Sibannac, Inc. - Quarter Report: 2012 November (Form 10-Q)

naprodis10q113012.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934

For the quarterly period ended November 30, 2012

o	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _______________

Commission File Number: 333-122009

NAPRODIS, INC.

(Exact Name of Registrant as Specified in its Charter)

Nevada		33-0903494
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

13250 Gregg St., Suite F, Poway, CA 92064

(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number including area code: (858) 486-8655

N/A

Former name, former address, and former fiscal year, if changed since last report

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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 o No x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

	Larger accelerated filer	o	Accelerated filer	o
	Non-accelerated filer	o	Smaller reporting company	x

Indicate by check mark whether registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 4,990,000 shares outstanding as of May 23, 2013.

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NAPRODIS, INC.

FINANCIAL STATEMENTS

For the three months ended

November 30, 2012

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FINANCIAL STATEMENTS

	Page

Balance Sheets as of November 30, 2012 (unaudited) and August 31, 2012	1

Statements of Operations for the Three Months Ended November 30, 2012 and 2011 (unaudited)	2

Statements of Cash Flows for the Three Months Ended November 30, 2012 and 2011 (unaudited)	3

Notes to Financial Statements (unaudited)	4-11

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NAPRODIS, INC.
BALANCE SHEETS

	November 30,			August 31,
	2012			2012
ASSETS	(Unaudited)
Current assets
Cash	$	13,237		$	648
Accounts receivable		12,177			11,396
Inventories, net		124,769			118,083
Total current assets		150,183			130,127

Property and equipment, net		37,088			40,523
Other assets		10,159			10,159
TOTAL ASSETS	$	197,430		$	180,809

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable and accrued expenses	$	123,995		$	98,021
Accrued payroll and payroll taxes		1,092			1,484
Accrued interest		37,927			33,795
Payables to related party		124,523			124,523
Officer loans		205,505			206,542
Total liabilities		493,042			464,365

Stockholders' deficit
Preferred stock, $0.001 par value,
10,000,000 shares authorized, 0 share issued		-			-
Common stock, $0.001 par value,
60,000,000 shares authorized;
4,990,000 issued and outstanding at
November 30, 2012 and August 31, 2012		4,990			4,990
Additional paid-in capital		131,260			131,260
Accumulated deficit		(431,862	)		(419,806	)

Total stockholders’ deficit		(295,612	)		(283,556	)

TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIT	$	197,430		$	180,809

The accompanying notes are an integral part of these financial statements

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NAPRODIS, INC.

STATEMENTS OF OPERATIONS

(Unaudited)

	For the three months ended
	November 30,
	2012			2011

Revenue	$	70,574		$	190,669
Cost of sales, (exclusive of depreciation, included in
general & administrative expenses)		12,331			25,330
Gross profit		58,243			165,339

Selling, general and administrative expenses
Selling expenses		1,938			4,220
Occupancy costs		33,306			32,372
Salaries and wages		2,088			73,033
Other general and administrative expenses		28,045			62,954

Total selling, general and administrative expenses		65,377			172,579

Net loss before other income and expenses		(7,134	)		(7,240	)

Interest expense		4,922			2,604

Net loss	$	(12,056	)	$	(9,844	)

Loss per share - basic and diluted	$	(0.00	)	$	(0.00	)

Weighted average common shares outstanding - basic and diluted		4,990,000			4,150,000

The accompanying notes are an integral part of these financial statements

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NAPRODIS, INC.

STATEMENTS OF CASH FLOWS

(Unaudited)

	For the three months ended
	November 30,
	2012			2011
Operating Activities
Net loss	$	(12,056	)	$	(9,844	)
Adjustments to reconcile net loss to net cash provided by operations:
Depreciation expense		3,435			3,401
Changes in operating assets and liabilities:
Accounts receivable		(781	)		(5,806	)
Inventories		(6,686	)		2,622
Prepaid expenses		-			(6,500	)
Accounts payable and accrued expenses		25,974			3,005
Accrued payroll and payroll taxes		(392	)		(13,909	)
Bank overdraft		-			8,044
Accrued interest		4,132			2,604
Customer deposits		-			(2,104	)
Net cash provided by (used in) operating activities		13,626			(18,487	)

Financing Activities
Repayment on officer loans		(1,037	)		4,254
Net cash used in financing activities		(1,037	)		4,254

Net increase (decrease) in cash		12,589			(14,233	)
Cash, beginning of period		648			15,726
Cash, end of period	$	13,237		$	1,493

Supplemental disclosures of cash flow information
Cash paid for
Interest	$	-		$	-
Income taxes	$	-		$	-

The accompanying notes are an integral part of these financial statements

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NAPRODIS, INC.

NOTES TO FINANCIAL STATEMTNS

For the three months ended

November 30, 2012

NOTE 1- BASIS OF PRESENTATION AND NATURE OF BUSINESS

Nature of Business

Naprodis, Inc. (the “Company”) was incorporated in the state of Nevada on June 4, 1999. The Company is a pharmaceutical manufacturer, supplying natural raw materials and natural health care products to the health supplement and beauty product industry. The Company also markets its own line of beauty products from its offices and laboratory in Poway, California.

Basis of Presentation

The accompanying financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”).

The financial statements presented include all adjustments which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the period presented in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.

These unaudited interim financial statements as of and for the three months ended November 30, 2012 reflect all adjustments which, in the opinion of management, are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented, in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.

These unaudited interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s fiscal year end August 31, 2012 report on Form 10-K. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three month period ended November 30, 2012 are not necessarily indicative of results for the entire year ending August 31, 2013.

Summary of Significant Accounting Policies

Cash and Cash Equivalents

For purposes of the statements of cash flows, cash equivalents include all highly liquid debt instruments with original maturities of three months or less which are not securing any corporate obligations. As of November 30, 2012 and August 31, 2012, there were no cash and cash equivalents.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reported periods. Actual results could materially differ from those estimates. Significant estimates made by management are, among others, realizability of long-lived assets and deferred taxes.

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Recognition of Revenue The Company's revenue recognition policies are in compliance with ASC 605-13 (Staff accounting bulletin (SAB) 104). Sales revenue is recognized at the date of completion of services to customers when a formal arrangement exists, the price is fixed or determinable, the delivery of services is completed, no other significant obligations of the Company exist and collectability is reasonably assured. Revenue from wholesale customers is recognized at the time title passes and risk of loss is transferred to the customer, i.e. FOB “freight on board”. Discounts are based on trade terms. E-commerce revenue is recognized upon receipt of payment and shipment to the customer. The Company does not grant price adjustments after a sale is complete. The Company warrants its products sold on the internet with a right of exchange. Returns of unused merchandise are pre-authorized. Sales are presented net of discounts and allowances. The Company accounts for sales taxes by excluding such taxes from revenue and cost of revenue.

Components of Revenue:

	2012			2011

Service		19.2	%		26.3	%
Personal Care		80.8	%		65.8	%
Other		0.0	%		7.9	%

Shipping and Handling Costs

Shipping and handling charges billed to customers are included in general revenue. Costs associated with shipping goods to customers that are not billed are reflected as selling costs.

Cost of Goods Sold

Cost of Goods Sold includes the expenses incurred to acquire and produce inventory for sale, including product costs, freight in and import costs, as well as changes in reserves for inventory shrinkage and obsolescence.

Inventories

Inventory is recorded as lower of cost (first in, first out) or market. When required, a provision is made to reduce excess and obsolete inventory to estimated net value. Inventory at November 30, 2012 and August 31, 2012 consisted of raw materials, work in process, and finished goods as follows:

	November 30,			August 31,
	2012			2012

Raw materials	$	133,891		$	123,811
Work in process		326			326
Finished goods		512			3,906
Provision for price adjustments		(9,960	)		(9,960	)
Total inventory	$	124,769		$	118,083

Deposits

Deposits represent amounts paid under the Company’s office and laboratory space lease.

November 30,		August 31,
2012		2012

$	10,159	$	10,159

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Concentration of Credit Risk: Credit risk arises from the potential that a counterpart will fail to perform its obligations. The Company is exposed to credit risk related to its accounts receivable and manufacturing risk related to source of raw materials.

Cash and cash equivalents: The Company maintains its cash deposits in one bank account, which at times may exceed federally insured limits.

Revenues and Accounts Receivable: It is management’s opinion that the Company is not exposed to significant credit risk associated with the balance of its accounts receivable as of November 30, 2012 and August 31, 2012, nor manufacturing risk related to its suppliers.

Product Purchases and Accounts Payable: The Company purchased approximately 10% and 42% in 2012 and 2011, respectively, of its products from two companies that are related parties. (See Note 6)

Accounts Receivable

Accounts receivable are presented at net realizable value consisting of the carrying amount, less an allowance for uncollectible accounts as needed. The Company maintains allowances for doubtful accounts for estimated losses. The Company reviews the accounts receivable on a periodic basis and uses the allowance method to account for uncollectable accounts receivable balances. Under the allowance method, if needed, an estimate of uncollectable customer balances is made based upon specific account balances that are considered uncollectable. Factors used to establish an allowance include the age of the balance, credit quality, payment history, current credit-worthiness of the customer and current economic trends. There is no allowance for doubtful accounts recorded as of November 30, 2012 and August 31, 2012 as the balance of the Company’s receivables was considered collectable based on analysis of individual accounts.

Property and Equipment

Equipment is stated at cost less accumulated depreciation and depreciated using straight line methods over the estimated useful lives of the related assets ranging from 5 to 10 years.

	Equipment:	5 and 7 years (pallet racks 10 years)
	Furniture and Fixtures	7 years
	Autos, trucks, buses	5 years

Assets costing more than $500 are capitalized.

Maintenance and repairs are expensed currently. The cost of normal maintenance and repairs is charged to operations as incurred. Major overhaul that extends the useful life of existing assets is capitalized. When equipment is retired or disposed, the costs and related accumulated depreciation are eliminated and the resulting profit or loss is recognized in income. Expenditures for maintenance and repairs are charged to operations as incurred; additions, renewals and betterments are capitalized.

Impairment of Long-lived Assets

The Company adopted FASB ASC Topic 360: Property Plant and Equipment, sub topic 360-10-35-15: Impairment or Disposal of Long Lived Assets (SFAS 142 and 144). ASC 360-10-35-15 requires recognition of impairment losses on long-lived assets when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amounts. No impairment has been applied to the company’s long lived assets.

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Loss Per Share

The Company computes net earnings (loss) per common share in accordance with FASB ASC 260 (SFAS No. 128 “Earnings per Share” and SAB No. 98). Under the provisions of ASC 260, the basic net earnings (loss) per common share is computed by dividing the net earnings (loss) available to common stock outstanding during the period. Net earnings (loss) per share on a diluted basis is computed by dividing the net earnings (loss) for the period by the weighted average number of common and dilutive common stock equivalent shares outstanding during the period.

The Company has no potentially dilutive securities outstanding as of November 30, 2012 and 2011.

Fair Value of Financial Instruments

The Financial Accounting Standards Board issued ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures" for financial assets and liabilities. FASB ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

All of the Company’s financial instruments are recorded at fair value due their term of maturity.

Provision for Income Taxes

The company utilizes FASB ASC 740, “Income Taxes” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established if it is more likely than not that some portion of or all of the deferred tax asset will not be realized. The Company generated a deferred tax credit through net operating loss carry forwards. As of November 30, 2012 the Company had federal and state net operating loss carryforwards of approximately $441,000 that can be used to offset future taxable income. The carryforwards will begin to expire in 2014 unless utilized in earlier years.

Interest and penalties on tax deficiencies recognized in accordance with ACS accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.

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NOTE 2 – GOING CONCERN

As shown in the financial statements, the Company incurred a net loss of $12,056 and $9,844 during the three months ended November 30, 2012 and 2011, respectively. The Company has accumulated a deficit of $431,862 and $419,806 as of November 30, 2012 and August 31, 2012, respectively. These factors create an uncertainty regarding the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 3 – PROPERTY AND EQUIPMENT

A summary as of November 30, 2012 and August 31, 2012 is as follows:

	November 30,			August 31,
	2012			2012

Machinery and Equipment	$	48,152		$	48,152
Automobile		28,800			28,800
Furniture and Fixtures		10,819			10,819
		87,771			87,771
Less: accumulated depreciation		(50,683	)		(47,248	)
Property and equipment, net	$	37,088		$	40,523

NOTE 4 – OPERATING LEASES

The Company leased office and warehouse space under a lease that expired January 31, 2010. On February 1, 2011 the Company moved to new premises under a five year lease. The future minimum payments for lease and common area costs are as follows, for the fiscal years ending August 31,

2013		135,235
2014		158,740
2015		58,425
	$	352,400

NOTE 5 – RECENT ACCOUNTING PRONOUNCEMENTS

Adopted

Effective January 2013, we adopted FASB ASU No. 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities (ASU 2011-11). The amendments in ASU 2011-11 require the disclosure of information on offsetting and related arrangements for financial and derivative instruments to enable users of its financial statements to understand the effect of those arrangements on its financial position. Amendments under ASU 2011-11 will be applied retrospectively for fiscal years, and interim periods within those years, beginning after January 1, 2013. The adoption of this update did not have a material impact on the financial statements.

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Effective January 2013, we adopted FASB ASU No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive (ASU 2013-02). This guidance is the culmination of the FASB’s deliberation on reporting reclassification adjustments from accumulated other comprehensive income (AOCI). The amendments in ASU 2013-02 do not change the current requirements for reporting net income or other comprehensive income. However, the amendments require disclosure of amounts reclassified out of AOCI in its entirety, by component, on the face of the statement of operations or in the notes thereto. Amounts that are not required to be reclassified in their entirety to net income must be cross-referenced to other disclosures that provide additional detail. This standard is effective prospectively for annual and interim reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on the financial statements.

Not Adopted

In February 2013, the FASB issued ASU No. 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date. The amendments in ASU 2013-04 provide guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this Update is fixed at the reporting date, except for obligations addressed within existing guidance in U.S. GAAP. The guidance requires an entity to measure those obligations as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors and any additional amount the reporting entity expects to pay on behalf of its co-obligors. The guidance in this Update also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. The amendment in this standard is effective retrospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013. We are evaluating the effect, if any, adoption of ASU No. 2013-04 will have on our financial statements.

In April 2013, the FASB issued ASU No. 2013-07, Presentation of Financial Statements (Top 205): Liquidation Basis of Accounting. The objective of ASU No. 2013-07 is to clarify when an entity should apply the liquidation basis of accounting and to provide principles for the measurement of assets and liabilities under the liquidation basis of accounting, as well as any required disclosures. The amendments in this standard is effective prospectively for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. We are evaluating the effect, if any, adoption of ASU No. 2013-07 will have on our financial statements.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

NOTE 6 – PAYABLES TO RELATED PARTIES

The following payables to companies that are related by common ownership are payable on demand, have no terms of repayment or maturity date and accrue interest at 5% per annum:

	November 30,		August 31,
	2012		2012

Solde Naprodis Inc.	$	4,418	$	4,418
Phybiosis Inc.		120,105		120,105
	$	124,523	$	124,523

NOTE 7 – OFFICER LOANS

Loans from the following officers of the Company have no terms of repayment or maturity, are payable on demand and bear interest at 5% per annum.

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	November 30,		August 31,
	2012		2012

Paul Petit	$	101,987	$	101,987
Alain Petit		16,101		16,101
Kelley Thompson		67,258		67,258
Jean-Phillipe Petit		6,200		7,237
Antoine Lagomarsino		6,459		6,459
Guillaume Petit		7,500		7,500
	$	205,505	$	206,542

NOTE 8 – LOSS CONTINGENCIES, LEGAL PROCEEDINGS

There were no loss contingencies or legal proceedings against the Company with respect to matters arising in the ordinary course of business. Neither the Company nor any of its officers or directors is involved in any other litigation either as plaintiffs or defendants, and have no knowledge of any threatened or pending litigation against them or any of the officers or directors.

NOTE 9 – SEGMENTED INFORMATION

Although the Company sells more than 400 products, only the Company’s skin care product line accounted for more than 10% of the Company’s revenue for the three months ended November 30, 2012 and 2011. The following presents certain information concerning the Company’s skin care product segment:

For the three months ended November 30, 2012

	Skin Care		All Other Segments		Total

Revenue	$	57,038	$	13,536	$	70,574
Interest Revenue		0		0		0
Interest Expense		5,383		1,278		6,661
Depreciation and Amortization		2,776		659		3,435
Segment profit (loss)		42,659		10,123		52,782
Segment assets (1)		104,404		24,777		129,181
Expenditures for segment assets (1)		14,409		3,394		17,803

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For the three months ended November 30, 2011

	Skin Care		All Other Segments		Total

Revenue	$	171,602	$	19,067	$	190,669
Interest Revenue		0		0		0
Interest Expense		0		2,577		2,577
Depreciation and Amortization		0		3,402		3,402
Segment profit (loss)		24,555		2,729		27,284
Segment assets (1)		2,576		126,213		128,789
Expenditures for segment assets		5,826		779		6,605

(1)	Inventory is the only asset that can be segmented since the remaining assets of the Company are used for all of the Company’s activities.

All other segments are:

	●	Body Care
	●	Hair Care
	●	Dietary Supplements
	●	Raw Materials which include:

	*	Essential Oils
	*	Hydrolates
	*	Clays
	*	Celtic Sea Salt
	*	Fatty Vegetal Oils
	*	Sea Algae

NOTE 10 – CAPITAL STOCK

At November 30, 2012, the Company has 10,000,000 shares of preferred stock and 60,000,000 shares of common stock authorized and 4,990,000 shares of common stock issued and outstanding at par value of $.001 per share.

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management and information currently available to management. The use of words such as “believes”, “expects”, “anticipates”, “intends”, “plans”, “estimates”, “should”, “likely” or similar expressions, indicates a forward-looking statement.

The identification in this report of factors that may affect our future performance and the accuracy of forward-looking statements is meant to be illustrative and by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

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

General

The Company was incorporated in Nevada in June 1999.

Since September 2000 the Company has been in the business of selling dietary and personal care products. The Company distributes its products primarily through private label resellers and through spas, beauty salons, health professionals, and health and beauty stores. As of the date of this report the Company’s products were being sold in the United States and Canada along with several foreign countries. The Company relies upon referrals from its customers and it website to market its products.

Material changes of certain items in the Company’s Statement of Operations for the three months ended November 30, 2012, as compared to the same period last year, are discussed below.

	Increase (I)
Item	or Decrease (D)	Reason

Revenues	D	(1)
Cost of Sales	D	(1)
Salaries and wages	D	(1)
Other general and
administrative expenses	D	(1)

(1)	Loss of major customer.

In October 2011, the Company’s largest customer, Plant Devas, which accounted for approximately 85% the Company’s its sales during the year ended August 31, 2011, decided to manufacture for its own account the products which they had previously been buying from the Company. The Company previously manufactured 22 products from its skin care segment for Plant Devas, who then resold the products under its own label. The Company is now manufacturing these same 22 skin care products and selling them under its label. The equipment used to manufacture the skin care products for Plant Devas was not custom built, but was the same equipment used, and which the Company is currently using, to manufacture all of its products.

Other than the foregoing, the Company does not know of any trends, events or uncertainties that have had, or are reasonably expected to have, a material impact on sales, revenues or income from continuing operations, or liquidity and capital resources.

Research and Development

During the past two years the Company research and development expenses have been less than $1,500.

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However, the Company believes that in order to be competitive it will need to commit to continuous product innovation and improvement through research. Research efforts will combine in-house research, published research, and clinical studies and will involve the following:

	●	Investigation of the in vitro activity of new natural extracts,
	●	Identification and research of combinations of nutrients that may be suitable for new products,
	●	Analysis of the benefits of existing and newly identified nutritional supplements,
	●	Improvement of existing products following new discoveries in nutrition, and
	●	Improvements to manufacturing processes.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

An evaluation was carried out under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report on Form 10-Q. Disclosure controls and procedures are procedures designed with the objective of ensuring that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, such as this Form 10-Q, is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and is communicated to our management, including our Principal Executive Officer and Principal Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Based on that evaluation, our management concluded that, as of November 30, 2012, our disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended November 30, 2012, that materially affected or are reasonably likely to materially affect our internal control over financial reporting.

PART II

Item 6. Exhibits

a. Exhibits

	31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

	31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

	32	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	NAPRODIS, INC.

Date: May 24, 2013	By:	/s/ Paul Petit
		Paul Petit, President, Principal Executive,
		Financial and Accounting Officer