0001681769 false --07-31 Q3 2023 0001681769 2022-08-01 2023-04-30 0001681769 2023-06-13 0001681769 2023-04-30 0001681769 2022-07-31 0001681769 2023-02-01 2023-04-30 0001681769 2022-02-01 2022-04-30 0001681769 2021-08-01 2022-04-30 0001681769 2021-07-31 0001681769 2022-04-30 0001681769 us-gaap:CommonStockMember 2022-07-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2022-07-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-07-31 0001681769 us-gaap:RetainedEarningsMember 2022-07-31 0001681769 us-gaap:CommonStockMember 2022-10-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2022-10-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-10-31 0001681769 us-gaap:RetainedEarningsMember 2022-10-31 0001681769 2022-10-31 0001681769 us-gaap:CommonStockMember 2023-01-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2023-01-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-01-31 0001681769 us-gaap:RetainedEarningsMember 2023-01-31 0001681769 2023-01-31 0001681769 us-gaap:CommonStockMember 2021-07-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2021-07-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-07-31 0001681769 us-gaap:RetainedEarningsMember 2021-07-31 0001681769 us-gaap:CommonStockMember 2021-10-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2021-10-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-10-31 0001681769 us-gaap:RetainedEarningsMember 2021-10-31 0001681769 2021-10-31 0001681769 us-gaap:CommonStockMember 2022-01-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2022-01-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-01-31 0001681769 us-gaap:RetainedEarningsMember 2022-01-31 0001681769 2022-01-31 0001681769 us-gaap:CommonStockMember 2022-08-01 2022-10-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2022-08-01 2022-10-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-08-01 2022-10-31 0001681769 us-gaap:RetainedEarningsMember 2022-08-01 2022-10-31 0001681769 2022-08-01 2022-10-31 0001681769 us-gaap:CommonStockMember 2022-11-01 2023-01-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2022-11-01 2023-01-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-11-01 2023-01-31 0001681769 us-gaap:RetainedEarningsMember 2022-11-01 2023-01-31 0001681769 2022-11-01 2023-01-31 0001681769 us-gaap:CommonStockMember 2023-02-01 2023-04-30 0001681769 us-gaap:AdditionalPaidInCapitalMember 2023-02-01 2023-04-30 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-02-01 2023-04-30 0001681769 us-gaap:RetainedEarningsMember 2023-02-01 2023-04-30 0001681769 us-gaap:CommonStockMember 2021-08-01 2021-10-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2021-08-01 2021-10-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-08-01 2021-10-31 0001681769 us-gaap:RetainedEarningsMember 2021-08-01 2021-10-31 0001681769 2021-08-01 2021-10-31 0001681769 us-gaap:CommonStockMember 2021-11-01 2022-01-31 0001681769 us-gaap:AdditionalPaidInCapitalMember 2021-11-01 2022-01-31 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-11-01 2022-01-31 0001681769 us-gaap:RetainedEarningsMember 2021-11-01 2022-01-31 0001681769 2021-11-01 2022-01-31 0001681769 us-gaap:CommonStockMember 2022-02-01 2022-04-30 0001681769 us-gaap:AdditionalPaidInCapitalMember 2022-02-01 2022-04-30 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-02-01 2022-04-30 0001681769 us-gaap:RetainedEarningsMember 2022-02-01 2022-04-30 0001681769 us-gaap:CommonStockMember 2023-04-30 0001681769 us-gaap:AdditionalPaidInCapitalMember 2023-04-30 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-04-30 0001681769 us-gaap:RetainedEarningsMember 2023-04-30 0001681769 us-gaap:CommonStockMember 2022-04-30 0001681769 us-gaap:AdditionalPaidInCapitalMember 2022-04-30 0001681769 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-04-30 0001681769 us-gaap:RetainedEarningsMember 2022-04-30 0001681769 ccyc:PeriodEndRMBUSDExchangeRateMember 2023-04-30 0001681769 ccyc:PeriodEndRMBUSDExchangeRateMember 2022-04-30 0001681769 ccyc:PeriodAverageRMBUSDExchangeRateMember 2023-04-30 0001681769 ccyc:PeriodAverageRMBUSDExchangeRateMember 2022-04-30 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended April 30, 2023

 

OR

 

☐ TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ________ to _________

 

Commission File Number: 333-213698

 

CLANCY CORP.

(Exact name of registrant as specified in its charter)

 

Nevada   30-0944559
(State or Other Jurisdiction of
Incorporation or Organization)		  

(I.R.S. Employer

Identification No.)

     

2nd Floor, BYD, No. 56, Dongsihuan South Road,

Chaoyang District, Beijing, China

 

100023

(Address of Principal Executive Offices)   (Zip Code)

 

+86-189-1098-4577

(Registrant’s telephone number, including area code)

 

n/a   n/a

 

(Former Name, former address and former fiscal year, if changed since last report)

 

Securities registered under Section 12(b) of the Exchange Act: None

 

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

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

 

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

 

Large accelerated filer  ☐  Accelerated filer  ☐
Non-accelerated filer  ☒ Smaller reporting company  ☒ 
Emerging growth company  ☐    

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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

 

As of June _, 2023, there were 153,105,464 shares of common stock, $0.001 par value per share, outstanding. 

 

 

 

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements.

 

CLANCY CORP.

 

INDEX TO FINANCIAL STATEMENTS

 

  Page
Number
CONSOLIDATED BALANCE SHEETS F-1
CONSOLIDATED STATEMENTS OF OPERATIONS F-2
CONSOLIDATED STATEMENT OF CASH FLOWS F-3
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT F-4
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS F-5 to F-9

 

-2-

CLANCY CORP.
CONSOLIDATED BALANCE SHEETS

 

           
   As of April 30, 2023
(Unaudited)		   As of July 31, 2022 
ASSETS          
           
CURRENT ASSETS          
Cash and equivalents  $23,994   $19,511 
Prepaid expenses   —    212 
Business advances   —    — 
           
Total current assets   23,994    19,723 
           
NONCURRENT ASSETS          
Deposit - rent   13,865    14,236 
Right of use asset, net   4,622    48,831 
           
Total noncurrent assets   18,487    63,067 
           
TOTAL ASSETS  $42,481   $82,790 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)          
           
CURRENT LIABILITIES          
           
Accounts payable   20,252    18,377 
Advance from related party   732,485    541,750 
Operating lease liability   21,060    20,820 
           
Total current liabilities   773,797    580,947 
           
Operating lease liability, non-current   —    — 
           
TOTAL LIABILITIES   773,797    580,947 
           
COMMITMENTS AND CONTINGENCIES          
           
STOCKHOLDERS’ EQUITY (DEFICIT)          
Common stock, $0.001 par value; authorized 345,000,000 shares; 153,105,464 shares issued and outstanding at July 31, 2022 and April 30, 2023   153,105    153,105 
Additional paid-in capital   213,251    213,251 
Accumulated other comprehensive income   19,954    12,058 
Accumulated deficit   (1,117,626)   (876,571)
           
TOTAL EQUITY (DEFICIT)   (731,316)   (498,157)
           
TOTAL LIABILITIES AND EQUITY (DEFICIT)  $42,481   $82,790 

 

See accompanying notes to the consolidated financial statements.

 

F-1

CLANCY CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS
for the three months and nine months ended April 30, 2023 and 2022
(unaudited)

 

                     
   THREE MONTHS ENDED APRIL 30,   NINE MONTHS ENDED APRIL 30, 
   2023   2022   2023   2022 
Revenues  $—   $—   $—   $— 
Revenues - related party   —    —    —    — 
                     
Total Revenues   —    —    —    — 
                     
Cost of revenues   —    —    —    — 
                     
Gross loss   —    —    —    — 
                     
Operating expenses                    
Research and development expense-software   11,943    63,745    53,477    204,246 
General and administrative   66,062    27,108    187,618    96,220 
                     
Total operating expenses   78,005    90,853    241,095    300,466 
                     
Loss from operations   (78,005)   (90,853)   (241,095)   (300,466)
                     
Non-operating income                    
Interest income   17    9    39    56 
                     
Total non-operating loss, net   17    9    39    56 
                     
Loss before income tax   (77,987)   (90,844)   (241,055)   (300,411)
                     
Income tax expense   —    —    —    — 
                     
Net loss   (77,987)   (90,844)   (241,055)   (300,411)
                     
Other comprehensive item                    
Foreign currency translation fain (loss)   11,935    10,638    7,896    8,902 
                     
Comprehensive loss  $(66,052)  $(10,638)  $(233,159)  $(291,509)
                     
Basic weighted average shares outstanding   153,105,464    153,105,464    153,105,464    153,105,464 
                     
Basic net loss per share  $(0.00)  $(0.00)  $(0.00)  $(0.00)

 

See accompanying notes to the consolidated financial statements

 

F-2

CLANCY CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

 

           
   NINE MONTHS ENDED APRIL 30, 
   2023   2022 
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net loss  $(241,055)  $(300,411)
Lease expense   42,883    49,704 
(Increase) decrease in assets and liabilities:          
Accounts receivable   —    — 
Prepaid expense   212    (10)
Accounts payable   2,354    (7,905)
Advances from customers   —    — 
Net cash used in operating activities   (195,606)   (258,622)
           
CASH FLOWS FROM FINANCING ACTIVITIES:          
Proceeds from shares issued for equity financing   —    — 
Changes in due to related party   200,552    240,208 
           
Net cash provided by financing activities   200,552    240,208 
           
EFFECT OF EXCHANGE RATE CHANGE ON CASH AND EQUIVALENTS   (463)   (521)
           
NET CHANGE IN CASH AND EQUIVALENTS   4,483    (18,934)
           
CASH AND EQUIVALENTS, BEGINNING OF PERIOD   19,511    54,375 
           
CASH AND EQUIVALENTS, END OF PERIOD  $23,994   $35,441 
           
Supplemental cash flow data:          
Income tax paid  $—   $— 
Interest paid  $—   $— 
           
Supplemental Disclosure of Non-cash lease activities:          
Recognition of right of use asset  $—   $— 
Recognition of lease liability  $—   $— 

 

See accompanying notes to financial statements.

 

F-3

CLANCY CORP.
STATEMENT OF CHANGES IN SHAREHOLDERS’ DEFICIT

 

For the three months and nine months ended April 30, 2023

 

                               
           Accumulated         
       Additional   Other         
   Common Stock   Paid in   Comprehensive   Accumulated     
   Shares   Amount   Capital   Loss   Deficit   Total 
Balance July 31, 2022   153,105,464   $153,105   $213,251   $12,058   $(876,571)  $(498,157)
                               
Net Loss   —    —    —    —    (93,223)   (93,223)
Currency Translation Adjustment   —    —    —    23,155    —    23,155 
Balance October 31, 2022   153,105,464    153,105    213,251    35,213    (969,794)   (568,225)
                               
Net Loss   —    —    —    —    (69,845)   (69,845)
                               
Balance, January 31, 2023   153,105,464   $153,105   $213,251   $8,019   $(1,039,639)  $(665,264)
                               
Currency translation   —    —    —    11,935    —    11,935 
Net Loss   —    —    —    —    (77,987)   (77,987)
                               
Balance, April 30, 2023   153,105,464   $153,105   $213,251   $19,946   $(1,117,618)  $(731,316)

 

For the three and nine months ended April 30, 2022

 

           Accumulated         
       Additional   Other         
   Common Stock   Paid in   Comprehensive   Accumulated     
   Shares   Amount   Capital   Loss   Deficit   Total 
Balance July 31, 2021   153,105,464   $153,105   $213,251   $(2,489)  $(495,920)  $(132,053)
                               
Net Loss   —    —    —    —    (106,195)   (106,195)
Currency Translation Adjustment   —    —    —    (1,195)   —    (1,195)
Balance October 31, 2021   153,105,464    153,105    213,251    (3,684)   (602,115)   (239,443)
                               
Net Loss   —    —    —    —    (103,371)   (103,371)
Currency translation   —    —    —    (541)   —    (541)
Balance, January 31, 2022   153,105,464   $153,105   $213,251   $(4,225)  $(705,486)  $(343,355)
                               
Currency translation   —    —    —    10,638    —    10,638 
Net Loss                       (90,844)   (90,844)
                               
Balance, April 30, 2022   153,105,464   $153,105   $213,251   $6,413   $(796,331)  $(423,562)

 

See accompanying notes to the consolidated financial statements

 

F-4

CLANCY CORP.
NOTES TO THE FINANCIAL STATEMENTS

April 30, 2023 (Unaudited) and July 31, 2022

 

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

 

Clancy Corp. (“Company”) was incorporated on March 22, 2016 under the laws of the State of Nevada, USA.

 

On April 13, 2020, the Company registered Shanghai Clancy Enterprise Management Co., Ltd. (Shanghai Clancy) as a wholly foreign-owned entity and as a wholly owned subsidiary in Shanghai, China. Shanghai Clancy had no business activity from inception through April 30, 2023.

 

On April 24, 2020, Shanghai Clancy registered Beijing Clancy Information Technology Co., Ltd. (Beijing Clancy) in Beijing as its wholly-owned subsidiary and a second tier subsidiary of the Company.

 

From August 1, 2020 to April 30, 2021, the Company business centered on providing IT services to a small number of clients. Beginning in May 2021, the Company terminated its IT services and re-focused its business operations to business consulting services to small and median sized businesses. Management believes their prior business experience will enable them to assist small and medium sized companies improve their operating efficiencies. The Company will charge its clients based on their performance. Management believes the new business model will reduce internal overhead costs and potentially provide a larger market for its services.

 

NOTE 2 – GOING CONCERN

 

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. For the three and nine months ended April 30, 2023, the Company incurred loss, an accumulated deficit and experienced negative cash flow from operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Mr. Meng, the major stockholder, Chief Executive Officer and sole director of Company, verbally has agreed to provide continued financial support to the Company.

 

The Company’s business objective for the next twelve month and beyond such time will be to expand business operations and increase revenue. The Company will focus on product management, digital marketing, refined user operations, performance optimization, after-sales service, etc. to provide customers with more convenient and high- quality service experience.

 

The Covid-19 pandemic presents novel challenges and a chaotic business environment globally. The duration and intensity of the impact of the Covid-19 to business entities differ geographically. Covid-19 has a limited impact on the Company’s activities since Shanghai Clancy has no activities and Beijing Clancy operations are limited to Beijing, PRC. The impact on the Company’s result of operation and the financial statements was immaterial as of April 30, 2023.

 

F-5

NOTE 3 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of Clancy Corp. and its wholly owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation.

 

Fiscal year end

 

The Company’s year-end is July 31.

 

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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Income Taxes

 

Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

 

Revenue Recognition

 

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts. The core principle of ASC 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity recognizes revenue in accordance with that core principle by applying the following steps: Step 1: Identify the contract(s) with a customer Step 2: Identify the performance obligations in the contract Step 3: Determine the transaction price Step 4: Allocate the transaction price to the performance obligations in the contract Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

 

Cash and Cash Equivalents

 

Cash and cash equivalents consist of all cash balances and highly liquid investments with original maturities of three months or less. Because of short maturity of these investments, the carrying amounts approximate their fair values.

 

Concentration of Credit Risk

 

The Company is exposed to credit risk in the normal course of business, primarily related to cash and cash equivalents. A portion of the Company’s cash and cash equivalents are deposited with Industrial and Commercial Bank of China Limited and Pingan Bank in the PRC, which is not insured or otherwise protected. The Company had deposits of $23,994 as of April 30, 2023. The Company has not experienced any losses in such accounts in the PRC.

 

F-6

Leases

 

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in the consolidated balance sheets. Finance leases are included in finance lease ROU assets and finance lease liabilities in the consolidated balance sheets.

 

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease and finance lease ROU assets and liabilities recognized at April 30, 2023 based on the present value of lease payments over the lease term discounted using the rate implicit in the lease. In cases where the implicit rate is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

 

The Company has elected not to recognize operating lease ROU assets and liabilities arising from short-term leases.

 

Reporting Currency and Translation

 

The financial statements of the Company’s foreign subsidiaries are measured using the local currency, Renminbi (“RMB”), as the functional currency; whereas the functional currency of Clancy Corp. and reporting currency of the Company is the United States dollar (“USD” or “$”).

 

The Company has operations in China where the local currency of RMB is used to prepare the consolidated financial statements which are translated into the Company’s reporting currency, U.S. dollars. The local currency of RMB is the functional currency for the operations outside the United States. Changes in the exchange rates between this currency and the Company’s reporting currency are partially responsible for some of the periodic changes in the consolidated financial statements. Assets and liabilities of the Company’s foreign operations are translated into U.S. dollars at the spot rate in effect at the applicable reporting date. Revenues and expenses of the Company’s foreign operations are translated at the average exchange rate during the applicable period. The resulting unrealized cumulative translation adjustment is recorded as a component of accumulated other comprehensive income (loss) in stockholders’ deficit. Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entity are recorded in general and administrative expense in the period in which they occur. For the six months period ended April 30, 2023 and 2022 there were no realized or unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entities.

 

The exchange rates used to translate amounts in RMB to USD for the purposes of preparing the consolidated financial statements were as follows:

 

          
   April 30,
2023		   April 30,
2022		 
Period end USD: RMB exchange rate   6.9240    6.6177 
Average USD: RMB exchange rate   6.9796    6.4222 

 

Basic Income (Loss) Per Share

 

The Company computes income (loss) per share in accordance with FASB ASC 260 “Earnings per Share”. Basic income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of outstanding common shares during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. In the three and nine months ended April 30, 2023 and 2022, there were no potentially dilutive equity instruments issued or outstanding.

 

F-7

Financial Instrument

 

The carrying value of the Company’s short-term financial instruments, such as prepaid expenses, security deposit, accounts payable and advances, approximates their fair values because of their short maturities.

 

Stock-Based Compensation

 

Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718, “Compensation – Stock Compensation”, which requires that share-based payment transactions with employees be measured based on the grant-date fair value of the equity instrument issued and recognized as compensation expense over the requisite service period. To date, the Company has not adopted a stock option plan and has not granted any stock options.

 

Recently Adopted Accounting Pronouncements

 

As of April 30, 2023 and for the period then ended, there were no recently adopted accounting standards that had a material effect on the Company’s financial statements.

 

Recently Issued Accounting Pronouncements Not Yet Adopted

 

As of April 30, 2023, there was no recently issued accounting standards adopted which would have a material effect on the Company’s consolidated financial statements.

 

NOTE 4 - OPERATING LEASE RIGHT-OF-USE ASSETS

 

As of April 30, 2023, the total operating lease Right of Use assets were $4,622. The total operating lease cost was $13,754 and $15,021, respectively, for the three-month period ended April 30, 2023 and 2022. The total operating lease cost was $41,263 and $48,380, respectively, for the nine-month period ended April 30, 2023 and 2022.

 

NOTE 5 - LEASE LIABILITIES- OPERATING LEASE

 

Future minimum lease payments under the operating lease as of April 30, 2023 are: 

 

     
12 months ended April 30, 2024  $21,060 
12 months ended April 30, 2025   — 
Total Lease payments   21,060 
Less Imputed Interest   — 
Net Lease liability  $21,060 

 

F-8

NOTE 6 - RELATED PARTY TRANSACTIONS

 

The Company’s major shareholder has orally agreed to loan funds to the Company for its operations on an as needed basis. For the nine months ended April 30, 2023 and 2022, the major shareholder loaned the Company $200,552 and $240,208, respectively.

 

As of April 30, 2023 and July 31, 2022, the balance owing the major shareholder was $732,485 and $541,750, respectively. The loan is interest free and unsecured and had no stated terms of repayment.       

 

NOTE 7 - RESEARCH AND DEVELOPMENT EXPENSE

 

The Company incurred significant expenses in research and development (R&D). For the three months ended April 30, 2023 and 2022, the R&D expenses were $11,943 and $63,745, respectively. For the nine months ended April 30, 2023 and 2022, the R&D expenses were $53,477 and $204,246, respectively.

 

NOTE 8 - INCOME TAXES

 

Income tax expense was $0 for the nine and there months ended April 30, 2023 and 2022.

 

As of April 30, 2023, the Company had no unrecognized tax benefits and, accordingly, the Company did not recognize interest or penalties during the three and nine months ended April 30, 2023 related to unrecognized tax benefits. There was no accrual for uncertain tax positions as of April 30, 2023.

 

There is no income tax benefit for the losses for the three and nine months ended April 30, 2023 and 2022, since management has determined that the realization of the net tax deferred asset is not assured and has created a valuation allowance for the entire amount of such benefits.

 

NOTE 9 - SUBSEQUENT EVENTS

 

Management has evaluated subsequent events through the date of filing the financial statements with the Securities and Exchange Commission, the date the financial statements were available to be issued. Management is not aware of any reportable events that occurred subsequent to the balance sheet date up to the date of filing this report.

 

F-9

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Forward-Looking Statements

 

Certain statements made in this quarterly report on Form 10-Q are “forward-looking statements” in regard to the plans and objectives of management for future operations. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the registrant to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. The Company’s plans and objectives are based, in part, on assumptions involving the continued expansion of business. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the Company believes its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance the forward-looking statements included in this quarterly report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the registrant or any other person that the objectives and plans of the registrant will be achieved.

 

Substantial risks exist with respect to an investment in the Company. These risks include but are not limited to, those factors discussed in our Annual Report on Form 10-K for the fiscal year ended July 31, 2022, filed with the Securities and Exchange Commission (“Commission”) on October 31, 2022. More broadly, these factors include, but are not limited to:  

 

  ● We have incurred significant losses and expect to incur future losses;

 

  ● Our current financial condition and immediate need for capital;

 

  ● Potential significant dilution resulting from the issuance of new securities for any funding, debt conversion or any business combination; and

 

  ● We are a “penny stock” company.

 

Description of Business

 

Clancy Corp. (“the Company”) was incorporated on March 22, 2016 under the laws of the State of Nevada, USA. The Company initially was formed for the purpose of producing and selling handcrafted soaps.

 

On April 13, 2020, the Company registered Shanghai Clancy Enterprise Management Co., Ltd. (Shanghai Clancy) as a wholly foreign-owned entity and as a wholly owned subsidiary in Shanghai, China. Shanghai Clancy had no business activity from inception through January 31, 2023.

 

On April 24, 2020, Shanghai Clancy registered Beijing Clancy Information Technology Co., Ltd. (Beijing Clancy) in Beijing as its wholly-owned subsidiary and a second tier subsidiary of the Company.

 

From August 1, 2020 to April 30, 2021, the Company business centered on providing IT services to a small number of clients. In May 2021, the Company ceased its IT services and re-focused its operations to provide marketing services to small and median sized businesses. Clancy is now a product marketing consulting firm that provides product marketing consulting services to clients. The Company will develop marketing programs and strategies in line with customer needs. Our marketing programs will provide clients with detailed analysis on the market data in their industry, including historical data. We also will assist clients expand their marketing communication channels including but not limited to advertisements in the business journals, electronical communication tools such as WeChat marketing programs, etc. We charge an agreed upon fee based on technical difficulties and the marketing reach of the programs.

 

Results of Operations

 

While we commenced limited operations during the first fiscal quarter of last year, at the present time, the Company still is considered a shell company as defined in Rule 504 of the Act. One of our principal business objective for the next 12 months and beyond such time will be to achieve meaningful business operations. Alternatively, if we are unable to successfully develop our business, we may seek a combination with a business rather than immediate, short-term earnings. The Company will not restrict our potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business.

 

-3-

Comparison of Three and Nine Month Periods ended April 30, 2023 and 2022

 

Revenues

 

For the three months and nine months ended April 30, 2023 and 2022, the Company had no revenues.

 

Cost of Revenues

 

For both the three months and nine months ended April 30, 2023 and 2022, the Company had no cost of goods sold as we did not have any revenues for the respective periods.

 

Operating Expenses

 

For the three months ended April 30, 2023, the Company had total operating expenses of $78,005, consisting of $11,943 in research and development (“R&D”) expense, $66,052 in general and administrative expenses. These amounts compare with total operating expenses of $90,853 consisting of $63,745 in R&D expense and $27, 108 in general and administrative expense for the three months ended April 30, 2022. The decrease for the current quarter was due to a substantial reduction in R&D expenses.

 

For the nine months ended April 30, 2023, the Company had total operating expenses of $241,049, consisting of $53,477 in R&D expense, $187,618 in general and administrative expenses. These amounts compare with total operating expenses of $300,466 consisting of $204,246 in R&D expense and $96,240 in general and administrative expense for the three months ended April 30, 2022. The decrease for the current period was due to the decrease in R&D expense.

 

Net Loss

 

For the nine months ended April 30, 2023 and 2022, the Company had a net loss of $241,005 and $300,411, respectively, for the reasons discussed above.

 

For the three months ended April 30, 2023 and 2022, the Company had a net loss of $77,987 and $90,844, respectively, for the reasons discussed above.

 

Liquidity and Capital Resource

 

The Company had $23,944 and $19,511, respectively, in cash and cash equivalents as of April 30, 2023 and July 31, 2022.

 

As of April 30, 2023 and July 31, 2022, the Company had working capital deficit of $749,853 and $561,224, respectively. The increase in working capital deficit was due to increased operating expenses during the period.

 

The Company can provide no assurances that it can continue to satisfy its cash requirements for at least the next twelve months.

 

-4-

The following is a summary of the Company’s cash flows from operating and financing activities for the nine months ended JanuApril 30, 2023 and 2022:

 

    Nine Month Ended     Nine Month Ended  
    April 30, 2023     April 30, 2022  
Net Cash Used in Operating Activities   $ (195,606 )   $ (258,622 )
Net Cash Provided by Financing Activities        200,552       240,208  
                 
Effects of Exchange rate Changes on Cash     (463)       (581)  
Net Change in Cash   $ 4,483     $ (18,934 ) 

 

Operating Activities

 

During the nine months ended April 30, 2023, the Company had a net loss of $241,055 and after adjusting for lease expense, increased cash amortization of prepaid expenses and decreased payment on accounts payable, net cash used in operating activities of $195,606 was recorded. By comparison, during the nine months period ended April 30, 2022, the Company incurred net cash used in operating activities of $258,622, which was mainly from net loss of $300,411 for the period.

 

Financing Activities

 

During the nine months ended April 30, 2023, the Company had cash provided by financing activities of $200,552, which were loans from a related party (the Company’s sole officer and major shareholder). By comparison, during the nine months ended April 30, 2022, the Company had cash provided by financing activities of $240,208, which were loans from a related party (the Company’s sole officer and major shareholder).

 

Our financial statements reflect the fact that we do not have enough revenue to cover expenses. We are at present under-capitalized. The Company is dependent upon the receipt of capital investment or other financing to fund its ongoing operations and to execute its business plan of seeking a combination with a private operating company. In addition, the Company is dependent upon certain related parties to provide continued funding and capital resources. If continued funding and capital resources are unavailable at reasonable terms, the Company may not be able to implement its plan of operations.

 

Off-Balance Sheet Arrangements

 

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

 

Contractual Obligations

 

None except as disclosed in the notes to the financial statements.   

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

 

Item 4. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

In connection with the preparation of this quarterly report, an evaluation was carried out by the Company’s management, with the participation of the principal executive officer and the principal financial officer, of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act (“Exchange Act”) as of April 30, 2023. Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to management, including the principal executive officer and the principal financial officer, to allow timely decisions regarding required disclosures.

 

Based on that evaluation, the Company’s management concluded, as of the end of the period covered by this report, that the Company’s disclosure controls and procedures were not effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Commission’s rules and forms, and that such information was not accumulated and communicated to management, including the principal executive officer and the principal financial officer, to allow timely decisions regarding required disclosures.

 

-5-

Management’s Report on Internal Control over Financial Reporting

 

Change in Internal Control over Financial Reporting

 

During the quarter ended April 30, 2023, there has been no changes in internal control over financial reporting that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

There are presently no material pending legal proceedings to which the Company, any executive officer, any owner of record or beneficially of more than five percent of any class of voting securities is a party or as to which any of its property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.

 

Item 1A. Risk Factors.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

 

Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.

 

None.

 

Item 3. Defaults Upon Senior Securities.

 

None.

 

Item 4. Mine Safety Disclosures.

 

Not applicable to our Company.

 

Item 5. Other Information.

 

None

 

Item 6. Exhibits.

 

Exhibit   Description
31.1   Certification of the Company’s Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
     
32.1   Certification of the Company’s Principal Executive Officer and Principal Financial pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002+
     
101.INS   XBRL INSTANCE DOCUMENT*
     
101.SCH   XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT*
     
101.CAL   XBRL TAXONOMY CALCULATION LINKBASE DOCUMENT*
     
101.DEF   XBRL TAXONOMY DEFINITION LINKBASE DOCUMENT*
     
101.LAB   XBRL TAXONOMY LABEL LINKBASE DOCUMENT*
     
101.PRE   XBRL TAXONOMY PRESENTATION LINKBASE DOCUMENT*

 

+ In accordance with SEC Release 33-8238, Exhibit 32.1 is being furnished and not filed.

 

 

* Filed herewith.
   

-6-

 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.

 

Date: June __, 2023 CLANCY CORP.
   
  /s/ Xiangying Meng
  Xiangying Meng
   

-7-
Clancy (PK) (USOTC:CCYC)
Gráfico Histórico do Ativo
De Jun 2024 até Jul 2024 Click aqui para mais gráficos Clancy (PK).
Clancy (PK) (USOTC:CCYC)
Gráfico Histórico do Ativo
De Jul 2023 até Jul 2024 Click aqui para mais gráficos Clancy (PK).