number
333-226979
Assisted 4 Living, Inc. |
(Exact name of registrant as specified in its charter) |
Nevada | 82-1884480 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
2382 Bartek Pl, North Port, FL | 34289 | |
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code:
888-609-1169
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
None | None | None |
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 the Securities Act. Yes
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No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act Yes
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No ☐
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 last 90 days. Yes
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No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).). Yes
☒
No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
Emerging Growth Company | ☒ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
☐ No ☒
The aggregate market value of Common Stock held by non-affiliates of the Registrant on May 31, 2019, the last business day of the Registrant’s most recently completed second fiscal quarter was $52,500, based on the price paid under our recent Registration Statement.
Indicate the number of shares outstanding of each of the registrant’s classes of common stock as of the latest practicable date.
14,150,000 common shares as of February 27, 2020.
DOCUMENTS INCORPORATED BY REFERENCE
None.
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This report contains forward-looking statements. The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This report and other written and oral statements that we make from time to time contain such forward-looking statements that set out anticipated results based on management’s plans and assumptions regarding future events or performance. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance or results of current and anticipated sales efforts, expenses, the outcome of contingencies, such as legal proceedings, and financial results. Factors that could cause our actual results of operations and financial condition to differ materially are discussed in greater detail under Item 1A - “Risk Factors” of this report.
We caution that the factors described herein and other factors could cause our actual results of operations and financial condition to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
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General Overview
As used in this current report and unless otherwise indicated, the terms the “Company,” “A4L,” “we,” “us” and “our” mean Assisted 4 Living, Inc., a Nevada corporation, and our wholly-owned subsidiary, Assisted 2 Live, Inc., a Florida corporation, unless otherwise indicated.
We were incorporated in Nevada on May 24, 2017, with an objective to operate as is a facilitator of assisted living projects and related services. Our Company has positioned itself as a go-to resource for individuals or private groups that wish to enter and operate within the Assisted Living Facility (“ALF”) industry. Our Company’s first target market will be Florida, and will operate within the State through our solely owned subsidiary Assisted 2 Live, Inc. The goal being to use Florida as a test market to streamline our consulting processes and ultimately transition to a national company in the assisted living field. The barriers to entering the ALF space are considerable and require a detailed understanding of each State’s regulatory environment and processes. There are a myriad of steps that must be navigated to properly set up an ALF residence; including, but not limited to, licensing, complying with building codes, medical care requirements, staffing and industry regulations. Our Company is designed to mentor prospective ALF clients and guide them through every step of the start-up process, working hand-in-hand with them to ensure that their facility gets off to a proper and sustainable start.
We have a wholly-owned subsidiary, Assisted 2 Live, Inc., a Florida corporation (“A2L”), which was incorporated on June 15, 2017.
On May 31, 2018 and June 6, 2018, we issued 2,300,000 and 750,000 shares of common stock, respectively, to an aggregate 17 individuals pursuant to the provisions of Section 4(a)(2) of the Securities Act of 1933 (the “
Act
”) and Rule 506(b) of Regulation D promulgated by the Securities and Exchange Commission (“SEC
”).During January 2019, we sold 1,100,000 shares of common stock pursuant to our Registration Statement on Form S-1 filed on August 23, 2018 as amended, which Form S-1 became effective on October 1, 2018. We received $22,000 as proceeds from the sale of the registered shares.
Our principal executive office is located at 2382 Bartek Pl., North Port, FL 34289 and our telephone number is (888) 609-1169. Our corporate website is www.assisted4living.com.
We have not been subject to any bankruptcy, receivership or similar proceeding.
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Our Current Business
The key philosophy behind A4L is to facilitate the growth of residences that offer a stimulating environment, and provide care that empowers seniors (and young people in specific circumstances) to live an independent and fulfilling life, while also providing the residents assistance with their housekeeping, transportation, medical, personal hygiene, dressing and cooking needs.
Our Company, through the experience of our principal officers, is a resource for anyone wishing to do business in the ALF field. With Florida as a test market, clients will be guided through every stage of the organizational and licensing process required towards establishing an ALF. We can also assist in the operation of a new ALF in conjunction with the owners to ensure that the facilities are established and functioning smoothly, from physical site planning to optimizing care levels and strategies for the various populations in need.
Our Company will charge a fee for these services, whereby a prospective ALF operator can choose the specific area of expertise in which they require developmental assistance and pay according to incremental needs. Clients can simply opt for consultation in licensing, or physical space configuration, staffing requirements and certifications, resident referrals, or other details of the ALF environment. We will offer a full range of services and options, from isolated consultations to an option whereby our Company will set-up and walk clients through every step of the ALF process, and oversee the project for 6 months to ensure a smooth emergence into the marketplace.
In addition to acting as a facilitator of assisted living projects and related services, the Company’s subsidiary Assisted 2 Live Inc. signed a management agreement on March 1, 2019, to take over the day-to-day operations of a 32-bed assisted living project in Punta Gorda, FL.
Principal Products, Services and Their Markets
Assisted 4 Living Inc. is a facilitator of assisted living projects and related services. Our Company is positioned as a resource for private individuals or groups that wish to enter and operate within the ALF industry. Our Company’s first target market will be Florida, and will operate within the State through its solely owned subsidiary Assisted 2 Live, Inc. Our strategy is to use Florida as a test market to better define our consulting processes, and ultimately become a national presence in the assisted living field. The barriers to entering the ALF space are considerable and require a detailed understanding of each State’s regulatory environment and processes. There are a myriad of steps to properly set up an ALF residence, including, but not limited to licensing, building codes, medical care requirements, staffing and industry regulations. Our Company is designed to mentor prospective ALF clients and assist them through every step of the start-up process, working with them to ensure that their facility gets off to a proper and sustainable start.
The ALF industry is rapidly growing, and the skewed demographics of the current aging population will only further this industry interest and population need. The number of potential ALF residents is expected to grow as our aging population reaches the point where they begin to experience declines in their various physical, intellectual, social and mental abilities, and overall health. ALF residences offer people with mild health problems a uniquely supportive environment in which to live, being tailored to provide a ‘home-like’ atmosphere where residents enjoy all their familiar comforts, with the advantage of being in a stimulating social community and not an ‘institutionalized’ feel. Additionally, however, they may also receive supplemental medical supervision and minor medical care, alongside the essentials for daily-living help.
Also, in taking over of the day-to-day operations of the 32-bed facility in Punta Gorda, the Company expanded on its original consulting mandate and adapted to include the management of a physical operation. The Company can now bring prospective and actual clients into an operating facility to demonstrate and instruct on the various aspects of operating an ALF.
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Distribution Methods
Potential clients will find A4L services through two primary channels: the first is through referrals generated from an informal network of industry contacts, and the second is through a nationally optimized www.Assisted4Living.com website. The website will be optimized for keywords that are related to the assisted living industry. In Florida, the www.Assited2Live.com website will be created and locally optimized to help generate regional business. We will also create on-line Google and Facebook ads that target keywords such as ‘Assisted Living,’ and ‘Assisted Living Facilities’. In addition to this, the Company will look to take out print ads in publications such as AARP magazine.
Status of Publicly Announced New Products or Services
A4L has no new publicly announced products or services.
Competitive Business Conditions and Strategy; Assisted4Living’s Position in the Industry
A4L will initially compete with other ALF companies that are currently in the Florida market. Large nationally recognized companies such as Life Care Center of America and Brookdale Senior living are competitors, as well as smaller regional operators such as South Port Square and Genesis Healthcare. It is possible that new or prospective ALF operators will gravitate to these larger entities for guidance. However, based on the professional history of our Company’s officers in the Florida market, we are experienced, connected, and able to compete. We will also compete with these larger firms for prospective ALF residents. While there are established and strong competitors in the Florida ALF market, however, the industry is growing, and we are positioning ourselves to be a niche player as a resource-intensive consulting company providing a highly personalized approach to the ALF marketplace.
While A4L can take on the regulatory and logistical challenges of opening a large ALF center (60 beds+), we are focusing our efforts on smaller, more family-oriented projects (with as few as 4 residents). Keeping an ALF from 4-16 residents can maintain the personal home-style context. We are structuring our consulting approach to target this area and view it as an unrealized niche growth opportunity. The barriers to developing a small-scale ALF project are also significantly less than those for constructing and conforming to the regulatory steps of larger, more industrial-sized projects.
And again, in taking over the physical operations of a 32-bed facility in Punta Gorda, the Company gains both credibility and greater access to the Florida Gulf Coast assisted living market. This access can be leveraged to market our consulting services to other prospective clients and/or industry professionals.
Talent Sources and Names of Principal Suppliers
Our success will depend on the quality of our leadership and their ability to leverage industry knowledge and contacts. Our Company is headed by Romulus Barr, an eighteen-year veteran of the assisted living industry. Mr. Barr has owned and operated an ALF center in Portland, OR, and currently owns a 16-bed facility in Punta Gorda, Florida. The one facility that Romulus currently owns is not operated by him, but rather has been leased to a third-party operator. Mr. Barr has a broad understanding of the dynamics on the ALF field, consults on ongoing projects, and developed a standardized ‘Emergency Plan’ that was adopted for use by the State of Florida. Having operated in Florida for the past 10 years, Mr. Barr has developed close relationships with local SW Florida case workers, guardians, and AHCA Florida State regulators. In short, Mr. Barr has a network of industry contacts and a deep understanding of the ALF industry. Mr. Barr hopes to expand this success beyond Florida to other states. Mr. Barr is also directing the operations of the recently added 32-bed facility in Punta Gorda, FL.
Anca Barr has also worked closely with the Agency for Health Administration (AHCA- Licensing), the Department of Children and Families (case work and resident placements), and the Department of Health (food storage, preparation, and service). Ms. Barr has also worked on a day-to-day basis with ALF centers, and has extensive experience on how to establish centers, care for the residents, manage staffing and budgets, as well as coordinate with medical professionals and regulatory agencies.
Together, both Romulus and Anca provide our Company with substantial experience within the industry.
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Research and Development
Since inception, no funds have been expended on research and development.
Employees
The Company has no employees other than its officers. The Company’s wholly-owned subsidiary, A2L, leases 12 full-time employees whose primary duties consist of preparing food and caring for the residents of the A2L assisted living facility.
Dependence on one or a few major customers
A4L currently does not have any consulting clients. A4L currently derives all of its revenues from the sale of Common Stock registered by the Company via form S-1 and the operation, by its subsidiary A2L, of the assisted living facility in Punta Gorda, Florida. A4L intends to have a broad mix of clients and does not believe it will be dependent on any single consulting client or source of revenues.
Patents, Trademarks, Licenses, Agreements or Contracts
There are no aspects of our business plan which require a patent or trademark. We have not entered into any vendor agreements or contracts that give or could give rise to any obligations or concessions.
Governmental Controls, Approval and Licensing Requirements
We are subject to state and local regulation as it pertains to assisted living centers owned and/or operated by us. In Florida, our ownership and operation of the A2L facility in Punta Gorda is subject to the approvals and licensing of the Agency for Health Care Administration (AHCA). AHCA regulates all aspects of owning and operating an assisted living center. This agency is responsible for approving new ALF licenses, regulating existing licenses, enforcing codes, as well as ensuring the proper implementation of Emergency Plans. The Florida Department of Agriculture, Division of Food Safety also regulates our A2L facility, since we provide food service, and must comply with safe food standards.
Our business model will also be impacted by these, and other governmental agencies that regulate AFL facilities and operations as they will regulate our clients and their operations.
If our consulting clients have their own residents who rely upon Medicaid for the payment of their housing and living costs, state case workers will also be engaged and have an impact on our business. Other states have their own regulatory agencies who oversee assisted living facilities, and who will need to be engaged when and if we decide to expand beyond the Florida test market.
WHERE YOU CAN FIND MORE INFORMATION
You are advised to read this Form 10-K in conjunction with other reports and documents that we file from time to time with the SEC. In particular, please read our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that we file from time to time. You may obtain copies of these reports directly from us. In addition, the SEC maintains information for electronic filers at its website http://www.sec.gov and our corporate website is www.assisted4living.com.
As a “smaller reporting company,” we are not required to provide the information required by this Item.
As a “smaller reporting company”, we are not required to provide the information required by this Item.
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Our address principal executive office is located at 2382 Bartek Pl., North Port, FL 34289. Our offices are provided to us at no charge by our President.
On March 7, 2019, the Company entered into the commercial real estate lease agreement. The Company leases an adult living facility building for $3,713 monthly.
From time to time, we may become involved in litigation relating to claims arising out of our operations in the normal course of business. We are not involved in any pending legal proceeding or litigation and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we are a party and which would reasonably be likely to have a material adverse effect on our Company. To date, our Company has never been involved in litigation, as either a party or a witness, nor has our Company been involved in any legal proceedings commenced by any regulatory agency against our company.
Not applicable.
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Our shares of Common Stock were listed for quotation on the OTC Pink Market of the OTC Markets on October 25, 2019. No trades of our Common Stock have occurred.
Our shares of Common Stock are issued in registered form. VStock Transfer, LLC at 18 Lafayette Place, Woodmere, NY 11598 (Telephone: (212) 828-8436) is the registrar and transfer agent for our common shares.
On November 30, 2019, the shareholders’ list showed 29 registered shareholders with 14,150,000 shares of Common Stock outstanding.
Dividend Policy
We have not paid any cash dividends on our Common Stock and have no present intention of paying any dividends on the shares of our Common Stock. Our current policy is to retain earnings, if any, for use in our operations and in the development of our business. Our future dividend policy will be determined from time to time by our board of directors.
Equity Compensation Plan Information
We do not have any equity compensation plans.
Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities
We did not sell any equity securities which were not registered under the Securities Act during the year ended November 30, 2019, that were not otherwise disclosed on our quarterly reports on Form 10-Q or our current reports on Form 8-K filed during the year ended November 30, 2019.
Purchase of Equity Securities by the Issuer and Affiliated Purchasers
We did not purchase any of our shares of Common Stock or other securities during our fourth quarter of our fiscal year ended November 30, 2019.
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As a “smaller reporting company”, we are not required to provide the information required by this Item.
The following discussion should be read in conjunction with our consolidated financial statements, including the notes thereto, appearing elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this Annual Report. Our audited consolidated financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.
Results of Operations - Years Ended November 30, 2019 and 2018
The following summary of our results of operations should be read in conjunction with our consolidated financial statements for the year ended November 30, 2019 and 2018, which are included herein. On March 1, 2019, we commenced our operation of an assisted living facility (“ALF”) in Florida. Historical results will not reflect our current operations and will not be comparable to results of operations being reporting in the current period.
Our operating results for the year ended November 30, 2019 and 2018, and the changes between those periods for the respective items are summarized as follows:
Year Ended | ||||||||||||
November 30, | ||||||||||||
2019 | 2018 | Change | ||||||||||
Revenue | $ | 392,706 | $ | 18,700 | $ | 374,006 | ||||||
Cost of service | 246,478 | - | 246,478 | |||||||||
Operating expenses | 229,344 | 45,665 | 183,679 | |||||||||
Other expense | 2,005 | - | 2,005 | |||||||||
Net loss | $ | 85,121 | $ | 26,965 | $ | 58,156 | ||||||
We recognized revenues of $392,706 during the year ended November 30, 2019, compared to limited revenues during the year ended November 30, 2018. The increase in revenue is mainly due to commencing an assisted living facility business in 2019.
Cost of service consists of facility lease, rent, food and labor directly related to the operations of our assisted living facility. Cost of service expenses commenced in 2019, with the operations of our ALF. For the year ended November 30, 2019, our gross profit was $146,228 or 37.3%.
Operating expenses for the year ended November 30, 2019 and 2018 were $229,344 and $45,665, respectively. Operating expenses during 2019 and 2018 were primarily attributed to general and administration expenses of $184,254 and $21,178 and professional fees of $45,090 and $24,487, respectively. Our increase in operating expenses were primarily due to increased general and administrative expenses related to the new ALF operations. The increase in professional fees is primarily due to audit and accounting fees incurred during the period, due to our filing of an S-1 Registration Statement.
Net loss was $85,121 and $26,965 for year ended November 30, 2019 and 2018, respectively. The increase in net loss was primarily due to an increase in operating expenses from the new ALF operations.
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Liquidity and Capital
The following table provides selected financial data about our Company as of November 30, 2019 and 2018, respectively.
Working Capital
November 30, | November 30, | |||||||||||
2019 | 2018 | Change | ||||||||||
Cash | $ | 8,164 | $ | 21,019 | $ | (12,855 | ) | |||||
Current Assets | $ | 9,854 | $ | 21,019 | $ | (11,165 | ) | |||||
Current Liabilities | 54,837 | 2,881 | 51,956 | |||||||||
Working Capital (Deficiency) | $ | (44,983 | ) | $ | 18,138 | $ | (63,121 | ) | ||||
As at November 30, 2019 and 2018, our Company’s current assets were $9,854 and $21,019 respectively. The decrease in current assets is primarily due to a decrease in cash.
As at November 30, 2019, our Company had current and total liabilities of $54,837, compared with current and total liabilities of $2,881 as at November 30, 2018. As at November 30, 2019, liabilities consisted of $42,581 accounts payable and accrued liabilities, $5,556 payable to an officer of our Company, $6,700 deferred revenue and customer deposits. As at November 30, 2018, liabilities consisted solely of accounts payable.
As of November 30, 2019, our working capital decreased $63,121 from November 30, 2018, due to an increase in current liabilities and a decrease in current asset.
Cash Flows
Year Ended | ||||||||||||
November 30, | ||||||||||||
2019 | 2018 | Change | ||||||||||
Cash used in operating activities | $ | (34,855 | ) | $ | (21,218 | ) | $ | (13,637 | ) | |||
Cash provided by financing activities | 22,000 | 30,500 | (8,500 | ) | ||||||||
Net change in cash for period | $ | (12,855 | ) | $ | 9,282 | $ | (22,137 | ) | ||||
Cash Flows from Operating Activities
For the year ended November 30, 2019, net cash used in operating activities was $34,855 compared to $21,128 used during the year ended November 30, 2018. Cash flows used in operating activities for the year ended November 30, 2019, comprised of a net loss of $85,121, which was reduced by a net change in working capital of $50,266. Cash flows used in operating activities for the year ended November 30, 2018, comprised of a net loss of $26,965, which was reduced by a net change in working capital of $5,747.
Cash Flows from Investing Activities
For the year ended November 30, 2019 and 2018, we did not have any investing activities.
Cash Flows from Financing Activities
For the year ended November 30, 2019 and 2018, we received $22,000 and $30,500 from issuance of our Common Stock, respectively.
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Contractual Obligations
As a “smaller reporting company”, we are not required to provide tabular disclosure obligations.
Off-Balance Sheet Arrangements
We have no 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 is material to stockholders.
Critical Accounting Policies
We prepare our financial statements in conformity with GAAP, which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the financial statements are prepared. On a regular basis, we review our accounting policies and how they are applied and disclosed in our financial statements.
While we believe that the historical experience, current trends and other factors considered support the preparation of our financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.
Revenue
recognition
Effective January 1, 2018, the Company adopted ASC 606,
”Revenue from Contracts with Customers.”
Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company derives its revenues from the rendering of business advisory services, such as training, implementation, consulting, and other customer-specific services. The five step model defined by ASC Topic 606 requires us to: (1) identify our contracts with customers, (2) identify our performance obligations under those contracts, (3) determine the transaction prices of those contracts, (4) allocate the transaction prices to our performance obligations in those contracts and (5) recognize revenue when each performance obligation under those contracts is satisfied. Revenue is recognized when promised goods or services are transferred to the customer in an amount that reflects the consideration expected in exchange for those goods or services.Resident fees at our independent senior living and assisted living community consists of regular monthly charges for basic housing and support services and fees for additional requested services, such as assisted living services, personalized health services and ancillary services. Fees are specified in our agreements with residents, which are generally 30-day terms, with regular monthly charges billed in advance on the first day of each month.
Also, refer to Note 2 - Significant Accounting Policies and the audited consolidated financial statements that are included in this Report.
Recent Accounting Pronouncements
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under this guidance, lessees will be required to recognize on the balance sheet a lease liability and a right-of-use asset for all leases, with the exception of short-term leases. The lease liability represents the lessee's obligation to make lease payments arising from a lease and will be measured as the present value of the lease payments. The right-of-use asset represents the lessee’s right to use a specified asset for the lease term, and will be measured at the lease liability amount, adjusted for lease prepayment, lease incentives received and the lessee s initial direct costs. The standard also requires a lessee to recognize a single lease cost allocated over the lease term, generally on a straight-line basis. The new guidance is effective for fiscal years beginning after December 15, 2018. ASU 2016-02 is required to be applied using the modified retrospective approach for all leases existing as of the effective date and provides for certain practical expedients. Early adoption is permitted. The Company is currently evaluating the effects that the adoption of ASU 2016-02 will have on the Company’s financial statements.
Management has considered all recent accounting pronouncements issued. Our management believes that these recent pronouncements will not have a material effect on our Company’s financial statements.
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As a “smaller reporting company,” we are not required to provide the information required by this Item.
The consolidated financial statements and Report of Independent Registered Public Accounting Firm are listed in the “Index to Consolidated Financial Statements” on page F-1 and included on pages F-2 through F-11.
There were no disagreements related to accounting principles or practices, financial statement disclosure, internal controls or auditing scope or procedure during the two fiscal years and interim periods.
Evaluation of Effectiveness of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer, as of November 30, 2018, concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are not effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act was recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure for the reasons noted below.
Management’s Report on Internal Control Over Financial Reporting
Our management is also responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. Our Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
Our internal control over financial reporting includes those policies and procedures that:
• | Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our Company; and | |
• | Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and | |
• | That our receipts and expenditures are being made only in accordance with authorizations of our Company’s management and directors; and | |
• | Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
As of November 30, 2019, management conducted an evaluation of the effectiveness of internal control over financial reporting based on criteria established in
Internal Control – Integrated Framework (2013)
issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that our internal control over financial reporting was not effective as of November 30, 2019.| 13 |
Management has identified the following material weaknesses and is taking action to remedy and remove the weakness in its internal controls over financial reporting:
• | Lack of an independent board of directors, including an independent financial expert. The current board of directors is evaluating expanding the board of directors to include additional independent directors. | |
• | Lack of segregation of duties and adequate documentation of our internal controls. | |
• | Lack of multiple levels of review in our Company’s financial reporting process. |
Changes in internal control over financial reporting
There have been no changes in our internal control over financial reporting during the quarter ended November 30, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Limitations on the Effectiveness of Controls
Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, misstatements, errors, and instances of fraud, if any, within our company have been or will be prevented or detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management or Board override of the control.
The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
This annual report does not include a standard internal control report by our Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our Company’s registered public accounting firm pursuant to current rules of the SEC that permit our Company, as a smaller reporting company, to provide only management’s report in this annual report.
None.
| 14 |
All directors of our Company hold office until the next annual meeting of the security holders or until their successors have been elected and qualified. The officers of our Company are appointed by our board of directors and hold office until their death, resignation or removal from office. Our directors and executive officers, their ages, positions held, and duration as such, are as follows:
Name | Position Held with the Company | Age | Date First Elected or Appointed | |||
Romulus Barr | President, Chief Executive Officer, Chief Financial Officer, Treasurer and Director | 46 | May 24, 2017 | |||
Anca Barr | Secretary and Director | 41 | May 24, 2017 |
Business Experience
The following is a brief account of the education and business experience during at least the past five years of each director, executive officer and key employee of our Company, indicating the person’s principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out.
Romulus Barr – President, Chief Executive Officer, Chief Financial Officer, Treasurer and Director
Since 2004, Mr. Barr has been the President and Owner of R.A. Alf, Inc., a Punta Gorda, FL based company. From 1998 to 2003, Mr. Barr was President and Owner of R.A. Adult Care, an adult care home in Portland, OR. With his 20 years of experience in the healthcare industry, Mr. Barr is knowledgeable in all aspects of establishing and running a successful assisted living business. His expertise includes, but it is not limited to, state and local licensing requirements, staff training, daily operations, emergency planning.
Mr. Barr obtained a Masters of History and Theology from Holy Cross in Brookline, MA in 2001. He also received a Bachelor’s Degree from the University of Oradea, Romania in 1995. Mr. Barr completed an Adult Foster Care Home Training in 1999 and Assisted Living Facilities Core Training Program in 2004.
Our Company believes that Mr. Barr’s professional background experience gives him the qualifications and skills necessary to serve as a director and officer of our Company.
Anca Barr
– Secretary and Director
Ms. Barr has been involved in the Healthcare Services industry for more than 20 years. Ms. Barr is skilled in caring for adult patients to improve their health and wellbeing. She is familiar with day-to-day operations and activities of daily living in both, Adult Care Homes and Assisted Living Facilities. Ms. Barr was Administrator Assistant of R.A. Adult Care in Portland, OR, from 1998 to 2003, and Dietary Aide and Administrator Assistant of R.A. ALF, Inc., in Punta Gorda, FL, from 2004 to 2016. From 2016 to the present, Anca works as a Caregiver and CNA (Certified Nursing Assistant) at RA ALF Inc., in Punta Gorda, FL.
In 1994, Ms. Barr completed her Certified Nursing Assistant Program from the school Health Group in Sibiu, Romania. Ms. Barr completed an Adult Foster Care Home Training in 1998 and Assisted Living Facilities Core Training Program in 2004.
Our Company believes that Ms. Barr’s professional background experience gives her the qualifications and skills necessary to serve as a director and officer of our Company.
Term of Office
Our directors are appointed for a one-year term to hold office until the next annual general meeting of our stockholders; until removed from office in accordance with our Bylaws; or until resignation. Our officers are appointed by our board of directors and hold office until removed by the Board or until resignation.
All officers and directors listed above will remain in office until the next annual meeting of our stockholders, and until their successors have been duly elected and qualified. There are no agreements with respect to the election of directors. We have not compensated our Directors for service on our Board, any committee thereof, or reimbursed for expenses incurred for attendance at meetings of our Board and/or any committee of our Board. Officers are appointed annually by our Board and each executive officer serves at the discretion of our Board. We do not have any standing committees. Our Board may in the future determine to pay directors’ fees and reimburse directors for expenses related to their activities as such.
| 15 |
Employment Agreements
We have no formal employment agreements with any of our directors or officers.
Family Relationships
Romulus Barr, our President, CEO and a director is the brother of Anca Barr who is our Secretary and also a director.
Involvement in Certain Legal Proceedings
To the best of our knowledge, none of our directors or executive officers has, during the past ten years:
1. | been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offences); | |
2. | had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time; | |
3. | been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity; | |
4. | been found by a court of competent jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated; | |
5. | been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or | |
6. | been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26)), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29)), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member. |
Compliance with Section 16(A) of the Securities Exchange Act of 1934
Our common stock is not registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Accordingly, our executive officers and directors and persons who own more than 10% of a registered class of our equity securities are not subject to the beneficial ownership reporting requirements of Section 16(1) of the Exchange Act.
Code of Ethics
We have not adopted a Code of Business Conduct and Ethics.
| 16 |
Board and Committee Meetings
Our board of directors held no formal meetings during the year ended November 30, 2018. All proceedings of the board of directors were conducted by resolutions consented to in writing by all the directors and filed with the minutes of the proceedings of the directors. Such resolutions consented to in writing by the directors entitled to vote on that resolution at a meeting of the directors are, according to the Nevada Business Corporation Act and our Bylaws, as valid and effective as if they had been passed at a meeting of the directors duly called and held.
Nomination Process
As of November 30, 2019, we did not affect any material changes to the procedures by which our shareholders may recommend nominees to our board of directors. Our board of directors does not have a policy with regards to the consideration of any director candidates recommended by our shareholders. Our board of directors has determined that it is in the best position to evaluate our Company’s requirements as well as the qualifications of each candidate when the board considers a nominee for a position on our board of directors. If shareholders wish to recommend candidates directly to our Board, they may do so by sending communications to the President of our Company at the address on the cover of this annual report.
Audit Committee
Currently our audit committee consists of our entire board of directors. We do not have a standing audit committee as we currently have limited working capital and minimal revenues. Should we be able to raise sufficient funding to execute our business plan, we will form an audit, compensation committee and other applicable committees utilizing our directors’ expertise.
Audit Committee Financial Expert
Currently our audit committee consists of our entire board of directors. We do not currently have a director who is qualified to act as the head of the audit committee.
The particulars of the compensation paid to the following persons:
(a) | our principal executive officer; | |
(b) | each of our two most highly compensated executive officers who were serving as executive officers at the end of the years ended November 30, 2019 and 2018; and | |
(c) | up to two additional individuals for whom disclosure would have been provided under (b) but for the fact that the individual was not serving as our executive officer at the end of the years ended November 30, 2019 and 2018, who we will collectively refer to as the named executive officers of our company, are set out in the following summary compensation table, except that no disclosure is provided for any named executive officer, other than our principal executive officers, whose total compensation did not exceed $100,000 for the respective fiscal year: |
SUMMARY COMPENSATION TABLE | |||||||||
Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Compensa-tion ($) | Change in Pension Value and Nonqualified Deferred Compensa-tion Earnings ($) | All Other Compensation ($) | Total ($) |
Romulus Barr(1) | 2019 | 10,360 | - | - | - | - | - | - | 10,360 |
President, CEO, CFO, Treasurer and Director | 2018 | - | - | - | - | - | - | - | - |
Anca Barr(2) | 2019 | 10,000 | - | - | - | - | - | - | 10,000 |
Secretary and Director | 2018 | - | - | - | - | - | - | - | - |
(1) | Mr. Barr was appointed President, Chief Executive Officer, Chief Financial Officer, Treasurer and Director on May 24, 2017. | |
(2) | Ms. Barr was appointed Secretary and Director on May 24, 2017. |
| 17 |
There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers. Our directors and executive officers may receive share options at the discretion of our board of directors in the future. We do not have any material bonus or profit-sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that share options may be granted at the discretion of our board of directors.
Grants of Plan-Based Awards
During the fiscal year ended November 30, 2019 we did not grant any stock options.
Option Exercises and Stock Vested
During our fiscal year ended November 30, 2019 there were no options exercised by our named officers.
Compensation of Directors
We do not have any agreements for compensating our directors for their services in their capacity as directors, although such directors are expected in the future to receive stock options to purchase shares of our common stock as awarded by our board of directors.
No compensation was paid to non-employee directors for the year ended November 30, 2019.
Pension, Retirement or Similar Benefit Plans
There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers. We have no material bonus or profit-sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of the board of directors or a committee thereof.
Indebtedness of Directors, Senior Officers, Executive Officers and Other Management
None of our directors or executive officers or any associate or affiliate of our Company during the last two fiscal years, is or has been indebted to our Company by way of guarantee, support agreement, letter of credit or other similar agreement or understanding currently outstanding.
The following table sets forth, as of November 30, 2019, certain information with respect to the beneficial ownership of our common and preferred shares by each shareholder known by us to be the beneficial owner of more than 5% of our Common or Preferred shares, as well as by each of our current directors and executive officers as a group. Each person has sole voting and investment power with respect to the shares of common and preferred stock, except as otherwise indicated. Beneficial ownership consists of a direct interest in the shares of common and preferred stock, except as otherwise indicated.
| 18 |
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percentage of Class(1) | ||||
Romulus Barr 2382 Bartek Pl. North Port, FL 34289 | 8,000,000 shares of common stock / direct | 56.54 | % | |||
Anca Barr 2382 Bartek Pl. North Port, FL 34289 | 2,000,000 shares of common stock / direct | 14.13 | % | |||
Directors and Executive Officers as a Group | 10,000,000 shares of common stock | 70.67 | % | |||
_________________
(1) | Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on February 1, 2019. As of February 1, 2019 there were 14,150,000 shares of our company’s common stock issued and outstanding. |
Changes in Control
We are unaware of any contract or other arrangement or provisions of our Articles of Incorporation or Bylaws the operation of which may at a subsequent date result in a change of control of our company. There are not any provisions in our Articles of Incorporation or Bylaws, the operation of which would delay, defer, or prevent a change in control of our Company.
Except as disclosed herein, no director, executive officer, shareholder holding at least 5% of shares of our common stock, or any family member thereof, had any material interest, direct or indirect, in any transaction, or proposed transaction since the year ended November 30, 2019, in which the amount involved in the transaction exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at the year-end for the last two completed fiscal years.
Director Independence
We currently act with two directors, Romulus Barr and Anca Barr.
We have determined we do not have an independent director, as that term is used in Rule 4200(a)(15) of the Rules of National Association of Securities Dealers.
Currently our audit committee consists of our entire board of directors. We currently do not have nominating, compensation committees or committees performing similar functions. There has not been any defined policy or procedure requirements for shareholders to submit recommendations or nomination for directors.
From inception to present date, we believe that the members of our audit committee and the board of directors have been and are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting.
| 19 |
The aggregate fees billed for the most recently completed fiscal year ended November 30, 2019 and for fiscal year ended November 30, 2018 for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements included in our quarterly reports on Form 10-Q and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:
Year Ended | ||||||||
November 30, 2019 | November 30, 2018 | |||||||
Audit Fees | $ | 11,000 | $ | 7,800 | ||||
Audit Related Fees | - | - | ||||||
Tax Fees | - | - | ||||||
All Other Fees | - | - | ||||||
Total | $ | 11,000 | $ | 7,800 | ||||
Our board of directors pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by the board of directors either before or after the respective services were rendered.
Our board of directors has considered the nature and amount of fees billed by our independent auditors and believes that the provision of services for activities unrelated to the audit is compatible with maintaining our independent auditors’ independence.
| 20 |
(a) | Financial Statements |
(1) | The consolidated financial statements and Report of Independent Registered Public Accounting Firm are listed in the “Index to Consolidated Financial Statements” on page F-1 and included on pages F-2 through F-11. | |
(2) | All schedules for which provision is made in the applicable accounting regulations of the SEC are either not required under the related instructions, are not applicable (and therefore have been omitted), or the required disclosures are contained in the financial statements included herein. |
(b) | Exhibits |
Exhibit Number | Description | Incorporated By Reference | ||||||
Form | Exhibit | Filing Date | ||||||
(3) | Articles of Incorporation and Bylaws | |||||||
S-1 | 3.1 | August 23, 2018 | ||||||
S-1 | 3.2 | August 23, 2018 | ||||||
(21) | Subsidiaries of the Registrant | |||||||
21.1 | Assisted 2 Live, Inc., a Florida corporation | |||||||
(31) | Rule 13a-14 (d)/15d-14d) Certifications | |||||||
(32) | Section 1350 Certifications | |||||||
101 ** | Interactive Data File | |||||||
101.INS | XBRL Instance Document | |||||||
101.SCH | XBRL Taxonomy Extension Schema Document | |||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
* Filed herewith.
** Furnished herewith.
| 21 |
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.
ASSISTED 4 LIVING, INC. | |||
(Registrant) | |||
Dated: February 28, 2020 | /s/ Romulus Barr | ||
Romulus Barr | |||
President, Chief Executive Officer, Chief Financial Officer, Treasurer and Director | |||
(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Dated: February 28, 2020 | /s/ Romulus Barr | ||
Romulus Barr | |||
President, Chief Executive Officer, Chief Financial Officer, Treasurer and Director | |||
(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) | |||
/s/ Anca Barr | |||
Dated: February 28, 2020 | Anca Barr | ||
Secretary and Director |
| 22 |
ASSISTED 4 LIVING, INC.
AUDITED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED NOVEMBER 30, 2019 AND 2018
Page | |||
F-2 | |||
F-3 | |||
F-4 | |||
F-5 | |||
F-6 | |||
F-7 |
| F-1 |
Pinnacle Accountancy Group of Utah
(a DBA of Heaton & Co., PLLC)
1438 N. Hwy 89, Ste. 120
Farmington, UT 84025
Ph. 801-447-9572
To the Board of Directors and Stockholders
Assisted 4 Living, Inc.
North Port, Florida
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Assisted 4 Living, Inc. (the Company) as of November 30, 2019 and 2018, and the related statements of operations, stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of November 30, 2019 and 2018, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.
Consideration of the Company’s Ability to Continue as a Going Concern
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has suffered recurring losses and has minimal operations which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provides a reasonable basis for our opinion.
We have served as the Company’s auditor since January 2018.
Pinnacle Accountancy Group of Utah
Farmington, Utah
February 28, 2020
| F-2 |
ASSISTED 4 LIVING, INC.
November 30, | November 30, | |||||||
2019 | 2018 | |||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash | $ | 8,164 | $ | 21,019 | ||||
Prepaid expense | 1,690 | - | ||||||
Total Current Assets | 9,854 | 21,019 | ||||||
TOTAL ASSETS | $ | 9,854 | $ | 21,019 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
Current Liabilities | ||||||||
Accounts payable and accrued liabilities | $ | 42,581 | $ | 2,881 | ||||
Deferred revenue and customer deposits | 6,700 | - | ||||||
Due to related parties | 5,556 | - | ||||||
Total Current Liabilities | 54,837 | 2,881 | ||||||
Total Liabilities | 54,837 | 2,881 | ||||||
Stockholders’ Equity (Deficit) | ||||||||
Preferred stock: 25,000,000 shares authorized; $0.0001 par value no shares issued and outstanding | - | - | ||||||
Common stock: 100,000,000 shares authorized; $0.0001 par value 14,150,000 and 13,050,000 shares issued and outstanding, respectively | 1,415 | 1,305 | ||||||
Additional paid in capital | 71,085 | 49,195 | ||||||
Accumulated deficit | (117,483 | ) | (32,362 | ) | ||||
Total Stockholders’ Equity (Deficit) | (44,983 | ) | 18,138 | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | 9,854 | $ | 21,019 | ||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-3 |
ASSISTED 4 LIVING, INC.
Year Ended | ||||||||
November 30, | ||||||||
2019 | 2018 | |||||||
Revenue | $ | 392,706 | $ | 18,700 | ||||
Cost of service | (246,478 | ) | - | |||||
Gross Profit | 146,228 | 18,700 | ||||||
Operating Expenses: | ||||||||
General and administrative | 184,254 | 21,178 | ||||||
Professional fees | 45,090 | 24,487 | ||||||
Total operating expenses | 229,344 | 45,665 | ||||||
Operating Loss | (83,116 | ) | (26,965 | ) | ||||
Other income (expense) | ||||||||
Interest expense, net | (2,005 | ) | - | |||||
Total other expenses | (2,005 | ) | - | |||||
Net loss before income taxes | (85,121 | ) | (26,965 | ) | ||||
Provision for income tax | - | - | ||||||
Net Loss | $ | (85,121 | ) | $ | (26,965 | ) | ||
Basic and Diluted Loss per Common Share | $ | (0.01 | ) | $ | (0.00 | ) | ||
Basic and Diluted Weighted Average Common Shares Outstanding | 13,998,767 | 11,525,205 | ||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-4 |
Consolidated Statements of Changes in Stockholders’ Equity (Deficit)
For the Years Ended November 30, 2019 and 2018
Additional | ||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Paid in | Accumulated | |||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Deficit | Total | ||||||||||||||||||||||
Balance - November 30, 2017 | - | - | 10,000,000 | 1,000 | 19,000 | $ | (5,397 | ) | $ | 14,603 | ||||||||||||||||||
| - | ||||||||||||||||||||||||||||
Issuance of common shares for cash at $0.01 per share | - | - | 3,050,000 | 305 | 30,195 | - | 30,500 | |||||||||||||||||||||
Net loss | - | - | - | - | - | (26,965 | ) | (26,965 | ) | |||||||||||||||||||
Balance - November 30, 2018 | - | - | 13,050,000 | 1,305 | 49,195 | (32,362 | ) | 18,138 | ||||||||||||||||||||
Issuance of common shares for cash at $0.02 per share | - | - | 1,100,000 | 110 | 21,890 | - | 22,000 | |||||||||||||||||||||
Net loss | - | - | - | - | - | (85,121 | ) | (85,121 | ) | |||||||||||||||||||
Balance - November 30, 2019 | - | $ | - | 14,150,000 | $ | 1,415 | $ | 71,085 | $ | (117,483 | ) | $ | (44,983 | ) | ||||||||||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-5 |
Consolidated Statements of Cash Flows
Year Ended | ||||||||
November 30, | ||||||||
2019 | 2018 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net loss | $ | (85,121 | ) | $ | (26,965 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Changes in current assets and liabilities: | ||||||||
Prepaid expenses | (1,690 | ) | 5,000 | |||||
Accounts payable and accrued liabilities | 39,700 | 1,697 | ||||||
Due to related parties | 5,556 | (950 | ) | |||||
Deferred revenue and customer deposits | 6,700 | - | ||||||
Net Cash Used in Operating Activities | (34,855 | ) | (21,218 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Proceeds from issuance of common stock | 22,000 | 30,500 | ||||||
Net Cash Provided by Financing Activities | 22,000 | 30,500 | ||||||
Net change in cash for the period | (12,855 | ) | 9,282 | |||||
Cash at beginning of period | 21,019 | 11,737 | ||||||
Cash at end of period | $ | 8,164 | $ | 21,019 | ||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||
Cash paid for income taxes | $ | - | $ | - | ||||
Cash paid for interest | $ | - | $ | - | ||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-6 |
Notes to the Audited Consolidated Financial Statements
November 30, 2019 and 2018
NOTE 1 – ORGANIZATION, DESCRIPTION OF BUSINESS AND GOING CONCERN
Assisted 4 Living, Inc., (“Assisted 4 Living,” “the Company,” “we” or “us”) was incorporated in the state of Nevada on May 24, 2017. It is based in North Port, Florida. The Company incorporated a wholly-owned subsidiary, “Assisted 2 Live, Inc.” in the state of Florida on June 15, 2017. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is November 30.
The Company operates as an assisted living consulting company that specializes in acquiring, licensing, staffing, and operating assisted living facilities (“ALF”). The Company offers clients that wish to enter the ALF field an opportunity to purchase and run its own center(s), and will also act as a referral agent finding and placing clients that are in search of quality residential care. The Company will also offer a la carte consulting services such as submitting license applications, developing emergency plans, as well as other regulatory and compliance needs.
Going Concern
The accompanying audited consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. As of November 30, 2019, the Company has an accumulated deficit and has sustained a net loss.
The ability of the Company to obtain profitability is dependent upon, among other things, obtaining additional financing to continue operations, and development of its business plan. In response to these problems, management intends to raise additional operating funds through equity and/or debt offerings. However, there can be no assurance management will be successful in its endeavors.
There are no assurances that the Company will be able to either (1) achieve a level of revenues adequate to generate sufficient cash flow from operations; or (2) obtain additional financing through either private placement, public offerings and/or bank financing necessary to support its working capital requirements. To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, the Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to the Company. If adequate working capital is not available to the Company, it may be required to curtail or cease its operations.
These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The consolidated financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The consolidated financial statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles of the United States (“GAAP”).
Basis of Consolidation
These consolidated financial statements include the accounts of the Company and the wholly-owned subsidiary, Assisted 2 Live, Inc. All intercompany balances and transactions have been eliminated.
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Use of Estimates and Assumptions
The preparation of financial statements in conformity with GAAP 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. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.
Cash and Cash Equivalents
Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value. The Company had $8,164 and $21,019 in cash and cash equivalents as of November 30, 2019 and 2018, respectively.
Financial Instruments and Fair Value Measurements
The Company follows ASC 820, “
Fair Value Measurements and Disclosures,
” which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of November 30, 2019 and 2018. The carrying values of our financial instruments, including, cash and cash equivalents, prepaid expenses, due to related parties, and accounts payable, approximate their fair values due to the short-term maturities of these financial instruments.
Accounts Receivable and Allowance for Uncollectible Accounts
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments for services. Accounts with known financial issues are first reviewed and specific estimates are recorded. The remaining accounts receivable balances are then grouped in categories by the number of days the balance is past due, and the estimated loss is calculated as a percentage of the total category based upon past history. Account balances are charged against the allowance when it is probable that the receivable will not be recovered. As at November 30, 2019 and 2018, the Company had no valuation allowance, nor accounts receivable.
Related Parties
The Company follows ASC 850, "
Related Party Disclosures,”
for the identification of related parties and disclosure of related party transactions (see Note 5).Revenue R
ecognition
Effective January 1, 2018, the Company adopted ASC 606,
”Revenue from Contracts with Customers.”
Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company derives its revenues from the rendering of business advisory services, such as training, implementation, consulting, and other customer-specific services. The five step model defined by ASC Topic 606 requires us to: (1) identify our contracts with customers, (2) identify our performance obligations under those contracts, (3) determine the transaction prices of those contracts, (4) allocate the transaction prices to our performance obligations in those contracts and (5) recognize revenue when each performance obligation under those contracts is satisfied. Revenue is recognized when promised goods or services are transferred to the customer in an amount that reflects the consideration expected in exchange for those goods or services.| F-8 |
Resident fees at our independent senior living and assisted living community consists of regular monthly charges for basic housing and support services and fees for additional requested services, such as assisted living services, personalized health services and ancillary services. Fees are specified in our agreements with residents, which are generally 30-day terms, with regular monthly charges billed in advance on the first day of each month.
Consulting services are invoiced monthly for assistance to third parties with operating and establishing an assisted living facility. As of November 30, 2019, the Company is focusing on their resident fees and do not expect to receive significant revenue from these services.
Concentrations
During the year ended November 30, 2019, there were no material concentrations.
During the year ended November 30, 2018, revenue was comprised of one labor contract from an unrelated party, that leases and operates its assisted living facility from our CEO. One customer represented 100% of the revenues of the Company for the year ended November 30, 2018.
Income Taxes
The Company uses the liability method of accounting for income taxes. Under the liability method, deferred tax assets and liabilities are determined based on differences between financial reporting and the tax basis of assets, liabilities, the carry forward of operating losses and tax credits, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. An allowance against deferred tax assets is recorded when it is more likely than not that such tax benefits will not be realized.
Net Loss Per Share of Common Stock
The Company has adopted ASC Topic 260, "
Earnings per Share,”
(“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying financial statements, basic earnings (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.The Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.
Recent Accounting Pronouncements
In February 2016, the FASB issued ASU 2016-02,
“Leases”
(Topic 842). Under this guidance, lessees will be required to recognize on the balance sheet a lease liability and a right-of-use asset for all leases, with the exception of short-term leases. The lease liability represents the lessee’s obligation to make lease payments arising from a lease, and will be measured as the present value of the lease payments. The right-of-use asset represents the lessee’s right to use a specified asset for the lease term, and will be measured at the lease liability amount, adjusted for lease prepayment, lease incentives received and the lessee s initial direct costs. The standard also requires a lessee to recognize a single lease cost allocated over the lease term, generally on a straight-line basis. The new guidance is effective for fiscal years beginning after December 15, 2018. ASU 2016-02 is required to be applied using the modified retrospective approach for all leases existing as of the effective date and provides for certain practical expedients. Early adoption is permitted. The Company is currently evaluating the effects that the adoption of ASU 2016-02 will have on the Company’s financial statements. The Company has reviewed all other recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on our financial statements.
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NOTE 3 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Accounts payable and accrued liabilities at November 30, 2019 and 2018 consist of the following:
November 30, | November 30, | |||||||
2019 | 2018 | |||||||
Trade accounts | $ | 9,282 | $ | 2,881 | ||||
Credit card | 18,240 | - | ||||||
Accrued salary | 14,724 | - | ||||||
Sales tax payable | 335 | - | ||||||
Total | $ | 42,581 | $ | 2,881 | ||||
NOTE 4 - EQUITY
Preferred Stock
The Company has authorized 25,000,000 preferred shares with a par value of $0.0001 per share. The Board of Directors are authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.
As of November 30, 2019 and 2018, the Company had no classes of preferred shares designated.
Common Stock
The Company has authorized 100,000,000 common shares with a par value of $0.0001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.
During the year ended November 30, 2019, the Company issued to unaffiliated investors 1,100,000 shares of common stock at $0.02 per share for $22,000.
During the year ended November 30, 2018 the Company issued to unaffiliated investors 3,050,000 shares of common stock at $0.01 per share for $30,500.
As of November 30, 2019 and 2018, the Company had 14,150,000 and 13,050,000 common shares issued and outstanding, respectively.
NOTE 5 - RELATED PARTY TRANSACTIONS
During the year ended November 30, 2019 and 2018, the Company paid officers and directors management fees of $20,360 and $0, respectively.
During the year ended November 30, 2019 and 2018, our CEO paid $5,556 and $0, respectively, for a property and liability insurance deposit on behalf of the Company, of which $5,556 remains payable to our CEO at November 30, 2019.
During the year ended November 30, 2018, the amount owed to the officer of $950 was fully repaid by the Company.
During the year ended November 30, 2019 and 2018, the Company paid consulting fees to a company controlled by our CEO, a total amount of $2,700 and $0, respectively.
The Company does not have employment contracts with its officers.
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NOTE 6 – PROVISION FOR INCOME TAXES
On December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (the “Act”) resulting in significant modifications to existing law. The Company has completed the accounting for the effects of the Act during the year ended November 30, 2018. The Company’s consolidated financial statements for the year ended November 30, 2018 reflect certain effects of the Act which includes a reduction in the corporate tax rate from 34% to 21% as well as other changes.
The reconciliation of income tax expense at the U.S. statutory rate of 21% in 2019 and the blended U.S. statutory rate of 34% in 2018, to the Company’s effective tax rate is as follows:
November 30, | November 30, | |||||||
2019 | 2018 | |||||||
Income tax expense at statutory rate | $ | (17,875 | ) | $ | (9,168 | ) | ||
Income tax adjustment | 384 | - | ||||||
Effect of change in statutory rate | - | 3,505 | ||||||
Change in valuation allowance | 17,491 | 5,663 | ||||||
Income tax expense per books | $ | - | $ | - | ||||
The tax effects of temporary differences that give rise to the Company’s net deferred tax assets as of November 30, 2019 and 2018 are as follows:
November 30, | November 30, | |||||||
2019 | 2018 | |||||||
NOL Carryover | $ | 24,267 | $ | 6,776 | ||||
Valuation allowance | (24,267 | ) | (6,776 | ) | ||||
Net deferred tax asset | $ | - | $ | - | ||||
The Company has approximately $115,500 of net operating losses (“NOL”) generated from inception (May 24, 2017) to November 30, 2019 carried forward to offset taxable income in future years which expire commencing in fiscal 2037. NOLs generated in tax years prior to November 30, 2018, can be carryforward for twenty years, whereas NOLs generated after November 30, 2018 can be carryforward indefinitely. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the assessment, management has established a full valuation allowance against all of the deferred tax assets relating to NOLs for every period because it is more likely than not that all of the deferred tax assets will not be realized.
A valuation allowance has been established for our tax assets as their use is dependent on the generation of sufficient future taxable income, which cannot be predicted at this time. As of November 30, 2019, we had no material unrecognized tax benefits and no adjustments to liabilities or operations were required. No interest and penalties have been recognized by us to date. Our net operating loss carryforwards are subject to review and possible adjustment by the Internal Revenue Service and are subject to certain limitations in the event of cumulative changes in the ownership interest of significant stockholders over a three-year period in excess of 50%.
Tax returns for the year ended 2017, 2018 and 2019 are subject to review by the tax authorities. The Company has no liabilities related to uncertain tax positions or unrecognized benefits as of the year ended November 30, 2019.
NOTE 7 – COMMITMENT
On March 7, 2019, the Company entered into the commercial real estate lease agreement. The Company leases an adult living facility building for $3,713 monthly, from March 7, 2019 until January 7, 2020. The term may be extended at the sole discretion of the landlord.
NOTE 8 – SUBSEQUENT EVENT
Management has evaluated subsequent events through the date these consolidated financial statements were available to be issued. Based on our evaluation no material events have occurred that require disclosure.
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