SEC Filing Summary: Standard Capital Corporation (10-K)
Business Context and Reporting Period
This Form 10-K covers the fiscal year ended August 31, 2008, for Standard Capital Corporation (referred to as "Standard"). The company is a Delaware corporation incorporated in 1998, operating as a pre-exploration stage mineral exploration company. As of the reporting date, Standard holds no mineral claims after allowing its previous "Standard" claim to lapse in February 2008. The company has no revenue, no subsidiaries, and minimal operations consisting primarily of identifying new claims and filing regulatory reports.
Key Financial Metrics
| Metric | Value (USD) |
|---|---|
| Revenue | $0 |
| Net Loss (FY 2008) | $(21,803) |
| Accumulated Deficit (Inception to 2008) | $(190,474) |
| Cash and Cash Equivalents | $3,318 |
| Total Current Liabilities | $99,242 |
| Stockholders' Deficiency | $(95,924) |
| Shares Outstanding | 2,285,000 |
Debt and Liquidity: The company has significant liabilities relative to its cash position. Total liabilities of $99,242 include $89,760 owed to general creditors (including $49,672 to a former director and $36,040 to an internal accountant) and $9,482 owed to related parties. The company has a working capital deficit and relies on non-interest-bearing advances from related parties to meet obligations.
Material Changes vs. Prior Period
- Asset Status: The company lost its only asset, the "Standard" mineral claim, when it was allowed to lapse in February 2008. Consequently, the company currently has no assets to build upon.
- Liabilities: Current liabilities increased significantly from $82,659 in 2007 to $99,242 in 2008, driven largely by accrued expenses for accounting, legal, and filing fees.
- Management Changes: Del and Maryanne Thachuk resigned as directors and officers in December 2007. They were replaced by Alexander B. Magallano (President) and Rudy Beloy Perez (Secretary Treasurer).
- Net Loss: The net loss for the year decreased slightly from $(26,295) in 2007 to $(21,803) in 2008, though the accumulated deficit continues to grow.
Outlook, Risks, and Management Commentary
Going Concern: The independent auditors have issued a report expressing substantial doubt about the company's ability to continue as a going concern. The company requires additional working capital to service debt and fund future exploration. Without financing from directors, officers, or equity sales, the company may cease operations.
Plan of Operation: Management intends to identify and acquire a new mineral claim. Estimated expenses for the next twelve months are approximately $103,485, including $48,040 for accounting/audit fees and $49,672 to settle the debt owed to the former director.
Risk Factors:
- Penny Stock Status: Shares are subject to SEC "Penny Stock" rules, which may severely limit liquidity and marketability.
- Financing Risk: There is no assurance the company can raise capital. Future equity offerings will result in shareholder dilution.
- Operational Risk: The company has no operating history, no current assets, and a high probability of failure common to start-up exploration companies.
- Key Man Risk: The company has no key man insurance; the departure of current management could be detrimental.
Investor Verification Checklist
- Capital Adequacy: Verify if the company has secured the estimated $103,485 required for the next 12 months, specifically the $49,672 owed to the former director.
- Asset Acquisition: Confirm if a new mineral claim has been identified or acquired, as the company currently holds no assets.
- Related Party Transactions: Review the terms of the $9,482 owed to related parties and the $49,672 owed to the former director to understand repayment expectations.
- Going Concern Status: Assess the likelihood of the company ceasing operations if additional equity financing is not obtained immediately.
- Management Continuity: Monitor the stability of the new management team (Magallano and Perez) given the lack of key man insurance.