Item 1. Business
Overview of Our Business
Strong Solutions Inc. (referred to in this Report as “Strong Solutions,” the “Company,” “we”, “our”, or “us”) is a real estate property management company, also make construction equipment rental business in Eastern Europe, and specifically in Ukraine.
At the date of this report, we have one client (Protel Management) for whom we provide property management service for real estate located in Ukraine and we have one client (firm Marcus) for whom we provide construction equipment rental service. From both clients, we received income of the past three years. It has been the source of all the revenue we have received since inception.
For Protel Management, we provide real estate management in Ukraine. The services we provide include identifying suitable opportunities for future real estate development and construction, oversight of development and construction of real estate managed by Protel Management, and the management of residential and commercial real estate, represented by Protel Management to consumers residing in and outside of Ukraine.
For firm Marcus we agreed to provide the construction equipment for rent. This equipment includes: Scaffoldings and Rafters for outside and inside work.
When the height of rooms or buildings does not allow to use of stairs or ladders and the use of a crane is not cost-effective in this case our equipment is in demand. When building not high walls the scaffoldings also demand.
Also, we will offer rehabilitation of properties with equipment rental services useful in appropriate maintenance and repair. We consider perspective business development direction in rehabilitation property services because the infrastructure across Ukraine is being adversely impacted by the conflict with neighboring Russia, thus requiring high quality, cost efficient solutions to make such properties usable again. Our potential customers can be the owners of such real estate objects.
Revenues
We bill our services per contract on an individual-property basis.
Marketing Program
The primary objective of our marketing program is providing property management and maintenance, rehabilitation as well as construction equipment rental. We plan to accomplish our business objectives through a multi-faceted marketing program consisting of the following elements:
• Face to face meetings and calls;
• Advertising;
• Links to web source: http://arendasklad.biz
We have designed our public relations program to gain more customers, increase visibility, and heighten awareness of us and our services and capabilities. We will use regional business press to carry out our public relations program. The goals of our public relations program are:
• Clearly establish us as a provider of property management and rental equipment services;
• Differentiate us and our services from competitors;
• Create a greater awareness with potential clients and partners;
• Identify us as strong, trusted, and progressive through our partnerships and services.
Industry Background
The property management service in Ukraine develops and grows. We believe the market for our property management and, as well as our construction equipment rental initially consists of small individual building owners who lack the time or proficiency to manage their own properties in a profitable manner or adequately repair damaged properties. Kharkov, along with Kiev, Dnepropetrovsk, Odessa and multiple other cities offer pockets of dense population and areas where we believe building owners will benefit from our services.
Advertising
Our advertising campaigns will generally focus on web, presentations, meetings, calls and leads. We have identified these forms of advertising as being the most effective means for reaching potential clients in our target markets. We also use the website www.arendasklad.biz as a means of advertising and as an electronic brochure for generating sales leads and increasing market awareness. We do not manage the properties pictured on our web site, which are examples of the types of properties we expect to manage in the future and are provided for marketing purposes. We will also consider other means of advertising.
We are implementing procedures to control advertising and promotions. These procedures are necessary to assure our proper representation and include review of all advertising material and restrictions on how our clients and others can advertise using our brand.
Business Strategy
We intend to provide property management, maintenance, rehabilitation to meet our clients’ needs. Our strategy is to leverage broad geographic reach, long-term client relationships, and full-range and service offerings to become a large, robust property management firm. We have adopted a multi-step growth plan:
• Offering property management services for both commercial and residential spaces. The infrastructure across Ukraine is being adversely impacted by the conflict with neighboring Russia, thus requiring high quality, cost efficient solutions to make such properties usable again.
• Offering construction equipment rental for those properties that already have their own maintenance teams but don’t own their own equipment outright. The inventory of equipment that we will hold for rental will also be available for use with our property rehabilitation and property management services.
• We are first offering our services in Kharkov, and plan to expand our reach on a city-by-city basis, expanding geographically to meet the demand for property management and as well as property rehabilitation and construction equipment rental.
• We seek to be a ‘one-stop shop’ for the building owners. Additionally, for those building owners who either cannot afford a full-time property manager, or have so few properties that they prefer to manage themselves, we offer property management and rehabilitation services to help those building owners make the most of their time and extract the most value from their property.
Pricing
Costs associated with the customer acquisition, retention, overhead and management and continued servicing are budgeted individually for each project. Contingencies are allowed for as deemed necessary. Then our pricing will be reviewed based on competitors’ prices, along with a market survey of the satisfaction with these prices and the associated services. We are of the opinion that the pricing of our services will represent a savings to the customer and yet provide us a better-than-market sales price.
Sales Objectives
We are introducing our services to the marketplace, which we believe will benefit us because of the opportunities that are presented due to the current political and military situation in Ukraine. Our sales strategy looks to convert sales in the following ways, depending on the perceived needs of individual building owners:
Sales Process 1: Construction equipment rental
Sales Process 2: Upsell to property rehabilitation
Sales Process 3: Property rehabilitation
Sales Process 4: Post rehabilitation property management
Sales Process 5: Post rehabilitation property management consulting
Sales Process 6: Property management
Sales Process 7: Property management consulting
Sales Process 8: Upsell to property rehabilitation or construction equipment rental.
Also, we intend to introduce our products and services for existing and new clients to capture revenue streams from new clients as well as utilizing existing relationships, and obtain new revenues as the market matures. We believe our path to revenue and growth will be through acquiring clients:
• from organizations with which our management has existing relationships;
• from competitors by demonstrating superior, quality, and reliability at a lower cost;
• by implementation of our marketing plan.
The foregoing does not include all of the ways we expect to convert leads to sales.
Strategic Partners and Alliances
We expect to leverage sales and delivery alliances with companies whose capabilities complement our own, either by enhancing our services, or by helping extend offerings to new geographies. By combining alliance partners’ products and services with our capabilities and expertise, we intend to create innovative, high-value business solutions for our clients. Some alliances will be specifically aligned with our offerings, thereby adding skills, technology and insights that are applicable across the real estate and construction industries. Currently, we do not have any strategic partners or alliances.
Governmental Regulation
Laws and regulations impose environmental zoning restrictions, use controls, disclosure obligations, and other restrictions that affect the management, development, use, and/or sale of real estate. Such laws and regulations tend to discourage sales and leasing activities. Transactions in which we are involved may be delayed or abandoned as a result of these restrictions.
In Ukraine, legislation is not good developed that governs a foreign entity conducting business within the country. Even though we are headquartered and operate in Ukraine, the laws applicable to us as a Nevada USA corporation include requirements that (a) we take out liability insurance on behalf of any full-time employees and (b) we maintain adequate books and records and periodic financial statements. We are also subject to various consumer protection laws that prohibit the use of fraudulent or deceptive practices.
Competition
The property management, property rehabilitation and construction equipment rental businesses are competitive and have relatively low barriers to entry. We compete locally, and expect to eventually compete on a countrywide basis, with a variety of primarily local companies that offer similar services. Based on our review of advertisements, we believe the majority of these companies engage in real estate sales and offer property management services, but not property rehabilitation construction equipment rental and some are affiliated with the owners or operators of properties where they provide their services. Many of our competitors have had many more years of business experience, may have proprietary processes and have greater financial and personnel resources including marketing and sales organizations, and may provide their services at lower rates. We do not believe any one company holds a dominant share of the local or countrywide market on which we are focused.
Employees
Mr. Guzii is our only employee at the date of this registration statement. We do not have an employment agreement with Mr. Guzii. He devoted his time and efforts as needed when operations and funding are available. We anticipate hiring additional employees in a future on a commission basis only. We will hire necessary personnel based as needed only on a per contract basis to be compensated directly from revenues. Mr. Guzii will work on a fulltime basis once we have enough revenue to sustain his full-time employment. At the present time, he is spending whatever time is necessary, to further develop our business.
Item 1A.
Item 1A. Risk Factors
In addition to the other information provided in this annual report, you should carefully consider the following risk factors in evaluating our business before investing in any of our common stock.
Dependence Upon Current Clients
We have only two current clients from which we generate income and in case one of them leaves we are at risk of declining incomes. If both leave and we do not find new clients our business will stop.
Small revenue
We have not yet generated significant revenues. The revenues we have generated from operations makes it difficult for you to evaluate our future business and make decisions based on those estimates of our future performance. In 2018, we have generated revenues of $11,576. For now, it is difficult to forecast our future results based upon our historical data. Because of the related uncertainties, we may be hindered in our ability to anticipate and timely adapt to increases or decreases revenues or expenses. If we make poor budgetary decisions as a result of unreliable data, we may never become profitable and incur losses, which may result in a decline in our stock price.
Substantial doubt about our ability to continue as a going concern
Our auditor has indicated in our report that our lack of revenues raises substantial doubt about our ability to continue as a going concern. If we are unable to generate significant revenue or secure financing - we may be required to cease or curtail our operations.
The competition
We face intense competition in our industry, and as we attempt to increase operations, we will face increasing competition from domestic companies. The property management and maintenance market are highly competitive, with participants ranging from national and multi-regional equipment rental companies to small, independent businesses with a limited number of locations. As such, our services will face strong competition. We will compete primarily on the basis of service offering availability, customer service and price. In addition, the current political landscape and military activity in Ukraine present a situation in which the infrastructure across a large part of the country will face the threat of partial damage or total destruction. While Strong Solutions is headquartered in Ukraine, companies from neighboring countries operating in the same industry as ours may try to expand their businesses to include Ukraine, further increasing competition. Moreover, other companies with similar business models may be started in Ukraine with the aim to offer their services to building owners who have been affected by the current situation in the country. Our competitors may provide services comparable or superior to those we provide or adapt more quickly than we do to evolving industry trends or changing market requirements. Increased competition could result in lower profit margins, substantial pricing pressure, reduced market share and lower operating cash flows. Price competition, together with other forms of competition, could have a material adverse effect on our business, financial position, results of operations and operating cash flows.
Loss of litigation
Our future sales and reputation may be affected by litigation or other liability claims.
We have not procured a general liability insurance policy for our business. To the extent that we suffer a loss of a type which would normally be covered by general liability, we would incur significant expenses in defending any action against us and in paying any claims that result from a settlement or judgment against us.
The fluctuations in market prices and demand for our services
As we increase operations, our earnings may be sensitive to fluctuations in market prices and demand for our services. In addition, the demand for property management services, construction equipment rental, and property rehabilitation services could decline, whether because of supply or for any other reason, including other similar services considered to be superior by end users. A decrease in the selling price received for real estate, or a decline in demand for real estate after we commence operations could have a material adverse effect on our business, results of operations and financial condition.
Seasonality
Our revenues from rental construction equipment is subject to seasonality. We expect our revenues and operating income in the second and third calendar quarters to be generally higher than in the first and fourth calendar quarters due to seasonal fluctuations, which are generally consistent with the industry.
Potential Lack of Space to Lease
A significant portion of our property management business may involve facilitating the lease of commercial property including retail, industrial, and office space. The development of new retail, industrial, and office space in Ukraine has been limited. As a consequence, in certain areas of the country, there is beginning to be inadequate office, industrial and retail space to meet demand which may have an adverse impact on our operating results.
Dependence from our founder
Our founder and Chief Executive Officer Mr. Guzii is responsible for our operations and reporting.
The requirements of operating as a small public company are new to our management. This may require us to obtain outside assistance from legal, accounting, investor relations, or other professionals that could be costlier than planned. We may also be required to hire additional staff to comply with additional SEC reporting requirements.
Our business and results of operations depend from Mr.Guzii. If we lose his services or if he fails to perform in his current position, or if we are not able to attract and retain skilled employees as needed, our business could suffer.
Dependence from company who use our construction equipment
If company who use our construction equipment do not renew the services agreements, our business would be adversely affected.
Risks Related to our Potential Future Operations in Ukraine
We could be adversely affected by the current political landscape in Ukraine. Due to the ongoing inside conflict with some other Ukraine regions which supports by Russia, and the sanctions imposed on them, some resources may not be available in Ukraine for extend periods of time. Russia supplies natural gas and petrol for Ukraine, and without access to these resources for extended periods of time, our ability to operate may be severely hindered.
We expect that a significant amount of our business for the foreseeable future will focus on properties located in Ukraine. The following risks could affect our business after we commence planned harmed and thus harm potential future revenues.
• Level of government involvement in the economy;
• Control of foreign exchange rate;
• Balance of payments position;
• International trade restrictions; and
• International conflict.
We do not yet have substantial assets or revenues
We may not be able to attain profitability without additional funding, which may be unavailable.
We have limited capital resources. To date, we have funded our operations from revenue received from our two clients, but it’s not enough to be profitable. Unless we begin to generate sufficient revenues to finance operations as a going concern, we may experience liquidity and solvency problems. Such liquidity and solvency problems may for us to cease operations if additional financing is not available. No known alternative sources of funds are available to us.
Risk to serve process and enforce judgments against our director and executive officer in Ukraine
Our Chief Executive Officer, Andrii Guzii is not a resident of the United States, and substantially all of our assets and the assets of these persons may be located outside the United States. Therefore, it may be difficult to effect service of process within the United States on us or any of our executive officers or directors who are non-residents of the United States and/or bring an original action in an Ukrainian court against us or against any of our executive officers or directors to enforce liabilities based upon the United States federal securities laws. It may further be difficult to enforce court judgments obtained in the United States, including those predicated upon the civil liability provisions of the United States federal securities laws, against us or against any of our executive officers or directors that are non-residents of the United States. Ukrainian courts may refuse to hear a claim based on a violation of U.S. securities laws because Ukraine is not the most appropriate country in which to bring such a claim.
Item 1B.
Item 1B. Unresolved Staff Comments
None.
We have effective our Registration Statement Form 10-12G on September 30, 2017. (Registration No. 000-55819) Also, October 27, 2017 we received letter from SEC about completed review of our Registration Statement.
Item 2.
Item 2. Properties
Our 400-square foot corporate office is located at 2/13 Korolenko Str. Kharkov, Ukraine. These offices are provided by Mr. Guzii, our sole director and chief executive officer. We pay Mr. Guzii rent at $450 per quarter for this office.
Item 3.
Item 3. Legal Proceedings
We are not currently a party to any legal proceedings, and to our knowledge none is threatened.
Item 4.
Item 4. Mine Safety Disclosures
Not applicable.
PART II
Item 5.
Item 5. Markets for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Market Information
As of December 31,2018, we had 31 non-affiliated shareholders in our record held 1,293,000 common shares. Action Stock Transfer Corporation is our transfer agent.
Located at: 2469 Fort Union Blvd #214, Cottonwood Heights, UT 84121. Phone # (801) 274-1088
Holders
As of December 31, 2018, there were 36,293,000 shares of the Company’s common stock.
35,000,000 were held by our founder Mr.Guzii and 1,293,000 were held by 31 non-affiliated shareholders.
Dividends
We have never paid or declared any cash dividends on our common stock, and we do not anticipate paying any cash dividends on our common stock in the foreseeable future. We intend to retain all available funds and any future earnings to fund the development and expansion of our business. Any future determination to pay dividends will be at the discretion of our board of directors and will depend upon a number of factors, including our results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors our board of directors deems relevant.
Equity Compensation Plans
We do not have any equity compensation plans.
Recent Sales of Unregistered Securities
None
Item 6.
Item 6. Selected Financial Data
"Emerging growth company” is not required to provide the information required by this Item 6.
Item 7.
Item 7. Management's discussion and analysis of financial condition and results of operations
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) section of this Annual Report discusses our results of operations, liquidity and financial condition, and certain factors that may affect our future results. You should read this MD&A in conjunction with our financial statements and accompanying notes included in this Report. This MD&A contains forward-looking statements that involve risks, uncertainties, and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of a variety of uncertainties and risk factors.
Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking. Forward-looking statements are, by their very nature, uncertain and risky.
Overview:
Since our inception we have engaged in the following significant operating activities:
Company set up:
a. Incorporate company in state of Nevada
b. Set up main executive office in Ukraine
c. Open up bank account for the company
Secured initial capital by a contribution from our founder, Chief Executive Officer and Director Commenced significant other operational activities, such as:
a. Have researched and identified potential new clients
b. Have arranged for and met with various potential clients
c. Have drafted and began production of various marketing materials
As of the date of this form, we have obtained a written agreement for our services with:
Protel Management, LLC and Firm Markus.
The services what we contribute to Protel Management include: Manage the property, find the tenants for lease, assist work directly with tenants about make the payments in time, handling maintenance, watch that all equipment’s as: elevators, fire and gas alarms, sewerage, phone lines, refrigerators, etc., work properly. If repair is required, then contact with services to fix it. Below we provide comparisons for 2017 and 2018.
We provide long term rental of construction equipment to firm Marcus. This equipment includes:
Scaffoldings and Rafters for outside and inside work. Technically this equipment uses all year around, but more in demand in warm weather. We received $500 a month form firm Marcus as a payment for this construction equipment. We don’t have insurance to cover accidental damage but our agreement with firm Marcus obligate their pay the collateral value $25,000 in case of total loss. Below we provide comparisons for 2017 and 2018.
In December 2018 we putted on our balance construction equipment what we received from our director Mr.Guzii.
Liquidity
We don’t know about trends or any demands, commitments, events or uncertainties that will result to our liquidity increasing or decreasing in any material way.
Capital resources
We have fixed assets on our balance total 25,000. Scaffolding cost $20,000 and Rafters $5,000.
Results of Operations for the Year ended December 31, 2018 and December 31, 2017
As indicated in the Financial Statements included in this Report as of December 31, 2018 we generated $11,576 in revenues and $11,415 during the year ended December 31, 2017. In 2018, we generated $6,576 from Protel management and $5,000 from firm Marcus. In 2017, we generated $6,415 from Protel management and $5,000 from firm Marcus.
Operating expenses during the year ended December 31, 2018, were $42,047 which were general and administrative expense and equipment rental, office rent and salary expense.
Operating expenses during the year ended December 31, 2017 were $326,348 consisting of general and administration expenses, equipment rental, office rent, salary expense and stock compensation expense.
Our revenue in 2018 from Protel management was increased on $161 in compare with 2017 and we had same revenue from firm Marcus in 2018 as in 2017.
We didn’t have stock compensation expense in 2018. Stock Compensation Expense in 2017 was $270,000. Our general and administration expenses in 2018 were higher than in 2017 on $3,649. We had our expenses $26,250 equipment rental, office rent and salary in 2018 and $44,200 in 2017.
Our cash balances were not sufficient to fund our limited levels of operations for any period of time without further revenue or proceeds. We may have utilize funds from Andrii Guzii our Chief Executive Officer, who has informally agreed to advance funds to allow us to pay for offering costs, filing fees, and professional fees. Mr. Guzii however, has no binding contractual arrangement or legal obligation to advance or loan funds to the company on the basis of this verbal agreement. Being a emerging growth company we have a limited operating history but have meaningfully commenced business operations based upon the amount of revenue we have been able to generate.
At the present time, we have not made any arrangements to raise additional cash. If we unable to raise additional cash, we will either have to suspend operations until we do raise the cash, or cease operations entirely.
During start up period, our operations will be limited due to the limited amount of funds on hand. Our specific goal for profitably rent the construction equipment and sell related property management and property rehabilitation services.
The following table presents and compares our results of our operations for the 12 months 2017 and 12 months 2018.
Assuming we obtain sufficient funding to complete our management programs. We intend to employ and train our staff with the latest available real estate management/operations criteria in order to provide an integrated streamlined service to our clients.
If we are unable to raise sufficient equity funds or obtain alternate financing, we may never complete development and become profitable. In order to become profitable, we may still need to secure additional debt or equity funding. We hope to be able to raise additional funds from an offering of our stock in the future. We do not have any plans or specific agreements for new sources of funding or any planned material acquisitions.
Going Concern Consideration
While management of the Company believes that the Company will be successful in its planned operating activities, there can be no assurance that the Company will be successful in the development this business or services that will generate sufficient revenues to earn a profit and sustain the operations of the Company. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has incurred an operating expense since inception, had small working capital as of December 31, 2018 and the cash resources of the Company were insufficient to meet its planned business objectives. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying 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.
Off-Balance Sheet Arrangements; Commitments and Contractual Obligations
During 2018, we used our director’s Mr.Guzii construction equipment with $50 fee monthly obligations to make our business with firm Marcus. Also end of the year we putted this equipment on the balance sheet. We paid Mr. Guzii $600 as compensation for it use. The amounts of revenues, expenses and cash flows arising from use this construction equipment were properly placed on the balance sheet. Mr. Guzii decided give away his construction equipment and now it classifies as Fixed Assets / Equates and appeared on our balance.
Item 7A.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk.
An "emerging growth company “is not required to provide the information required by this item.
Item 8.
Item 8. Financial Statements
Report of Independent Registered Public Accounting Firm
To the shareholders and the board of directors of Strong Solutions, Inc.
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Strong Solutions, Inc. (the "Company") as of December 31, 2018 and 2017, the related statements of operations, stockholders' equity (deficit), and cash flows for the years then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2018 and 2017, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company’s minimal activities raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ BF Borgers CPA PC
BF Borgers CPA PC
We have served as the Company's auditor since 2017
Lakewood, CO
February 19, 2019
STRONG SOLUTIONS, INC.
BALANCE SHEETS (AUDITED)
DECEMBER 31, 2018, DECEMBER 31, 2017
See notes to financial statements
STRONG SOLUTIONS, INC.
STATEMENTS OF OPERATIONS (AUDITED)
YEAR ENDED DECEMBER 31, 2018
YEAR ENDED DECEMBER 31, 2017
See notes to financial statements
STRONG SOLUTIONS, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY (AUDITED)
ON DECEMBER 31, 2018 AND DECEMBER 31, 2017
See notes to financial statements.
STRONG SOLUTIONS, INC.
STATEMENTS OF CASH FLOWS (AUDITED)
YEAR ENDED DECEMBER 31, 2018
YEAR ENDED DECEMBER 31, 2017
See notes to financial statements.
STRONG SOLUTIONS INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - DESCRIPTION OF BUSINESS
Strong Solutions, Inc. (the “Company”) was incorporated under the laws of the State of Nevada on June 18, 2014 for engagement in business of real estate management, maintenance and rehabilitation and construction equipment rental in Eastern Europe, and specifically in Ukraine. The Company provides this service for companies and for individuals outside of the United States of America.
As a development-stage enterprise, the Company had limited operating revenues through December 31,2018. Recorded Commission Revenue was generated from Ukrainian clients. The Company is currently devoting substantially all of its present efforts to securing and establishing a new business.
NOTE 2 - GOING CONCERN
The financial statements have been prepared assuming that the Company will continue as a going concern. Currently, the Company has a cash balance of $13,705 as of December 31, 2018 and net loss from operation of $30,471. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management believes that the Company’s capital requirements will depend on many factors including the success of our development efforts and our efforts to raise capital. Management also believes the Company needs to raise additional capital for working purposes. There is no assurance that such financing will be available in the future. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of estimates
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from these estimates.
Revenue recognition
We base our judgment on guidance ASC 606. Accounting Standards Update 2016-08.
All revenues appear in current periods to be recognized as gross, so there is no net revenue recognized in current periods.
FASB’s new single, principle-based approach to accounting for revenue from contracts with customers. As the entity, we involved in providing a good and provide service to the customers. In those circumstances, Topic 606 requires us to determine whether the nature of our promise is to provide that good or service to the customers (that is, the entity is a principal) or to arrange for the good or service to be provided to the customers by the other party (that is, the entity is an agent). This determination is based upon whether we control the good or the service before it is transferred to the customer. Some indicators help in this evaluation.
1.We identify obligations in the contract with firm Markus. A contract includes promises to transfer temporary right to use construction equipment in their business for profit.
2.We determine the transaction price $500 in a month. The transaction price is the reasonable amount of which we and firm Markus were agree. The transaction price in 2018 was a fixed amount.
3.We recognize revenue when the firm Markus obtains control of that equipment and we received the payment.
4.The incremental costs of obtaining a contract are those costs that we incur to obtain a contract with a customer that we would not have incurred if the contract had not been obtained. In our business we paid Mr. Guzii $50 monthly for rent construction equipment and to have a possibility work with firm Markus.
5.The transaction price also can include variable consideration or consideration in a form other than cash. In our property management service with Protel Management we received changeable revenue. If the consideration is variable, we estimate the amount of consideration to which we will be entitled in exchange for the services. The estimated amount of variable consideration will be included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
The Company considered recognizes the revenue on the accrual basis, revenue is recognized when earned and services have been performed. We are principal, and recognize the gross amount received from the customer as revenue. Revenues are reported on the income statement when the services have been performed. Our revenue includes the gross amounts that come from Client for the Property Management and Rent Service.
Cash equivalents
The Company considers all highly liquid instruments and tries to work in cash equivalent segment. The Company’s funds are deposited in insured institutions.
Income Taxes
We are subject to income taxes in the U.S. February 8, 2017 USA and Ukraine signed an Intergovernmental Agreement (IGA) to implement provisions of the Foreign Account Tax Compliance Act (FATCA) and to promote transparency between the two nations on tax matters.
For present time we don’t have any current income tax obligations.
The Company accounts for income taxes under the provisions of ASC Topic 740, “Income Taxes.” The method of accounting for income taxes under ASC 740 is an asset and liability method.
The asset and liability method require the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between tax bases and financial reporting bases of other assets and liabilities. Deferred tax asset would be the net operating loss carryforward value at tax rates. Our Net Operating Loss for 2018 ($30,471) and Net Operating Loss for 2017 ($314,933).
Income tax assets and liabilities are computed annually for differences between financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities.
NOTE 4 - COMMON STOCK ISSUED AND OUTSTANDING
The company authorized 75,000,000 Common shares $0.0001 par value.
End of December 2018 the Company had issued and outstanding 36,293,000 common stocks.
We issued 1,293,000 common shares for cash at a purchase price of $0.01 per share to 31 nonaffiliated shareholders.
30,000,000 shares were issued to our founder Mr.Guzii of repayment of accrued salary on $30,000 and $270,000 of stock compensation value at $0,01 per share. This value was determined based on the previous sale of stock to unrelated parties at 0.01 per share.
NOTE 5 - FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amounts of cash and cash equivalents approximate their fair values due to their short-term nature.
NOTE 6 - CONCENTRATION OF CREDIT RISK
The Company maintains cash balances at a Wells Fargo financial institution. The balance, at any given time, may exceed Federal Deposit Insurance Corporation (“FDIC”) insurance limits of $250,000 per institution. Our cash balances at December 31, 2018 were within FDIC insured limits.
Concentration of revenues.
Since the Company has only two clients from which we receive the income our revenues concentrate from particular clients. It shows our vulnerability from them and in present time we can't diversify in order to mitigate the risks. We can have the potential for serious impact that can result from a complete or partial loss of business from our clients and as a consequence of the change in income.
NOTE 7 - COMMITMENTS AND CONTINGENCIES
The Company is not currently a party to any material legal proceedings, nor is we aware of any other pending or threatened litigation that would have a material adverse effect on our business, operating results, cash flows or financial condition should such litigation be resolved unfavorable.
NOTE 8 - RELATED PARTY TRANSACTIONS
Mr. Guzii is our controlling shareholder. He represents the company and provides the services on our behalf to our clients firm Marcus and Protel Management. We use his construction equipment to make our business with firm Marcus. We booked expense for equipment rental from this related party of $600 and $600 respectively in fiscal year 2018 and 2017.
Also, he devotes significant time servicing to Protel Management. We do not have an employment agreement with Mr. Guzii. From inception by now he did receive accrued salary. In 2017 he received 30,000,000 Stock for repayment to $30,000 accrued salary and stock compensation, valued as $270,000 based on 0.01 per share valuation which was derived from the last sale of stock to non-related parties.
We used our director Mr. Guzii construction equipment to make our business with firm Marcus. We paid him a rent fee $50 a month. End of the 2018 we putted this equipment on the balance sheet since it is already our property. Also, we rent office from Mr. Guzii. Our annual rental payment for 2017 was $3,600 and for 2018 was $2,250 respectively.
NOTE 9 - STOCKHOLDERS’ EQUITY
From our inception on June 18, 2014 through December 31, 2018, the Company issued 36,293,000 shares of common stock. 35,000,000 for our founder and 1,293,000 for non-affiliated investors for cash, received of $12,930 sold at 0.01 per share.
NOTE 10 - SUBSEQUENT EVENTS
In accordance with ASC 855 the Company’s management reviewed all material events through the date these financial statements were available to be issued, and there are no material subsequent events.
Item 9
Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A
Item 9A Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time period specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is accumulated and communicated to management including our principal executive officer as appropriate, to allow timely decisions regarding required disclosure.
Our CEO Andrii Guzii is responsible for managing us, including compliance with SEC reporting obligations, and maintaining disclosure controls and procedures and internal control over financial reporting. He following to these public reporting requirements and controls from 2014 and have enough experience to manage the company. Also, he received 5-year knowledge, experience and training in the application of U.S. GAAP commensurate with financial reporting requirement. If necessary Mr. Guzii obtain outside assistance from legal, transfer agent or other professionals.
Changes in Internal Control Over Financial Reporting
There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation that occurred during the Company’s last fiscal quarter that has materially affected, or is reasonable likely to materially affect, the Company internal control over financial reporting.
Item 9B
Item 9B Other Information
There are no further disclosures.
PART III
Item 10.
Item 10. Directors, Executive Officers and Corporate Governance
Our stockholders elect our board of directors annually. A majority vote of the directors who are in office is required to fill vacancies. Each director shall be elected for the term of one year, and until his successor is elected and qualified, or until his earlier resignation or removal. Our board of directors elect our executive officers annually. Our directors and executive officers are as follows:
Mr. Guzii served as Director of Contact Center, a call center started by Mr. Guzii, in Ukraine from January 2014 to April 2014. Mr. Guzii started the company, developed a business plan, and optimized operations. From June 2008 to January 2011, he was a branch manager of Ukrgastech LLC, where he oversaw management of twelve employees and communicated with government authorities regarding approval of construction contracts. Prior to becoming branch manager, Mr. Guzii was head of the production department at Ukrgastech, working in contract procurement and preparation of financial plans. We believe his experience in establishing and guiding development stage companies, along with his experience in the construction make Mr. Guzii a suitable director and executive officer. In 2003, Mr. Guzii received his Master of Law degree from Kharkov Law National University.
Conflicts of Interest
The Company does not currently foresee any conflict of interest.
Involvement in Certain Legal Proceedings
There are no legal proceedings that have occurred in 2018 concerning the company, our director, or control persons which involved a criminal conviction, a criminal proceeding, an administrative or civil proceeding limiting one's participation in the securities or banking industries, or a finding of securities or commodities law violations.
Item 11.
Item 11. Executive Compensation
Since inception, we have not paid salary to Mr. Guzii in his capacity of sole director and our only executive officer. We expect to pay him an annual salary of $40,000 when we have funding or revenues available for that purpose. We do not have an employment agreement with Mr. Guzii. In 2017 we issued 30,000,000 shares to Mr.Guzii as for repayment to accrued salary and stock compensation .
Accrued annual salary for 2018 $23,500
Accrued annual salary for 2017 $40,000. We added $10,000 to our balance sheet as accrued shareholder salary and $30,000 we consider as a partial payment for his 30,000,000 stock and rest $270,000 of stock compensation value at $0.01 per share. This value was determined based on the previous sale of stock to unrelated parties at 0.01 per share.
Summary Compensation
As of December 31, 2018, we had no health, hospitalization, or medical reimbursement or relocation plans in effect. Further, we had no pension plans or plans or agreements which provide compensation on the event of termination of employment or corporate change in control. We have no long-term equity incentive plans.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following tables set forth, as of the date of this annual report, the ownership of our common stock by each person known by us to be the beneficial owner of more than 5% of our outstanding common stock, our directors, and our executive officers and directors and executive officers as a group. To the best of our knowledge, the persons named have sole voting and investment power with respect to such shares, except as otherwise noted. There are not any pending or anticipated arrangements that may cause a change in control.
Item 13.
Item 13. Certain Relationships and Related Transactions, and Director Independence.
Mr. Guzii is our controlling shareholder. He represents the company and provides services on our behalf to our clients firm Marcus and Protel Management. We do not have an employment agreement with Mr. Guzii. From inception by now he didn’t receive accrued salary that indicated in our books.
We rent office from Mr. Guzii and pay for this $2,250 in 2018. In 2017, we paid him $10,800 to cover our obligation.
Also, we used our director Mr. Guzii construction equipment to make our business with firm Marcus. We paid him a rent fee $50 a month.
We do not believe that our directors currently meet the definition of “independent” as promulgated by the rules and regulations of the American Stock Exchange.
Item 14.
Item 14. Principal Accounting Fees and Services.
We paid to our auditor BF Borgers CPA PC, for professional services rendered for the audit of our financial statements in 2018 $8,400. No other fees were billed or incurred for services by our auditor other than the fees noted above.
PART IV
Item 15.
Item 15. Exhibits
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Strong Solutions Inc.
February 19, 2019 By: /s/ Andrii Guzii
Andrii Guzii
Director, CEO
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Strong Soltuions Inc.
February 19, 2019 By: /s/ Andrii Guzii
Andrii Guzii
Director, CEO