E-Smart Corp: A Comprehensive Review of the 2024 10-K Filing

Introduction

E-Smart Corp, a Nevada-based company, is an innovative digital platform aiming to revolutionize the tattoo industry by connecting tattoo artists and clients efficiently. The company was incorporated on June 6, 2023, and is still in its development stage. This review will delve into the company's 10-K filing for the fiscal year ending August 31, 2024, to assess its investment potential.

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Business Description

E-Smart Corp operates a digital platform designed to enhance the interaction between tattoo artists and clients. The platform provides a comprehensive database of skilled tattoo artists, allowing them to showcase their work and expand their client base. The company also offers an API - AI textual tattoo idea generator, which businesses and developers can integrate into their products on a subscription basis. The company is exploring additional revenue streams, including premium features and strategic partnerships with tattoo-related businesses.

Financial Performance

Income Statement

For the fiscal year ending August 31, 2024, E-Smart Corp reported a net loss of $41,236, a significant increase from the net loss of $979 in the previous year. The company generated $0 in revenue for 2024, compared to $11,562 in 2023. Operating expenses increased substantially to $45,925 from $990, primarily due to accumulated depreciation and professional fees.

Balance Sheet

As of August 31, 2024, E-Smart Corp's total assets were $149,489, up from $16,725 in 2023. This increase is mainly due to intangible assets, which rose from $16,500 to $148,942. The company's liabilities also increased, with a director loan accounting for $180,297 of the total liabilities of $180,297.

Cash Flow

The company used $10,973 in net cash for operating activities in 2024, compared to $521 in 2023. Investing activities used $157,300 in cash, primarily for intangible assets, while financing activities provided $168,594, mainly from a director loan.

Risk Factors

E-Smart Corp is not currently involved in any legal proceedings, and there are no known pending or potential legal actions. However, the company operates in a highly competitive industry, and its auditors have issued a going concern opinion, indicating substantial doubt about its ability to continue as a going concern.

Internal Controls

The company identified several material weaknesses in its internal controls over financial reporting, including the absence of an audit committee and inadequate segregation of duties. These weaknesses could lead to a material misstatement of the financial statements.

Conclusion

E-Smart Corp is in its early stages of development and faces significant challenges, including a lack of revenue, substantial losses, and material weaknesses in internal controls. While the company's innovative platform has potential, its current financial position and operational risks make it a speculative investment. Investors should carefully consider these factors before investing.

Investment Score

Based on the analysis of E-Smart Corp's 10-K filing, the company receives an investment score of 3.5 out of 10. This score reflects the company's potential for growth in a competitive industry but also highlights the significant risks and challenges it faces.