10QSB 1 form10_qsb.txt FORM 10-QSB Form 10-QSB -------------------------------------------------------------------------------- SEC POTENTIAL PERSONS WHO ARE TO RESPOND TO THE COLLECTION OF INFORMATION 2334(6- CONTAINED IN THIS FORM ARE NOT REQUIRED TO RESPOND UNLESS THE FORM 00) DISPLAYS A CURRENTLY VALID OMB CONTROL NUMBER. -------------------------------------------------------------------------------- ------------------------- UNITED STATES OMB SECURITIES AND EXCHANGE COMMISSION APPROVAL WASHINGTON, D.C. 20549 ------------------------- OMB NUMBER: 3235-0416 FORM 10-QSB ------------------------- EXPIRES APRIL 30, 2003 ------------------------- ESTIMATED AVERAGE BURDEN HOURS PER RESPONSE: 32.00 ------------------------- (Mark One) [ ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 31, 2001 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from ___________ to __________ Commission file number ______________________________ PREVENTION INSURANCE.COM -------------------------------------------------------------------------------- (Exact name of small business issuer as specified in its charter) NEVADA ---------------------------------------- ----------------------------------- (State of other jurisdiction of (IRS Employer Identification No.) incorporation or organization) 2770 So. Maryland PKWY. #403A, Las Vegas, NV 89109 -------------------------------------------------------------------------------- (Address of principal executive offices) (702) 732 - -------------------------------------------------------------------------------- (Issuer's telephone number) -------------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Check whether the registrant 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 [ ] PART 1 - FINANCIAL STATEMENT AND MANAGEMENT DISCUSSION OF OPERATIONS MANAGEMENT DISCUSSION OF OPERATIONS A. PLAN OF OPERATION FOR COMING YEARS: Prevention Insurance's primary focus in the coming year will be to enroll as many member insurance agencies as possible. Our goal is minimum 192 agencies enrolled by the end of our fiscal year which is April 30, 2002. We project this by projecting three salesmen adding on two agencies per week each. Each member will contribute an average of $375.00 per month in membership dues. If we succeed in enrolling 192 agencies, we will realize $72,000 per month, or $864,000 in annual membership fees. Estimated Cash Requirements Per Month Are As Follows: Sales Cost $172,800 - Advertising: $48,000 - Administration: $101,400 Prevention Insurance's cash needs will be covered by membership dues, however we still intend to raise working capital of $500,000 to $2.5 million for purposes of having sufficient working capital on hand to cover any expansion plans, to have 1 year's total operating expenses on hand and for any acquisitions that may require cash as well as stock. Research and Development cost for new products should be under $10,000 as we primarily will be searching for new products from among the over 3,100 registered underwriters in the U.S., basically keeping in touch with the major underwriters as to what they may be introducing, going to National Association of Underwriters convention and utilizing the internet will be our primary R & D efforts. The cost in this category should remain modest unless we start developing products from scratch ourselves which is not in our plan for the next 12 months. We spend only 33% out of every dollar of revenue for sales cost and administrative expenses. We feel our sales projections are conservative, utilizing only three sales representatives, and making modest sales of only 2 agencies signed per week. We feel we offer a significant value to the independent agent in the services we provide and we make available to them the opportunity to participate in growth and equity of the company, depending on their size and contribution to the company. B. DISCUSSION OF FINANCIAL CONDITION & RESULTS OF OPERATIONS: Our condition is at present under-capitalized as we have elected not to accept additional new contracts or revenue from member agencies until we are certain we would be able to list the company and stock will be publicly traded. We have a current backlog of membership contracts and have basically been able to pay off all of our payables as agreed with only $4,961 in current accounts payable. Revenue to date has been provided by our equipment sales division, Quick Pay Co., that is selling ATM machines to retail outlets around the U.S. We have also received a small amount of seed capital from existing shareholders. We intend to raise a mezzanine round of capital to fund the company of between $500,000 to $5 million through an offering under Reg. D after we've brought on board 100 or so insurance agencies. We will also be seeking our venture capital and strategic partners as possible sources of financing. (cont'd Discussion of Financial Condition & Results of Operations) b-1 Financial conditions have remained essentially the same as last quarter except for a small capital infusion of $5,000. Overhead has primarily been paid for by our Quick Pay Division that sells ATM machines. We don't anticipate any known trends to have an adverse affect on us. We are, however, waiting to see the impact of September 11th has on the economy, stock market and willingness of business in general to continue purchasing items such as ATM machines and making the additional financial commitments necessary to join our Prevention membership. b-2 There is not any known internal or external changes foreseen in sources of liquidity b-3 There are no anticipated changes for capital expenditures. There are no significant elements of income or loss that we see from ongoing operations. There are no material changes from period to period in the financial statement. There are no seasonal impacts on our business plans or operations. There are essentially no material financial changes from the end of last year until the end of the first quarter. TAX ACCOUNT PROS A TAX AND BOOKKEEPING COMPANY In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Prevention Insurance.Com as of July 31, 2001. The comparable statements is as of October 31, 2000 due to the early stages of start up. /s/ Russ Kam Russ Kam Independent Bookeeper 14-Sep-01 2650 S. Maryland Pkwy., Suite A-3B Las Vegas, NV 89709 o (702) 731-FAST (3278) 4001 S. Decatur, Suite 28, Las Vegas, NV 89103 o (702) 366-OTAX (0829) PREVENTION INSURANCE.COM BALANCE SHEET AS OF JULY 31, 2001 JULY 31 '01 ----------- ASSETS Current Assets Checking/Savings Business Bank 1,874.16 ----------- Total Checking/Savings 1,874.16 Accounts Receivable ACCOUNTS RECEIVABLE 5,427.46 ----------- Total Accounts Receivable 5,427.46 Total Current Assets 7,301.62 Other Assets Due from Quick Pay 1,750.00 1900 Due from Officer 2,363.17 ----------- Total Other Assets 4,118.17 ----------- TOTAL ASSETS 11,419.79 =========== LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable ACCOUNTS PAYABLE 10,458.00 ----------- Total Accounts Payable 10,458.00 ----------- Total Current Liabilities 10,458.00 ----------- Total Liabilities 10,458.00 Equity ADDITIONAL PAID IN CAPITAL 3,350,015.78 COMMON STOCK 64,611.46 Retained Earnings -3,359,656.46 TREASURY STOCK -52,954.10 Net Income -854.90 ----------- Total Equity 961.79 ----------- TOTAL LIABILITIES & EQUITY 11,419.79 =========== PREVENTION INSURANCE.COM PROFIT & LOSS MAY THROUGH JULY 2001 MAY - JUL '01 ------------- Ordinary Income/Expense Expense LEGAL FEES 375.00 PROFESSIONAL SERVICE 279.00 BANK CHARGES 26.82 COMMISSIONS-SALES 274.08 ------------- Total Expense 954.90 ------------- Net Ordinary Income -954.90 ------------- Net Income -954.90 ============= PREVENTION INSURANCE.COM STATEMENT OF CASH FLOWS QUARTER ENDING JULY 31, 2001 Cash Flow from Operating Activity Net Loss -955 Adjustments to Reconcile Net Loss to Cash Increase in Other Assets -4,077 Increase in Other liabilities 0 Increase in Common Stock 5,000 Net Change in Cash -32 Cash Beginning of Year @ May 1, 2001 1,907 Cash End of Year @ July 31, 2001 1,874 PREVENTION INSURANCE.COM BALANCE SHEET AS OF OCTOBER 31, 2000 OCT 31, '00 ------------ ASSETS Current Assets Checking/Savings 1010 COMMUNITY BANK-47E 101.94 ------------ Total Checking/Savings 101.94 ------------ Total Current Assets 101.94 Other Assets 1900 Due from Officer 7,356.34 ------------ Total Other Assets 7,356.34 ------------ TOTAL ASSETS 7,458.28 ============ LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable ACCOUNTS PAYABLE 10,458.00 ------------ Total Accounts Payable 10,458.00 ------------ Total Current Liabilities 10,458.00 ------------ Total Liabilities 10,458.00 Equity ADDITIONAL PAID IN CAPITAL 3,350,015.78 COMMON STOCK 56,411.46 Retained Earnings -3,347,164.65 Net Income -9,308.21 TREASURY STOCK -52,954.10 ------------ Total Equity -2,999.72 ------------ TOTAL LIABILITIES & EQUITY 7,468.28 ============ PREVENTION INSURANCE.COM PROFIT AND LOSS MAY THROUGH OCTOBER 2000 May - Oct '00 ------------- Ordinary Income/Expense Expense Licensing and Taxes 1,693.58 LEGAL FEES 541.75 Accounting and Bkpng Svcs 1,448.00 ADVERTISING-CO-OP 2,500.00 MISC EXPENSE 455.00 RENT 36.00 PRINTING & COPYING 695.50 PROFESSIONAL SERVICES 1,908.38 BANK CHARGES 30.00 Uncategorized Expenses 0.00 ------------ Total Expense 9,308.21 ------------ Net Ordinary Income -9,308.21 ------------ Net Income -9,308.21 ============ PREVETION INSURANCE.COM STATEMENT OF CASH FLOWS 6 MONTH STATEMENT MAY 2000 THRU OCT 2000 ------------- CASH FLOWS FROM OPERATING ACTIVITIES NET LOSS -9,308.21 Adjustment to reconcile net loss to cash Cash used by operating activities -9,308.21 Increase in Other Assets -7,356.34 Net change in Cash -16,664.55 Cash Beginning of Year @ 05/01/00 16,766.49 Cash end of Period @ 10/31/00 101.94 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Furnish the exhibits required by Item 601 of Regulation S-B (b) Reports on Form 8-K. State whether any reports on Form 8-K were filed during the quarter for which this report is filed, listing the terms reported, any financial statements filed and the dates of such reports. SIGNATURES In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on his behalf by the undersigned, thereunto duly authorized. PREVENTION INSURANCE.COM ------------------------- (Registrant) /s/ Scott Goldsmith ----------------------------------------------------------- Date 9/14/01 Scott Goldsmith (Signature) President Date ______________________________________________________________________ (Signature) * Print the name and title of each signing officer under his signature.