SEC Filing Summary: Excaliber Enterprises, Ltd. (10-Q)
Business Context and Reporting Period
This is a Quarterly Report on Form 10-Q for Excaliber Enterprises, Ltd. for the period ended March 31, 2009. The company is a Nevada corporation classified as a "Development Stage Company." Its stated business is selling specialty gift baskets to health care professionals, organizations, patients, and real estate agents via an online platform (www.ExcaliberStore.com). The company has limited operations and has not yet generated any revenue since its inception in October 2005.
Key Financial Metrics
| Metric | Q1 2009 (3 Months) | Q1 2008 (3 Months) | Inception to Mar 31, 2009 |
|---|---|---|---|
| Revenue | $0 | $0 | $0 |
| Total Expenses | $17,189 | $2,250 | $43,790 |
| Net Loss | $(17,219) | $(2,280) | $(43,880) |
| Cash Balance (Ending) | $3,852 | $315 | $3,852 |
| Net Cash Used in Operations | $(17,960) | $(280) | $(37,399) |
| Total Assets | $4,993 | N/A | $4,993 |
| Total Liabilities | $1,838 | N/A | $1,838 |
| Stockholders' Equity | $3,155 | N/A | $3,155 |
Debt: The company has a $500 note payable to a related party, bearing no interest and due on demand.
Liquidity: Cash on hand is $3,852. Management states this is insufficient to fund operations for the next 12 months.
Material Changes vs. Prior Period
- Expense Increase: Total expenses for the three months ended March 31, 2009, were $17,189, a significant increase from $2,250 in the same period in 2008. This increase is primarily due to General and Administrative expenses rising from $2,250 to $17,082.
- Cash Position: Cash decreased from $21,812 at December 31, 2008, to $3,852 at March 31, 2009, due to operating cash outflows.
- Accumulated Deficit: The accumulated deficit since inception grew to $43,880.
Outlook, Risks, and Management Commentary
- Going Concern: The filing contains a "Going Concern" warning. Management and auditors express substantial doubt about the company's ability to continue as a going concern due to a lack of revenue, history of losses, and insufficient cash to fund operations for the next 12 months.
- Revenue Target: Management estimates a minimum of $25,000 in sales is required over the next 12 months to achieve profitability, though they cannot guarantee any sales will occur.
- Operational Status: The company has received no orders via its website to date. Marketing and promotional efforts have been delayed until at least the first quarter of 2010 due to the economic climate affecting the purchase of engraved award products.
- Financing Needs: The company anticipates needing to raise additional capital by issuing stock to continue operations. There are no formal agreements for such financing.
- Internal Controls: Management identified material weaknesses in internal controls, including a lack of a functioning audit committee, inadequate segregation of duties, and ineffective financial disclosure controls. Remediation is planned but dependent on available funds.
Investor Verification Checklist
- Verify the company's ability to secure additional financing, as current cash ($3,852) is insufficient for 12 months of operations.
- Confirm the status of the website (www.ExcaliberStore.com) and whether any sales have been generated since the filing date.
- Review the timeline for the planned marketing launch (Q1 2010) and assess the risk of further delays.
- Monitor the progress of remediation efforts for internal control weaknesses, specifically the appointment of outside directors and an audit committee.
- Check for any new related-party transactions or debt issuances, given the existing $500 related-party note and history of stock-for-service issuances.