TURNKEY CAPITAL, INC. The following Management's Discussion and Analysis ("MD&A") is intended to help
the reader understand the results of operations and financial condition of
Our discussion and analysis of our financial condition and results of operations
is based on our consolidated financial statements, which have been prepared in
accordance with accounting principles generally accepted in
We cannot accurately predict the amount of funding or the time required to successfully implement our business plan. The actual cost and time required to achieve profitability may vary significantly depending on, among other things, the availability of qualified personnel and marketing and other costs associated with the planned operations. Because of this uncertainty, even if financing is available to us, we may secure insufficient funding to effectuate our business plan.
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As of
Recent DevelopmentsEgg Health Hub, Inc.
On
Egg is a brand new model for healthcare and wellness that brings together top physicians and wellness professionals into co-practicing communities with shared access to a full-stack technology platform - scheduling, billing, client acquisition, and telemedicine - and flexible access to beautiful office space designed to optimize both the physician and client experience. This model creates a compelling new option for re-tenanting traditional shopping centers and mixed-use space that landlords see as a true traffic generator.
Reverse Stock Split
The Company effected a 1-for-100 reverse stock split (the "Reverse Split") of
the Company's issued and outstanding shares of common stock. On
Results of Operations
Year Ended
Revenue
We did not generate any revenue during the year ended
Operating Expenses A summary of our operating expense for the years endedDecember 31, 2019 and 2018 follows: Years Ended December 31, (Decrease) / 2019 2018 Increase Operating expense General and administrative$ 11,903 $ 20,163 $ (8,260 ) Other operations expense - 21,598 (21,598 ) Professional fees - related party 270,000 210,850 59,150 Legal and professional 42,917 29,076 13,841 Total operating expense$ 324,820 $ 281,687 $ 43,133 8
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General and administrative costs include costs related to public company costs and other office related costs.
Other operating expense during the year ended
Professional fees - related party costs primarily include costs for management
services provided by TBG and costs related to R3 Accounting for accounting
related services. The increase in costs is attributable to an increase in the
monthly management fee due to TBG from
Legal and professional expenses relate to amounts incurred by the outside
accounting firm and lawyers. The primary reason for the increase from the year
ended
Other Expenses
In
Liquidity and Capital Resources
Our available working capital and capital requirements will depend upon numerous factors, including our ability to make accretive acquisitions, and our ability to attract and retain key employees.
During the year ended
Cash used in operating activities was
Cash used in investing activities was
Cash provided by financing activities was
We expect TBG to continue to provide support services until sufficient capital is raised.
Plan of Operations and Funding
On
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Egg is a brand new model for healthcare and wellness that brings together top physicians and wellness professionals into co-practicing communities with shared access to a full-stack technology platform - scheduling, billing, client acquisition, and telemedicine - and flexible access to beautiful office space designed to optimize both the physician and client experience. This model creates a compelling new option for re-tenanting traditional shopping centers and mixed-use space that landlords see as a true traffic generator.
We expect that working capital requirements will continue to be funded through further related party advances and further issuances of securities until our business activities can generate positive cash flow. Our working capital requirements are expected to increase in line with the growth of our business.
We have minimal working capital, and we do not have any lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments and related party advances. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet short-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.
Going Concern
The accompanying consolidated 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. As of
Contractual Obligations None.
Critical Accounting Policies and Estimates
The preparation of consolidated financial statements and related disclosures in
conformity with accounting principles generally accepted in
A critical accounting estimate is defined as one that is both material to the presentation of our consolidated financial statements and requires management to make difficult, subjective or complex judgments that could have a material effect on our financial condition and results of operations. Specifically, critical accounting estimates have the following attributes:
· we are required to make assumptions about matters that are highly
uncertain at the time of the estimate; and
· different estimates we could reasonably have used, or changes in the
estimate that are reasonably likely to occur, would have a material effect
on our financial condition or results of operations.
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Estimates and assumptions about future events and their effects cannot be determined with certainty. We base our estimates on historical experience and on various other assumptions believed to be applicable and reasonable under the circumstances. These estimates may change as new events occur, as additional information is obtained and as our operating environment changes. These changes have historically been minor and have been included in the consolidated financial statements as soon as they became known. Based on a critical assessment of our accounting policies and the underlying judgments and uncertainties affecting the application of those policies, management believes that our consolidated financial statements are fairly stated in accordance with GAAP and present a meaningful presentation of our financial condition and results of operations.
Our most critical accounting estimates include:
· the recognition and measurement of current and deferred income taxes,
which impact our provision for taxes.
Below, we discuss these policies further, as well as the estimates and judgments involved.
Income Taxes
The Company accounts for income taxes using the liability method prescribed by Accounting Standards Codification 740 "Income Taxes". Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset the deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.
Pursuant to accounting standards related to the accounting for uncertainty in income taxes, the evaluation of a tax position is a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50% likelihood of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. The accounting standard also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition.
The Company assessed its earning history, trends and estimates of future
earnings and determined that the deferred tax asset could not be realized as of
Off-Balance Sheet Arrangements
As of
Recently Issued Accounting Pronouncements
See "NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES" to our Consolidated Financial Statements.
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