INTERDYNE CO - Quarter Report: 2021 December (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 December 31, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from: Not applicable

Commission file number 0-4454

INTERDYNE COMPANY

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (805) 322-3883

Securities registered pursuant to Section 12(b) of the Act: None

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 ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).

Yes ☒  No ☐

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):

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 ☐

As of January 28, 2022, there were 39,999,942 shares of Common Stock, no par value, issued and outstanding.

INTERDYNE COMPANY

FORM 10-Q

INDEX

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

INTERDYNE COMPANY

BALANCE SHEETS

 INTERDYNE COMPANY

STATEMENTS OF OPERATIONS

The accompanying notes are an integral part of these unaudited financial statements. 

INTERDYNE COMPANY

STATEMENTS OF STOCKHOLDERS’ EQUITY  (DEFICIT)

For the Six Months Ended December 31, 2021

(Unaudited)

The accompanying notes are an integral part of these unaudited financial statements. 

INTERDYNE COMPANY

STATEMENTS OF STOCKHOLDERS’ EQUITY

For the Six Months Ended December 31, 2020

(Unaudited)

The accompanying notes are an integral part of these unaudited financial statements. 

INTERDYNE COMPANY

STATEMENTS OF CASH FLOWS

INTERDYNE COMPANY 

NOTES TO UNAUDITED FINANCIAL STATEMENTS

Note 1. Interim Financial Statements 

Basis of presentation

The accompanying financial statements are unaudited, but in the opinion of the management of Interdyne Company (“the Company”), contain all adjustments, consisting of only normal recurring accruals, necessary to present fairly the financial position as of December 31, 2021 and the results of operations, cash flows and changes in stockholders’ equity (deficit)  for interim periods presented. Certain information and footnote disclosures normally included in financial statements that have been prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, although management of the Company believes that the disclosures contained in these financial statements are adequate to make the information presented therein not misleading. For further information, refer to the financial statements and footnotes thereto included in the Company's Annual Report in Form 10-K as of June 30, 2021, as filed with the Securities and Exchange Commission. The results of operations for the six months ended December 31, 2021 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending June 30, 2022.

Going concern

The Company’s financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As of December 31, 2021, the Company has an accumulated deficit of $500,545, and a net loss of $12,747 for the six months ended December 31, 2021. The Company did not generate revenues during the six months ended December 31, 2021 and may not have sufficient cash in hand to fund its operations for the next twelve months. These factors among others raise substantial doubt about the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company will have to rely on its related parties to fund its operations. There are no assurances that such funds will be available when needed.

Note 2. Changes in Significant Accounting Policies

In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in ASC 740 and also clarifies and amends existing guidance to improve consistent application. This guidance is effective for entities for the fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020 on a prospective basis, with early adoption permitted.

On July 1, 2021, the Company adopted the new standard and the adoption of ASU 2019-12 did not have a material effect on the Company’s financial statements.

Note 3. Related Party Transactions

An officer of the Company charged a management fee totaling $3,000 and $3,000 for the six months ended December 31, 2021 and 2020, respectively, for the use of a home office, accounting and other services.  The balances due to this officer as of December 31, 2021 and June 30, 2021 were $30,000 and $27,000, respectively. The amounts due to this officer are unsecured, bearing no interest and are repayable on demand.

Note 4. Commitments and Contingencies 

In March 2017, the Company received a letter from the County of Santa Clara, California, which claimed that the Company is delinquent on its property taxes relating to tax year 1988/1989 in the amount of $80,238 including penalties which should be paid immediately. The Company believes that these property taxes were related to the period prior to the filing of the reorganization of the Company under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Central District of California on November 22, 1988 and the eventual confirmation of the Company’s Amended Plan of Reorganization (the “Plan”) by the Bankruptcy Court on May 17, 1990, and thus have been settled in accordance with the terms of the Plan and are therefore invalid. The Company has informed the County of Santa Clara that if it wants to assert its claim, it would have to petition to the Bankruptcy Court for relief. The Company does not recognize the said claim and therefore has not recorded any tax liabilities related to this claim. If the County of Santa Clara claim is adjudicated to be valid and the Company is liable, the tax liabilities imposed could have a material effect on the Company’s result of operations and financial position.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The Company is at present dormant and is looking for new opportunities.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

N/A

Item 4. Controls and Procedures

Our management, comprising the Chief Executive Officer and Chief Financial Officer/Principal Accounting Officer, is responsible for establishing and maintaining disclosure controls and procedures for the Company. It has designed such disclosure controls and procedures to ensure that material information is made known to it, particularly during the period in which this report was prepared.

As of the end of the period covered by this report, our management carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (or Exchange Act)). Based on this evaluation, as of the end of the period covered by this report, our management has concluded that our disclosure controls and procedures are not effective considering the fact that the Company, being dormant, has only one person on staff, the Chief Financial Officer/Principal Accounting Officer, to (1) handle all accounting transactions (consisting of primarily paying all expenses, including fees to this same officer); (2) reconcile the bank account, and (3) prepare all financial statement disclosures. The above duties have no supervision or review to insure proper segregation of duties and review of disclosures. As a result, material weaknesses over disclosure controls and procedures exist.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2021 based on the criteria set forth in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organization of the Treadway Commission. Based on this evaluation, our management has concluded that our internal control over financial reporting was not effective as of December 31, 2021 because of the following material weaknesses as of December 31, 2021: (i) lack of supervision or review to insure proper internal control over financial reporting, (ii) inadequate segregation of duties and effective risk assessment, (iii) lack of well-established procedures to authorize and approve related party transactions. As a result, material weaknesses over internal control over financial reporting exist.

Our independent auditors have not audited and are not required to audit this assessment of our internal control over financial reporting for the period covered by this report.

During our most recent fiscal three months, there has not occurred any change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

None.

Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Submission of Matters to a Vote of Security Holders.

None.

Item 5. Other Information.

None.

Item 6. Exhibits

SIGNATURES

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.