EXTREME BIODIESEL, INC. - Quarter Report: 2008 September (Form 10-Q)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form 10-Q
Quarterly
Report Pursuant to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
For the
Quarterly Period Ended September 30, 2008
Commission File Number 333-152837
BIGWEST
ENVIRONMENTAL, Inc.
(Exact
name of registrant as specified in its charter)
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Nevada
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36-4627722
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(State
or other jurisdiction of
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(I.R.S.
Employer
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incorporation
or organization)
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Identification
No.)
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BigWest
Environmental, Inc.
1350 W.
Horizon Ridge Drive
Suite
1922
Henderson,
Nevada 89014
(702)
301-7333
(Registrant’s
telephone number, including area code)
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 past 90 days.
Yes x
No o
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definitions of “large accelerated filer,” “accelerated filer,” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):
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Large
accelerated filer o
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Accelerated
filer o
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Non-accelerated
filer o
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Smaller
reporting company x
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(Do
not check if a smaller reporting company)
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Indicate
by check mark whether the registrant is a shell Company (as defined in
Rule 12b-2 of the Exchange Act).
Yes o
No x
10,055,000
shares of
Common Stock, par value $0.001, were outstanding on November
10, 2008.
BIGWEST
ENVIRONMENTAL, INC.
INDEX
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Page
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Number
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PART I - FINANCIAL
INFORMATION
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Item
1 – Financial Statements -Unaudited
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Balance Sheets
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F-1
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Statements of Operations
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F-2
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Statements of Cash Flows
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F-3
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Notes to Financial Statements
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F-4-9
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Item 2 – Management’s Discussion and Analysis of Financial Condition
and Results of Operations
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1
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Item 3 – Quantitative and Qualitative
Disclosure About
Market Risk
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2
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Item 4 – Controls and
Procedures
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2
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PART II – OTHER
INFORMATION
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3
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Item 1 - Legal
Proceedings
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3
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Item 2 – Unregistered Sales of
Equity Securities and Use of Proceeds
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3
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Item 3 - Defaults upon Senior
Securities
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3
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Item 4 – Submission of Matters to a Vote
of Security Holders
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3
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Item 5 - Other
Information
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3
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Item 6 – Exhibits and Reports on Form
8-K
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3
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Signatures
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3
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PART
I ― FINANCIAL INFORMATION
Item
1. Financial
Statements.
BIGWEST
ENVIRONMENTAL, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
For
the Three and Six Months Ended September 30, 2008 and the
Period
of February 28, 2008 (Inception) to September 30, 2008
BIGWEST
ENVIRONMENTAL, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
For the
Three and Six Months Ended September 30, 2008 and the
Period of
February 28, 2008 (Inception) to September 30, 2008
TABLE
OF CONTENTS
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Page
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FINANCIAL
STATEMENTS
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Balance
Sheets as of March 31, 2008 and September 30, 2008
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F-1
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Statement
of Operations for the three and six months ended September 30, 2008 and
the period of February 28, 2008 (inception) to September 30,
2008
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F-2
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Statement
of Cash Flows for the six months ended September 30, 2008 and the period
of February 28, 2008 (inception) to September 30, 2008
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F-3
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Notes
to Unaudited Financial Statements
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F-4-9
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BIGWEST
ENVIRONMENTAL, INC.
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(A
Development Stage Enterprise)
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Balance
Sheets
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September
30, 2008
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March
31, 2008
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(unaudited)
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||||||||
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ASSETS
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Current
assets
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||||||||
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Cash
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$ | 1,000 | $ | 1,000 | ||||
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Prepaid
Expenses
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7,193 | 9,590 | ||||||
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Total
current assets
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8,193 | 10,590 | ||||||
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Total
assets
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$ | 8,193 | $ | 10,590 | ||||
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LIABILITIES
AND STOCKHOLDERS' EQUITY
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||||||||
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Liabilities
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$ | - | $ | - | ||||
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Stockholders'
Equity
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||||||||
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Common
stock, $.001 par value; 75,000,000 shares authorized, 10,590,000 shares
issued and outstanding
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10,590 | 10,590 | ||||||
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Additional
paid in capital
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- | - | ||||||
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Deficit
accumulated during the development stage
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(2,398 | ) | - | |||||
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Total
stockholders' equity
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8,193 | 10,590 | ||||||
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Total
liabilities and stockholders' equity
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$ | 8,193 | $ | 10,590 | ||||
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See
accompanying notes to financial statements
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F-1
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BIGWEST
ENVIRONMENTAL, INC.
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(A
Development Stage Enterprise)
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Statement
of Operations (unaudited)
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Three
months ended September 30, 2008
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Six
months ended September 30, 2008
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For
the period from February 28, 2008 (inception) to September 30,
2008
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Revenue
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$ | - | $ | - | $ | - | ||||||
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Expenses
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Professional
fees
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2,398 | 2,398 | 2,398 | |||||||||
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Total
expenses
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2,398 | 2,398 | 2,398 | |||||||||
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Net
loss
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$ | (2,398 | ) | $ | (2,398 | ) | $ | (2,398 | ) | |||
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Basic
and diluted loss per common share
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$ | (0.00 | ) | $ | (0.00 | ) | ||||||
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Weighted
average shares outstanding
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10,590,000 | 10,590,000 | ||||||||||
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See
accompanying notes to financial statements
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F-2
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BIGWEST
ENVIRONMENTAL, INC.
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(A
Development Stage Enterprise)
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Statements
of Cash Flows (unaudited)
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Six
months ended September 30, 2008
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For
the period from February 28, 2008 (inception) to September 30,
2008
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Cash
flows from operating activities
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Net
loss
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$ | (2,398 | ) | $ | (2,398 | ) | ||
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Adjustments
to reconcile net loss to net cash used in operating
activities
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Common
stock issued for services
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- | 8,090 | ||||||
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Changes
in operating assets and liabilities
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Prepaid
expenses
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2,398 | (7,193 | ) | |||||
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Net
cash used in operating activities
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- | (1,500 | ) | |||||
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Cash
flows from investing activities
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- | - | ||||||
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Cash
flows from financing activities
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Proceeds
from sale of stock
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- | 2,500 | ||||||
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Net
cash provided by financing activities
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- | 2,500 | ||||||
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Increase
in cash
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- | 1,000 | ||||||
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Cash
at beginning of period
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1,000 | - | ||||||
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Cash
at end of period
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$ | 1,000 | $ | 1,000 | ||||
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Supplemental
disclosure of non-cash investing and financing activities:
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Issuance
of 890,000 shares of common stock for professional and consulting
services
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$ | - | $ | 8,090 | ||||
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Supplemental
cash flow Information:
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Cash
paid for interest
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$ | - | $ | - | ||||
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Cash
paid for income taxes
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$ | - | $ | - | ||||
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See
accompanying notes to financial statements
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F-3
BIGWEST
ENVIRONMENTAL, INC.
(A
Development Stage Enterprise)
Notes
to Unaudited Financial Statements
For
the Three and Six Months Ended September 30, 2008 and the
Period
from February 28, 2008 (Inception) to September 30, 2008
A summary
of significant accounting policies of BigWest Environmental, Inc. (A Development
Stage Enterprise) (the Company) is presented to assist in understanding the
Company’s financial statements. The accounting policies presented in these
footnotes conform to accounting principles generally accepted in the United
States of America and have been consistently applied in the preparation of the
accompanying financial statements. These financial statements and notes are
representations of the Company’s management who are responsible for their
integrity and objectivity. The Company has not realized revenues from its
planned principal business purpose and is considered to be in its development
state in accordance with SFAS 7, “Accounting and Reporting by
Development State Enterprises.”
NOTE
1 - NATURE OF BUSINESS
Development Stage
Enterprise
BigWest
Environmental, Inc. (the "Company"), a development stage enterprise, was
incorporated in the State of Nevada on February 28, 2008. BigWest Environmental
is currently focusing on commercializing a selection of targeted solar products
(amorphous thin film solar panels and ancillary products) and technologies for a
wide range of applications including electrical power generation. As of the date
of this prospectus, we have generated no revenues from operations. We
intend to enter into supply agreement(s) with manufacturers of solar electric
power products and technologies which directly convert sunlight into
electricity. We are seeking solar cells that have a high conversion efficiency
and offer these products to the mass market along with the installation of
same.
We will
then offer the solar power products including solar cells, solar panels and
inverters which convert sunlight to electricity compatible with the utility
network. We intend to focus our sales in regions where government
incentives have accelerated solar power adoption. In addition, we
intend to develop and maintain solar parks. The development and maintenance of
solar parks requires a significant level of expertise and capital, which we
currently do not possess. We plan to obtain the expertise, either
internally or through outsourcing, as well as obtain the capital necessary to
complete solar park projects although there is no guarantee that we will be able
to acquire such expertise or capital. If we are unable to acquire or
develop such expertise or capital, we will not be able to develop our planned
solar park business and may be required to cease operations. We
anticipate that our customers will be utility companies and owners of large
commercial property (as buyers of the energy produced from the installation of
the solar panels) and owners of residential properties, for both single and
multi-family dwellings, as well as residential property developers who would
purchase the solar panels and consume the resultant electrical
output.
NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Development Stage
Enterprise
The
Company has devoted substantially all of its efforts to business planning, and
development. Additionally, the Company has allocated a substantial portion of
their time and investment in bringing their product to the market, and the
raising of capital.
F-4
BIGWEST
ENVIRONMENTAL, INC.
(A
Development Stage Enterprise)
Notes
to Unaudited Financial Statements
For
the Three and Six Months Ended September 30, 2008 and the
Period
from February 28, 2008 (Inception) to September 30, 2008
NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Company Year
End
The
Company has elected to have a March 31st year-end.
Cash and Cash
Equivalents
For
financial statement presentation purposes, the Company considers short-term,
highly liquid investments with original maturities of three months or less to be
cash and cash equivalents.
The
Company maintains cash and cash equivalent balances at a financial institution
that is insured by the Federal Deposit Insurance Corporation up to $100,000. At
of September 30, 2008, the Company did not have any deposits in excess of
insured amounts.
Property and
Equipment
Property
and equipment are carried at cost. Expenditures for maintenance and repairs are
charged against operations. Renewals and betterments that materially extend the
life of the assets are capitalized. When assets are retired or otherwise
disposed of, the cost and related accumulated depreciation are removed from the
accounts, and any resulting gain or loss is reflected in income for the
period.
Depreciation
is computed for financial statement purposes on a straight-line basis over
estimated useful lives of the related assets. The estimated useful lives of
depreciable assets are:
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Estimated
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Useful
Lives
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Office
Equipment
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5-10
years
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Copier
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5 -
7 years
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Vehicles
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5-10
years
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For
federal income tax purposes, depreciation is computed under the modified
accelerated cost recovery system. For audit purposes, depreciation is computed
under the straight-line method.
Revenue
Recognition
The
Company's financial statements are prepared under the accrual method of
accounting. Revenues will be recognized in the period the services are performed
and costs are recorded in the period incurred rather than paid.
Fair Value of Financial
Instruments
The
Company's financial instruments are all carried at amounts that approximate
their estimated fair value as of September 30, 2008.
F-5
BIGWEST
ENVIRONMENTAL, INC.
(A
Development Stage Enterprise)
Notes
to Unaudited Financial Statements
For
the Three and Six Months Ended September 30, 2008 and the
Period
from February 28, 2008 (Inception) to September 30, 2008
NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Use of
Estimates
The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Income
Taxes
The
provision for income taxes includes the tax effects of transactions reported in
the financial statements. Deferred taxes would be recognized for differences
between the basis for assets and liabilities for financial statement and income
tax purposes. The major difference relates to the net operating loss carry
forwards generated by sustaining deficits during the development
stage.
Advertising
Costs
Advertising
and promotions costs are expensed as incurred. The Company incurred no
such expenses since inception.
Recent Accounting
Pronouncements
In May
2008, FASB issued Financial Accounting Standards No. 163, “Accounting for Financial Guarantee
Insurance Contracts - an interpretation of FASB Statement No. 60.”
Diversity exists in practice in accounting for financial guarantee
insurance contracts by insurance enterprises under FASB Statement No. 60,
Accounting and Reporting by Insurance Enterprises. That diversity results in
inconsistencies in the recognition and measurement of claim liabilities because
of differing views about when a loss has been incurred under FASB Statement No.
5, Accounting for Contingencies.
This
Statement requires that an insurance enterprise recognize a claim liability
prior to an event of default (insured event) when there is evidence that credit
deterioration has occurred in an insured financial obligation. This Statement
also clarifies how Statement 60 applies to financial guarantee insurance
contracts, including the recognition and measurement to be used to account for
premium revenue and claim liabilities. Those clarifications will increase
comparability in financial reporting of financial guarantee insurance contracts
by insurance enterprises. This Statement requires expanded disclosures about
financial guarantee insurance contracts. The accounting and disclosure
requirements of the Statement will improve the quality of information provided
to users of financial statements. This Statement is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and all
interim periods within those fiscal years.
F-6
BIGWEST
ENVIRONMENTAL, INC.
(A
Development Stage Enterprise)
Notes
to Unaudited Financial Statements
For
the Three and Six Months Ended September 30, 2008 and the
Period
from February 28, 2008 (Inception) to September 30, 2008
NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Recent
Accounting Pronouncements (continued)
In May
2008, FASB issued Financial Accounting Standards No. 162, “The Hierarchy of Generally
Accepted Accounting Principles.” This Statement identifies the sources of
accounting principles and the framework for selecting the principles to be used
in the preparation of financial statements of nongovernmental entities that are
presented in conformity with generally accepted accounting principles (GAAP) in
the United States (the GAAP hierarchy). This Statement is effective 60 days
following the SEC's approval of the Public Company Accounting Oversight Board
amendments to AU Section 411, The Meaning of Present Fairly in
Conformity With Generally Accepted Accounting Principles. This
pronouncement has no effect on this Company’s financial reporting at this
time.
In March
of 2008 the Financial Accounting Standards Board (FASB) issued SFAS No. 161,
“Disclosures about Derivative
Instruments and Hedging Activities—an amendment of FASB Statement No.
133, “Accounting for
Derivatives and Hedging Activities.” SFAS No. 161 has the same
scope as Statement No. 133 but requires enhanced disclosures about (a) how and
why an entity uses derivative instruments, (b) how derivative instruments and
related hedged items are accounted for under Statement No. 133 and its related
interpretations, and (c) how derivative instruments and related hedged items
affect an entity’s financial position, financial performance, and cash flows.
SFAS No. 161 is effective for financial statements issued for fiscal years
and interim periods beginning after November 15, 2008, with early application
encouraged. The statement encourages, but does not require, comparative
disclosures for earlier periods at initial adoption. SFAS No. 161 has no
effect on the Company’s financial position, statements of operations, or cash
flows at this time.
In
December, 2007, the FASB issued SFAS No. 160, “Non-controlling interests in
Consolidated Financial Statements, an amendment of ARB No. 51.” SFAS
No. 160 applies to “for-profit” entities that prepare consolidated financial
statements where there is an outstanding non-controlling interest in a
subsidiary. The Statement requires that the non-controlling interest be
reported in the equity section of the consolidated balance sheet but identified
separately from the parent. The amount of consolidated net income
attributed to the non-controlling interest is required to be presented, clearly
labelled for the parent and the non-controlling entity, on the face of the
consolidated statement of income. When a subsidiary is de-consolidated,
any retained non-controlling interest is to be measured at fair value.
Gain or loss on de-consolidation is recognized rather than carried as the
value of the retained investment. The Statement is effective for fiscal
years and interim periods beginning on or after December 15, 2008. It
cannot be adopted earlier but, once adopted, is to be applied retroactively.
This pronouncement has no effect on this Company’s financial reporting at
this time.
In
December 2007, the FASB issued SFAS No.141 (revised 2007), “Business Combinations” (“SFAS
141(R)”) and SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements” (“SFAS 160”). These standards aim to
improve, simplify, and converge internationally the accounting for business
combinations and the reporting of noncontrolling interests in consolidated
financial statements. The provisions of SFAS 141 (R) and SFAS 160 are effective
for the fiscal year beginning April 1, 2009. The adoption of SFAS 141(R)
and SFAS 160 has not impacted the Company’s financial statements.
F-7
BIGWEST
ENVIRONMENTAL, INC.
(A
Development Stage Enterprise)
Notes
to Unaudited Financial Statements
For
the Three and Six Months Ended September 30, 2008 and the
Period
from February 28, 2008 (Inception) to September 30, 2008
NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Recent
Accounting Pronouncements (continued)
None of
the above new pronouncements has current application to the Company, but may be
applicable to the Company’s future financial reporting.
Share Based
Payments
In March
2004, the FASB issued Financial Accounting Standards No. 123 (revised 2004) (FAS
123R), "Share-Based Payment,” FAS 123R replaces FAS No. 123, "Accounting for
Stock-Based Compensation", and supersedes APB Opinion No. 25, "Accounting for
Stock Issued to Employees." FAS 123R requires compensation expense, measured as
the fair value at the grant date, related to share-based payment transactions to
be recognized in the financial statements over the period that an employee
provides service in exchange for the award. The Company intends to adopt FAS
123R using the "modified prospective" transition method as defined in FAS 123R.
Under the modified prospective method, companies are required to record
compensation cost prospectively for the unvested portion, as of the date of
adoption, of previously issued and outstanding awards over the remaining vesting
period of such awards. FAS 123R is effective January 1, 2006. The Company is
evaluating the impact of FAS 123R on its' results and financial
position.
NOTE
3 - STOCKHOLDERS' EQUITY
On
February 28, 2008 the Company was formed with one class of common stock, par
value $0.001. The Company authorized 75,000,000 shares of common
stock.
On
February 29, 2008, the Company issued 10,000,000 shares of stock to its sole
officer and director for cash of $2,500. In addition, the Company issued on the
same day, 100,000 shares of its common stock to Jameson Capital, LLC for $1,000
in services to be rendered and 490,000 shares of its common stock to Centurion
Capital Funding, LLC for $7,090 in services to be rendered.
BigWest relied in Section 4(2) of the
Securities Act as its exemption from registration when it issued the shares of
common stock to Mr. Rossana, Jameson Capital and Centurion Capital Management.
All the initial shareholders agreed to hold the shares for investment purposes
only and to transfer such shares only in a registered offering or in reliance
upon an exemption therefrom.
NOTE 4 - GOING
CONCERN
As shown
in the accompanying financial statements, as is typical of companies going
through the development stage, the Company yet to recognize any revenues or
significant expenses. The Company is currently in the development stage, and
there is no guarantee whether the Company will be able to generate enough
revenue and/or raise capital to support current operations and generate
anticipated sales. This raises substantial doubt about the Company's ability to
continue as a going concern.
F-8
BIGWEST
ENVIRONMENTAL, INC.
(A
Development Stage Enterprise)
Notes
to Unaudited Financial Statements
For
the Three and Six Months Ended September 30, 2008 and the
Period
from February 28, 2008 (Inception) to September 30, 2008
. NOTE 4 - GOING CONCERN
(continued)
Management
believes that the Company's capital requirements will depend on many factors
including the success of the Company's service development efforts. Management's
plans include marketing of their services and establishment of key management
personnel to support the business plan. With the business plan being followed,
Management believes along with working capital being raised that the operations
and sales will make the Company a viable entity over the next twelve
months.
The
financial statements do not include any adjustments relating to the
recoverability or classification of recorded assets and liabilities that might
result should the Company be unable to continue as a going concern.
NOTE
5 - NET LOSS PER COMMON SHARE
Net loss
per share is calculated in accordance with SFAS No. 128, “Earnings Per Share.”
The weighted –average number of common shares outstanding during each period is
used to compute basic loss per share. Basic net loss per common share is based
on the weighted-average number of share of common stock of Ten Million Five
Hundred Ninety Thousand (10,590,000) outstanding in three and six months ended
September 30, 2008.
NOTE
5 - PROVISION FOR INCOME TAXES
Deferred
income taxes will be determined using the liability method for the temporary
differences between the financial reporting basis and income tax basis of the
Company's assets and liabilities. Deferred income taxes will be measured
based on the tax rates expected to be in effect when the temporary differences
are included in the Company's tax return. Deferred tax assets and
liabilities are recognized based on anticipated future tax consequences
attributable to differences between financial statement carrying amounts of
assets and liabilities and their respective tax bases.
At
September 30, 2008, deferred tax assets consist of the following:
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2008
|
||||
|
Net
operating loss carry forward
|
$ | 2,398 | ||
|
Valuation
allowance
|
(2,398 | ) | ||
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Net
deferred tax asset
|
$ | - | ||
At September 30, 2008, the Company had
an accumulated deficit of $2,398 incurred during the development stage to offset
future taxable income. The Company will establish valuation
allowances equal to the full amount of the deferred tax assets due to the
uncertainty of the utilization of the operating losses in future
periods.
NOTE
6 - WARRANTS AND OPTIONS
There are
no warrants or options outstanding to acquire any additional shares of common
stock of the Company
F-9
Item 2. Management's Discussion and
Analysis of Financial Condition and Plan of Operations.
FORWARD
LOOKING STATEMENTS
This
report contains forward-looking statements that involve risk and uncertainties.
We use words such as "anticipate", "believe", "plan", "expect", "future",
"intend", and similar expressions to identify such forward-looking statements.
Investors should be aware that all forward-looking statements contained within
this filing are good faith estimates of management as of the date of this filing
and actual results may differ materially from historical results or our
predictions of future results.
General
BigWest
Environmental, Inc. (the “Company”) is a development stage company that was
incorporated on February 28, 2008, in the state of Nevada. The Company intends
to enter into the sale and distribution of solar pv panels. And, when financing
becomes available, the Company plans to build and operate solar power generation
parks. The Company has never declared bankruptcy, it has never been in
receivership, and it has never been involved in any legal action or proceedings.
Since becoming incorporated, BigWest Environmental has not made any significant
purchase or sale of assets, nor has it been involved in any mergers,
acquisitions or consolidations and the Company owns no
subsidiaries. The fiscal year end is June 30th. The
Company has not had revenues from operations since its inception and/or any
interim period in the current fiscal year.
Plan
of Operation
As of
September 30, 2008, we have $1,000
of cash available. We have no current liabilities.. From
the date of inception (February 28, 2008) to September 30, 2008 the Company has
recorded a net loss of $2,398
of which were expenses relating to the initial development of the Company,
filing its Registration Statement on Form S-1, and expenses relating to
maintaining Reporting Company status with the SEC. In order to
survive as a going concern over the Company will require additional capital
investments or borrowed funds to meet cash flow projections and carry forward
our business objectives. There can be no guarantee or assurance that we can
raise adequate capital from outside sources to fund the proposed business.
Failure to secure additional financing would result in business failure and a
complete loss of any investment made into the Company.
The
Company filed a registration statement on Form S-1on Auguse 7, 2008, which was
deemed effective on August 15, 2008. As of the date of this Form 10-Q
report, the Company had sold no shares of common stock from this offering,
however, since September 30, 2008, the Company has sold 55,000
shares of common stock to the public with total proceeds raised of $2,750. These
proceeds have been utilized by the Company to fund its initial development
including administrative costs associated with maintaining its status as a
Reporting Company as defined by the Securities and Exchange Commission (“SEC”)
under the Exchange Act of 1934 as amended. The Company plans to
continue to focus efforts on selling their common shares through this offering
in order to continue to fund its initial development and fund the expenses
associated with maintaining a reporting company status.
In
addition, over the course of the next 90 to 120 days, management
intends to focus efforts on obtaining a quotation for its common stock on the
Over the Counter Bulletin Board (“OTCBB”). Management believes having
its common stock quoted on the OTCBB will provide it increased opportunity to
raise additional capital for its proposed business
development. However, there can be no guarantee or assurance the
Company will be successful in filing a Form 211 application and obtaining a
quotation. To date there is no public market for the Company’s common
stock. There can be no guarantee or assurance that a public market will ever
exist for the common stock. Failure to create a market for the Company’s common
stock would result in business failure and a complete loss of any investment
made into the Company.
Product
Research and Development
The
Company does not anticipate any costs or expenses to be incurred for product
research and development within the next twelve months.
1
Employees
There are
no employees of the Company, excluding the current President and Director, Mr.
Rossana and the Company does not anticipate hiring any additional employees
within the next twelve months.
Off-Balance
Sheet Arrangements
As of the
date of this Quarterly Report, the Company does not have any off-balance sheet
arrangements that have or are reasonably likely to have a current or future
effect on the Company's financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures or
capital resources that are material to investors. The term "off-balance sheet
arrangement" generally means any transaction, agreement or other contractual
arrangement to which an entity unconsolidated with the Company is a party, under
which the Company has (i) any obligation arising under a guarantee contract,
derivative instrument or variable interest; or (ii) a retained or contingent
interest in assets transferred to such entity or similar arrangement that serves
as credit, liquidity or market risk support for such assets.
Item
3. Quantitative
and Qualitative Disclosures about Market Risk.
Not
Applicable
Item
4. Controls and Procedures
The
management of the Company is responsible for establishing and maintaining
adequate internal control over financial reporting, as required by
Sarbanes-Oxley (SOX) Section 404 A. The Company's internal control over
financial reporting is a process designed under the supervision of the Company's
Chief Executive Officer and Chief Financial Officer to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of the Company's financial statements for external purposes in accordance with
U.S. generally accepted accounting principles.
As of
June 30, 2008 management assessed the effectiveness of the Company's internal
control over financial reporting based on the criteria for effective internal
control over financial reporting established in SEC guidance on conducting such
assessments. Based on that evaluation, they concluded that, during the period
covered by this report, such internal controls and procedures were not effective
to detect the inappropriate application of US GAAP rules as more fully described
below. This was due to deficiencies that existed in the design or operation of
our internal control over financial reporting that adversely affected our
internal controls and that may be considered to be material
weaknesses.
The
matters involving internal controls and procedures that the Company's management
considered to be material weaknesses under the standards of the Public Company
Accounting Oversight Board were: (1) lack of a functioning audit committee and
lack of a majority of outside directors on the Company's board of directors,
resulting in ineffective oversight in the establishment and monitoring of
required internal controls and procedures; (2) inadequate segregation of duties
consistent with control objectives; (3) insufficient written policies and
procedures for accounting and financial reporting with respect to the
requirements and application of US GAAP and SEC disclosure requirements; and (4)
ineffective controls over period end financial disclosure and reporting
processes. The aforementioned material weaknesses were identified by the
Company's Chief Financial Officer in connection with the review of our financial
statements as of June 30, 2008 and communicated the matters to our
management.
Management
believes that the material weaknesses set forth in items (2), (3) and (4) above
did not have an affect on the Company's financial results. However, management
believes that the lack of a functioning audit committee and lack of a majority
of outside directors on the Company's board of directors, resulting in
ineffective oversight in the establishment and monitoring of required internal
controls and procedures can result in the Company's determination to its
financial statements for the future years.
We are
committed to improving our financial organization. As part of this commitment,
we will create a position to segregate duties consistent with control objectives
and will increase our personnel resources and technical accounting expertise
within the accounting function when funds are available to the Company: i)
Appointing one or more outside directors to our board of directors who shall be
appointed to the audit committee of the Company resulting in a fully functioning
audit committee who will undertake the oversight in the establishment and
monitoring of required internal controls and procedures; and ii) Preparing and
implementing sufficient written policies and checklists which will set forth
procedures for accounting and financial reporting with respect to the
requirements and application of US GAAP and SEC disclosure
requirements.
Management
believes that the appointment of one or more outside directors, who shall be
appointed to a fully functioning audit committee, will remedy the lack of a
functioning audit committee and a lack of a majority of outside directors on the
Company's Board. In addition, management believes that preparing and
implementing sufficient written policies and checklists will remedy the
following material weaknesses (i) insufficient written policies and procedures
for accounting and financial reporting with respect to the requirements and
application of US GAAP and SEC disclosure requirements; and (ii) ineffective
controls over period end financial close and reporting processes. Further,
management believes that the hiring of additional personnel who have the
technical expertise and knowledge will result proper segregation of duties and
provide more checks and balances within the department. Additional personnel
will also provide the cross training needed to support the Company if personnel
turn over issues within the department occur. This coupled with the appointment
of additional outside directors will greatly decrease any control and procedure
issues the company may encounter in the future.
2
We will
continue to monitor
and evaluate the effectiveness of
our internal controls and procedures and our internal controls over
financial reporting on an ongoing basis and
are committed to
taking further action and implementing
additional enhancements or improvements, as necessary and as funds
allow.
Changes
in Internal Controls.
There
were no significant changes in the Company's internal controls or, to the
Company's knowledge, in other factors that could significantly affect these
controls subsequent to the date of their evaluation.
PART
II - OTHER INFORMATION
Item
1. Legal Proceedings
The
Company is not a party to any pending legal proceedings, and no such proceedings
are known to be contemplated.
No
director, officer, or affiliate of the Company and no owner of record or
beneficial owner of more than 5.0% of the securities of the Company, or any
associate of any such director, officer or security holder is a party adverse to
the Company or has a material interest adverse to the Company in reference to
pending litigation.
Item
2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item
3. Defaults Upon Senior Securities
None.
Item
4. Submission of Matters to Vote of Security Holders
None.
Item
5. Other Information
None.
Item
6. Exhibits
|
|
(a)
Exhibits furnished as Exhibits
hereto:
|
|
|
|
|
Exhibit No.
|
Description
|
|
|
31.1
|
Certification
of Frank Rossana pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
|
|
|
32.1
|
Certification
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
|
BigWest
Environmental, Inc.
|
||
|
Date:
November
10,2008
|
By:
|
/s/Frank
Rossana
|
|
Frank
Rossana
|
||
|
Chief
Financial Officer, Treasurer and Clerk
|
||
|
(principal
financial and accounting officer)
|
||
|
Date:
November
10, 2008
|
By:
|
/s/Frank
Rossana
|
|
Frank
Rossana
|
||
|
President
and Chief Executive Officer
|
||
3