U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB/A
(Mark One)
X...Quarterly report under section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended August 31, 1999.
....Transition report under section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from _________ to
_________.
Commission File No: 0-21955
M & A WEST, INC.
(Name of small business in its charter)
Colorado 84-1356427
(State or other (IRS Employer Id. No.)
jurisdiction of Incorporation)
583 San Mateo Ave.
San Bruno, CA 94066
______________________________________________
(Address of principal
executive offices) (Zip Code)
Issuer's telephone number: (650) 588-2678
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 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 ....
Applicable only to issuers involved in bankruptcy proceedings during
the past five years.
Check whether the issuer has filed all documents and reports required
to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court. Yes .....
No .....
Applicable only to corporate issuers
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date. At August 31,
1999, the following shares of common were outstanding: Common
Stock, no par value, 11,000,000.
Transitional Small Business Disclosure
Format (Check one):
Yes ..... No ..X..
<PAGE>
PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS
(a) The unaudited financial statements of registrant for the
three months ended August 31, 1999, follow. The financial statements
reflect all adjustments which are, in the opinion of management,
necessary to a fair statement of the results for the interim period
presented.
M & A WEST, INC.
FINANCIAL STATEMENTS
Quarter Ended August 31, 1999
M & A West, Inc.
<TABLE>
<CAPTION>
Index to Financial Statements
<S> <C>
Balance Sheet 5
Statement of Operations 7
Consolidated Statements of Cash Flows 9
Notes to Financial Statements 10
</TABLE>
M & A West, Inc.
BALANCE SHEET
August 31, 1999
(unaudited)
<TABLE>
<CAPTION>
<S> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents 181,425
Accounts receivable-clients -
Marketable securities
held for trading 4,690,225
Investments - at equity 1,097,088
Investments - at cost 610,890
Employee advances 8,732
Prepaid taxes 126,000
Total current assets 6,714,360
OTHER ASSETS:
Deferred income tax asset 12,110
Property and equipment,
net of depreciation 23,999
Homestart, restricted securities 87,825
Total Assets 6,838,294
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable 23,727
Income taxes payable 1,709,000
Payroll taxes
accrued and payable 32,464
Deferred revenue 1,078,844
TOTAL CURRENT LIABILITIES 2,844,035
STOCKHOLDERS' EQUITY
Common stock, no par value;
100,000,000 shares authorized;
11,000,000 shares issued and
outstanding 2,020,538
Retained earnings 1,973,721
Total stockholders' equity 3,994,259
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY 6,838,294
</TABLE>
The accompanying notes are an integral part of these financial statements.
M & A West, Inc.
STATEMENT OF OPERATIONS
For the period June 1, 1999 through August 31, 1999
(unaudited)
<TABLE>
<CAPTION>
August 31, 1999 August 31, 1998
<S> <C> <C>
REVENUE
Commission Revenue 3,458,202 2,500
Refunds 409 -
Trading gains (losses) (106,638) -
Total revenue 3,351,973 -
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Advertising 107,417 17,070
Employee Business Expenses 77,437 1,271
Consultants 76,111 27,391
Payroll 109,782 4,974
Other selling, general and
administrative expenses 147,433 56,277
Total selling, general
and administrative
expenses 518,180 106,983
Income from operations 2,833,793 (104,483)
OTHER INCOME (EXPENSE)
Interest income 542 -
Realized gains and losses on
sale of securities, net 173,292 (12,179)
Equity in loss of unconsolidated
subsidiary (37,370) -
Total other income (expense) 136,464 (12,179)
Net income before taxes 2,970,257 (116,662)
Income tax expense (1,188,000) -
Net income 1,782,257 (116,662)
RETAINED EARNINGS
Balance, beginning
of year 191,464 -
Balance, end of
year 1,973,721 -
Net income per share .162 -
NUMBER OF SHARES
OUTSTANDING 11,000,000 -
</TABLE>
The accompanying notes are an integral part of these financial statements.
M & A West, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
for the three months ended August 31, 1999
(unaudited)
<TABLE>
<CAPTION>
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
122,642
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equipment (3,415)
Purchase of investments (1,079,615)
Net cash used by investing
activities (1,083,030)
CASH FLOWS FROM FINANCING ACTIVITIES:
-
Net increase in cash
and equivalents (960,388)
CASH AND CASH EQUIVALENTS
Beginning of year 1,141,813
CASH AND CASH EQUIVALENTS
End of year 181,425
</TABLE>
The accompanying notes are an integral part of these financial statements.
M & A West, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
August 31, 1999
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
Description of Business
M & A West, Inc., is engaged in providing management
consulting services to public companies. On May 12, 1999, M & A
West, Inc., a Nevada corporation, underwent a stock transfer and
exchange with Buffalo Capital IV, Ltd., a publicly traded shell
company, in a transaction more fully described in Note 3, whereby M
& A West became a wholly-owned subsidiary of Buffalo Capital IV,
Ltd. Immediately after the transaction, Buffalo Capital IV, Ltd.
changed its name to M & A West, Inc. All references to "the
Company" in these financial statements refer to M & A West, Inc., the
Nevada corporation, prior to May 12, 1999, and to the consolidated
entity from May 12 forward.
Basis of accounting
The accompanying financial statements of the Company are
prepared using the accrual basis of accounting in which revenues are
recognized when earned, and expenses are recognized when incurred.
Marketable Securities and Investments
The Company holds investments in marketable equity
securities. Investments held for trading purposes are presented at
market value, with realized and unrealized gains and losses on the
investments recognized in earnings during the period incurred.
Investments in which the Company has significant influence, but not
voting control, are accounted for at original cost, as adjusted for the
Company's share of the investee's gains and losses. Investments in
non-trading equity securities are considered available for sale, and are
accounted for at cost, which approximates market.
Use of Estimates
The preparation of the Company's financial statements in
conformity with generally accepted accounting principals requires the
Company's management to make estimates and assumptions that effect
the amounts reported in these financial statements and accompanying
notes. Actual results could differ from those estimates.
Property and Equipment
The Company's property and equipment, consisting of
computers and equipment supporting the administrative function, are
stated at cost. Depreciation is provided using the straight line method
over estimated useful lives of 5 to 7 years.
Advertising
Advertising costs are expensed as incurred.
Cash Equivalents
For purposes of the Statement of Cash Flows, the Company
considers all highly liquid debt instruments purchased with an original
maturity of three months or less to be cash equivalents.
Loss per share
Loss per share has been calculated using the average number of
shares outstanding.
NOTE 2. RELATED PARTY TRANSACTIONS
For the period ended August 31, 1999, the Company's offices
were leased from the Company's Chief Executive Officer on a month-
to-month basis for monthly payments of $1,811. The Company also
leased space from its Chief Financial Officer on a month-to-month
basis for $692 per month.
NOTE 3. STOCKHOLDERS EQUITY
Authorized capital
The Company's capital consists of 100,000,000 authorized
common shares, no par value, of which 11,000,000 shares were issued
and outstanding at August 31, 1999.
Preferred Stock
The Company is authorized to issue up to 10,000,000 shares of
Preferred Stock, with rights and privileges to be determined by the
Board of directors. No preferred shares were issued and outstanding at
August 31, 1999.
NOTE 4. INCOME TAXES
The Company has recorded a deferred tax asset for the effects
of unrealized losses on marketable equity securities which are
deductible for tax purposes only to the extent of realized gains. the
Company's provision for income tax is calculated using a flat rate of
40%.
NOTE 5. INVESTMENTS
Investments at equity
The Company has an approximate 21% investment in
Virtuallender.com at May 31, 1999, which is accounted for using the
equity method, whereby the Company's investment is increased by
gains and additional investments, and decreased by losses and
distributions. The following is a summary of the financial position
and operating results of Virtuallender.com as of May 31, 1999 (current
information is not available).
<TABLE>
<CAPTION>
<S> <C>
Current Assets 180,913
Property and equipment 260,266
Other assets 65,570
506,749
Total liabilities 3,748
Total stockholders' equity 503,001
Total revenue 11,135
Net loss 178,819
</TABLE>
The Company's total investment in Virtuallender.com at August
31, 1999, consists of 5,869,300 shares of Virtuallender.com common
stock. Of this amount, approximately 5,000 shares are included in
trading securities at August 31, 1999, at a market value of $178,000.
Market value for the remaining shares which constitute the Company's
investment at equity, based upon the closing bid for Virtuallender.com
at August 31, 1999, totaled $22,743,500, before application of
discounts for liquidity or current trading transactions.
Investments in Other Equity Securities
The Company has invested in equity securities of companies
for which no established trading market exists at August 31, 1999.
These securities are stated at cost that does not exceed the estimated
net realizable value.
NOTE 6. FIXED ASSETS.
The Company's property and equipment consists of the
following at August 31, 1999:
<TABLE>
<CAPTION>
<S> <C>
Computers 20,028
Office furniture 8,042
28,070
less accumulated depreciation 4,071
23,999
</TABLE>
NOTE 7. DEFERRED REVENUE
The Company entitled into a consulting agreement with
Workfire technologies for a one year period. Payment for services
rendered was in the form of stock which has been booked as revenue
over a twelve month period.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION
Net revenues for the Company increased $3,349,473 or
1,339.78%, to $3,351,973 in the quarter ending August 31, 1999, from
$2,500 in the same period for 1998. The net increase reflects an
increase of $3,455,702 in the Company's commission income and a
decrease of $106,229 in the Company's trading gains. The Company
believes that its portfolio of companies will continue to develop and
introduce their products commercially, actively pursue increased
revenues from new and existing customers, and look to expand into
new market opportunities. Therefore, the Company expects to report
further revenue growth.
Cost of revenue comparison is not applicable.
Selling, general and administrative expenses increased
$411,197, or 384% to $518,180. The net increase reflects increases of
$90,347 in advertising and $48,720 in consultant fees. Employment
business expenses and payroll increased $180,974 or 2,897%,
reflecting the Company's continued growth. As the Company's
subsidiaries continue to introduce new products and expand sales, the
Company expects to incur significant promotional expenses, as well as
expenses related to the hiring of additional sales and marketing
personnel, increased advertising expenses, and anticipates that these
costs will substantially increase in future periods.
Interest income increased $542 or 100%, resulting from
increased activity in the Company's brokerage accounts.
Equity in losses of affiliates resulted from the Company's
ownership in certain investments that are accounted for under the
equity method. Under the equity method of accounting, the
Company's proportionate share of each affiliate's operating losses and
amortization of the Company's net excess investment over its equity in
each affiliate's net assets is included in equity in losses of affiliates.
Equity in losses of affiliates for the quarter ended August 31, 1999,
include the results from the Company's minority ownership of
Virtuallender.com. Equity in losses of affiliates for the period ended
August 31, 1998, is not applicable. The Company expects its portfolio
companies to continue to invest in development of their products and
services, and to recognize operating losses, which will result in future
charges.
The effective tax rates are 40% and zero. The Company's
effective tax rate differs materially from the federal statutory rate
primarily due to valuation allowances provided on certain deferred tax
assets, the provision for state income taxes, non-deductible goodwill
amortization and in-process research and development charges.
Working capital increased $3,870,325, compared to ($60,000)
predominantly as a result of the Company's increased securities held
for sale. The Company's principal uses of capital during the quarter
ending August 31, 1999, were $518,180 for funding operations,
$1,334,613 for the investment and development segment, and $2,838
for purchases of property and equipment. The Company's principal
sources of capital during the quarter ending August 31, 1999, were
$3,458,202, received in the form of commission revenues. The
Company intends to continue to fund existing and future Internet and
interactive media investment and development efforts.
During the quarter ending August 31, 1999, the Company
completed the acquisition of 4 companies for purchase prices valued at
a combined total of $568,000. No common stock of the Company has
been transferred.
On June 25, 1999, the Company acquired, from Joanne Soto,
the Internet address known as VirtualGroceries.com and its attendant
goodwill, in exchange for $25,000 cash, $75,000 worth of common
stock of the Company, a 2% commission on the net profits generated
from the sale of any merchandise through the virtual grocer's .com
website, and 20% of the net proceeds received by the Company in any
subsequent resale of such assets.
On June 8, 1999, the Company acquired a 5% interest in
Workfire Technologies, Inc. for cash in the amount of $360,250.
On July 7, 1999, the Company acquired a 5% interest in
Ronlan Entertainment Company for cash in the amount of $100,000.
On August 8, 1999, the Company acquired a 100% interest in
Winbigbucks.com for cash in the amount of $7,900.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
INFORMATION
This report contains various forward-looking statements that are
based on the Company's beliefs as well as assumptions made by and
information currently available to the Company. When used in this
report, the words "believe," "expect," "anticipate," "estimate" and
similar expressions are intended to identify forward-looking statements.
Such statements may include statements regarding seeking business
opportunities, payment of operating expenses, and the like, and are
subject to certain risks, uncertainties and assumptions which could
cause actual results to differ materially from projections or estimates
contained herein. Factors which could cause actual results to differ
materially include, among others, unanticipated delays or difficulties in
location of a suitable business acquisition candidate, unanticipated or
unexpected costs and expenses, competition and changes in market
conditions, lack of adequate management personnel and the like.
Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary
materially form those anticipated, estimated or projected. The
Company cautions again placing undue reliance on forward-looking
statements all of which speak only as of the date made.
PART II
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBIT 27 - FINANCIAL DATA SCHEDULE
(b) There were no reports on Form 8-K filed during the
quarter ended August 31, 1999.
Signatures
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
M & A WEST, INC.
(Registrant)
Date: October 13, 1999
By: /s/___________________________
Scott Kelly, CEO
