NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS
FOR THE NINE MONTHS ENDED JANUARY 31, 2021
(UNAUDITED)
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
A. ORGANIZATION AND OPERATIONS
The Company was originally incorporated on April 12, 2004, in
the State of Nevada under the name of Ford-Spoleti Holdings, Inc. On June 4, 2009, the Company merged with Eagle Oil Holding Company,
a Nevada corporation, and the surviving entity, the Company, changed its name to “Eagle Oil Holding Company, Inc.”
Inception of the current Company occurred February 8, 2019 when the Company was acquired by Green Stream Holdings Inc. Previously
there was no activity from July 31, 2017 until the acquisition of February 8, 2019. On April 25, 2019, the Company changed its
name to “Green Stream Holdings Inc.” and is deemed to be a continuation of business of Eagle Oil Holding Company, Inc.
Additionally, the Company was reorganized that so that the Company became operating as a holding company of Green Stream Finance,
Inc., a Wyoming Corporation. That reorganization, inter alia, gave Madeline Cammarata, President of Green Stream Finance, Inc.,
the majority of the voting power in the Company. On April 25, 2019 the Company also filed the certificate of Amendment to Articles
of Incorporation with the Secretary of State of Nevada providing for reverse stock split: each thirty thousand shares of common
stock of the Company issued and outstanding immediately prior to the “effective time” of the filing were automatically
and without any action on the part of the respective holders thereof, be combined and converted into one (1) share of common stock,
provided that no fractional shares were to be issued in connection with said reverse stock split. On May 15, 2019, the Company
filed the articles of conversion with the secretary of state of Nevada, to convert the company from Nevada Corporation to Wyoming
Corporation. The Company is in good standing in the State of Wyoming as of September 25, 2019. The Company’s common shares
are quoted on the “Pink Sheets” quotation market under the symbol “GSFI.”
B. PRINCIPALS OF CONSOLIDATION
These consolidated financial statements include the accounts
of the Company and its wholly-owned subsidiary Green Stream Finance, Inc. based in the state of Wyoming. All material inter-company
balances and transactions were eliminated upon consolidation.
C. BASIS OF ACCOUNTING
The Company utilizes the accrual method of accounting, whereby
revenue is recognized when earned and expenses when incurred. The financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information. As such, the financial statements do not include
all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In
the opinion of management, all adjustments considered necessary for a fair presentation have been included and these adjustments
are of a normal recurring nature.
D. 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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the period. Actual results could differ from those estimates.
E. CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand; cash in banks
and any highly liquid investments with maturity of three months or less at the time of purchase. The Company maintains cash and
cash equivalent balances at several financial institutions, which are insured by the Federal Deposit Insurance Corporation up to
$250,000.
F. COMPUTATION OF EARNINGS PER SHARE
Net income per share is computed by dividing the net income
by the weighted average number of common shares outstanding during the period. Due to the net loss, the options and stock conversion
of debt are not used in the calculation of earnings per share because the stock conversions and options are considered to be antidilutive.
G. INCOME TAXES
The Company accounts for income taxes under the asset and liability
method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and
tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets
and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
The Company’s management has reviewed the Company’s
tax positions and determined there were no outstanding, or retroactive tax positions with less than a 50% likelihood of being sustained
upon examination by the taxing authorities, therefore the implementation of this standard has not had a material effect on the
Company.
H. REVENUE RECOGNITION
Revenue for license fees is recognized upon the execution and
closing of the contract for the amount of the contract. Contract fees are generally due based upon various progress milestones.
Revenue from contract payments are estimated and accrued as earned. Any adjustments between actual contract payments and estimates
are made to current operations in the period they are determined.
I. FAIR VALUE MEASUREMENT
The Company determines the fair value of a financial instrument
as the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced
sale or liquidation. The carrying amounts reported in the balance sheet for cash, accounts receivable, inventory, accounts payable
and accrued expenses, and loans payable approximate their fair market value based on the short-term maturity of these instruments.
Fair value measurements are determined based on the assumptions
that market participants would use in pricing an asset or liability. US GAAP establishes a hierarchy for inputs used
in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that
the most observable inputs be used when available. The established fair value hierarchy prioritizes the use of inputs used in valuation
methodologies into the following three levels:
·
|
Level 1: Quoted prices (unadjusted) for identical assets
or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and must
be used to measure fair value whenever available.
|
·
|
Level 2: Significant other observable inputs other
than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or
other inputs that are observable or can be corroborated by observable market data.
|
·
|
Level 3: Significant unobservable inputs that reflect
a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.
For example, level 3 inputs would relate to forecasts of future earnings and cash flows used in a discounted future cash flows
method.
|
J. STOCK-BASED COMPENSATION
The Company measures and recognizes compensation expense for
all share-based payment awards made to employees, consultants and directors including employee stock options based on estimated
fair values. Stock-based compensation expense recognized for the years ended December 31, 2014 and 2013 was $24,000 and $0 respectively.
Stock-based compensation expense recognized during the period is based on the value of the portion of share-based payment awards
that vest during the period.
Share-based compensation expense recognized in the Company’s
consolidated statement of operations for the years ended December 31, 2014 included compensation expense for share-based payment
awards granted in December 31, 2014.
K. SALES AND ADVERTISING
The costs of sales and advertising are expensed as incurred.
Sales and advertising expense was $23,808 and $112,808 for the nine months ended January 31, 2021 and 2020, respectively.
L. NEW ACCOUNTING PRONOUNCEMENTS
The Company reviews new accounting standards as issued. No new
standards had any material effect on these financial statements. The accounting pronouncements issued subsequent to the date of
these financial statements that were considered significant by management were evaluated for the potential effect on these consolidated
financial statements. Management does not believe any of the subsequent pronouncements will have a material effect on these consolidated
financial statements as presented and does not anticipate the need for any future restatement of these consolidated financial statements
because of the retro-active application of any accounting pronouncements issued subsequent to January 31, 2021 through the date
these financial statements were issued.
M. FURNITURE AND EQUIPMENT
Furniture and equipment are recorded at costs and consists of
furniture and fixtures, computers and office equipment. We compute depreciation using the straight-line method over the estimated
useful lives of the assets. Expenditures for major betterments and additions are charged to the property accounts, while replacements,
maintenance, and repairs that do not improve or extend the lives of the respective assets are charged to expense.
N. INTELLECTUAL PROPERTY
Intangible assets (intellectual property) are recorded at cost
and are amortized over the estimated useful life of the asset. Management evaluates the fair market value to determine if the asset
should be impaired at the end of each year.
O. IMPAIRMENT OF LONG-LIVED ASSETS
The Company tests long-lived assets or asset groups for recoverability
when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger
a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in
the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the
acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast
of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be
sold or disposed significantly before the end of its estimated useful life.
Recoverability is assessed based on the carrying amount of the
asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from
the use and the eventual disposal of the asset, as well as specific appraisal in certain instances.
An impairment loss is recognized when the carrying amount is
not recoverable and exceeds fair value.
NOTE 2 - GOING CONCERN AND LIQUIDITY CONSIDERATIONS
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation
of liabilities in the normal course of business. At January 31, 2021 the Company had a loss from operations, for
the nine months ended, of $1,078,815 and an accumulated deficit of $1,447,877 and negative working capital of $162,662. The
Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to
continue as a going concern.
The Company depends upon capital to be derived from future
financing activities such as subsequent offerings of its common stock or debt financing in order to operate and grow the
business. There can be no assurance that the Company will be successful in raising such capital. The key factors
that are not within the Company's control and that may have a direct bearing on operating results include, but are not
limited to, acceptance of the Company's business plan, the ability to raise capital in the future, the ability to expand its
customer base, and the ability to hire key employees to provide services. There may be other risks and
circumstances that management may be unable to predict.
The financial statements do not include any adjustments to reflect
the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities
that may result from the possible inability of the Company to continue as a going concern.
NOTE 3 – PROPERTY
AND EQUIPMENT
Property and equipment at January 31, 2021 and April 30, 2020
consists of the following:
|
|
January 31, 2021
|
|
|
April 30, 2020
|
|
|
|
|
|
|
|
|
Furniture and Fixtures
|
|
$
|
915,654
|
|
|
$
|
915,564
|
|
Leasehold Improvements
|
|
|
172,245
|
|
|
|
–
|
|
Less: Accumulated Depreciation
|
|
|
(26,917
|
)
|
|
|
–
|
|
Net Property and Equipment
|
|
$
|
1,060,982
|
|
|
$
|
915,564
|
|
Depreciation expense for the three months ended January 31, 2021 and 2020 was $15,020 and $11,937 respectively. Property and equipment
are recorded at cost. Depreciation is computed on the straight-line method, based on the estimated useful lives of the assets.
NOTE 4 – INTANGIBLE
ASSETS
Intangible Assets at January 31, 2021 and April 30, 2020 consists
of the following:
|
|
January 31, 2021
|
|
|
April 30, 2020
|
|
|
|
|
|
|
|
|
Intangible Assets
|
|
$
|
185,000
|
|
|
$
|
185,000
|
|
Less: Accumulated Amortization
|
|
|
(3,083
|
)
|
|
|
–
|
|
Net Intangible Assets
|
|
$
|
181,917
|
|
|
$
|
185,000
|
|
The Company invests in various intellectual properties to be
developed into future projects. By definition these intangible assets are amortized over a 15 year period. Amortization expense
for the nine months ended January 31, 2021 and 2020 was $3,083 and $0 respectively. January 31, 2021, the Company has determined
that the intangible asset should not be impaired.
NOTE 5 –STOCKHOLDERS’ EQUITY/(DEFICIT)
AUTHORIZED SHARES & TYPES
As of January 31, 2021, we had 77,654,000
shares of Common Stock issued and:
|
·
|
1,000,000 authorized shares of Convertible Series A
Preferred Shares. Convertible Series A Preferred Shares are convertible into the shares of Common Stock at a ratio of 1,000 shares
of Convertible Series A Preferred Shares to 1 share of Common Stock. There are 53,000 shares issued and outstanding or 53 votes.
|
|
·
|
1,000,000 authorized shares of Convertible Series B
Preferred Shares. Convertible Series B Preferred Shares are convertible into the shares of Common Stock at a ratio of 1,000,000
shares of Common Stock for each single Convertible Series B Preferred Share. Additionally, the Preferred B Shares are non-dilutive.
There are 600,000 shares issued and outstanding or 600,000,000,000 votes.
|
|
·
|
10,000,000 authorized shares of Convertible Series
C Preferred Shares. Convertible Series C Preferred Shares are convertible into Common Stock at a ratio of 1,000 shares of Convertible
Series C Preferred Share for one share of Common Stock. There are 760,000 shares issued and outstanding or 760 votes.
|
NOTE 6 – INCOME TAXES
Deferred tax assets arising as a result of net operation loss
carry forwards have been offset completely by a valuation allowance due to the uncertainty of their utilization in future periods.
Based on its evaluation, the Company has concluded that there
are no significant uncertain tax positions requiring recognition in its financial statements. The Company’s evaluation was
performed for the tax years ended April 30, 2020 and 2019 for U.S. Federal Income Tax and for the State of Wyoming.
A reconciliation of income taxes at statutory rates with the
reported taxes follows:
|
|
January 31, 2021
|
|
|
July 31, 2019
|
|
|
|
|
|
|
|
|
Loss before income tax benefit
|
|
$
|
1,124,046
|
|
|
$
|
–
|
|
Expected income tax benefit
|
|
|
(280,980
|
)
|
|
|
–
|
|
Non-deductible expenses
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Tax loss benefit not recognized for book purposes, valuation allowance
|
|
|
280,980
|
|
|
|
–
|
|
Total income tax
|
|
$
|
–
|
|
|
$
|
–
|
|
The Company has net operating loss carry forwards in the amount
of approximately $1,124,046 that will expire beginning in 2029. The deferred tax assets including the net operating loss carry
forward tax benefit of $1,124,046 total $280,980 which is offset by a valuation allowance. The other deferred tax assets include
accrued officer compensation, stock based compensation, and amortization.
The Company follows the provisions of uncertain tax positions.
The Company recognized approximately no increase in the liability for unrecognized tax benefits.
The Company has no tax position at January 31, 2021 for which
the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.
The Company recognizes interest accrued related to unrecognized
tax benefits in interest expense and penalties in operating expenses. No such interest or penalties were recognized during the
periods presented. The Company had no accruals for interest and penalties at January 31, 2021. The open tax years are from 2019
through 2029.
NOTE 7 – RELATED PARTY TRANSACTIONS
During the three months ended January 31, 2021 and 2020 the
Company’s CEO had advanced $0 and $130,254 respectively of personal funds. As of January 31, 2021 and 2020 the Company owed
the CEO $25,930 and $141,569 respectively.
NOTE 8 –NOTES AND OTHER LOANS PAYABLE
On December 11, 2019 the company agreed to pay Cheryl Hintzen
$40,000 in the form of a promissory note with a term of one year at 10 % interest compounded annually. The Company accrued interest
for the six months ended January, 31, 2020 in the amount of $2,017. On January 8, 2020 the Company signed a promissory note for
$8,000 with Cheryl Hintzen. The note becomes due on March 8, 2020 and carries a per annum interest rate of 10%. The Company accrued
interest for the Six months ended January 31, 2020 in the amount of $651.
On February 21, 2020 the Company borrowed $25,000 from GPL Ventures
with interest at a rate of 10% and a due date of July 31, 2020.
On March 12, 2020 the Company agreed to pay Dr. Jason Cohen
1,000,000 shares at a valuation of $.20 per share plus 8 % interest until the shares are issued. The interest accrued through January
31. 2021 is $10,213.70.
In the month July 13, 2020 the Company borrowed $250,000 from
Leonite Capital on a senior convertible note maturing in 6 months. The note had an Original Issue Discount of 10% and carries an
interest rate of 12% annually. Additionally the lender received 1,500,000 shares of restricted common shares. The Note converts
at the rate of $.10 per share had the Company has reserved 60,000,000 common shares for the conversion. For the nine months ended
January 31, 2021 $8,371.39 interest was accrued for this note.
On September 17, 2020 the Company borrowed $100,000 from Quick
Capital LLC on a senior convertible note maturing in 12 months at an interest rate of 10%. Additionally the lender received 1,000,000
shares of restricted common shares. For the nine months ended January 31, 2021 $1,205.48 interest was accrued for this note.
On January 10, 2020 the Company borrowed $65,000 from Geneva
Roth Remark Holdings Inc. on a senior convertible note maturing in 12 months at an interest rate of 10%. The Note converts at
the rate of 42% discount to Market Price for restricted common shares. For the nine months ended January 31, 2021 $409.59 interest
was accrued for this note.
The following schedule is Notes Payable at January 31, 2021
and April 30, 2020:
Description
|
|
January 31, 2021
|
|
|
April 30, 2020
|
|
|
|
|
|
|
|
|
Note payable to Cheryl Hintzen due December 11, 2021; interest at 10%
|
|
$
|
40,000
|
|
|
$
|
40,000
|
|
|
|
|
|
|
|
|
|
|
Note Payable to Cheryl Hintzen due March 8, 2020: interest 10%
|
|
|
19,000
|
|
|
|
14,000
|
|
|
|
|
|
|
|
|
|
|
Note payable to GPL Ventures due March 8, 2020; interest at 10%
|
|
|
–
|
|
|
|
25,000
|
|
|
|
|
|
|
|
|
|
|
Note payable Dr. Jason Cohen 1,000,000 shares @ $.20
|
|
|
200,000
|
|
|
|
200,000
|
|
|
|
|
|
|
|
|
|
|
Note payable escrow attorney for REG A shares
|
|
|
46,900
|
|
|
|
46,900
|
|
|
|
|
|
|
|
|
|
|
Note Payable to Quick Capital LLC due Sept 17,2021 interest at 10%
|
|
|
100,000
|
|
|
|
–
|
|
Note payable to EMA Financial
|
|
|
100,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note Payable to Geneva Roth Holdings interest 10%
|
|
|
65,000
|
|
|
|
|
|
Note Payable to Geneva Roth Holdings
|
|
|
35,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note Payable to Leonite Capital due January 13, 2021 interest at @10%
|
|
|
277,778
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Total Notes Payable
|
|
$
|
975,678
|
|
|
$
|
340,900
|
|
NOTE 9 - SUBSEQUENT EVENTS
During February, 2021, the Company paid off several outstanding
debts reflected by promissory note and related stock conversion obligations under such notes, which notes and conversion obligations
are no longer outstanding. EMA Financial, LLC was paid off, approximately $133,775.34 which encompassed $100,000.00
of principal and the balance of accrued interest and finance fees. Quick Capital, LLC was paid off approximately $100,000.00 of
principal and interest and prepayment fees of $47,200.00. Geneva Roth Remark Holdings, Inc. had two notes paid off
of approximately $186,000. Which included principal, interest and prepayments. Additionally the Company’s obligation
to Leonite Capital was reduced by $100,000.00. Further, Leonite has agreed to waive the variable price option for the conversion
of the notes and to remain only with the fixed price conversion and allowed the company to cancel a portion of the common shares
available to them in the conversion.