Filing identity and reporting period
Important mismatch: The supplied filing is for Bear Lake Recreation, Inc., not Modular Medical, Inc. It is a Form 10-Q for the three months ended September 30, 2015, filed November 5, 2015. The filing identifies Bear Lake as a Nevada shell company with no established operations. The metadata’s company name and “2015 Q1” label should be verified before relying on this summary.
Financial results and condition
| Metric | Three months ended September 30, 2015 | Comparable 2014 period |
|---|---|---|
| Revenue | $0 | $0 |
| General and administrative expenses | $6,851 | $4,524 |
| Related-party interest expense | $4,181 | $3,334 |
| Net loss | $11,032 | $7,858 |
| Basic and diluted loss per share | $0.01 | $0.01 |
| Operating cash flow | $0 | $0 |
At September 30, 2015, total assets were $625, consisting entirely of prepaid expenses, and cash was $0. Current liabilities were $174,336, including $121,204 due to a shareholder, $48,931 of accrued related-party interest, and $4,201 of accounts payable. The resulting working-capital deficit was $173,711; stockholders’ deficit was also $173,711. The filing reports no investing or financing cash flows.
The shareholder advances are described as unsecured, non-interest-bearing, and payable on demand. The company imputes interest at 10% annually for accounting purposes. There is no reported revenue or gross margin from operations.
Changes, outlook, and risks
- Net loss increased by $3,174 year over year, primarily reflecting higher administrative costs and imputed related-party interest. Administrative expenses included accounting, OTC Markets QB listing, and office fees.
- The company had no operations and planned to evaluate industries, adopt a business plan, and pursue operations through funding or an acquisition. Management said a principal shareholder had been paying expenses and did not anticipate needing additional funds for foreseeable costs over the next 12 months; funding for any acquisition or venture was uncertain.
- Management disclosed substantial doubt about the company’s ability to continue as a going concern because of minimal assets, no established operations, and accumulated losses. The company intended to seek a merger with a well-capitalized operating company. The financial statements include no adjustments for the uncertainty.
- The company said it would not renew its OTC Markets QB listing, which expired October 30, 2015. Forward-looking statements are subject to risks including the ability to raise capital and identify a business opportunity. No legal proceedings or off-balance-sheet arrangements were reported.
- Management concluded disclosure controls were effective and reported no material change in internal control over financial reporting during the quarter.
Most important facts to verify
- Confirm that this Bear Lake Recreation filing, rather than a Modular Medical filing, is the intended source.
- Confirm the reporting-period label: the filing covers the quarter ended September 30, 2015.
- Verify the shareholder payable, accrued interest, and on-demand repayment terms, as well as the company’s reliance on shareholder support.
- Assess the going-concern uncertainty and whether the proposed merger or another operating opportunity materialized.
- Confirm the reported zero cash and operating cash flow alongside the period’s losses and accrued obligations.