RemSleep Holdings Inc. - Annual Report: 2009 (Form 10-K)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
________________
FORM
10-K
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR
THE FISCAL YEAR ENDED DECEMBER 31, 2008
Commission File
Number: 000-53450
_______________________________
BELLA
VIAGGIO, INC.
(Exact
name of registrant as specified in its charter)
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NEVADA
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38-3759675
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|
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(State
or other jurisdiction of incorporation or organization)
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(I.R.S.
Employer Identification No.)
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2120
58th
Avenue, Suite 107
Vero
Beach, Florida 32966
(Address
of principal executive offices, including zip code)
(772)
266-5554
(Registrant's
telephone number, including area code)
Securities
registered pursuant to Section 12(b) of the Act:
Common
Stock, $0.001 par value per share
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Title
of class
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Name
of each exchange on which registered
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Common
Stock. $0.001 par value per share
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None
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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
405 of the Securities Act. Yes o
No x
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Exchange
Act. Yes x No o
1
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 if
disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
is not contained herein, and will not be contained, to the best of Registrant's
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. 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 the 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
(Do
not check if smaller reporting company)
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Smaller
Reporting Company x
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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 x No o
The
aggregate market value of the registrant’s $0.001 par value common equity held by non-affiliates of the registrant was
$152,791; this is based upon the last trade of the common stock at $0.25 on
January 21, 2009. The Registrant had outstanding 541,167 shares of Common
Stock.
As of
April 14,
2009 there were 2,644,500 common
shares par value $0.001 issued and
outstanding.
DOCUMENTS
INCORPORATED BY REFERENCE
The
following documents (or portions thereof) are incorporated herein by
reference: registration statement and exhibits thereto filed on Form
SB-2 October 16, 2007 are incorporated by reference within Part I and Part II
herein.
2
INDEX
BELLA
VIAGGIO, INC.
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PAGE
NO
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PART I
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ITEM 1
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BUSINESS
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4
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ITEM 1A
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RISK
FACTORS
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6
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ITEM
1B
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UNRESOLVED
STAFF COMMENTS
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8
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ITEM 2
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PROPERTIES
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8
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ITEM 3
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LEGAL
PROCEEDINGS
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8
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ITEM 4
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SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS
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8
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PART II
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ITEM 5
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MARKET
FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
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9
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ITEM 6
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SELECTED
FINANCIAL DATA
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9
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ITEM 7
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MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
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9
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ITEM 7A
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QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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10
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ITEM 8
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FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
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10
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ITEM 9
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CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
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11
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ITEM 9A(T)
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CONTROLS
AND PROCEDURES
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11
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ITEM 9B
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OTHER
INFORMATION
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14
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PART III
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ITEM 10
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DIRECTORS
AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
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14
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ITEM 11
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EXECUTIVE
COMPENSATION
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15
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ITEM 12
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SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
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16
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ITEM 13
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CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
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17
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ITEM 14
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PRINCIPAL
ACCOUNTANT FEES AND SERVICES
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17
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PART IV
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ITEM 15
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EXHIBITS
AND FINANCIAL STATEMENT SCHEDULES
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18
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SIGNATURES
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19
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3
PART
I.
Cautionary
Note
This
Annual Report on Form 10-K contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934, which are subject to a number of risks
and uncertainties. All statements that are not historical facts are
forward-looking statements, including statements about our business strategy,
the effect of Generally Accepted Accounting Principles ("GAAP") pronouncements,
uncertainty regarding our future operating results and our profitability,
anticipated sources of funds and all plans, objectives, expectations and
intentions and the statements regarding future potential revenue, gross margins
and our prospects for fiscal 2009. These statements appear in a number of places
and can be identified by the use of forward-looking terminology such as "may,"
"will," "should," "expect," "plan," "anticipate," "believe," "estimate,"
"predict," "future," "intend," or "certain" or the negative of these terms or
other variations or comparable terminology, or by discussions of
strategy.
Actual
results may vary materially from those in such forward-looking statements as a
result of various factors that are identified in "Item 1A.—Risk Factors"
and elsewhere in this document. No assurance can be given that the risk factors
described in this Annual Report on Form 10-K are all of the factors that
could cause actual results to vary materially from the forward-looking
statements. References in this Annual Report on Form 10-K to
(i) the "Company," the "Registrant," "Bella Viaggio "we," "our," “BVIG,”
and "us" refer to Bella Viaggio, Inc.
Investors
and security holders may obtain a free copy of the Annual Report on
Form 10-K and other documents filed by BVIG with the Securities and
Exchange Commission ("SEC") at the SEC's website at http://www.sec.gov. Free
copies of the Annual Report on Form 10-K and other documents filed by BVIG
with the SEC may also be obtained from BVIG by directing a request to Bella
Viaggio, Inc., Attention: Ronald Davis 2120 58th Avenue,
Suite 107, Vero Beach, Florida 32966.
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BUSINESS.
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General
Bella
Viaggio, Inc. is a development stage company that was incorporated on June 6,
2007, in the state of Nevada. 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, Bella Viaggio 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 December 31st. The
Company has not had revenues from operations since its inception and/or any
interim period in the current fiscal year.
4
Description
of Business
Since
inception the Company has not begun any revenue generating operations and
activities have been limited to raising proceeds through the sale of our common
stock via our registered offering that was filed on Form SB-2 October 16, 2007,
maintaining the requirements of a reporting company as defined under the
Exchange Act of 1934, and researching potential markets to launch our
business. As of December 31, 2008, Bella Viaggio had raised $42,950
through the sale of common stock.
We
currently have minimal funds available and in order to continue as a going
concern we must raise additional proceeds. We estimate that we will
need $25,000 in order to cover our costs associated with maintaining our status
as a reporting company. We will likely be required to borrow proceeds from a
shareholder in order to pay expenses associated with filing this
report. We cannot provide any guarantee will be successful in
securing adequate proceeds in the future and failure to do so would result in a
complete loss of any investment made into the Company.
If and
when we secure additional financing, we plan to enter into the ownership and
operation of beauty and personal care salons providing hair cutting, styling,
perms, coloring, nails, tanning and day spa services. Bella Viaggio intends to
establish itself as a one stop shop specializing in services that will be
attractive to today’s busy working adults, with prices and operating hours that
will accommodate their busy schedules. The Company intends to
identify a range of services most in demand within its marketing area and
maintain operating hours that will meet the needs of working
couples. Bella Viaggio will source much of the spa products to be
used, such as lotions, shampoos, rinses, towels, slippers and apparel in France,
Italy and China. Once the Company has selected a range of apparel
and products and negotiated pricing, we plan to purchase a small quantity
in order to make inventory available to stock the first location. We
cannot provide any assurance that we will ever begin operations and failure to
do so would result in a complete loss of any investment made into the
Company.
Bella
Viaggio has not conducted any product research and development since inception.
There was no purchase or sale of any plant and or significant
equipment. We have no patents, trademarks licenses, or labor
contracts. We currently are not aware of any governmental approval required to
conduct our business.
Our
common stock is quoted on the Over-the-Counter Bulletin Board (“OTCBB”) under
the ticker symbol “BVIG”. As of the date of this report there has been
minimal trading of our common stock. The Company cannot provide any
guarantee or assurance a liquid market will ever develop for the common stock in
the future. If such a market is not developed shareholders would not
be able to sell their shares.
Other
than Ronald Davis (officer and director) there are no other
employees. Currently Mr. Davis is donating his time to the
development of the Company. There is no employment agreement by and
between us and Mr. Davis.
5
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ITEM
1A
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RISK
FACTORS
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Factors
Affecting Future Operating Results
This
Annual Report on Form 10-K contains forward-looking statements concerning
our future programs, expenses, revenue, liquidity and cash needs as well as our
plans and strategies. These forward-looking statements are based on current
expectations and we assume no obligation to update this information, except as
required by applicable laws and regulations. Numerous factors could cause actual
results to differ significantly from the results described in these
forward-looking statements, including the following risk factors.
Because
our auditors have issued a going concern opinion, there is substantial
uncertainty we will continue activities in which case you could lose your
investment.
Our
auditors have issued a going concern opinion. This means that there is
substantial doubt that we can continue as an ongoing business for the next
twelve months. As such we may have to cease activities and you could lose your
investment.
We
currently do not have adequate funds to cover the costs associated with
maintaining our status as a Reporting Company.
The
Company currently has approximately $978 of cash available. This
amount will not be enough to pay the legal, accounting, and filing fees that is
required to maintain our status as a reporting company, which is currently
estimated at $25,000 for fiscal year 2009. If we can no longer be a
reporting company our common stock would no longer be eligible for quotation on
the Over-the-Counter Bulletin Board. This would result in there being
no public market for an investor to trade our common stock and any investment
made would be lost in its entirety.
Because
of our inherent limitations, internal control over financial reporting may not
prevent or detect misstatements on our financial
statements.
During
the auditing process for the 2008 annual report; the Company discovered
inconsistencies within its quarterly reports for the first, second and third
quarters of 2008. The Company believes this was due to the lack of
internal control over the financial reporting for these
periods.
Projections
of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because changes in conditions may occur or
the degree of compliance with the policies or procedures may
deteriorate.
We
lack an operating history and have losses which we expect to continue into the
future. As a result, we may have to suspend or cease activities, which would
result in a complete loss of any investment made into the Company.
We were
incorporated on June 6, 2007 and we have not started our proposed business
activities or realized any revenues. We have no operating history upon which an
evaluation of our future success or failure can be made. As of December 31, 2008
our net loss since inception is $70,872. Based upon current plans, we
expect to incur operating losses in future periods. As a
result, we may not generate revenues in the future. Failure to
generate revenues will cause us to suspend or cease activities.
If
we are able to complete financing through the sale of additional shares of our
common stock in the future, then shareholders will experience
dilution.
The most
likely source of future financing presently available to us is through the sale
of shares of our common stock. Any sale of common stock will result in dilution
of equity ownership to existing shareholders.
6
This
means that if we sell shares of our common stock, more shares will be
outstanding and each existing shareholder will own a smaller percentage of the
shares then outstanding. To raise additional capital we may have to issue
additional shares, which may substantially dilute the interests of existing
shareholders. Alternatively, we may have to borrow large sums, and assume debt
obligations that require us to make substantial interest and capital
payments.
Because there is currently a limited
public trading market for our common stock, you may not be able to resell your
stock.
Although
our common stock is quoted on the Over-the-Counter Bulletin Board (OTCBB) the
market is limited. If a market does not develop there would be no central place,
such as stock exchange or electronic trading system to resell your
shares.
Because our securities are subject
to penny stock rules, you may have difficulty reselling your
shares.
Our
shares are penny stocks are covered by section 15(g) of the Securities Exchange
Act of 1934 which imposes additional sales practice requirements on
broker/dealers who sell the Company's securities including the delivery of a
standardized disclosure document; disclosure and confirmation of quotation
prices; disclosure of compensation the broker/dealer receives; and, furnishing
monthly account statements. For sales of our securities, the broker/dealer must
make a special suitability determination and receive from its customer a written
agreement prior to making a sale. The imposition of the foregoing additional
sales practices could adversely affect a shareholder's ability to dispose of his
stock.
We
are subject to the requirements of section 404 of the Sarbanes-Oxley Act. If we
are unable to timely comply with section 404 or if the costs related to
compliance are significant, our profitability, stock price and results of
operations and financial condition could be materially adversely
affected.
We are
required to comply with the provisions of Section 404 of the Sarbanes-Oxley Act
of 2002, which require us to maintain an ongoing evaluation and integration of
the internal controls of our business. We were required to document and test our
internal controls and certify that we are responsible for maintaining an
adequate system of internal control procedures for the year ended December 31,
2008. In subsequent years, our independent registered public accounting firm
will be required to opine on those internal controls and management’s assessment
of those controls. In the process, we may identify areas requiring improvement,
and we may have to design enhanced processes and controls to address issues
identified through this review.
We
evaluated our existing controls for the year ended December 31, 2008. Our Chief
Executive Officer and Chief Financial Officer identified material weaknesses in
our internal control over financial reporting and determined that we did not
maintain effective internal control over financial reporting as of December 31,
2008. The identified material weaknesses did not result in material audit
adjustments to our 2008 financial statements; however, uncured material
weaknesses could negatively impact our financial statements for subsequent
years.
7
We
cannot be certain that we will be able to successfully complete the procedures,
certification and attestation requirements of Section 404 or that our auditors
will not have to report a material weakness in connection with the presentation
of our financial statements. If we fail to comply with the requirements of
Section 404 or if our auditor’s report such material weakness, the accuracy and
timeliness of the filing of our annual report may be materially adv ersely affected and
could cause investors to lose confidence in our reported financial information,
which could have a negative effect on the trading price of our common stock. In
addition, a material weakness in the effectiveness of our internal controls over
financial reporting could result in an increased chance of fraud and the loss of
customers, reduce our ability to obtain financing and require additional
expenditures to comply with these requirements, each of which could have a
material adverse effect on our business, results of operations and financial
condition.
Further,
we believe that the out-of-pocket costs, the diversion of management’s attention
from running the day-to-day operations and operational changes caused by the
need to comply with the requirements of Section 404 of the Sarbanes-Oxley Act
could be significant. If the time and costs associated with such compliance
exceed our current expectations, our results of operations could be adversely
affected.
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ITEM
1B
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UNRESOLVED
STAFF COMMENTS
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None
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PROPERTIES.
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ITEM
3
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LEGAL
PROCEEDINGS.
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Bella
Viaggio is not currently a party to any legal proceedings.Bella’s agent for
service of process in Nevada is: Val-U Corp. Services, Inc., 1802 North Carson
Street, Suite 212, Carson City, Nevada 89701.
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ITEM
4
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SUBMISSION
OF MATTERS TO A VOTE OF SECURITY
HOLDERS.
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None
8
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MARKET
FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES.
|
Our
common stock is quoted on the Over-the-Counter Bulletin Board (OTCBB) under the
ticker symbol BVIG. The stock trades are limited and sporadically;
there is no established public trading market for our common
stock. In 2008 our stock did not trade. As of the date of
this report the common stock has traded at $0.25. As of the
date of this report there are approximately 45 shareholders of our common
stock.
We did
not declare or pay dividends during the Fiscal Year 2008 and do not anticipate
declaring or paying dividends in fiscal year 2009.
We had no
equity compensation plan in 2008.
Summary of Financial
Data
|
As
of December 31, 2008
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||||
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Revenues
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$
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0
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||
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Operating
Expenses
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$
|
()
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||
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Earnings
(Loss)
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$
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(70,872
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) | |
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Total
Assets
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$
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8,478
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||
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Liabilities
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$
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4,400
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Shareholders’
Equity
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$
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8,478
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||
The
following discussion is intended to assist in the understanding and assessment
of significant changes and trends related to the results of operations and
financial condition of Bella Viaggio, Inc. This discussion and analysis should
be read in conjunction with our financial statements and notes thereto included
elsewhere in this Annual Report on Form 10-K for the fiscal year ended
December 31, 2008.
9
Critical
Accounting Policies
The
preparation of our consolidated financial statements and notes thereto requires
management to make estimates and assumptions that affect the amounts and
disclosures reported within those financial statements. On an ongoing basis,
management evaluates its estimates, including those related to revenue
recognition, contingencies, litigation and income taxes. Management bases its
estimates and judgments on historical experiences and on various other factors
believed to be reasonable under the circumstances. Actual results under
circumstances and conditions different than those assumed could result in
differences from the estimated amounts in the financial statements. There have
been no material changes to these policies during fiscal 2008. As of
December 31, 2008 the Company has not identified any critical estimates that are
used in the preparation of the financial statements.
Liquidity and Capital Resources.
At the end of fiscal year 2008 we had $978 of cash on hand and available
we had liabilities of $4,400. We must secure additional funds in order to
continue our business. We will be required to secure a loan to pay expenses
relating to filing this report including legal, accounting and filing
fees. We believe that we will be able to obtain this loan from a
current shareholder of the Company; however we cannot provide any assurance that
we will be able to raise additional proceeds or secure additional loans in the
future to cover our expenses related to maintaining our reporting company status
(estimated at $25,000 for fiscal year 2009). Furthermore, there is no
guarantee we will receive the required financing to complete our business
strategies; we cannot provide any assurance that future financing will be
available to us on acceptable terms. If financing is not available on
satisfactory terms, we may be unable to continue, develop or expand our
operations. If we are unable to accomplish raising adequate funds
then any it would be likely that any investment made into the Company would be
lost in its entirety.
Results of Operations. We
have not begun operations and we have not generated any
revenues. Since incorporation we have incurred a loss of
$70,872.
Off-Balance Sheet
Arrangements. None
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ITEM
7A
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
|
We do not
currently hold any market risk sensitive instruments entered into for hedging
transaction risks related to foreign currencies. In addition, we have not
entered into any transactions with derivative financial instruments for trading
purposes.
Our
financial statements appear beginning on page F-1, immediately following the
signature page of this report.
10
On June
30, 2008, the Company filed on a Form 8-K information disclosing the relocation
of the corporate headquarters to Vero Beach, Florida.
None
Disclosure
Controls and Procedures
Management
of Bella Viaggio, Inc. is responsible for maintaining disclosure controls and
procedures that are designed to ensure that information required to be disclosed
in the reports that the Company files or submits under the Securities Exchange
Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange Commission’s
rules and forms. In addition, the disclosure controls and procedures must ensure
that such information is accumulated and communicated to the Company’s
management, including its Chief Executive Officer and Chief Financial Officer,
as appropriate, to allow timely decisions regarding required financial and other
required disclosures.
At the
end of the period covered by this report, an evaluation of the effectiveness of
our disclosure controls and procedures (as defined in Rules 13(a)-15(e) and
15(d)-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)) was
carried out under the supervision and with the participation of our Principal
Executive Officer, Principal Financial and Accounting Officer, Ronald Davis.
Based on his evaluation of our disclosure controls and procedures, he concluded
that during the period covered by this report, such disclosure controls and
procedures were not effective to detect the inappropriate application of US GAAP
standards. This was due to deficiencies that existed in the design or operation
of our internal control over financial reporting that adversely affected our
disclosure controls and that may be considered to be “material
weaknesses.”
Bella
Viaggio will continue to create and refine a structure in which critical
accounting policies and estimates are identified, and together with other
complex areas, are subject to multiple reviews by accounting personnel. In
addition, Bella Viaggio will enhance and test our year-end financial close
process. Additionally, Bella Viaggio’s audit committee will increase its review
of our disclosure controls and procedures. Finally, we plan to designated
individuals responsible for identifying reportable developments. We believe
these actions will remediate the material weakness by focusing additional
attention and resources in our internal accounting functions. However, the
material weakness will not be considered remediated until the applicable
remedial controls operate for a sufficient period of time and management has
concluded, through testing, that these controls are operating
effectively.
11
Management’s
Annual Report on Internal Control over Financial Reporting
Our
management is responsible for establishing and maintaining adequate internal
control over our financial reporting. Internal control over financial reporting
is a process designed to provide reasonable assurance to our management and
board of directors regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
U.S. generally accepted accounting principles. Our internal control over
financial reporting includes those policies and procedures that (i) pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect our transactions; (ii) provide reasonable assurance that
transactions are recorded as necessary for preparation of our financial
statements; (iii) provide reasonable assurance that receipts and expenditures of
company assets are made in accordance with management authorization; and
(iv) provide reasonable assurance that unauthorized acquisition, use or
disposition of company assets that could have a material effect on our financial
statements would be prevented or detected on a timely basis.
Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because changes in conditions may occur or the degree of compliance
with the policies or procedures may deteriorate.
During
the auditing process for the 2008 annual report; the Company discovered
inconsistencies within its quarterly reports for the first, second and third
quarters of 2008. The Company believes this was due to the lack of
internal control over the financial reporting for these
periods.
Management
assessed the effectiveness of our internal control over financial reporting as
of December 31, 2008. This assessment is based on the criteria for
effective internal control described in Internal Control — Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Based on its assessment, management concluded that our internal control over
financial reporting as of December 31, 2008 was not effective in the
specific areas described in the “Disclosure Controls and Procedures” section
above and as specifically described in the paragraphs below.
As of
December 31, 2008 the Principal Executive Officer/Principal Financial
Officer identified the following specific material weaknesses in the Company’s
internal controls over its financial reporting processes:
•
Policies and Procedures for the Financial Close and Reporting Process —
Currently there are no policies or procedures that clearly define the roles in
the financial close and reporting process. The various roles and
responsibilities related to this process should be defined, documented, updated
and communicated. Failure to have such policies and procedures in place amounts
to a material weakness to the Company’s internal controls over its financial
reporting processes.
•
Representative with Financial Expertise — For the year ending December 31,
2008, the Company did not have a representative with the requisite knowledge and
expertise to review the financial statements and disclosures at a sufficient
level to monitor the financial statements and disclosures of the Company.
Failure to have a representative with such knowledge and expertise amounts to a
material weakness to the Company’s internal controls over its financial
reporting processes.
12
•
Adequacy of Accounting Systems at Meeting Company Needs — The accounting system
in place at the time of the assessment lacks the ability to provide high quality
financial statements from within the system, and there were no procedures in
place or built into the system to ensure that all relevant information is
secure, identified, captured, processed, and reported within the accounting
system. Failure to have an adequate accounting system with procedures to ensure
the information is secure and accurately recorded and reported amounts to a
material weakness to the Company’s internal controls over its financial
reporting processes.
•
Segregation of Duties — Management has identified a significant general lack of
definition and segregation of duties throughout the financial reporting
processes. Due to the pervasive nature of this issue, the lack of adequate
definition and segregation of duties amounts to a material weakness to the
Company’s internal controls over its financial reporting processes.
In light
of the foregoing, once we have the adequate funds, management plans to develop
the following additional procedures to help address these material
weaknesses:
• Bella
Viaggio will create and refine a structure in which critical accounting policies
and estimates are identified, and together with other complex areas, are subject
to multiple reviews by accounting personnel. In addition, we plan to enhance and
test our month-end and year-end financial close process. Additionally, our audit
committee will increase its review of our disclosure controls and procedures. We
also intend to develop and implement policies and procedures for the financial
close and reporting process, such as identifying the roles, responsibilities,
methodologies, and review/approval process. We believe these actions will
remediate the material weaknesses by focusing additional attention and resources
in our internal accounting functions. However, the material weaknesses will not
be considered remediated until the applicable remedial controls operate for a
sufficient period of time and management has concluded, through testing, that
these controls are operating effectively.
This
annual report does not include an attestation report of our registered public
accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by our registered public
accounting firm pursuant to temporary rules of the Securities and Exchange
Commission that permit us to provide only management’s report in this annual
report.
This
report shall not be deemed to be filed for purposes of Section 18 of the
Securities Exchange Act of 1934, or otherwise subject to the liabilities of that
section, and is not incorporated by reference into any filing of the Company,
whether made before or after the date hereof, regardless of any general
incorporation language in such filing.
Changes
in Internal Controls
There
have been no changes in our internal control over financial reporting that
occurred during our fiscal quarter ended December 31, 2008 that have
materially affected, or are reasonable likely to materially affect, our internal
control over financial reporting.
13
|
ITEM
9B
|
OTHER
INFORMATION.
|
None
PART
III
Bella
Viaggio, Inc.’s executive officer and director and his respective age as of
December 31, 2008 are as follows:
Directors:
|
Name of Director
|
Age
|
|
|
Ronald
A. Davis
|
66
|
Executive
Officers:
|
Name of Officer
|
Age
|
Office
|
|
|
Ronald
A. Davis
|
66
|
President,
Chief Financial Officer, Secretary and
Treasurer
|
The term
of office for each director is one year, or until the next annual meeting of the
shareholders.
Biographical
Information
Set forth
below is a brief description of the background and business experience of our
executive officer and director for the past five years
Ronald A. Davis. Ronald A.
Davis joined the Bella Viaggio on June 6, 2007 and is currently the President,
Secretary, Treasurer and Director. Mr. Davis commenced his career at
Goldman Sachs & Co. in 1964 as an office boy. Following the completion of
graduate school at the University of Southern California and military service,
Mr. Davis returned to Goldman Sachs where he worked until joining Dean Witter
& Co. (now Morgan Stanley). Areas of work responsibility included
syndication and institutional sales. In 1981, Mr. Davis commenced advising high
net worth individuals and their investments. In 1994, he was asked to take over
the stewardship of Caffe Diva of which he was the CEO until September 2000. Mr.
Davis received his B.S. Business Administration from the University of Southern
California. In 1967, he also received a Masters of Business Administration from
the University of Southern California.
14
Bella
Viaggio’s Officer and sole Director has not been involved, during the past five
years, in any bankruptcy, conviction or criminal proceedings; has not been
subject to any order, judgment, or decree, not subsequently reversed or
suspended or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his involvement
in any type of business, securities or banking activities; and has not been
found by a court of competent jurisdiction, the Commission or the Commodity
Futures trading Commission to have violated a federal or state securities or
commodities law.
Significant Employees. We do
not employ any non-officers who are expected to make a significant contribution
to its business.
Corporate
Governance
Nominating
Committee. We have not established a Nominating Committee
because of our limited operations; and because we have only one director and
officer, we believe that we are able to effectively manage the issues normally
considered by a Nominating Committee.
Audit
Committee. We have has not established an Audit Committee
because of our limited operations; and because we have only one director and
officer, we believe that we are able to effectively manage the issues normally
considered by a Audit Committee.
Code of Ethics. We have
adopted a Code of Ethics for our principal executive and financial
officers. Our Code of Ethics is filed as an Exhibit to this Annual
Report, Exhibit 14.
|
ITEM
11
|
EXECUTIVE
COMPENSATION.
|
Summary Compensation
Table
|
Name
and principal position
|
Fiscal
Year
|
Salary
|
Bonus
|
Other
annual compensation
|
Restricted
stock
award(s)
|
Securities
underlying
options/
SARs
|
LTIP
payouts
|
All
other
compensation
|
||||||||
|
Ronald
Davis
Director,
Officer
|
2007
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||
|
2008
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
There has
been no cash payment paid to the executive officer for services rendered in all
capacities to us for the period ended December 31, 2008. There has been no
compensation awarded to, earned by, or paid to the executive officer by any
person for services rendered in all capacities to us for the fiscal period ended
December 31, 2008. No compensation is anticipated within the next six
months to any officer or director of the Company.
15
Stock Option
Grants
We did
not grant any stock options to the executive officer during the most recent
fiscal period ended December 31, 2008. We have also not granted any
stock options to the executive officer of the Company.
The
following table provides the names and addresses of each person known to Bella
Viaggio to own more than 5% of the outstanding common stock as of December
31, 2008, and by the Officers and Directors, individually
and as a group. Except as otherwise indicated, all
shares are owned directly.
|
Title
of class
|
Name
and address
of
beneficial owner
|
Amount
of
beneficial
ownership
|
Percent
of
class
|
|||
|
Common
Stock
|
*Ronald
A. Davis
2120
58th
Ave., Ste 107, Vero Beach FL 32966
|
1,033,333
shares
|
39.150%
|
|||
|
Common
Stock
|
Ronald
G. Brigham
2120
58th
Ave., Ste 107, Vero Beach FL 32966
|
1,000,000
shares
|
37.850%
|
*officer
and director of the Company
The
percent of class is based on 2,644,500 shares of common stock issued and
outstanding as of December 31, 2008
16
During Fiscal Year 2008, Heartland Managed Risk, LLC
(owned 100% by Ronald Davis, Officer and Director of Bella Viaggio, Inc.)
provided compliance consulting services pursuant to a contract by and between
Bella and Heartland. The contract included compensation to Heartland
in the amount of $20,000 for consulting services provided in both 2007 and
2008.
Other than the above consulting agreement there were no
material transactions between the Company and any Officer, Director or related
party has not, since the date of incorporation, had any material interest,
direct or indirect, in any transaction with us or in any presently proposed
transaction that has or will materially affect us:
-The sole
Officer and Director;
-Any
person proposed as a nominee for election as a director;
-Any
person who beneficially owns, directly or indirectly, shares carrying more than
5% of the voting rights attached to the outstanding shares of common
stock;
-Any
relative or spouse of any of the foregoing persons who have the same house as
such person.
Any
future transactions between us and our Officers, Directors, and Affiliates will
be on terms no less favorable to us than can be obtained from unaffiliated third
parties. Such transactions with such persons will be subject to approval of our
Board of Directors.
As of
December 31, 2008 the Company has incurred auditing expenses of approximately
$15,000 which includes bookkeeping and auditing services. There were
no other audit related services or tax fees incurred.
17
PART
IV
|
(a)
|
The
following documents have been filed as a part of this Annual Report on
Form 10-K.
|
|
1.
|
Financial
Statements
|
|
Audited
year end 12-31-08 Statements
|
Page
|
|
Report
of Independent Registered Public Accounting Firm
|
F-3
|
|
Balance
Sheets
|
F-4
|
|
Statements
of Operations
|
F-5
|
|
Statements
of Stockholders' Equity
|
F-6
|
|
Statements
of Cash Flows
|
F-7
|
|
Notes
to Financial Statements
|
F-8-13
|
| Restated Quarterly Statement for the period ended September 30, 2008 | F-14-24 |
| Restated Quarterly Statement for the period ended June 30, 2008 | F-25-35 |
| Restated Quarterly Statement for the period ended March 31, 2008 | F-36-46 |
|
2.
|
Financial
Statement Schedules.
|
All
schedules are omitted because they are not applicable or not required or because
the required information is included in the Financial Statements or the Notes
thereto.
|
3.
|
Exhibits.
|
The
following exhibits are filed as part of, or incorporated by reference into, this
Annual Report:
EXHIBIT
|
NUMBER
|
DESCRIPTION
|
|
3.1
|
Articles
of Incorporation are incorporated herein by reference to Form SB-2, filed
on October 16, 2007.
|
|
3.2
|
By-Laws
are incorporated herein by reference to Form SB-2, filed on October 16,
2007.
|
|
14
|
Code
of Ethics
|
|
23.1
|
Consent
of Accountant
|
|
31.1
|
8650
SECTION 302 CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL
OFFICER
|
|
32.1
|
4700
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION
|
18
SIGNATURES
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, thereunto duly authorized.
|
BELLA
VIAGGIO, INC.
|
||
|
By:
|
/s/ Ronald
A. Davis
|
|
|
Ronald
A. Davis
|
||
|
President
|
||
|
Chief
Executive Officer
|
||
|
Chief
Financial Officer
|
||
|
Chief
Accounting Officer
|
||
|
Secretary,
Director
|
||
|
Date:
April 23, 2009
|
||
19
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Financial
Statements
December
31, 2008 and 2007
F-1
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Financial
Statements
December
31, 2008 and 2007
TABLE
OF CONTENTS
|
Page(s)
|
||
|
Report
of Registered Independent Accounting Firm
|
F-3
|
|
|
Balance
Sheets as of December 31, 2008 and 2007
|
F-4
|
|
|
Statements
of Operations for the years ended December 31, 2008 and 2007
and the period of June 6, 2007 (Inception) to December 31,
2008
|
F-5
|
|
|
Statement
of Changes in Stockholders’ Equity cumulative from June 6, 2007
(inception) to December 31, 2008
|
F-6
|
|
|
Statements
of Cash Flows for the years ended December 31, 2008 and 2007
and the period of June 6, 2007 (Inception) to December 31,
2008
|
F-7
|
|
|
Notes
to the Financial Statements
|
F-8-13
|
|
F-2
Report of Independent
Registered Public Accounting Firm
To the
Board of Directors
Bella
Viaggio, Inc.
Las
Vegas, Nevada
We have
audited the accompanying balance sheets of Bella Viaggio, Inc. (A Development
Stage Enterprise) as of December 31, 2008 and 2007 the related statements of
operations, stockholders’ deficit, and cash flows for the years then ended and
the period June 6, 2007 (inception) through December 31, 2008. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, 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. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting
principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Bella Viaggio, Inc. (A Development
Stage Enterprise) as of December 31, 2008 and 2007 and the results of its
operations and cash flows for the years then ended and the period June 6, 2007
(inception) through December 31, 2008, in conformity with U.S. generally
accepted accounting principles.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company has limited operations and has no established source of
revenue. This raises substantial doubt about its ability to continue
as a going concern. Management’s plan in regard to these matters is also
described in Note 2. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
Kyle L.
Tingle, CPA, LLC
March 28, 2009
Las Vegas, Nevada
F-3
|
BELLA
VIAGGIO, INC.
|
||||||||
|
(A
Development Stage Enterprise)
|
||||||||
|
Balance
Sheets
|
||||||||
|
December
31,
|
||||||||
|
2008
|
2007
|
|||||||
|
ASSETS
|
||||||||
|
Current
assets
|
||||||||
|
Cash
|
$ | 978 | $ | 353 | ||||
|
Prepaid
expenses
|
7,500 | - | ||||||
|
Total
current assets
|
8,478 | 353 | ||||||
|
Total
assets
|
$ | 8,478 | $ | 353 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||
|
Current
liabilities
|
||||||||
|
Accounts
payable
|
$ | 450 | $ | 50 | ||||
|
Loan
from shareholder
|
3,950 | 3,100 | ||||||
|
Total
current liabilities
|
4,400 | 3,150 | ||||||
|
Stockholders'
equity (deficit)
|
||||||||
|
Preferred
stock, $0.001 par value; 5,000,000 shares authorized, no shares issued or
outstanding
|
- | - | ||||||
|
Common
stock, $0.001 par value; 70,000,000 shares authorized, 2,644,500 and
2,220,000 shares issued and outstanding at December 31, 2008 and
2007
|
2,645 | 2,220 | ||||||
|
Additional
paid in capital
|
70,305 | 32,780 | ||||||
|
Deficit
accumulated during the development stage
|
(70,872 | ) | (37,797 | ) | ||||
|
Total
stockholders' equity (deficit)
|
4,078 | (2,797 | ) | |||||
|
Total
liabilities and stockholders' equity (deficit)
|
$ | 8,478 | $ | 353 | ||||
|
See
accompanying notes to financial statements
|
||||||||
F-4
|
BELLA
VIAGGIO, INC.
|
||||||||||||
|
(A
Development Stage Enterprise)
|
||||||||||||
|
Statements
of Operations
|
||||||||||||
|
For
the period from June 6, 2007 (inception) to December 31,
2008
|
||||||||||||
|
Year
ended December 31,
|
||||||||||||
|
2008
|
2007
|
|||||||||||
|
Revenue
|
$ | - | $ | - | $ | - | ||||||
|
Operating
Expenses
|
||||||||||||
|
Office
expenses
|
200 | 7,797 | 7,997 | |||||||||
|
Website
|
2,100 | - | 2,100 | |||||||||
|
Professional
fees
|
30,775 | 30,000 | 60,775 | |||||||||
|
Total
operating expenses
|
33,075 | 37,797 | 70,872 | |||||||||
|
Net
loss
|
$ | (33,075 | ) | $ | (37,797 | ) | $ | (70,872 | ) | |||
|
Basic
and diluted loss per common share
|
$ | (0.01 | ) | $ | (0.02 | ) | ||||||
|
Weighted
average shares outstanding
|
2,513,821 | 2,220,000 | ||||||||||
|
See
accompanying notes to financial statements
|
||||||||||||
F-5
|
BELLA
VIAGGIO, INC.
|
||||||||||||||||||||||||
|
(A
Development Stage Enterprise)
|
||||||||||||||||||||||||
|
Statement
of Changes in Stockholders' Equity
|
||||||||||||||||||||||||
|
For
the Period of June 6, 2007 (Inception) to December 31,
2008
|
||||||||||||||||||||||||
|
Common
Stock
|
Additional
Paid-In Capital
|
Common
stock subscribed
|
Accumulated
Deficit
|
Total
|
||||||||||||||||||||
|
Shares
|
Amount
|
|||||||||||||||||||||||
|
Balance,
June 6, 2007 (Inception)
|
- | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||
|
Common
stock subscriptions
|
- | - | - | 33,000 | - | 33,000 | ||||||||||||||||||
|
Issuance
of common stock for cash and services
|
2,200,000 | 2,200 | 30,800 | (33,000 | ) | - | - | |||||||||||||||||
|
Sale
of common stock for cash
|
20,000 | 20 | 1,980 | - | - | 2,000 | ||||||||||||||||||
|
Net
loss, December 31, 2007
|
- | - | - | - | (37,797 | ) | (37,797 | ) | ||||||||||||||||
|
Balance,
December 31, 2007
|
2,220,000 | 2,220 | 32,780 | - | (37,797 | ) | (2,797 | ) | ||||||||||||||||
|
Sale
of common stock for cash
|
374,500 | 375 | 37,075 | - | - | 37,450 | ||||||||||||||||||
|
Issuance
of common stock for services
|
50,000 | 50 | 2,450 | - | - | 2,500 | ||||||||||||||||||
|
Net
loss, December 31, 2008
|
- | - | - | - | (33,075 | ) | (33,075 | ) | ||||||||||||||||
|
Balance,
December 31, 2008
|
2,644,500 | $ | 2,645 | $ | 72,305 | $ | - | $ | (70,872 | ) | $ | 4,078 | ||||||||||||
|
See
accompanying notes to financial
statements
|
||||||||||||||||||||||||
F-6
|
BELLA
VIAGGIO, INC.
|
||||||||||||
|
(A
Development Stage Enterprise)
|
||||||||||||
|
Statements
of Cash Flows
|
||||||||||||
|
For
the period of June 6, 2007 (inception) to December 31,
2008
|
||||||||||||
|
Year
ended December 31,
|
||||||||||||
|
2008
|
2007
|
|||||||||||
|
Cash
flows from operating activities
|
||||||||||||
|
Net
loss
|
$ | (33,075 | ) | $ | (37,797 | ) | $ | (70,872 | ) | |||
|
Adjustments
to reconcile net income to net cash used in operating
activities
|
||||||||||||
|
Common
stock issued for services
|
2,500 | 29,500 | 32,000 | |||||||||
|
Changes
in operating assets and liabilities
|
||||||||||||
|
Prepaid
expenses
|
(7,500 | ) | - | (7,500 | ) | |||||||
|
Accounts
payable
|
400 | 50 | 450 | |||||||||
|
Net
cash used in operating activities
|
(37,675 | ) | (8,247 | ) | (45,922 | ) | ||||||
|
Net
cash used in investing activities
|
- | - | - | |||||||||
|
Cash
flows from financing activities
|
||||||||||||
|
Proceeds
from shareholder loan
|
5,850 | 3,100 | 8,950 | |||||||||
|
Repayments
of shareholder loan
|
(5,000 | ) | - | (5,000 | ) | |||||||
|
Proceeds
from sale of stock
|
37,450 | 5,500 | 42,950 | |||||||||
|
Net
cash provided by financing activities
|
38,300 | 8,600 | 46,900 | |||||||||
|
Net
increase in cash
|
625 | 353 | 978 | |||||||||
|
Cash
at beginning of period
|
353 | - | - | |||||||||
|
Cash
at end of period
|
$ | 978 | $ | 353 | $ | 978 | ||||||
|
Disclosure
of non-cash financing activities:
|
||||||||||||
|
Issuance
of 1,966,667 shares of common stock for professional and legal
services
|
$ | 2,500 | $ | 29,500 | $ | 32,000 | ||||||
|
Supplemental
Cash Flow Information:
|
||||||||||||
|
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
|
Cash
paid for income taxes
|
$ | - | $ | - | $ | - | ||||||
|
See
accompanying notes to financial statements
|
||||||||||||
F-7
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Financial Statements
December
31, 2008 and 2007
Note
1 – Nature of Business
Bella
Viaggio, Inc. (“Company”) was organized June 6, 2007 under the laws of the State
of Nevada for the purpose of owning and operating a chain of day spas and
salons. The Company currently has no operations or realized revenues
from its planned principle business purpose and, in accordance with Statement of
Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by
Development Stage Enterprises,” is considered a Development Stage
Enterprise.
Note
2 – Significant Accounting Policies
Estimates
The
preparation of financial statements in conformity with generally accepted
accounting principles 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 and
the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those
estimates.
Cash
For the
Statements of Cash Flows, all highly liquid investments with maturity of three
months or less are considered to be cash equivalents. There were no
cash equivalents as of December 31, 2008 and 2007.
Income
taxes
Income
taxes are provided for using the liability method of accounting in accordance
with SFAS No. 109 “Accounting
for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in
Income Taxes—an interpretation of FASB Statement
No. 109.” A deferred tax asset or liability is recorded
for all temporary differences between financial and tax
reporting. Temporary differences are the differences between the
reported amounts of assets and liabilities and their tax
basis. Deferred tax assets are reduced by a valuation allowance when,
in the opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effect of changes in tax laws and
rates on the date of enactment.
F-8
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Financial Statements
December
31, 2008 and 2007
Note
2 – Significant Accounting Policies (continued)
Share Based
Expenses
In
December 2004, the Financial Accounting Standards Board (“FASB”) issued
SFAS No. 123R “Share
Based Payment.”This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to
Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”This
statement requires a public entity to expense the cost of employee services
received in exchange for an award of equity instruments. This statement also
provides guidance on valuing and expensing these awards, as well as disclosure
requirements of these equity arrangements. The Company adopted SFAS No.
123R upon creation of the company and expenses share based costs in the period
incurred.
Going
concern
The
Company’s financial statements are prepared in accordance with generally
accepted accounting principles applicable to a going concern. This
contemplates the realization of assets and the liquidation of liabilities in the
normal course of business. Currently, the Company has minimal cash
and assets, and does not have operations or a source of revenue sufficient to
cover its operation costs and allow it to continue as a going
concern. The Company is currently attempting to raise capital in
order to initiate its business plan which will, if successful, mitigate these
factors which raise substantial doubt about the Company’s ability to continue as
a going concern. The Company will be dependent upon the raising of
this additional capital through placement of our common stock in order to
implement its business plan, or merge with an operating
company. There can be no assurance that the Company will be
successful in either situation in order to continue as a going
concern. The officers and directors have committed to advancing
certain operating costs of the Company.
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-9
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Financial Statements
December
31, 2008 and 2007
Note
2 – 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 labeled 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-10
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Financial Statements
December
31, 2008 and 2007
Note
2 – 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.
Note 3 – Stockholders’
Equity
Common
stock
The
authorized common stock of the Company consists of 70,000,000 shares with par
value of $0.001. On June 6, 2007, the Company authorized the issuance
of 2,200,000 shares of its $0.001 par value common stock at $0.015 per share in
consideration of $3,500 in cash and $29,500 in legal and business services.
During the years ended December 31, 2008 and 2007, the Company issued 374,500
and 20,000 shares of its common stock at $0.10 per share for a total cash
consideration of $37,450 and $20,000, respectively. In December 2008,
the Company issued restricted stock in lieu of services performed in February
2009. There were 2,644,500 and 2,220,000 shares of common stock
issued and outstanding at December 31, 2008 and 2007.
Preferred
stock
The
authorized preferred stock of the Company consists of 5,000,000 shares with a
par value of $0.001. The Company has no preferred stock issued or
outstanding.
SB-2 Registration
Statement
On
October 16, 2007, the Company filed a Form SB-2 Registration Statement with the
Securities and Exchange Commission for 750,000 shares to be sold at a price of
$0.10 per share to the public by a small business issuer under the Securities
Act of 1933. The Securities and Exchange Commission notified the Company on
October 22, 2007 the registration had been declared effective. During the year
ended December 31, 2008 the Company issued a total of 374,500 common shares for
a total cash consideration of $37,450.
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. Diluted loss per share is computed using the weighted averaged
number of shares and dilutive potential common shares
outstanding. Dilutive potential common shares are additional common
shares assumed to be exercised.
Basic net
loss per common share is based on the weighted average number of shares of
common stock outstanding during 2008 or 2007 and since inception. As
of December 31, 2008 and 2007 and since inception, the Company had no dilutive
potential common shares.
F-11
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Financial Statements
December
31, 2008 and 2007
Note
4 – Income Taxes
We did
not provide any current or deferred U.S. federal income tax provision or benefit
for any of the periods presented because we have experienced operating losses
since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax”
and FASB Interpretation No. 48 “Accounting for Uncertainty in
Income Taxes an interpretation of FASB Statement No.109”, when it is more
likely than not that a tax asset cannot be realized through future income the
Company must allow for this future tax benefit. We provided a full
valuation allowance on the net deferred tax asset, consisting of net operating
loss carry-forwards, because management has determined that it is more likely
than not that we will not earn income sufficient to realize the deferred tax
assets during the carry-forward period.
The
provision for income taxes differs from the amount computed by applying the
statutory federal income tax rate to income before provision for income taxes.
The sources and tax effects of the differences for the periods presented are as
follows:
|
Income
tax provision at the
|
|
|
Federal
statutory rate
|
35%
|
|
Effect
of operating losses
|
-35%
|
|
0%
|
Net
deferred tax assets consist of the following:
|
2008
|
2007
|
|||||||
|
Net
operating loss carry forward
|
$ | 11,576 | $ | 13,229 | ||||
|
Valuation
allowance
|
(11,576 | ) | (13,229 | ) | ||||
|
Net
deferred tax asset
|
$ | - | $ | - | ||||
A
reconciliation of income taxes computed at the statutory rate t the income tax
amount recorded is as follows:
|
2008
|
2007
|
From
Inception
|
||||||||||
|
Net
operating loss carry forward
|
$ | 11,576 | $ | 13,229 | $ | 24,805 | ||||||
|
Valuation
allowance
|
(11,576 | ) | (13,229 | ) | (24,805 | ) | ||||||
|
Net
deferred tax asset
|
$ | - | $ | - | $ | - | ||||||
The
Company did not pay any income taxes during the years ended December 31, 2008 or
2007.
The net
federal operating loss carry forward will expire in 2027 and
2028. This carry forward may be limited upon the consummation of a
business combination under IRC Section 381.
F-12
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Financial Statements
December
31, 2008 and 2007
Note
5 – Related Party Transactions
The
Company neither owns nor leases any real or personal property. An
officer or resident agent of the corporation provides office services without
charge. Such costs are immaterial to the financial statements and
accordingly, have not been reflected therein. The officers and
directors for the Company are involved in other business activities and may, in
the future, become involved in other business opportunities. If a
specific business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business
interest. The Company has not formulated a policy for the resolution
of such conflicts.
An
officer of the Company advanced $8,950 for organizational expenses and
professional fees for the formation of the Company. The balance of
the advances were $3,950 and $3,100 as of December 31, 2008 and 2007,
respectively.
On April
17, 2008 the Company signed a contract with Heartland Managed Risk, LLC
(Heartland), a related party, for the purposes of provided the filing and
compliance services necessary to meet the Securities and Exchange Commission
requirements for reporting companies. The Company agreed to pay
Heartland $20,000 annually for these services which were paid in full in April
2008. Accordingly, this amount has been reflected in the financial statements as
a prepaid expense and will be recognized appropriately as services are rendered.
As of December 31, 2008, the Company had incurred $15,000 expense on the
contract and recorded prepaid expenses of $5,000.
On
January 16, 2008, the Company engaged Delos Stock Transfer, LLC (Delos), a
related party, for transfer agent and registrar services. For the
year ended December 31, 2008, the Company paid Delos $4,500 for stock transfer
and registrar services.
Note
6 – Warrants and Options
There are
no warrants or options outstanding to acquire any additional shares of common
stock of the Company.
Note
7 – Prepaid Expenses
The
Company issued 50,000 shares of restricted stock at $0.05 per share in December
2008. Services of $2,500 were performed in February
2009. The share issuance was treated as a prepaid expense as of
December 31, 2008. Total prepaid expenses including the agreements
noted in Note 5 were $7,500 and $0, respectively.
F-13
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
September
30, 2008 and 2007
F-14
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
September
30, 2008 and 2007
TABLE
OF CONTENTS
|
Page(s)
|
||
|
Balance
Sheets as of September 30, 2008 and December 31, 2007
|
F-16
|
|
|
Statements
of Operations for the three and nine months ended September 30,
2008 and
|
||
|
2007
and the period of June 6, 2007 (Inception) to September 30,
2008
|
F-17
|
|
|
Statements
of Cash Flows for the nine months ended September 30, 2008 and 2007 and
the
|
||
|
period
of June 6, 2007 (Inception) to September 30, 2008
|
F-18
|
|
|
Notes
to the Unaudited Financial Statements
|
F-19-24
|
|
F-15
|
BELLA
VIAGGIO, INC.
|
||||||||
|
(A
Development Stage Enterprise)
|
||||||||
|
Balance
Sheets
|
||||||||
|
September
30, 2008
|
December
31, 2007
|
|||||||
|
(unaudited)
|
||||||||
|
ASSETS
|
||||||||
|
Current
assets
|
||||||||
|
Cash
|
$
|
978 | $ | 353 | ||||
|
Prepaid
expenses
|
10,000 | - | ||||||
|
Total
current assets
|
10,978 | 353 | ||||||
|
Total
assets
|
$ | 10,978 | $ | 353 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||
|
Current
liabilities
|
||||||||
|
Accounts
payable
|
$ | - | $ | 50 | ||||
|
Loan
from shareholder
|
3,950 | 3,100 | ||||||
|
Total
current liabilities
|
3,950 | 3,150 | ||||||
|
Stockholders'
Equity (Deficit)
|
||||||||
|
Preferred
stock, $.001 par value; 5,000,000 shares authorized, no shares issued or
outstanding
|
- | - | ||||||
|
Common
stock, $.001 par value; 70,000,000 shares authorized, 2,594,500 and
2,220,000 shares issued and outstanding at September 30, 2008 and December
31, 2007
|
2,595 | 2,220 | ||||||
|
Additional
paid in capital
|
69,855 | 32,780 | ||||||
|
Deficit
accumulated during the development stage
|
(65,422 | ) | (37,797 | ) | ||||
|
Total
stockholders' equity (deficit)
|
7,028 | (2,797 | ) | |||||
|
Total
liabilities and stockholders' equity (deficit)
|
$ | 10,978 | $ | 353 | ||||
|
See
accompanying notes to financial statements
|
||||||||
F-16
|
BELLA
VIAGGIO, INC.
|
||||||||||||||||||||
|
(A
Development Stage Enterprise)
|
||||||||||||||||||||
|
Statements
of Operations
|
||||||||||||||||||||
|
(Unaudited)
|
||||||||||||||||||||
|
For
the period from June 6, 2007 (inception) to September 30,
2008
|
||||||||||||||||||||
|
Three
months ended September 30,
|
Nine
months ended September 30,
|
|||||||||||||||||||
|
2008
|
2007
|
2008
|
2007
|
|||||||||||||||||
|
Revenue
|
$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
|
Expenses
|
||||||||||||||||||||
|
Website
|
- | - | 2,100 | - | 2,100 | |||||||||||||||
|
Travel
|
- | - | 200 | - | 200 | |||||||||||||||
|
Professional
fees
|
11,000 | 500 | 25,325 | 30,000 | 63,122 | |||||||||||||||
|
Total
expenses
|
11,000 | 500 | 27,625 | 30,000 | 65,422 | |||||||||||||||
|
Net
loss
|
$ | (11,000 | ) | $ | (500 | ) | $ | (27,625 | ) | $ | (30,000 | ) | $ | (65,422 | ) | |||||
|
Basic
and diluted loss per common share
|
$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | $ | (0.01 | ) | ||||||||
|
Weighted
average shares outstanding
|
2,564,377 | 2,220,000 | 2,473,102 | 2,220,000 | ||||||||||||||||
|
See
accompanying notes to financial statements
|
||||||||||||||||||||
F-17
|
BELLA
VIAGGIO, INC.
|
||||||||||||
|
(A
Development Stage Enterprise)
|
||||||||||||
|
Statements
of Cash Flows
|
||||||||||||
|
For
the period of June 6, 2007 (inception) to September 30,
2008
|
||||||||||||
|
Nine
months ended September 30,
|
||||||||||||
|
2008
|
2007
|
|||||||||||
|
Cash
flows from operating activities
|
||||||||||||
|
Net
loss
|
$ | (27,625 | ) | $ | (30,000 | ) | $ | (65,422 | ) | |||
|
Adjustments
to reconcile net income to net cash used in operating
activities
|
||||||||||||
|
Common
stock issued for services
|
- | 29,500 | 29,500 | |||||||||
|
Changes
in operating assets and liabilities
|
||||||||||||
|
Prepaid
expenses
|
(10,000 | ) | - | (10,000 | ) | |||||||
|
Accounts
payable
|
(50 | ) | - | - | ||||||||
|
Net
cash used in operating activities
|
(37,675 | ) | (500 | ) | (45,922 | ) | ||||||
|
Net
cash used in investing activities
|
- | - | - | |||||||||
|
Cash
flows from financing activities
|
||||||||||||
|
Proceeds
from shareholder loan
|
5,850 | - | 8,950 | |||||||||
|
Repayments
of shareholder loan
|
(5,000 | ) | - | (5,000 | ) | |||||||
|
Proceeds
from sale of stock
|
37,450 | 3,500 | 42,950 | |||||||||
|
Net
cash provided by financing activities
|
38,300 | 3,500 | 46,900 | |||||||||
|
Net
increase in cash
|
625 | 3,000 | 978 | |||||||||
|
Cash
at beginning of period
|
353 | - | - | |||||||||
|
Cash
at end of period
|
$ | 978 | $ | 3,000 | $ | 978 | ||||||
|
Disclosure
of non-cash financing activities:
|
||||||||||||
|
Issuance
of 1,966,667 shares of common stock for professional and legal
services
|
$ | - | $ | 29,500 | $ | 29,500 | ||||||
|
Supplemental
Cash Flow Information:
|
||||||||||||
|
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
|
Cash
paid for income taxes
|
$ | - | $ | - | $ | - | ||||||
|
See
accompanying notes to financial statements
|
||||||||||||
F-18
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
September
30, 2008 and 2007
Note
1 – Nature of Business
The
unaudited financial statements have been prepared by the Company,
pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to such SEC rules
and regulations; nevertheless, the Company believes that the disclosures
are adequate to make the information presented
not misleading. These financial statements and the notes
attached hereto should be read in conjunction with the financial statements and
notes included in the Company’s Form SB-2, which was filed with the SEC on
October 19, 2008 and deemed effective on October 22, 2008. In the
opinion of the Company, all adjustments, including normal recurring
adjustments necessary to present fairly the financial position of Bella
Viaggio, Inc., as of September 30, 2008 and
the results of its operations and cash flows for the three and
nine month periods then ended, have been included. The results of
operations for the interim period are not necessarily indicative of the
results for the full year.
Bella
Viaggio, Inc. (“Company”) was organized June 6, 2007 under the laws of the State
of Nevada for the purpose of owning and operating a chain of day spas and
salons. The Company currently has no operations or realized revenues
from its planned principle business purpose and, in accordance with Statement of
Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by
Development Stage Enterprises,” is considered a Development Stage
Enterprise.
Note
2 – Significant Accounting Policies
Estimates
The
preparation of financial statements in conformity with generally accepted
accounting principles 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 and
the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those
estimates.
Cash
For the
Statements of Cash Flows, all highly liquid investments with maturity of three
months or less are considered to be cash equivalents. There were no
cash equivalents as of September 30, 2008 and December 31,
2007.
F-19
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
September
30, 2008 and 2007
Note
2 – Significant Accounting Policies (continued)
Income
taxes
Income
taxes are provided for using the liability method of accounting in accordance
with SFAS No. 109 “Accounting
for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in
Income Taxes—an interpretation of FASB Statement
No. 109.” A deferred tax asset or liability is recorded
for all temporary differences between financial and tax
reporting. Temporary differences are the differences between the
reported amounts of assets and liabilities and their tax
basis. Deferred tax assets are reduced by a valuation allowance when,
in the opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effect of changes in tax laws and
rates on the date of enactment.
Share Based
Expenses
In
December 2004, the Financial Accounting Standards Board (“FASB”) issued
SFAS No. 123R “Share
Based Payment.”This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to
Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”This
statement requires a public entity to expense the cost of employee services
received in exchange for an award of equity instruments. This statement also
provides guidance on valuing and expensing these awards, as well as disclosure
requirements of these equity arrangements. The Company adopted SFAS No.
123R upon creation of the company and expenses share based costs in the period
incurred.
Going
concern
The
Company’s financial statements are prepared in accordance with generally
accepted accounting principles applicable to a going concern. This
contemplates the realization of assets and the liquidation of liabilities in the
normal course of business. Currently, the Company has minimal cash
and no material assets, nor does it have operations or a source of revenue
sufficient to cover its operation costs and allow it to continue as a going
concern. The Company is currently attempting to raise capital in
order to initiate its business plan which will, if successful, mitigate these
factors which raise substantial doubt about the Company’s ability to continue as
a going concern. The Company will be dependent upon the raising of
this additional capital through placement of our common stock in order to
implement its business plan, or merge with an operating
company. There can be no assurance that the Company will be
successful in either situation in order to continue as a going
concern. The officers and directors have committed to advancing
certain operating costs of the Company.
F-20
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
September
30, 2008 and 2007
Note
2 – Significant Accounting Policies (continued)
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.
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.
F-21
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
September
30, 2008 and 2007
Note
2 – Significant Accounting Policies (continued)
Recent Accounting
Pronouncements (continued)
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 labeled 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.
None of
the above new pronouncements has current application to the Company, but may be
applicable to the Company’s future financial reporting.
Note 3 – Stockholders’
Equity
Common
stock
The
authorized common stock of the Company consists of 70,000,000 shares with par
value of $0.001. On June 6, 2007, the Company authorized the issuance
of 2,200,000 shares of its $0.001 par value common stock at $0.015 per share in
consideration of $3,500 in cash and $29,500 in legal and business
services.
Preferred
stock
The
authorized preferred stock of the Company consists of 5,000,000 shares with a
par value of $0.001. The Company has no preferred stock issued or
outstanding.
F-22
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
September
30, 2008 and 2007
Note 3 – Stockholders’ Equity
(continued)
SB-2 Registration
Statement
On
October 16, 2007, the Company filed a Form SB-2 Registration Statement with the
Securities and Exchange Commission for 750,000 shares to be sold at a price of
$0.10 per share to the public by a small business issuer under the Securities
Act of 1933. The Securities and Exchange Commission notified the Company on
October 22, 2007 the registration had been declared effective. During the nine
months ended September 30, 2008 the Company issued a total of 374,500 common
shares for a total cash consideration of $37,450.
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. Diluted loss per share is computed using the weighted averaged
number of shares and dilutive potential common shares
outstanding. Dilutive potential common shares are additional common
shares assumed to be exercised.
Basic net
loss per common share is based on the weighted average number of shares of
common stock outstanding during 2007 and since inception. As of
September 30, 2008 and since inception, the Company had no dilutive potential
common shares.
Note
4 – Income Taxes
We did
not provide any current or deferred U.S. federal income tax provision or benefit
for any of the periods presented because we have experienced operating losses
since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax and FASB
Interpretation No. 48 - Accounting for Uncertainty in Income Taxes an
interpretation of FASB Statement No.109,” when it is more likely than not
that a tax asset cannot be realized through future income the Company must allow
for this future tax benefit. We provided a full valuation allowance on the
net deferred tax asset, consisting of net operating loss carry-forwards, because
management has determined that it is more likely than not that we will not earn
income sufficient to realize the deferred tax assets during the carry-forward
period.
The
Company did not pay any income taxes during the nine months ended September 30,
2008.
The net
federal operating loss carry forward will expire in 2027. This carry
forward may be limited upon the consummation of a business combination under IRC
Section 381.
F-23
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
September
30, 2008 and 2007
Note 5 – Related Party
Transactions
The
Company neither owns nor leases any real or personal property. An
officer or resident agent of the corporation provides office services without
charge. Such costs are immaterial to the financial statements and
accordingly, have not been reflected therein. The officers and
directors for the Company are involved in other business activities and may, in
the future, become involved in other business opportunities. If a
specific business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business
interest. The Company has not formulated a policy for the resolution
of such conflicts.
An
officer of the Company has advanced $8,950 for organizational expenses and
professional fees as of September 30, 2008 of which $5,000 has been repaid
leaving a balance due of $3,950 as of September 30, 2008. Interest has not been
imputed as the amounts would be immaterial to the financial statements as a
whole.
Note
6 – Warrants and Options
There are
no warrants or options outstanding to acquire any additional shares of common
stock of the Company.
Note
7 - Prepaid Expenses
On April
17, 2008 the Company signed a contract with Heartland Managed Risk, LLC
(Heartland), a related party, for the purposes of provided the filing and
compliance services necessary to meet the Securities and Exchange Commission
requirements for reporting companies. The Company agreed to pay
Heartland $20,000 annually for these services which were paid in full in April
2008. Accordingly, this amount has been reflected in the financial statements as
a prepaid expense and will be recognized appropriately as services are rendered.
As of September 30, 2008, the Company had $10,000 of prepaid
expenses.
F-24
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
June 30,
2008 and 2007
F-25
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
June 30,
2008 and 2007
TABLE
OF CONTENTS
|
Page(s)
|
||
|
Balance
Sheets as of June 30, 2008 and December 31, 2007
|
F-27
|
|
|
Statements
of Operations for the three and six months ended June 30, 2008
and 2007 and the
|
||
|
period
of June 6, 2007 (Inception) to June 30, 2008
|
F-28
|
|
|
Statements
of Cash Flows for the six months ended June 30, 2008 and 2007 and
the
|
||
|
period
of June 6, 2007 (Inception) to June 30, 2008
|
F-29
|
|
|
Notes
to the Unaudited Financial Statements
|
F-30-35
|
|
F-26
|
BELLA
VIAGGIO, INC.
|
||||||||
|
(A
Development Stage Enterprise)
|
||||||||
|
Balance
Sheets
|
||||||||
|
June
30, 2008
|
December
31, 2007
|
|||||||
|
(unaudited)
|
||||||||
|
ASSETS
|
||||||||
|
Current
assets
|
||||||||
|
Cash
|
$ | 478 | $ | 353 | ||||
|
Subscriptions
receivable
|
1,100 | - | ||||||
|
Prepaid
expenses
|
15,000 | - | ||||||
|
Total
current assets
|
16,578 | 353 | ||||||
|
Total
assets
|
$ | 16,578 | $ | 353 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||
|
Current
liabilities
|
||||||||
|
Accounts
payable
|
$ | - | $ | 50 | ||||
|
Loan
from shareholder
|
3,950 | 3,100 | ||||||
|
Total
current liabilities
|
3,950 | 3,150 | ||||||
|
Stockholders'
Equity (Deficit)
|
||||||||
|
Preferred
stock, $.001 par value; 5,000,000 shares authorized, no shares issued or
outstanding
|
- | - | ||||||
|
Common
stock, $.001 par value; 70,000,000 shares authorized, 2,540,500 and
2,220,000 shares issued and outstanding at June 30, 2008 and December 31,
2007
|
2,540 | 2,220 | ||||||
|
Additional
paid in capital
|
64,510 | 32,780 | ||||||
|
Deficit
accumulated during the development stage
|
(54,422 | ) | (37,797 | ) | ||||
|
Total
stockholders' equity (deficit)
|
12,628 | (2,797 | ) | |||||
|
Total
liabilities and stockholders' equity (deficit)
|
$ | 16,578 | $ | 353 | ||||
|
See
accompanying notes to financial statements
|
||||||||
F-27
|
BELLA
VIAGGIO, INC.
|
||||||||||||||||||||
|
(A
Development Stage Enterprise)
|
||||||||||||||||||||
|
Statements
of Operations
|
||||||||||||||||||||
|
(Unaudited)
|
||||||||||||||||||||
|
For
the period from June 6, 2007 (inception) to June 30, 2008
|
||||||||||||||||||||
|
Three
months ended June 30,
|
Six
months ended June 30,
|
|||||||||||||||||||
|
2008
|
2007
|
2008
|
2007
|
|||||||||||||||||
|
Revenue
|
$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
|
Expenses
|
||||||||||||||||||||
|
Website
|
2,100 | - | 2,100 | - | 2,100 | |||||||||||||||
|
Travel
|
- | - | 200 | - | 200 | |||||||||||||||
|
Professional
fees
|
5,525 | 29,500 | 14,325 | 29,500 | 52,122 | |||||||||||||||
|
Total
expenses
|
7,625 | 29,500 | 16,625 | 29,500 | 54,422 | |||||||||||||||
|
Net
loss
|
$ | (7,625 | ) | $ | (29,500 | ) | $ | (16,625 | ) | $ | (29,500 | ) | $ | (54,422 | ) | |||||
|
Basic
and diluted loss per common share
|
$ | (0.00 | ) | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | ||||||||
|
Weighted
average shares outstanding
|
2,540,500 | 2,220,000 | 2,435,341 | 2,220,000 | ||||||||||||||||
|
See
accompanying notes to financial statements
|
||||||||||||||||||||
F-28
|
BELLA
VIAGGIO, INC.
|
||||||||||||
|
(A
Development Stage Enterprise)
|
||||||||||||
|
Statements
of Cash Flows
|
||||||||||||
|
(Unaudited)
|
||||||||||||
|
For
the period of June 6, 2007 (inception) to June 30, 2008
|
||||||||||||
|
Six
months ended June 30,
|
||||||||||||
|
2008
|
2007
|
|||||||||||
|
Cash
flows from operating activities
|
||||||||||||
|
Net
loss
|
$ | (16,625 | ) | $ | (29,500 | ) | $ | (54,422 | ) | |||
|
Adjustments
to reconcile net income to net cash used in operating
activities
|
||||||||||||
|
Common
stock issued for services
|
- | 29,500 | 29,500 | |||||||||
|
Changes
in operating assets and liabilities
|
||||||||||||
|
Prepaid
expenses
|
(15,000 | ) | - | (15,000 | ) | |||||||
|
Accounts
payable
|
(50 | ) | - | - | ||||||||
|
Net
cash used in operating activities
|
(31,675 | ) | - | (39,922 | ) | |||||||
|
Net
cash used in investing activities
|
- | - | - | |||||||||
|
Cash
flows from financing activities
|
||||||||||||
|
Proceeds
from shareholder loan
|
5,850 | - | 8,950 | |||||||||
|
Repayments
of shareholder loan
|
(5,000 | ) | - | (5,000 | ) | |||||||
|
Proceeds
from sale of stock
|
30,950 | 3,500 | 36,450 | |||||||||
|
Net
cash provided by financing activities
|
31,800 | 3,500 | 40,400 | |||||||||
|
(Decrease)
increase in cash
|
125 | 3,500 | 478 | |||||||||
|
Cash
at beginning of period
|
353 | - | - | |||||||||
|
Cash
at end of period
|
$ | 478 | $ | 3,500 | $ | 478 | ||||||
|
Disclosure
of non-cash financing activities:
|
||||||||||||
|
Issuance
of 1,966,667 shares of common stock for professional and legal
services
|
$ | - | $ | 29,500 | $ | 29,500 | ||||||
|
Supplemental
Cash Flow Information:
|
||||||||||||
|
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
|
Cash
paid for income taxes
|
$ | - | $ | - | $ | - | ||||||
|
See
accompanying notes to financial statements
|
||||||||||||
F-29
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
June
30, 2008 and 2007
Note
1 – Nature of Business
The
unaudited financial statements have been prepared by the Company,
pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to such SEC rules
and regulations; nevertheless, the Company believes that the disclosures
are adequate to make the information presented
not misleading. These financial statements and the notes
attached hereto should be read in conjunction with the financial statements and
notes included in the Company’s Form SB-2, which was filed with the SEC on
October 19, 2008 and deemed effective on October 22, 2008. In the
opinion of the Company, all adjustments, including normal recurring
adjustments necessary to present fairly the financial position of Bella
Viaggio, Inc., as of June 30, 2008 and
the results of its operations and cash flows for the three and
six month periods then ended, have been included. The results of operations
for the interim period are not necessarily indicative of the results for
the full year.
Bella
Viaggio, Inc. (“Company”) was organized June 6, 2007 under the laws of the State
of Nevada for the purpose of owning and operating a chain of day spas and
salons. The Company currently has no operations or realized revenues
from its planned principle business purpose and, in accordance with Statement of
Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by
Development Stage Enterprises,” is considered a Development Stage
Enterprise.
Note
2 – Significant Accounting Policies
Estimates
The
preparation of financial statements in conformity with generally accepted
accounting principles 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 and
the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those
estimates.
Cash
For the
Statements of Cash Flows, all highly liquid investments with maturity of three
months or less are considered to be cash equivalents. There were no
cash equivalents as of June 30, 2008 and December 31, 2007.
F-30
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
June
30, 2008 and 2007
Note
2 – Significant Accounting Policies (continued)
Income
taxes
Income
taxes are provided for using the liability method of accounting in accordance
with SFAS No. 109 “Accounting
for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in
Income Taxes—an interpretation of FASB Statement
No. 109.” A deferred tax asset or liability is recorded
for all temporary differences between financial and tax
reporting. Temporary differences are the differences between the
reported amounts of assets and liabilities and their tax
basis. Deferred tax assets are reduced by a valuation allowance when,
in the opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effect of changes in tax laws and
rates on the date of enactment.
Share Based
Expenses
In
December 2004, the Financial Accounting Standards Board (“FASB”) issued
SFAS No. 123R “Share
Based Payment.” This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to
Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”
This statement requires a public entity to expense the cost of employee services
received in exchange for an award of equity instruments. This statement also
provides guidance on valuing and expensing these awards, as well as disclosure
requirements of these equity arrangements. The Company adopted SFAS No.
123R upon creation of the company and expenses share based costs in the period
incurred.
Going
concern
The
Company’s financial statements are prepared in accordance with generally
accepted accounting principles applicable to a going concern. This
contemplates the realization of assets and the liquidation of liabilities in the
normal course of business. Currently, the Company has minimal cash
and no material assets, nor does it have operations or a source of revenue
sufficient to cover its operation costs and allow it to continue as a going
concern. The Company is currently attempting to raise capital in
order to initiate its business plan which will, if successful, mitigate these
factors which raise substantial doubt about the Company’s ability to continue as
a going concern. The Company will be dependent upon the raising of
this additional capital through placement of our common stock in order to
implement its business plan, or merge with an operating
company. There can be no assurance that the Company will be
successful in either situation in order to continue as a going
concern. The officers and directors have committed to advancing
certain operating costs of the Company.
F-31
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
June
30, 2008 and 2007
Note
2 – Significant Accounting Policies (continued)
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.
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.
F-32
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
June
30, 2008 and 2007
Note
2 – Significant Accounting Policies (continued)
Recent Accounting
Pronouncements (continued)
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 labeled 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.
None of
the above new pronouncements has current application to the Company, but may be
applicable to the Company’s future financial reporting.
Note 3 – Stockholders’
Equity
Common
stock
The
authorized common stock of the Company consists of 70,000,000 shares with par
value of $0.001. On June 6, 2007, the Company authorized the issuance
of 2,200,000 shares of its $0.001 par value common stock at $0.015 per share in
consideration of $3,500 in cash and $29,500 in legal and business
services.
Preferred
stock
The
authorized preferred stock of the Company consists of 5,000,000 shares with a
par value of $0.001. The Company has no preferred stock issued or
outstanding.
F-33
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
June
30, 2008 and 2007
Note 3 – Stockholders’ Equity
(continued)
SB-2 Registration
Statement
On
October 16, 2007, the Company filed a Form SB-2 Registration Statement with the
Securities and Exchange Commission for 750,000 shares to be sold at a price of
$0.10 per share to the public by a small business issuer under the Securities
Act of 1933. The Securities and Exchange Commission notified the Company on
October 22, 2007 the registration had been declared effective. During the six
months ended June 30, 2008 the Company issued 309,500 common shares for a total
cash consideration of $30,950. Also, 11,000 shares were issued and
unpaid at June 30, 2008.
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. Diluted loss per share is computed using the weighted averaged
number of shares and dilutive potential common shares
outstanding. Dilutive potential common shares are additional common
shares assumed to be exercised.
Basic net
loss per common share is based on the weighted average number of shares of
common stock outstanding during 2007 and since inception. As of June
30, 2008 and since inception, the Company had no dilutive potential common
shares.
Note
4 – Income Taxes
We did
not provide any current or deferred U.S. federal income tax provision or benefit
for any of the periods presented because we have experienced operating losses
since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax and FASB
Interpretation No. 48 - Accounting for Uncertainty in Income Taxes an
interpretation of FASB Statement No.109,” when it is more likely than not
that a tax asset cannot be realized through future income the Company must allow
for this future tax benefit. We provided a full valuation allowance on the
net deferred tax asset, consisting of net operating loss carry-forwards, because
management has determined that it is more likely than not that we will not earn
income sufficient to realize the deferred tax assets during the carry-forward
period.
The
Company did not pay any income taxes during the six months ended June 30,
2008.
The net
federal operating loss carry forward will expire in 2027. This carry
forward may be limited upon the consummation of a business combination under IRC
Section 381.
F-34
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
June
30, 2008 and 2007
Note 5 – Related Party
Transactions
The
Company neither owns nor leases any real or personal property. An
officer or resident agent of the corporation provides office services without
charge. Such costs are immaterial to the financial statements and
accordingly, have not been reflected therein. The officers and
directors for the Company are involved in other business activities and may, in
the future, become involved in other business opportunities. If a
specific business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business
interest. The Company has not formulated a policy for the resolution
of such conflicts.
An
officer of the Company has advanced $8,950 for organizational expenses and
professional fees as of June 30, 2008 of which $5,000 was repaid during the
three months ended June 30, 2008 leaving a balance due of $3,950 as of June 30,
2008. Interest has not been imputed as the amounts would be immaterial to the
financial statements as a whole.
Note
6 – Warrants and Options
There are
no warrants or options outstanding to acquire any additional shares of common
stock of the Company.
Note
7 - Prepaid Expenses
On April
17, 2008 the Company signed a contract with Heartland Managed Risk, LLC
(Heartland), a related party, for the purposes of provided the filing and
compliance services necessary to meet the Securities and Exchange Commission
requirements for reporting companies. The Company agreed to pay
Heartland $20,000 annually for these services which were paid in full in April
2008. Accordingly, this amount has been reflected in the financial statements as
a prepaid expense and will be recognized appropriately as services are rendered.
As of June 30, 2008, the Company had $15,000 of prepaid
expenses.
F-35
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
March 31,
2008
F-36
BELLA
VIAGGIO, INC.
(A
DEVELOPMENT STAGE ENTERPRISE)
Unaudited
Financial Statements
March 31,
2008
TABLE
OF CONTENTS
|
Page(s)
|
||
|
Balance
Sheets as of March 31, 2008 and December 31, 2007
|
F-38
|
|
|
Statements
of Operations for the three months ended March 31, 2008 and the period
of
|
||
|
June
6, 2007 (Inception) to March 31, 2008
|
F-39
|
|
|
Statements
of Cash Flows for the three months ended March 31, 2008 and the period
of
|
||
|
June
6, 2007 (Inception) to March 31, 2008
|
F-40
|
|
|
Notes
to the Unaudited Financial Statements
|
F-41-46
|
|
F-37
|
BELLA
VIAGGIO, INC.
|
||||||||
|
(A
Development Stage Enterprise)
|
||||||||
|
Balance
Sheets
|
||||||||
|
March
31, 2008
|
December
31, 2007
|
|||||||
|
(unaudited)
|
||||||||
|
ASSETS
|
||||||||
|
Current
assets
|
||||||||
|
Cash
|
$ | 25,603 | $ | 353 | ||||
|
Subscriptions
receivable
|
3,600 | - | ||||||
|
Total
current assets
|
29,203 | 353 | ||||||
|
Total
assets
|
$ | 29,203 | $ | 353 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||
|
Current
liabilities
|
||||||||
|
Accounts
payable
|
$ | - | $ | 50 | ||||
|
Loan
from shareholder
|
8,950 | 3,100 | ||||||
|
Total
current liabilities
|
8,950 | 3,150 | ||||||
|
Stockholders'
Equity (Deficit)
|
||||||||
|
Preferred
stock, $.001 par value; 5,000,000 shares authorized, no shares issued or
outstanding
|
- | - | ||||||
|
Common
stock, $.001 par value; 70,000,000 shares authorized, 2,540,500 and
2,220,000 shares issued and outstanding at March 31, 2008 and December 31,
2007
|
2,540 | 2,220 | ||||||
|
Additional
paid in capital
|
64,510 | 32,780 | ||||||
|
Deficit
accumulated during the development stage
|
(46,797 | ) | (37,797 | ) | ||||
|
Total
stockholders' equity (deficit)
|
20,253 | (2,797 | ) | |||||
|
Total
liabilities and stockholders' equity (deficit)
|
$ | 29,203 | $ | 353 | ||||
|
See
accompanying notes to financial statements
|
||||||||
F-38
|
BELLA
VIAGGIO, INC.
|
||||||||
|
(A
Development Stage Enterprise)
|
||||||||
|
Statements
of Operations
|
||||||||
|
(Unaudited)
|
||||||||
|
For
the period from June 6, 2007 (inception) to March 31, 2008
|
||||||||
|
Three
months ended March 31, 2008
|
||||||||
|
Revenue
|
$ | - | $ | - | ||||
|
Expenses
|
||||||||
|
Travel
|
200 | 200 | ||||||
|
Professional
fees
|
8,800 | 46,597 | ||||||
|
Total
expenses
|
9,000 | 46,797 | ||||||
|
Net
loss
|
$ | (9,000 | ) | $ | (46,797 | ) | ||
|
Basic
and diluted loss per common share
|
$ | (0.00 | ) | |||||
|
Weighted
average shares outstanding
|
2,323,423 | |||||||
|
See
accompanying notes to financial statements
|
||||||||
F-39
|
BELLA
VIAGGIO, INC.
|
||||||||
|
(A
Development Stage Enterprise)
|
||||||||
|
Statements
of Cash Flows
|
||||||||
|
(Unaudited)
|
||||||||
|
For
the period of June 6, 2007 (inception) to March 31, 2008
|
||||||||
|
Three
months ended March 31, 2008
|
||||||||
|
Cash
flows from operating activities
|
||||||||
|
Net
loss
|
$ | (9,000 | ) | $ | (46,797 | ) | ||
|
Adjustments
to reconcile net income to net cash used in operating
activities
|
||||||||
|
Common
stock issued for services
|
- | 29,500 | ||||||
|
Changes
in operating assets and liabilities:
|
||||||||
|
Accounts
payable
|
(50 | ) | - | |||||
|
Net
cash used in operating activities
|
(9,050 | ) | (17,297 | ) | ||||
|
Net
cash used in investing activities
|
- | - | ||||||
|
Cash
flows from financing activities
|
||||||||
|
Loan
from shareholder
|
5,850 | 8,950 | ||||||
|
Proceeds
from sale of stock
|
28,450 | 33,950 | ||||||
|
Net
cash provided by financing activities
|
34,300 | 42,900 | ||||||
|
Net
increase in cash
|
25,250 | 25,603 | ||||||
|
Cash
at beginning of period
|
353 | - | ||||||
|
Cash
at end of period
|
$ | 25,603 | $ | 25,603 | ||||
|
Disclosure
of non-cash financing activities:
|
||||||||
|
Issuance
of 1,966,667 shares of common stock for professional and legal
services
|
$ | - | $ | 29,500 | ||||
|
Supplemental
Cash Flow Information:
|
||||||||
|
Cash
paid for interest
|
$ | - | $ | - | ||||
|
Cash
paid for income taxes
|
$ | - | $ | - | ||||
|
See
accompanying notes to financial statements
|
||||||||
F-40
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
March
31, 2008
Note
1 – Nature of Business
The
unaudited financial statements have been prepared by the Company,
pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to such SEC rules
and regulations; nevertheless, the Company believes that the disclosures
are adequate to make the information presented
not misleading. These financial statements and the notes
attached hereto should be read in conjunction with the financial statements and
notes included in the Company’s Form SB-2, which was filed with the SEC on
October 19, 2008 and deemed effective on October 22, 2008. In the
opinion of the Company, all adjustments, including normal recurring
adjustments necessary to present fairly the financial position of Bella
Viaggio, Inc., as of March 31, 2008 and
the results of its operations and cash flows for the three month
period then ended, have been included. The results of operations for the
interim period are not necessarily indicative of the results for the full
year.
Bella
Viaggio, Inc. (“Company”) was organized June 6, 2007 under the laws of the State
of Nevada for the purpose of owning and operating a chain of day spas and
salons. The Company currently has no operations or realized revenues
from its planned principle business purpose and, in accordance with Statement of
Financial Accounting Standard (SFAS) No. 7, “Accounting and Reporting by
Development Stage Enterprises,” is considered a Development Stage
Enterprise.
Note
2 – Significant Accounting Policies
Estimates
The
preparation of financial statements in conformity with generally accepted
accounting principles 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 and
the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those
estimates.
Cash
For the
Statements of Cash Flows, all highly liquid investments with maturity of three
months or less are considered to be cash equivalents. There were no
cash equivalents as of March 31, 2008 and December 31, 2007.
F-41
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
March
31, 2008
Note
2 – Significant Accounting Policies (continued)
Income
taxes
Income
taxes are provided for using the liability method of accounting in accordance
with SFAS No. 109 “Accounting
for Income Taxes,” and clarified by FIN 48, “Accounting for Uncertainty in
Income Taxes—an interpretation of FASB Statement
No. 109.” A deferred tax asset or liability is recorded
for all temporary differences between financial and tax
reporting. Temporary differences are the differences between the
reported amounts of assets and liabilities and their tax
basis. Deferred tax assets are reduced by a valuation allowance when,
in the opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effect of changes in tax laws and
rates on the date of enactment.
Share Based
Expenses
In
December 2004, the Financial Accounting Standards Board (“FASB”) issued
SFAS No. 123R “Share
Based Payment.”This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to
Employees,” and amends FASB Statement No. 95, “Statement of Cash Flows.”This
statement requires a public entity to expense the cost of employee services
received in exchange for an award of equity instruments. This statement also
provides guidance on valuing and expensing these awards, as well as disclosure
requirements of these equity arrangements. The Company adopted SFAS No.
123R upon creation of the company and expenses share based costs in the period
incurred.
Going
concern
The
Company’s financial statements are prepared in accordance with generally
accepted accounting principles applicable to a going concern. This
contemplates the realization of assets and the liquidation of liabilities in the
normal course of business. Currently, the Company has minimal cash
and no material assets, nor does it have operations or a source of revenue
sufficient to cover its operation costs and allow it to continue as a going
concern. The Company is currently attempting to raise capital in
order to initiate its business plan which will, if successful, mitigate these
factors which raise substantial doubt about the Company’s ability to continue as
a going concern. The Company will be dependent upon the raising of
this additional capital through placement of our common stock in order to
implement its business plan, or merge with an operating
company. There can be no assurance that the Company will be
successful in either situation in order to continue as a going
concern. The officers and directors have committed to advancing
certain operating costs of the Company.
F-42
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
March
31, 2008
Note
2 – Significant Accounting Policies (continued)
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.
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.
F-43
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
March
31, 2008
Note
2 – Significant Accounting Policies (continued)
Recent Accounting
Pronouncements (continued)
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 labeled 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.
None of
the above new pronouncements has current application to the Company, but may be
applicable to the Company’s future financial reporting.
Note 3 – Stockholders’
Equity
Common
stock
The
authorized common stock of the Company consists of 70,000,000 shares with par
value of $0.001. On June 6, 2007, the Company authorized the issuance
of 2,200,000 shares of its $0.001 par value common stock at $0.015 per share in
consideration of $3,500 in cash and $29,500 in legal and business
services.
Preferred
stock
The
authorized preferred stock of the Company consists of 5,000,000 shares with a
par value of $0.001. The Company has no preferred stock issued or
outstanding.
F-44
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
March
31, 2008
Note 3 – Stockholders’ Equity
(continued)
SB-2 Registration
Statement
On
October 16, 2007, the Company filed a Form SB-2 Registration Statement with the
Securities and Exchange Commission for 750,000 shares to be sold at a price of
$0.10 per share to the public by a small business issuer under the Securities
Act of 1933. The Securities and Exchange Commission notified the Company on
October 22, 2007 the registration had been declared effective. During the three
months ended March 31, 2008 the Company issued 284,500 shares for a total cash
consideration of $28,450. Also, 36,000 shares were issued and unpaid
at March 31, 2008.
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. Diluted loss per share is computed using the weighted averaged
number of shares and dilutive potential common shares
outstanding. Dilutive potential common shares are additional common
shares assumed to be exercised.
Basic net
loss per common share is based on the weighted average number of shares of
common stock outstanding during 2007 and since inception. As of March
31, 2008 and since inception, the Company had no dilutive potential common
shares.
Note
4 – Income Taxes
We did
not provide any current or deferred U.S. federal income tax provision or benefit
for any of the periods presented because we have experienced operating losses
since inception. Per Statement of Accounting Standard No. 109 “Accounting for Income Tax and FASB
Interpretation No. 48 - Accounting for Uncertainty in Income Taxes an
interpretation of FASB Statement No.109,” when it is more likely than not
that a tax asset cannot be realized through future income the Company must allow
for this future tax benefit. We provided a full valuation allowance on the
net deferred tax asset, consisting of net operating loss carry-forwards, because
management has determined that it is more likely than not that we will not earn
income sufficient to realize the deferred tax assets during the carry-forward
period.
The
Company did not pay any income taxes during the three months ended March 31,
2008.
The net
federal operating loss carry forward will expire in 2027 and
2028. This carry forward may be limited upon the consummation of a
business combination under IRC Section 381.
F-45
BELLA
VIAGGIO, INC.
(A
Development Stage Enterprise)
Notes
to the Unaudited Financial Statements
March
31, 2008
Note 5 – Related Party
Transactions
The
Company neither owns nor leases any real or personal property. An
officer or resident agent of the corporation provides office services without
charge. Such costs are immaterial to the financial statements and
accordingly, have not been reflected therein. The officers and
directors for the Company are involved in other business activities and may, in
the future, become involved in other business opportunities. If a
specific business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business
interest. The Company has not formulated a policy for the resolution
of such conflicts.
The
officer of the Company has advanced $8,950 and $3,100 for organizational
expenses and professional fees as of March 31, 2008 and December 31, 2007.
Interest has not been imputed as the amounts would be immaterial to the
financial statements as a whole.
Note
6 – Warrants and Options
There are
no warrants or options outstanding to acquire any additional shares of common
stock of the Company.
F-46