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TMCNet:  GLOBE NET WIRELESS CORP. - 10-K - Management's Discussion and Analysis of Financial Condition and Results of Operations

[December 16, 2013]

GLOBE NET WIRELESS CORP. - 10-K - Management's Discussion and Analysis of Financial Condition and Results of Operations

(Edgar Glimpses Via Acquire Media NewsEdge) The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this annual 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 annual report. Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.


Results of Operations Liquidity, Capital Resources and Financial Position Year Ended August 31, 2013 Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. As of August 31, 2012, Globe Net had total assets of $41,005 and a working capital deficit of $37,288, compared with a working capital deficit of $42,563 as of August 31, 2012. The decrease in the working capital deficit was primarily due to an increase in cash and an increase in notes payable. Assets consisted of $19,753 in cash and $21,157 in prepaid expenses and the liabilities consisted of $27,448 in accounts payable, $10,750 in accrued liabilities, $30,000 in notes payable and $10,000 convertible notes payable.

From its inception, on September 4, 2009 to August 31, 2013 Globe Net raised a total of $52,000 from private offerings of its shares of common stock, which has been used to fund Globe Net's operations to date.

The notes to Globe Net's audited financial statements as of August 31, 2013, disclose its uncertain ability to continue as a going concern. Globe Net has not and does not expect to generate any revenues to cover its expenses while it is in the development stage and as a result Globe Net had accumulated a deficit of $90,099 since inception. As of August 31, 2013, Globe Net had $78,198 in current liabilities. When its current liabilities are offset against its current assets of $40,910 Globe Net is left with a working capital deficit of $37,288.

11 --------------------------------------------------------------------------------Net Cash provided by (used in) Operating Activities. Net cash used in operating activities during the year ended August 31, 2013 was $36,835 compared with $19,849 for the period ended August 31, 2012. The increase was primarily due to an increase in prepaid expenses and accounts payable.

Net Cash provided by Financing Activities. Net cash provided by financing activities was $55,000 for the fiscal year ended August 31, 2013 as compared with net cash provided by financing activities of $20,000 for the period ended August 31, 2012.

Net Cash provided by (used in) Investment Activities. Net cash used in investment activities was nil for the fiscal period ended August 31, 2013 as compared with net cash provided by investment activities of nil for the period ended August 31, 2012.

Results of Operations Year Ended August 31, 2013 Net Loss. During the year ended August 31, 2013, Globe Net had a net loss of $31,011 or $0.003 per share, compared to a net loss of $28,966 or $0.003 per share during the year ended August 31, 2012. The increase in the net loss was the direct result of the increase in general and administrative expenses.

Revenue. Globe Net had no operating revenues since its inception on September 4, 2009, through to August 31, 2013. Globe Net's activities have been financed from the proceeds of share subscriptions and debt financings.

Operating Expenses. Globe Net's operating expenses since its inception on September 4, 2009, through to August 31, 2013 were $90,099. The operating expenses were primarily due to $84,666 in general and administrative expenses, $1,600 in incorporation costs, and $3,833 in interest expense.

We have not attained profitable operations and are dependent upon obtaining financing to complete our proposed business plan. For these reasons our auditors believe that there is substantial doubt that we will be able to continue as a going concern.

Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.

Plan of Operation Globe Net's plan of operation for the remainder of its fiscal year is to: 1.

develop Internet and wireless connectivity systems and develop its website; 2.

identify and establish supply contracts with equipment suppliers and service providers; 3.

identify and obtain required licenses and permits Phase 1 - Develop the Internet and wireless connectivity systems (3 months) In Phase 1, Globe Net plans to (1) develop its Internet and wireless connectivity systems (the "GNW System") and (2) develop its website.

The development of the GNW System will consist of identifying potential viable target markets, producing a list of equipment required for the GNW System in the particular target markets, and identifying potential suppliers and service providers. Target markets will be identified based on the potential number of (a) potential subscribers and (b) locations for transmission towers or existing transmission towers.

Simultaneously, Globe Net will develop and populate its website (www.globenetwireless.com) with information regarding its business and the GNW System.

Globe Net has budgeted $15,000 for this phase and expects it to take three months to complete, with completion expected within the first three months of Globe Net's plan of operation.

12 --------------------------------------------------------------------------------Phase 2 - Identify and establish supply contracts (6 months) In Phase 2, Globe Net plans to (1) identify equipment suppliers and service providers in its identified target markets and (2) enter into supply contracts with the particular equipment suppliers and service providers.

In this phase of its plan of operations, Globe Net will identify reliable and competitive equipment suppliers, establish time lines for equipment supply and service capabilities, and establish lease criteria.

Globe Net has budgeted $10,000 for this phase and expects it to take six months to complete, with completion expected within the first six months of Globe Net's plan of operation. Also, during this phase, Globe Net will continue to (a) develop its GNW System and (b) develop its website. Phase 2 will overlap with Phase 1 and will be worked on simultaneously with Phase 1.

Phase 3 - Identify and obtain required licenses and permits (6 months) In Phase 3, Globe Net plans to identify and obtain all required licenses and permits in each identified target market. Globe Net will need to identify all required licenses and permits in a particular target market and then prepare and submit an application with the applicable regulatory body with all requisite information and documents. Also, Globe Net may be required to conduct a compliance study to ensure that the GNW System does not interfere or conflict with other transmissions in that target market.

Globe Net has budgeted $20,000 for this phase and expects it to take six months to complete, with completion expected within the first six months of Globe Net's plan of operation. Also, during this phase, Globe Net will continue to (a) develop its GNW System, (b) develop its website, and (c) identify and establish supply contracts. Phase 3 will overlap and will be worked on simultaneously with Phases 1 and 2.

It is possible that actual costs for Phase 1, 2 and 3 will exceed our estimates.

As well, our current cash on hand is not sufficient to meet our anticipated obligations for the next twelve-month period. We intend to raise additional funding either through the sale of our common stock to investors or through loans from our director. However, we do not have any commitments in this regard.

If we are unable to raise the required financing, we will be delayed in conducting our business plan.

Accounting and Audit Plan Globe Net intends to continue to have its outside consultant assist in the preparation of Globe Net's quarterly and annual financial statements and have these financial statements reviewed or audited by Globe Net's independent auditor. Globe Net's outside consultant is expected to charge Globe Net approximately $700 to prepare Globe Net's quarterly financial statements and approximately $2,000 to prepare Globe Net's annual financial statements. Globe Net's independent auditor is expected to charge approximately $1,000 to review each of Globe Net's quarterly financial statements and approximately $7,500 to audit Globe Net's annual financial statements. In the next twelve months, Globe Net anticipates spending approximately $12,000 to pay for its accounting and audit requirements.

Off-Balance Sheet Arrangements As of the date of this annual report, 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 are material to investors.

Going Concern The independent auditors' report accompanying our August, 2013 and 2012 financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared assuming that we will continue as a going concern, which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

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