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INTERUPS INC - 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 if we proceed with our current business plan. Our actual results could differ materially from 8 those discussed in the forward looking statements. Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles. RESULTS OF OPERATIONSWe have incurred recurring losses to date. 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. We expect we will require additional capital to meet our long-term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities. FISCAL YEAR ENDED MAY 31, 2014 COMPARED TO FISCAL YEAR ENDED MAY 31, 2013. Our net loss for the fiscal year ended May 31 2014 was $20,914 compared to a net loss of $19,975 during the fiscal year ended May 31, 2013. During fiscal years ended May 31, 2014 and 2013, we have not generated any revenue. During the fiscal year ended May 31, 2014, we incurred general and administrative expenses of $20,914 compared to general and administrative expenses of $19,975 incurred during fiscal year ended May 31, 2013. Expenses incurred during the fiscal year ended May 31, 2014 compared to fiscal year ended May 31, 2013 increased primarily due to the increased scale and scope of business operations. General and administrative expenses generally include corporate overhead, financial and administrative contracted services, marketing, and consulting costs. LIQUIDITY AND CAPITAL RESOURCES FISCAL YEAR ENDED MAY 31, 2014 and 2013 As of May 31, 2014, our total assets were $1,910 and our total liabilities were $10,037 composed of notes payable to related parties. As of May 31, 2013, our total assets were $17,824 composed of cash and cash equivalents. Stockholders' equity decreased from $7,787 as of May 31, 2014 to a deficit of $8,128 as of May 31, 2014. Cash Flows from Operating Activities We have not generated positive cash flows from operating activities. For the fiscal year ended May 31, 2014, net cash flows used in operating activities was $20,914 consisting of a net loss. For the fiscal year ended May 31, 2013, net cash flows used in operating activities were $12,961. Net cash flows used in operating activities was $33,890 for the period from inception April 11, 2012 to May 31, 2014. Cash Flows from Financing Activities We have financed our operations primarily from either director advances or the issuance of equity and debt instruments. For the fiscal year ended May 31, 2014, net cash from financing activities was $5,000. For the fiscal year ended May 31, 2013, net cash flows from financing activities was $26,700 consisting of $24,000 of proceeds received from issuances of common stock and $2,700 from director loans. For the period from inception on April 11, 2012 to May 31, 2014, net cash provided by financing activities was $35,800 consisting of $33,000 of proceeds received from issuances of common stock and $2,800 from director loans. PLAN OF OPERATION AND FUNDING 9 We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business. This section assumes we continue with our current business plan; we may not do so. Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next six months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of software; (ii) developmental expenses associated with a start-up business; and (iii) marketing expenses. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations. MATERIAL COMMITMENTS As of May 31, 2014, we did not have any material commitments. PURCHASE OF SIGNIFICANT EQUIPMENTWe do not intend to purchase any significant equipment during the next twelve months. OFF-BALANCE SHEET ARRANGEMENTS As of May 31, 2014, we did not have any offbalance 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 May 31, 2014 and May 31, 2013 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. |