The following discussion should be read in conjunction with the financial
statements and the notes to those statements included elsewhere in this
Quarterly Report on Form 10-Q. This Quarterly Report on Form 10-Q contains
certain statements that are forward-looking within the meaning of the Private
Securities Litigation Reform Act of 1995. Certain statements contained in the
MD&A are forward-looking statements that involve risks and uncertainties. The
forward-looking statements are not historical facts, but rather are based on
current expectations, estimates, assumptions and projections about our industry,
business and future financial results. Our actual results could differ
materially from the results contemplated by these forward-looking statements due
to a number of factors, including those discussed in other sections of this
Quarterly Report on Form 10-Q.
Our Business
Jubilant Flame International, Ltd., (the "Company", "the "Registrant", "we",
"us" or "our") was formed on September 29, 2009 under the name Liberty Vision,
Inc. The Company provided web development and marketing services for clients. On
December 5, 2012, the Company disposed of its subsidiary corporation to a
shareholder for a nominal sum, as well as other management operations. On
December 16, 2012, the Company changed its name to Jiu Feng Investment Hong
Kong, Inc. On January 27, 2013, the Company announced the change of its ticker
symbol from "LBYV" to "JFIL." On July 24, 2013, the Company changed its business
sector to the medical sector. On August 18, 2015 the Company changed its name to
Jubilant Flame International, Ltd.
From the fourth quarter of the fiscal year ended February 28, 2018, the Company
started to market and sell cosmetics products imported from Asia -Acropass
Series products - in the United States market. In the beginning of 2020, the
Company ceased the marketing and selling of cosmetic products in the United
States.
From the third quarter of the year ended February 29, 2020, the company began
providing technical support services for development of new nutrition food
products to sell to customers in USA.
Results of Operations
Revenue
We recognized no sales revenue in the three months ended May 31, 2021 compared
to zero sales revenue in the three months ended May 31, 2020.
Operating Expenses
For the three months ended May 31, 2021 compared to the three months ended May
31, 2020
The major components of our operating expenses for the three months ended May
31, 2021 and 2020 are outlined in the table below:
Three Months Ended Three Months Ended
May 31, May 31,
2021 2020
Officer compensation $ 4,500 $ 4,500
Professional fee $ 14,272 $ 15,540
OTC service expense and others $ 2,756 $ 3,060
Total operating expenses $ 21,528 $ 23,100
The $1,572 decrease in our operating costs for the three months ended May 31,
2021 compared to three months ended May 31, 2020, was mainly due to a decrease
of $1,268 decrease in professional fee.
Other Expenses
No other expenses incurred during the three-month periods ended May 31, 2021 and
2020.
Net Loss
For the three months ended May 31, 2021, we recognized a net loss of $21,528
compared to the net loss of $23,100 for the corresponding period in 2020.
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Liquidity and Capital Resources
Working Capital
May 31, February 28,
2021 2021
Current Assets $ 18,068 $ 20,825
Current Liabilities $ 1,154,038 $ 1,139,767
Working Capital Deficit $ (1,135,970 ) $ (1,118,942 )
As of May 31, 2021, the Company had current assets of $18,068, primarily
comprising of cash of $2,684, prepaid expenses of $6,000 and accounts receivable
of $9,384, and current liabilities of $1,154,038, resulting in a working capital
deficit of $1,135,970. The Company had limited profitable operation activities
and has an accumulated deficit of $3,613,751 as of May 31, 2021. This raises
substantial doubt about the Company's ability to continue as a going concern.
The financial statements have been prepared on a going concern basis which
assumes the Company will be able to realize its assets and discharge its
liabilities in the normal course of business for the foreseeable future.
Based on the Company's current operating plan and global coronavirus pandemic
impact , the Company does not have sufficient cash and cash equivalents to fund
its operations for at least the next twelve months. The Company will need to
obtain additional financing to operate our business. The Company may raise
additional capital through the sale of its equity securities, through an
offering of debt securities, or through borrowings from financial institutions
or related parties. By doing so, the Company hopes to generate sufficient
capital to execute its business plan in the nutrition product technology support
sector on an ongoing basis. Management believes that actions presently being
taken to obtain additional funding provide the opportunity for the Company to
continue as a going concern. There is no guarantee the Company will be
successful in achieving these objectives.
Cash Flows from Operating Activities
Our net cash used in operating activities decreased by $3,138 in the three
months ended May 31, 2021of $12,528 compared to the net cash used in operating
activities in the three months ended May 31, 2020 of $15,666. The decrease in
net cash used in operating activities was primarily the result of a $3,000
decrease in professional fee payment.
Cash Flows from Investing Activities
We did not generate or use any cash from investing activities during the three
months ended May 31, 2021 or 2020.
Cash Flows from Financing Activities
Our cash provided by financing activities increased from $10,624 for the three
months ended May 31, 2020 to $12,771 for the three months ended May 31, 2021. In
both periods, cash was provided by the way of loans from related parties.
Future Financing
We anticipate that additional funding will be required in the form of equity
financing from the sale of our common stock, through an offering of debt
securities, or through borrowings from financial institutions or related
parties. However, we cannot provide investors with any assurance that we will be
able to raise sufficient funding from the sale of our common stock or through a
loan from our directors to meet our obligations over the next twelve months.
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Recent Accounting Pronouncements
In December 2019, the Financial Accounting Standards Board (FASB) issued
Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying
the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting
for income taxes. This guidance will be effective for entities for the fiscal
years, and interim periods within those fiscal years, beginning after December
15, 2020 on a prospective basis, with early adoption permitted. The company
adopted the new standard effective March 1, 2021 and do not expect the adoption
of this guidance to have a material impact on our consolidated financial
statements.
In January 2020, the FASB issued Accounting Standards Update No. 2020-01,
Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint
Ventures (Topic 323), and Derivatives and Hedging (Topic 815) (ASU 2020-01),
which clarifies the interaction of the accounting for equity securities under
Topic 321, the accounting for equity method investments in Topic 323, and the
accounting for certain forward contracts and purchased options in Topic 815.
This guidance will be effective for entities for the fiscal years, and interim
periods within those fiscal years, beginning after December 15, 2020 on a
prospective basis, with early adoption permitted. The company adopted the new
standard effective March 1, 2021 and doesn't have any equity security investment
now.
Off Balance Sheet Arrangements
As of May 31, 2021, we did not have any off-balance-sheet arrangements, as
defined in Item 303(a)(4)(ii) of Regulation S-K.
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