UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

 

For Quarterly Period Ended June 30, 2017

 

or

 

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

 

Sheng Ying Entertainment Corp.

(Formerly known as Crowd 4 Seeds, Inc.)

(Exact name of registrant issuer as specified in its charter)

 

Nevada

 

30-0828224

(State or other jurisdiction of
incorporation or organization)

 

(I.R.S. Employer
Identification No.)

 

Avenida Doutor Mario Soares N. 320, Edificio Finance & IT Center, 5
Andar A, Macau

(Address of principal executive offices)

 

+853 8294-2333

Registrant’s phone number, including area code 

 

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 x NO ¨

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding twelve months (or shorter period that the registrant was required to submit and post such files). YES ¨ NO x

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “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

x

Emerging growth company x

 

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. o

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES x NO ¨

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. 

 

Class

 

Outstanding at June 30, 2017

Common Stock, $.001 par value

 

9,054,000

 

 
 
 

 

INDEX

 

 

Page No.

 

PART I - FINANCIAL INFORMATION

 

ITEM 1.

FINANCIAL STATEMENTS: 

 

3

 

Balance Sheets as of June 30, 2017 (unaudited) and December 31, 2016

 

3

 

Statements of Operations for the Three and Six Months Ended June 30, 2017 and June 30, 2016 (unaudited)

 

4

 

Statements of Cash Flows for the Six Months Ended June 30, 2017 and June 30, 2016 (unaudited)

 

5

 

Notes to Financial Statements (unaudited) 

 

6

 

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 

 

8

 

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 

 

10

 

ITEM 4.

CONTROLS AND PROCEDURES

 

10

 

PART II - OTHER INFORMATION

 

ITEM 1.

LEGAL PROCEEDINGS

 

12

 

ITEM 1A.

RISK FACTORS

 

12

 

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

12

 

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

 

12

 

ITEM 4.

MINE SAFETY DISCLOSURE

 

12

 

ITEM 5.

OTHER INFORMATION

 

12

 

ITEM 6.

EXHIBITS

 

13

 
 
2
 
 

 

PART I - FINANCIAL INFORMATION 

 

ITEM I — FINANCIAL STATEMENTS

 

SHENG YING ENTERTAINMENT CORP.

(FORMERLY KNOWN AS CROWD 4 SEEDS, INC.)

BALANCE SHEETS

 

 

 

June 30,

2017

 

 

December 31,

2016

 

 

 

(Unaudited)

 

 

 

 

ASSETS

Current assets:

 

 

 

 

 

 

Cash

 

$ 212

 

 

$ 1,130

 

 

 

 

 

 

 

 

 

 

Total current assets

 

 

212

 

 

 

1,130

 

 

 

 

 

 

 

 

 

 

Total assets

 

 

212

 

 

 

1,130

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

 

 

 

 

 

 

 

 

Accrued liabilities and other payables

 

 

18,492

 

 

 

-

 

Accounts payable - related parties

 

 

55,591

 

 

 

1,130

 

Total current liabilities

 

 

74,083

 

 

 

1,130

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

74,083

 

 

 

1,130

 

 

 

 

 

 

 

 

 

 

Stockholders’ deficit:

 

 

 

 

 

 

 

 

Preferred stock; $.001 par value, 5,000,000 shares authorized, none issued and outstanding

 

 

-

 

 

 

-

 

Common stock; $.001 par value, 45,000,000 shares authorized, 9,054,000 shares issued and outstanding as of June 30, 2017 and December 31, 2016

 

 

9,054

 

 

 

9,054

 

Additional paid-in capital

 

 

212,946

 

 

 

212,946

 

Accumulated deficit

 

 

(295,871 )

 

 

(222,000 )

Total stockholders’ deficit

 

 

(73,871 )

 

 

-

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders’ deficit

 

$ 212

 

 

$ 1,130

 

 

The accompanying notes are an integral part of these unaudited financial statements.

 
 
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SHENG YING ENTERTAINMENT CORP.

(FORMERLY KNOWN AS CROWD 4 SEEDS, INC.)

STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

For the Three Months Ended
June 30,

 

 

For the Six Months Ended
June 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$ 49,798

 

 

$ 14,777

 

 

$ 73,871

 

 

$ 29,273

 

Total operating expenses

 

 

49,798

 

 

 

14,777

 

 

 

73,871

 

 

 

29,273

 

Loss from operations

 

 

(49,798 )

 

 

(14,777 )

 

 

(73,871 )

 

 

(29,273 )

Provision for income taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Net loss

 

$ (49,798 )

 

$ (14,777 )

 

$ (73,871 )

 

$ (29,273 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per common share – basic and diluted

 

$ (0.01 )

 

$ (0.00 )

 

$ (0.01 )

 

$ (0.00 )

Weighted average common shares outstanding – basic and diluted

 

 

9,054,000

 

 

 

9,054,000

 

 

 

9,054,000

 

 

 

9,054,000

 

 

The accompanying notes are an integral part of these unaudited financial statements.

 
 
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SHENG YING ENTERTAINMENT CORP.

(FORMERLY KNOWN AS CROWD 4 SEEDS, INC.)

STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

Six Months Ended June 30,

 

 

 

2017

 

 

2016

 

Cash flow from operating activities:

 

 

 

 

 

 

Net loss

 

$ (73,871 )

 

$ (29,273 )

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Contributed services

 

 

-

 

 

 

18,900

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accrued liabilities and other payables

 

 

72,953

 

 

 

(9,816 )

Net cash used in operating activities

 

 

(918 )

 

 

(20,189 )

 

 

 

 

 

 

 

 

 

Cash flow from financing activities:

 

 

 

 

 

 

 

 

Promissory note from shareholder

 

 

-

 

 

 

18,009

 

Net cash provided by financing activities

 

 

-

 

 

 

18,009

 

 

 

 

 

 

 

 

 

 

NET DECREASE IN CASH

 

 

(918 )

 

 

(2,180 )

CASH AT BEGINNING OF PERIOD

 

 

1,130

 

 

 

2,408

 

CASH AT END OF PERIOD

 

$ 212

 

 

$ 228

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

 

Cash paid for interest

 

$ -

 

 

$ -

 

Cash paid for income taxes

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

Non-cash transactions

 

 

 

 

 

 

 

 

Expenses paid by related party on behalf of the Company

 

$ 54,461

 

 

$ -

 

 

The accompanying notes are an integral part of these unaudited financial statements.

 
 
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SHENG YING ENTERTAINMENT CORP.

(FORMERLY KNOWN AS CROWD 4 SEEDS, INC.)

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

 

NOTE 1 – ORGANIZATION AND GOING CONCERN

 

Sheng Ying Entertainment Corp. (the “Company”) was formed on April 11, 2014 as a Nevada corporation, under the name of Crowd 4 Seeds, Inc.

 

During 2014 the Company issued 9,054,000 shares of its common stock, for a total consideration of $20,000. The Company initially planned to operate in the field of crowd funding and to run an online platform for investments in Israeli startup companies.

 

On December 30, 2016, Tycoon Luck Global Limited acquired 65.72% of the equity interest of the Company from Itzhak Ostashinsky, the major shareholder and sole officer of the Company at the time, for $220,152 in cash and both parties agreed all the net liabilities of the Company as of the acquisition date are assumed by Itzhak Ostashinsky. On the same day, the new management team was appointed. The management has decided to transition the Company’s business plan to providing sub-junket services to main junkets based in Cambodia.

 

On January 9, 2017, the Company filed with Secretary of State of Nevada to change its name to Sheng Ying Entertainment Corp. On April 24, 2017, the Financial Industry Regulatory Authority (“FINRA”) approved the name change. The Company’s common stock symbol was also changed from CWWD to SALL, effective April 25, 2017. 

 

The Company is currently planning to acquire Sheng Ying Investments Limited, a BVI company incorporated on January 5, 2017 and wholly owned by Kok Chee LEE, the CEO of the Company, for the purpose of commencing junket business.

 

The accompanying unaudited interim financial statements have been prepared assuming that the Company will continue as a going concern. The Company has suffered recurring losses since inception, has negative cash flow from operating activities of $918 for the six months ended June 30, 2017, and has working capital deficit of $73,871 as of June 30, 2017. Due to these conditions, it raised substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that may result should the Company be unable to continue as a going concern.

 

NOTE 2 – BASIS OF PRESENTATION

 

Basis of Presentation

 

The unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the United States Securities and Exchange Commission. Accordingly, they do not contain all information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of the Company’s management, the accompanying unaudited financial statements contain all the adjustments necessary (consisting only of normal recurring adjustments) to present the financial position of the Company as of June 30, 2017 and the results of operations and cash flows for the periods presented. The results of operations for the six months ended June 30, 2017 are not necessarily indicative of the operating results for the full fiscal year. These financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent year ended December 31, 2016 have been omitted.

 

Use of Estimates

 

The preparation of the financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) 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 dates of the financial statements and the reported amounts of expenses during the reporting periods. Actual results could differ from those estimates.

 
 
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Recently Issued Accounting Pronouncements

 

In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business”. These amendments clarify the definition of a business. The amendments affect all companies and other reporting organizations that must determine whether they have acquired or sold a business. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments in this ASU are effective for public companies for annual periods beginning after December 15, 2017, including interim periods within those periods. Early adoption is permitted under certain circumstances. The amendments should be applied prospectively as of the beginning of the period of adoption. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

 

NOTE 3 – RECLASSIFICATIONS

 

Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications had no impact on net earnings and financial position.

 

NOTE 4 – TRANSACTIONS WITH RELATED PARTY

 

 

A.

The Company makes borrowings from its related parties from time to time for working capital purposes. As of December 31, 2016 and June 30, 2017, the Company owed $1,130 to Ms. Siew Heok ONG, the Chief Financial Officer. The amount is due on demand without any interest.

 

 

B.

During the six months ended June 30, 2017, the Company incurred operating expenses in the amount of $73,871, $54,461 of which was directly paid by Mr. Kok Chee LEE, the Chief Executive Officer of the Company. As of December 31, 2016 and June 30, 2017, the Company owed $0 and $54,461 to Mr. Kok Chee LEE, respectively. The borrowing is due on demand without any interest.

 

 

C.

During the period from January 1, 2016 to December 30, 2016, the Company leased its office space from its former major shareholder and sole officer at no charge. During the same period, the legal services of the Company were provided by a related party for free. The related party is the son of former major shareholder and sole officer.

 
 
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements appear in a number of places in this Report, including, without limitation, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements are not guarantees of future performance and involve risks, uncertainties and requirements that are difficult to predict or are beyond our control. Forward-looking statements speak only as of the date of this quarterly report. You should not put undue reliance on any forward-looking statements. We assume no responsibility to update the forward-looking statements contained in this quarterly report on Form 10-Q. The following should also be read in conjunction with the unaudited Financial Statements and notes thereto that appear elsewhere in this report.

 

Company Overview 

 

Company was incorporated in Nevada on April 11, 2014 as Crowd 4 Seeds Inc. Most of the activity through June 30, 2017 involved incorporation efforts, registration to become a reporting company, planning our business and developing our website.

 

After change in ownership on December 30, 2016, new management plans to operate the company under the new name of “Sheng Ying Entertainment Corp.”. The Company’s new business plan is to engage in the service of sub-junkets for a junket in Cambodia. For sub-junkets introduction service performed, we will charge 0.05% of total bets played by players introduced by us to a junket in casino located in Cambodia.

 

On January 9, 2017, the Company filed a certificate of amendment (the “Amendment”) to its Certificate of Incorporation with the Secretary of State of the State of Nevada in order to change its name to “Sheng Ying Entertainment Corp.” in order to better reflect the direction and business of the Company. The filling was approved on January 10, 2017 and we have obtained the business license under the new company name on the same day. On April 24, 2017, the Financial Industry Regulatory Authority (“FINRA”) approved to the name change of the Company. The Company’s common stock symbol has been changed from CWWD to SALL effective on April 25, 2017. The Company has adopted a fiscal year end of December 31.

 

We have plans to establish a website which set forth general information for our new junket business of the Company in next future.

 

Results of Operations

 

Three and six months ended June 30, 2017 compared to three and six months ended June 30, 2016

 

Selling, General and Administrative Expenses

 

Selling, general and administrative expenses amounted to $49,798 and $14,777 respectively for the three months ended June 30, 2017 and 2016, and amounted to $73,871 and $29,273 respectively for the six months ended June 30, 2017 and 2016. The amount incurred is mainly professional fee to corporate lawyer, transfer agent, auditor and accountant, and management compensation.

 

Liquidity and Capital Resources

 

The following is a summary of the Company’s cash flows used in operating activities for the six months ended June 30, 2017 and the six months ended June 30, 2016:

 

 

 

Six Months

ended

June 30,

2017

 

 

Six Months

ended

June 30,

2016

 

Net loss

 

$ (73,871 )

 

$ (29,273 )

Net cash used in operating activities

 

$ (918 )

 

$ (20,189 )

 
 
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As of June 30, 2017, most of our resources and work have been devoted to planning our new business and completing our registration statement.

 

We are a public company and as such we have incurred and will continue to incur significant expenses for legal, accounting and related services. As a public entity, subject to the reporting requirements of the Exchange Act of 1934, we incur ongoing expenses associated with professional fees for accounting, legal and a host of other expenses including annual reports and proxy statements, if required. We estimate that these costs will range up to $80,000 per year over the next few years and may be significantly higher if our business volume and transactional activity increases but should be lower for this year in 2017 because our overall business volume (and financial transactions) will be lower, and we will not yet be subject to the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 until we exceed $75 million in market capitalization (if ever). These obligations will certainly reduce our ability and resources to expand our business plan and activities. We hope to be able to use our status as a public company to increase our ability to use noncash means of settling outstanding obligations (i.e. issuance of restricted shares of our common stock) and compensate independent contractors who provide professional services to us, although there can be no assurances that we will be successful in any of these efforts. We will also reduce compensation levels paid to management (if we attract or retain outside personnel to perform this function) if there is insufficient cash generated from operations to satisfy these costs.

 

We hope to be able to use our status as a public company to enable us to use non-cash means of settling obligations and compensate persons and/or firms providing services to us, although there can be no assurances that we will be successful in any of those efforts. However, these actions, if successful, will result in dilution of the ownership interests of existing shareholders, may further dilute common stock book value, and that dilution may be material. Such issuances may also serve to enhance existing management’s ability to maintain control of the Company because the shares may be issued to parties or entities committed to supporting existing management. The Company may offer shares of its common stock to settle a portion of the professional fees incurred in connection with its registration statement. No negotiations have taken place with any professional and no assurances can be made as to the likelihood that any professional will accept shares in settlement of obligations due to them.

 

As of June 30, 2017, total liabilities increased to $74,083 from $1,130 as of December 31, 2016, mainly because the Company accrued for professional fee, legal fee etc. to maintain the company’s listed status.

 

Going Concern

 

Our auditor has issued a “going concern” qualification as part of its opinion in the Audit Report for the year ending December 31, 2016, and our unaudited financial statements for the quarter ended June 30, 2017 include a “going concern” note disclosing that our ability to continue as a going concern is contingent on us being able to raise working capital to grow our operations and generate revenue. 

 

Critical Accounting Policies

 

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosures of contingent assets and liabilities in the financial statements and accompanying notes. The SEC has defined a company’s critical accounting policies as the ones that are most important to the portrayal of the company’s financial condition and results of operations, and which require the company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. We believe that our estimates and assumptions are reasonable under the circumstances; however, actual results may vary from these estimates and assumptions. 

 

Recently Issued Accounting Pronouncements

 

In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business”. These amendments clarify the definition of a business. The amendments affect all companies and other reporting organizations that must determine whether they have acquired or sold a business. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments in this ASU are effective for public companies for annual periods beginning after December 15, 2017, including interim periods within those periods. Early adoption is permitted under certain circumstances. The amendments should be applied prospectively as of the beginning of the period of adoption. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

 
 
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Off-Balance Sheet Arrangements

 

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to investors. 

 

Contractual Obligations

 

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

 

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 

 

We conducted an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. The term “disclosure controls and procedures”, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended (“Exchange Act”), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC`s rules and forms. Disclosure controls and procedures also include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

 

Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded as of June 30, 2017, that our disclosure controls and procedures are not effective at a reasonable assurance level and are designed to provide reasonable assurance that the controls and procedures will meet their objectives due to the material weaknesses described below. However, it should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

 

Management’s Report on Internal Control Over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The internal controls for the Company are provided by executive management’s review and approval of all transactions. Our internal control over financial reporting also includes those policies and procedures that:

 

 

(1)

pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

 

 

(2)

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of our management; and

 

 

(3)

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

 
 
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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Management assessed the effectiveness of the Company’s internal control over financial reporting as of June 30, 2017. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations (“COSO”) of the Treadway Commission in Internal Control-Integrated Framework. Management’s assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of these controls.

 

Based on this assessment, management has concluded that as of June 30, 2017, our internal control over financial reporting was not effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles due to the existence of the following material weaknesses:

 

 

·

Lack of segregation of duties

 

·

Lack of audit committee and independent directors

 

·

Lack of well established procedures to authorize and approve related party transactions

 

               Although we are unable to meet the standards under COSO because of the limited resources available to a company of our size, we are committed to improving our financial organization. As funds become available, we will undertake to: (1) create a position to segregate duties consistent with control objectives, (2) increase our personnel resources and technical accounting expertise within the accounting function (3) appoint one or more independent directors to our board of directors who shall be appointed to a Company audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures; and (4) prepare and implement sufficient written policies and checklists which will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.

 

We will continue to monitor and evaluate the effectiveness of our disclosure controls and procedures and our internal control over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

 

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management’s report in this annual report.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in the Company’s internal control over financial reporting that occurred during the last fiscal quarter that have materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

 
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PART II -- OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

The Company is not a party to any legal proceeding or litigation. 

 

Item 1A. Risk Factors.

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

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

 

None. 

 

Item 3. Defaults Upon Senior Securities.

 

None. 

 

Item 4. Mine Safety Disclosure.

 

Not applicable.

 

Item 5. Other Information.

 

None. 

 

 
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Item 6. Exhibits.

 

31

 

Certification of President pursuant to Exchange Act Rule 13a-14 and 15d-14.

 

32

 

Certification of the Company’s Chief Executive Officer and Chief Financial Officer, 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 Extension Calculation Linkbase Document 

 

101.DEF ** 

 

XBRL Taxonomy Extension Definition Linkbase Document 

 

101.LAB ** 

 

XBRL Taxonomy Extension Label Linkbase Document 

 

101.PRE ** 

 

XBRL Taxonomy Extension Presentation Linkbase Document 

________________

**

XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 
 
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Table of Contents

 

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. 

 

 

 

SHENG YING ENTERTAINMENT CORP.

(FORMERLY KNOWN AS CROWD 4 SEEDS, INC.)

     

 

Date: August 10, 2017

By:

/s/ Kok Chee Lee

 

Kok Chee Lee

 

Chief Executive Officer

 

 

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