NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Development Stage Company
The Company is considered to be in the development stage as defined in the Accounting Standards Codification ASC 915-10-05, Development Stage Entity. The Company is devoting substantially all of its efforts to the execution of its business plan.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America may require management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could then differ from those estimates. There are no such estimates or assumptions incorporated in the attached financial statements.
Cash consists of currency on hand, demand deposits at commercial banks, or funds held in trust and available upon demand
In accordance with ASC 720-15-20, Start-up Activities, the Company expenses all costs incurred in connection with the start-up and organization of the Company.
Domain Name Transfer
In accordance with ASC 845-30-10 a nonmonetary asset received in a nonreciprocal transfer shall be recorded at the fair value of the asset received. A transfer of a nonmonetary asset to a stockholder or to another entity in a nonreciprocal transfer shall be recorded at the fair value of the asset transferred.
Furthermore, in accordance with ASC 845-10-50-1 an entity that engages in one
or more nonmonetary transactions during a period shall disclose in financial statements for the period all of the following:
a. The nature of the transactions;
b. The basis of accounting for the asset(s) transferred; and
c. Gains or losses recognized on transfers.
The domain name, lightcollar.com, was transferred to us from our sole Officer and Director on July 6, 2011 and had only a nominal fair value. The transfer was accounted for as a nonreciprocal transfer under ASC 845-10-30-1. The transfer of $45 and a renewal on January 5, 2012, in the amount of $38, were recorded as internet expense of $83 as of March 31, 2012.
Office Space and Labor
The Companys sole Officer and Director will provide the labor required to execute the business plan and supply the necessary office space and facilities for the initial period of operations. The Company will recognize the fair value of services and office space provided by our sole Officer and Director as contributed capital in accordance with ASC 225-10-S99-4. From inception (March 22, 2011) through March 31, 2012, the fair value of services and office space provided was estimated to be nil.
Net Income or (Loss) Per Share of Common Stock
Basic earnings per share is computed by dividing income or loss available to common shareholders by the weighted average shares outstanding for the period. Diluted earnings per share reflects the potential dilution due to other securities outstanding which could affect the number of common shares upon exercise. The Company has no potentially dilutive securities, such as options, warrants or convertible bonds, currently issued and outstanding. Consequently, basic and diluted shares are the same, as presented in the Statements of Operations and Comprehensive Loss.
Fair Value Measures
Accounting principles require an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instruments categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:
Level 1: applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
Level 2: applies to assets or liabilities for which there are other than quoted prices that are observable such as quoted prices for similar assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 3: applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.
Our financial instruments consist principally of cash and a loan from our sole officer and director (for which fair value is considered to approximate face value). The table below sets forth our assets and liabilities measured at fair value, on a recurring basis, and the fair value calculation input hierarchy level that we have determined applies to each category.
March 31, 2012 March 31, 2011
Cash (Input Hierarchy Level 1) $25 $17,988