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ITALK INC. - 10-Q - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Edgar Glimpses Via Acquire Media NewsEdge) FORWARD LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These statements
relate to future events or our future financial performance. In some cases, you
can identify forward-looking statements by terminology such as "may", "should",
expects", "plans", "anticipates", "believes", "estimates", "predicts",
potential" or "continue" or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown
risks, uncertainties and other factors that may cause our or our industry's
actual results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements to conform these statements to actual results.
Our unaudited financial statements are stated in United States Dollars (US$) and
are prepared in accordance with United States Generally Accepted Accounting
Principles. The following discussion should be read in conjunction with our
financial statements and the related notes that appear elsewhere in this
quarterly report. The following discussion contains forward-looking statements
that reflect our plans, estimates and beliefs. Our actual results could differ
materially from those discussed in the forward-looking statements. Factors that
could cause or contribute to such differences include, but are not limited to,
those discussed below and elsewhere in this quarterly report.
In this quarterly report, unless otherwise specified, all dollar amounts are
expressed in United States dollars. All references to "US$" refer to United
States dollars and all references to "common stock" refer to the common shares
in our capital stock.
As used in this quarterly report, the terms "we", "us", "our" and "our company"
mean iTalk Inc., unless otherwise indicated.
CORPORATE OVERVIEW
Our company was incorporated on July 10, 2006 in the State of Nevada under the
name Sopac Cellular Solutions Inc., and was formed to sell wireless technology
and cell phone service to medium and large corporations, involving a large array
of cellular service plans, cell phones, software and accessories.
On December 18, 2012, we filed Articles of Merger with the Nevada Secretary of
State to change our name from "Sopac Cellular Solutions Inc." to "iTalk Inc.",
to be effected by way of a merger with our wholly-owned subsidiary iTalk Inc.,
which was created solely for the name change.
Also on December 18, 2012, we filed a Certificate of Change with the Nevada
Secretary of State to give effect to a forward split of our authorized, issued
and outstanding shares of common stock on a 25 new for 1 old basis and,
consequently, our authorized capital increased from 75,000,000 to 1,875,000,000
shares of common stock and our issued and outstanding shares of common stock
increased from 1,700,000 to 42,500,000, all with a par value of $0.001.
These amendments became effective on December 21, 2012 upon approval from the
Financial Industry Regulatory Authority.
9
The forward split and name change became effective with the Over-the-Counter
Bulletin Board at the opening of trading on December 21, 2012 under the symbol
"SOPCD". The "D" will be placed on our ticker symbol for 20 business days. After
20 business days our ticker symbol will revert back to its original symbol
"SOPC". Subsequently, after 10 business days our ticker symbol will change to
our new symbol "TALK" to better reflect our company's new name. Our CUSIP number
is 465353 100.
RESULTS OF OPERATIONS
Our company is still in development stage and has generated no revenues to date.
THREE-MONTH PERIOD ENDED NOVEMBER 30, 2012 COMPARED WITH THE THREE MONTH PERIOD
ENDED NOVEMBER 30, 2011.
The following discussion of our results of operations should be read in
conjunction with our unaudited financial statements for the three month period
ended November 30, 2012 which are included herein.
Our operating results for the three month periods ended November 30, 2012 and
2011 and the period from July 10, 2006 (inception) to November 30, 2012 are
summarized as follows:
From
July 10, 2006
Three Months Ended (Inception) To
November 30, November 30,
2012 2011 2012
-------- -------- --------
Professional fees $ 6,142 $ 3,500 $ 51,392
General and administrative expenses 1,584 865 40,491
General and administrative expenses - related party 300 300 7,100
-------- -------- --------
Net Loss $ (8,026) $ (4,665) $(98,983)
======== ======== ========
We incurred operating expenses of $8,026 for the three month period ended
November 30, 2012 compared to operating expenses of $4,665 for the same period
in 2011. These expenses for the three month period ended November 30, 2012
consisted of general operating expenses incurred in connection with the day to
day operation of our business and the preparation and filing of our periodic
reports. Our operating expenses from July 10, 2006 (inception) through November
30, 2012 were $98,913.
Our net loss for the three months ended November 30, 2012 and 2011 was $8,026
and $4,665, respectively, with no revenues for either period. Our net loss from
July 10, 2006 (inception) through November 30, 2012 was $98,983.
LIQUIDITY AND CAPITAL RESOURCES
As of November 30, 2012, we had total current assets of $11,564 and current
liabilities of $70,547. We have a working capital deficit of $58,983 as of
November 30, 2012.
As of November 30, 2012, there is a total of $46,965 in a loan payable that is
owed by the company to Eric Ezra, an officer and director, for expenses that he
has paid on behalf of the company. The loan is interest free and payable on
demand.
As of November 30, 2012, there is a total of $15,000 in a loan payable that is
owed by the company to David F. Levy, an officer and director, for funds he
loaned the company to pay expenses. The loan is interest free and payable on
demand.
10
WORKING CAPITAL
As of As of
November 30, August 31,
2012 2012
-------- --------
Current Assets $ 11,564 $ 1,578
Current Liabilities $ 70,547 $ 52,535
Working Capital (Deficit) $(58,983) $(50,957)
CASH FLOWS
Three Month Three Month
Period Ended Period Ended
November 30, November 30,
2012 2011
-------- --------Cash provided by (used in) Operating Activities $ (5,014) $ (3,360)
Cash provided by (used in) Investing Activities Nil
Nil
Cash provided by (used in) Financing Activities 15,000 4,000
-------- --------
Net Increase (Decrease) in Cash $ 9,986 $ 640
======== ========
Cash used in operating activities for the three month period ended November 30,
2012 was $5,014 compared to $3,360 provided by operating activities for the
three month period ended November 30, 2011.
Cash provided by financing activities for the three month period ended November
30, 2012 was $15,000 compared to $4,000 provided by financing activities for the
three month period ended November 30, 2011.
PLAN OF OPERATION
Our company had not been successful in establishing partnerships with suppliers
such as Sprint/Nextel, AT&T and Verizon Wireless. Due to the economic conditions
over the past year, our company had been unable to attain any level of success
despite the continued efforts of our director. Our management began analyzing
various alternatives available to our company to ensure our survival and to
preserve our shareholder's investment in our common shares.
Our company's new focus on being a Wireless Technology Value Added Reseller
(VAR) to develop and launch new technology and products in the global
communications market. Our company provides wholesale and retail
telecommunications services, and products worldwide.
In December 2012, with the appointment of David F. Levy as president, chief
executive officer, secretary and director, and under his leadership, our company
changed its business focus and will now move forward with marketing and
distributing its iTalk Phone devices. The iTalk phone looks just like an iPhone,
but the monthly cost is nothing like the ones most smartphone customers get in
the mail each month as it will only cost $20 per month. The iTalk Phone isn't a
phone, exactly. The iTalk Phone uses the iPod Touch as a makeshift Smartphone,
an endeavor usually reserved for a small niche of enterprising techies. Many of
them share phone-related strategies, usually involving use of Skype or Google
Voice, on Internet message boards, but not anymore. The utilization of the iTalk
Phone as a makeshift Smartphone is accomplished by coupling its iTalk Sleeve
device with the iTouch, a touch-screen gadget that contains most of the features
of an iPhone, except for the earpiece and cellular chip integrated with iTalk
Service and Data Plan. The iTalk sleeve is as easy as putting on an iPhone cover
as it just snaps in place.
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GOING CONCERN
Our auditors have expressed their doubt about our ability to continue as a going
concern unless we are able to generate profitable operations.
CRITICAL ACCOUNTING POLICIES
BASIC EARNINGS PER SHARE
ASC No. 260, "Earnings Per Share", specifies the computation, presentation and
disclosure requirements for earnings (loss) per share for entities with publicly
held common stock. Our company has adopted the provisions of ASC No. 260.
Basic net loss per share amounts is computed by dividing the net loss by the
weighted average number of common shares outstanding. Diluted earnings per share
are the same as basic earnings per share due to the lack of dilutive items in
our company.
RECENT ACCOUNTING PRONOUNCEMENTS
Our company has evaluated the recent accounting pronouncements issued through
the issuance of these financial statements, and our company does not expect that
the effectiveness of any of these changes will have a material impact on our
company's financial position, or statements.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that is material to investors.
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