NOTES TO CONDENSED UNAUDITED FINANCIAL STATEMENTS
AUGUST 31, 2021
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Perk
International Inc. (“the Company” or “Perk”) was incorporated under the laws of the State of Nevada on April 10,
2013. The Company is an acquisition, sales management company for early stage, high growth businesses and technologies in the health
care industry. The Company has developed specific criteria and standards that must be met by each acquisition candidate. Once identified,
the Company will engage its highly seasoned and well-trained team of industry professionals to perform thorough due diligence on the potential
acquisition partner. Following successful due diligence, Perk will send in its M & A team to structure and present an attractive proposal
to the selling entity.
On February 22, 2019,
Marcus Southworth became, President, Secretary, Treasurer and Director of Perk International Inc.
On April 27, 2020, Certification
and Notice of Termination of Registration Under Section 12(g) of The Securities Exchange Act of 1934 of Duty to File Reports Under Sections
13 and 15 (d) of the Securities Exchange Act of 1934.
On April 30, 2020, Marcus
resigned from, President, Secretary, Treasurer and Director of Perk International Inc. Mr. Southworth no longer holds any officer position
with Perk International Inc.
On April 30, 2020, Nelson
Grist became the sole director of Perk International Inc.
On April 13, 2021, the
Company filed its Form 10 (Amendment No. 7).
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
Basis of presentation
The Company’s unaudited condensed financial
statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.
GAAP”). The accompanying unaudited condensed financial statements reflect all adjustments, consisting of only normal recurring items,
which, in the opinion of management, are necessary for a fair statement of the results of operations for the periods shown and are not
necessarily indicative of the results to be expected for the full year ending May 31, 2022. These unaudited condensed consolidated financial
statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s
Annual Report on Form 10-K for the year ended May 31, 2021.
Use of 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. Significant estimates include the estimated useful lives of property and equipment.
Actual results could differ from those estimates.
Concentrations of Credit Risk
We maintain our cash in bank deposit accounts,
the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and consequently
have not experienced any losses in our accounts. At times, such deposits may be in excess of the Federal Deposit Insurance Corporation
insurable amount (“FDIC”).
Cash equivalents
The Company considers all highly liquid investments
with a maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents for the years ended May
31, 2021 or 2020.
Fair value of financial instruments
The Company follows paragraph 825-10-50-10 of
the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of
the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments.
Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States
of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair
value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to
valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted
prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3)
levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1: Quoted market prices available in active markets for identical
assets or liabilities as of the reporting date.
Level 2: Pricing inputs other than quoted
prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3: Pricing inputs that are generally unobservable inputs and
not corroborated by market data.
The carrying amount of the Company’s financial
assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity
of those instruments. The Company’s notes payable approximates the fair value of such instruments based upon management’s
best estimate of interest rates that would be available to the Company for similar financial arrangements at May 31, 2021 and 2020.
Basic and Diluted Earnings Per Share
Net income (loss) per common share is computed
pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income (loss) per common share is computed by dividing
net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per
common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding
shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common
shares assumes that the Company incorporated as of the beginning of the first period presented. There were no dilutive shares as of May
31, 2021 and 2020.
Stock-based compensation
We account for equity-based transactions with
employees and non-employees under the provisions of FASB ASC Topic 718, “Compensation – Stock Compensation”
(Topic 718), which establishes that equity-based payments to employees and non-employees are recorded at the grant date the fair value
of the equity instruments the entity is obligated to issue when the employees and non-employees have rendered the requisite service and
satisfied any other conditions necessary to earn the right to benefit from the instruments. Topic 718 also states that observable market
prices of identical or similar equity or liability instruments in active markets are the best evidence of fair value and, if available,
should be used as the basis for the measurement for equity and liability instruments awarded in these share-based payment transactions.
However, if observable market prices of identical or similar equity or liability instruments are not available, the fair value shall be
estimated by using a valuation technique or model that complies with the measurement objective, as described in FASB ASC Topic 718.
Recently Adopted Accounting Pronouncements
The Company has implemented all new accounting
pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise
disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have
a material impact on its financial position or results of operations.
NOTE 3 - GOING CONCERN
The Company’s financial statements are
prepared using accounting principles generally accepted in the United States of America applicable to a going concern that
contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not
established any source of revenue to cover its operating costs. The Company has an accumulated deficit of $1,191,640
and a working capital deficit of $140,512 as of
August 31, 2021. The Company had an accumulated deficit of $1,174,883 and a working capital deficit of $123,755 as of May 31, 2021.
The Company will engage in limited activities without incurring significant liabilities that must be satisfied in cash until a
source of funding is secured. The Company will offer noncash consideration and seek equity lines as a means of financing its
operations. If the Company is unable to obtain revenue producing contracts or financing or if the revenue or financing it does
obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek
other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of
existing stockholders.
NOTE 4 - NOTES PAYABLE
On November 3, 2016,
the Company received a $25,000 loan from Securities Compliance Group, Ltd. The note is unsecured, bears interest at 25% and was due upon
the final order of dismissal of the custodianship. On October 20, 2022, the note was assigned to Kim Southworth. As of August 31, 2021
and May 31, 2021, there is $19,777 and $18,202 of interest accrued on this loan, respectively. This note is in default.
On May 2, 2019, the Company
executed a promissory note with Kim Southworth in the amount of $14,749. The loan is due either on demand or within five years and carries
an interest rate of 6%, compounded annually. As of August 31, 2021 and May 31, 2021, there is $2,156 and $1,905 of interest accrued on
this loan, respectively.
On December 16, 2020,
the Company received a $12,000 loan from GPL Ventures, LLC. The note is unsecured, bears interest at 10% and matures on December 16, 2021.
As of August 31, 2021 and May 31, 2021, there is $848 and $546 of interest accrued on this
loan, respectively.
On March 17, 2021, the
Company received a $10,000 loan from GPL Ventures, LLC. The note is unsecured, bears interest at 10% and matures on March 17, 2022. As
of August 31, 2021 and May 31, 2021, there is $1,458 and $1,205 of interest accrued on this
loan ($1,000 of which is related to processing fees), respectively.
On May 11, 2021, the
Company received a $30,000 loan from GPL Ventures, LLC. The note is unsecured, bears interest at 10% and matures on May 11, 2022. As of
August 31, 2021 and May 31, 2021, there is $921 and $164 of interest accrued on this loan,
respectively.
NOTE 5 – RELATED PARTY TRANSACTIONS
As of August
31, 2021 and May 31, 2021, the Company owed the CEO $9,163 and $9,163 for cash advances to the Company.
The advances were used to pay for certain operating expenses. They are unsecured, non-interest bearing and due on demand.
NOTE 6 – COMMON STOCK
On March 17, 2021, the Company amended its Articles
of Incorporation increasing its authorized common stock from 250,000,000 to 950,000,000 shares.
NOTE 7 – CORRECTION OF AN ERROR
During
2021, the Company discovered that interest expense was wrongly recorded in the financial statements for the fiscal year ended May 31,
2020. Consequently, interest expenses and the related liability were understated. These errors have now been corrected by restating
each of the affected financial statement line items for prior periods. The previous year audited numbers and restated numbers are as
follows:
| | |
| | | |
| | | |
| | |
| As of May 31, 2020 |
| | |
As Reported | | |
Adjusted | | |
As Restated | |
| Accounts payable | |
$ | 343,319 | | |
$ | – | | |
$ | 343,319 | |
| Accrued interest | |
| 962 | | |
| 12,158 | | |
| 13,120 | |
| Due to related parties | |
| 24,340 | | |
| – | | |
| 24,340 | |
| Loans payable | |
| 71,268 | | |
| – | | |
| 71,268 | |
| Notes payable | |
| 39,749 | | |
| – | | |
| 39,749 | |
| Total current liabilities | |
| 479,638 | | |
| 12,158 | | |
| 491,796 | |
| | |
| | | |
| | | |
| | |
| Common stock | |
| 22,720 | | |
| – | | |
| 22,720 | |
| Additional paid-in capital | |
| 1,028,408 | | |
| – | | |
| 1,028,408 | |
| Accumulated deficit | |
| (1,530,766 | ) | |
| – | | |
| (1,542,924 | ) |
| Total stockholders' deficit | |
| (479,638 | ) | |
| (12,158 | ) | |
| (491,796 | ) |
| Total liabilities and stockholders' equity | |
$ | – | | |
$ | – | | |
$ | – | |
| | |
| | | |
| | | |
| | |
| For the Three Months Ended August 31, 2020 |
| | |
As Reported | | |
Adjustment | | |
|
As Restated |
|
| Operating Expenses: | |
| | | |
| |
|
|
| |
|
| General and administration expenses | |
$ | 22,474 | | |
$ | – | | |
$ |
22,474 |
|
| Total operating expense | |
| 22,474 | | |
| – | | |
|
22,474 |
|
| Loss from operations | |
| (22,474 | ) | |
| – | | |
|
(22,474 |
) |
| | |
| | | |
| |
|
|
| |
|
| Other expense: | |
| | | |
| |
|
|
| |
|
| Interest expense | |
| (13,765 | ) | |
| (11,700 | ) | |
|
(2,065 |
) |
| Total other expense | |
| (13,765 | ) | |
| (11,700 | ) | |
|
(2,065 |
) |
| | |
| | | |
| |
|
|
| |
|
| Net Loss | |
$ | (36,239 | ) | |
$ | (11,700 | ) | |
$ |
$(24,539 |
) |
| | |
| | | |
| |
|
|
| |
|
| Net loss per share | |
$ | (0.00 | ) | |
| | | |
$ |
(0.00 |
) |
| | |
| | | |
| |
|
|
| |
|
| Weighted average shares outstanding—basic and diluted | |
| 227,203,331 | | |
| | | |
|
227,203,331 |
|
NOTE 8 - SUBSEQUENT EVENTS
In accordance with SFAS 165 (ASC 855-10) management
has performed an evaluation of subsequent events through the date that the financial statements were issued and has determined that it
does not have any material subsequent events to disclose in these financial statements other than the following.
On January 17, 2022, the Company issued a Convertible
Promissory Note to a third party in the amount of $100,000. The note bears interest at 10% per annum and matures on June 17, 2022. The
Note is convertible into shares of the Company’s common stock at $0.0001 per share.