10-Q/A: Wally World Media Files Amended Quarterly Report After Accounting Firm Change

Wally World Media has filed an amended quarterly report to include a review of its financials by a new accounting firm, following the dismissal of its previous auditor.

Summary

• Wally World Media, Inc. filed an amendment to its quarterly report on Form 10-Q for the period ended March 31, 2024.
• The amendment was necessary due to the dismissal of BF Borgers CPA PC as the company's independent auditor.
• Astra Audit & Advisory, LLC was engaged as the new independent auditor and completed a SAS 100 review of the unaudited interim financial information.
• The company updated several items in the original filing, including financial information, management's discussion and analysis, and exhibits.
• As of August 19, 2024, there were 330,483,033 shares of the company's common stock outstanding.
• The company reported no revenue for the three and six months ended March 31, 2024 and 2023.
• The net loss for the three months ended March 31, 2024 was $21,331, and for the six months ended March 31, 2024, it was $21,835.
• The company's accumulated deficit was $15,852,002 as of March 31, 2024.
• The company has no cash on hand and is dependent on related party loans to fund operations.
• Management has identified material weaknesses in internal controls over financial reporting.

Sentiment

Score: 2

Explanation: The document reveals significant financial challenges, including no revenue, substantial losses, an accumulated deficit, and material weaknesses in internal controls. The company's dependence on related party loans and its status as a blank check company further contribute to a negative outlook.

Positives

• The company has engaged a new independent auditor, Astra Audit & Advisory, LLC, to review its financials.
• The company is working towards full rehabilitation after a period of dormancy.
• Management is actively exploring business opportunities, including potential acquisitions.

Negatives

• The company has reported no revenue for the periods presented.
• The company has incurred net losses of $21,331 and $21,835 for the three and six months ended March 31, 2024, respectively.
• The company has an accumulated deficit of $15,852,002.
• The company has no cash on hand and is dependent on related party loans.
• The company has identified material weaknesses in its internal controls over financial reporting.
• The company is a blank check and shell company with no specific business plan.

Risks

• The company has limited operating history and has not demonstrated an ability to expand its business.
• The company is dependent on debt and equity financing to fund its operations.
• The company may not be able to raise additional capital on acceptable terms, or at all.
• The company faces risks associated with identifying and implementing a viable business strategy.
• The company's lack of diversification poses a substantial risk.
• The company's internal controls over financial reporting are not effective.
• The company is subject to the risks of a blank check company, including potential difficulties in finding a suitable merger partner.

Future Outlook

The company intends to explore and identify business opportunities within the U.S., including a potential acquisition of an operating entity through a reverse merger, asset purchase or similar transaction. The company anticipates incurring operating losses in the next 12 months.

Management Comments

• Management of the Company continues to work towards full rehabilitation.
• Management intends to explore and identify business opportunities within the U.S., including a potential acquisition of an operating entity through a reverse merger, asset purchase or similar transaction.
• Our management intends to develop procedures to address the current deficiencies to the extent possible given limitations in financial and manpower resources.
• Management of the Company is making efforts to raise additional funding until a registration statement relating to an equity funding facility is in effect.

Industry Context

The company operates as a blank check and shell company, which is a common structure for companies seeking to acquire or merge with an existing business. The company's lack of revenue and dependence on related party loans is not uncommon for companies in this stage of development.

Comparison to Industry Standards

• Wally World Media's financial situation is not unusual for a blank check company in its early stages, as many such entities have no revenue and rely on external funding.
• Compared to other shell companies, Wally World Media's lack of operational activity and reliance on related party loans is typical.
• The company's material weaknesses in internal controls are a concern, as most public companies are expected to have robust internal control systems.
• The company's need for additional capital is consistent with other blank check companies that are seeking to complete a merger or acquisition.

Related Party Transactions

• During the six months ended March 31, 2024, the company's Chief Executive Officer advanced $2,174 to fund the company's expenses.
• As of March 31, 2024, the company was indebted to its Chief Executive Officer in the amount of $92,984.

Stakeholder Impact

• Shareholders face significant risks due to the company's financial condition and lack of a clear business plan.
• Employees, if any, are likely to be impacted by the company's financial instability.
• Creditors face risks due to the company's lack of cash and dependence on related party loans.

Next Steps

• The company intends to explore and identify business opportunities within the U.S.
• The company plans to investigate, evaluate, and negotiate potential business combinations.
• The company will continue to file SEC reports.
• The company intends to implement an independent board of directors.
• The company plans to establish written policies and procedures for internal control of financial reporting.
• The company intends to hire additional accounting personnel at such time as it completes a reverse merger or similar business acquisition.

Key Dates

Keywords

amended quarterly report, financial statements, auditor change, internal controls, going concern, blank check company, shell company, related party transactions, reverse merger, Wally World Media