CitroTech Inc. 10-K

ITEM 8. Financial Statements Report of Independent Registered Public Accounting Firm F-1 Consolidated Balance Sheets as of December 31, 2018 and 2017 F-2 Consolidated Statements of Operations for the Years Ended December 31, 2018 and 2017 F-3 Consolidated Statements of Changes in Stockholders’ Deficiency for the Years Ended December 31, 2018 and 2017 F-4 Consolidated Statements of Cash Flows for the Years Ended December 31, 2018 and 2017 F-5 Notes to the Consolidated Financial Statements F-6 4 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of General Enterprise Ventures, Inc.: We were engaged to audit the accompanying balance sheets of General Enterprise Ventures, Inc. (“the Company”) as of December 31, 2018 and 2017 and the related statement of operations, stockholders’ equity (deficit) and cash flows for the years then ended. As described in the following paragraph, because the Company’s records were not sufficient, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on the financial statements, and we do not express, an opinion on these financial statements. Substantial Doubt about the Company’s Ability to Continue as a Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company’s significant operating losses raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Disclaimer Opinion: We were not engaged as auditors of the Company until February of 2023 at which time much of the audit evidence necessary to provide a basis for an audit opinion had been destroyed or lost. We were unable to satisfy ourselves by other audit procedures concerning the assets and liabilities held at December 31, 2010 and 2009, as well as the revenues and expenses recognized for the year then ended. As a result of these matters, we were unable to determine whether any adjustments might have been found necessary in respect of recorded or unrecorded assets, liabilities, revenue and expenses. We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Because of the matters described in the Basis for Disclaimer Opinion paragraph above, however, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the Company's internal control over financial reporting. Accordingly, we express no such opinion. Because of the significance of the matters described in the Basis for Disclaimer Opinion paragraph, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. Accordingly, we do not express an opinion on these financial statements. /s/ BF Borgers CPA PC B F Borgers CPA PC (PCAOB ID 5041) We have served as the Company's auditor since 2022 Lakewood, CO April 10, 2023 F- 1 GENERAL ENTERPRISE VENTURES, INC. CONSOLIDATED BALANCE SHEETS December 31, December 31, 2018 2017 Assets Cash and cash equivalents $ – $ – Total assets $ – $ – Liabilities and Stockholders' Deficit Current Liabilities Accounts payable – – Total liabilities – – Stockholders' Deficit Common stock, par value $0.001, 1,000,000,000 shares authorized, 22,945,388 and 22,945,388 shares issued and outstanding of shares as of December 31, 2018 and December 31, 2017, respectively 22,958 22,958 Additional paid in capital 57,358,557 57,358,557 Accumulated deficit (57,381,515 ) (57,381,515 ) Total stockholders’ deficit – – Total liabilities and stockholders' deficit $ – $ – The accompanying notes are an integral part of these financial statements F- 2 GENERAL ENTERPRISE VENTURES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS Year Year Ended Ended December 31, December 31, 2018 2017 Other income (expenses) Gain on the extinguishment of debt – 50,422,035 Total other income (expenses), net – 50,422,035 Income (loss) before provision for income tax – 50,422,035 Provision for income taxes – – Net income(loss) $ – $ 50,422,035 Basic and diluted loss per share consolidated $ – $ 2.20 Weighted average number of shares outstanding 22,945,388 22,945,388 The accompanying notes are an integral part of these financial statements F- 3 GENERAL ENTERPRISE VENTURES, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS DEFICIT Additional Total Common Stock Paid-In Accumulated Stockholders’ Shares Value Capital Deficit Deficit Balance, December 31, 2016 22,945,388 $ 22,958 $ 56,426,831 $ (107,803,550 ) $ (51,353,761 ) Net income – – – 50,422,035 50,422,035 Forgiveness of related party debt – – 931,726 – 931,726 Balance, December 31, 2017 22,945,388 $ 22,958 $ 56,426,831 $ (57,381,515 ) $ – Additional Total Common Stock Paid-In Accumulated Stockholders’ Shares Value Capital Deficit Deficit Balance, December 31, 2017 22,945,388 $ 22,958 $ 56,426,831 $ (57,381,515 ) $ – Net loss – – – – – Balance, December 31, 2018 22,945,388 $ 22,958 $ 56,426,831 $ (57,381,515 ) $ – The accompanying notes are an integral part of these financial statements F- 4 GENERAL ENTERPRISE VENTURES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS Year Year Ended Ended December 31, December 31, 2018 2017 Cash Flows From Operating Activities Net income (loss) $ – $ 50,422,035 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Gain on the extinguishment of debt – (50,422,035 ) Net cash provided by (used in) operating activities – – Net (decrease) increase in cash and cash equivalents – – Cash and cash equivalents, beginning of period – – Cash and cash equivalents, end of period $ – $ – The accompanying notes are an integral part of these financial statements F- 5 GENERAL ENTERPRISE VENTURES, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. ORGANIZATION AND PRINCIPAL ACTIVITIES General Enterprise Ventures, Inc. (the “Company”) was incorporated as Ultronics Corporation (the “UC”) under the laws of the State of Nevada on March 14, 1990. UC never had operations and was formed to investigate potential companies that would be interested in merging with it. On December 21, 2004, UC formed a subsidiary, Ultronics Acquisition Corporation (“UAC”) for the purpose of facilitating an agreement and plan of merger. UAC was incorporated in the State of Nevada. On December 23, 2004, UC, UAC and General Environmental Management, Inc. (“GEM”) entered into an Agreement and Plan of Merger whereby UAC would be merged into GEM (“Merger”) with GEM to be the surviving corporation. On February 14, 2005, a Certificate of Merger was filed in Delaware; however, there is no evidence of a Certificate of Merger being filed in Nevada. As such, GEM did not cease to exist in Nevada. The acquisition was treated as a reverse merger with GEM deemed to be the accounting acquiror, and UAC the legal acquiror. UAC’s name was changed to General Environmental Management, Inc. (the “Company”) on March 16, 2005. On March 10, 2006, the Company entered into an Agreement with K2M Mobile Treatment Services, Inc. of Long Beach, California (“K2M”), a privately held company, pursuant to which the Company acquired all of the issued and outstanding common stock of K2M. On August 31, 2008, The Company entered into an agreement with Island Environmental Services, Inc. of Pomona, California (“Island”), a privately held company, pursuant to which The Company acquired all of the issued and outstanding common stock of Island, a California-based provider of hazardous and non-hazardous waste removal and remediation services to a variety of private and public sector establishments. On November 6, 2009, the Company entered into a Stock Purchase Agreement (“CLW Agreement”) with United States Environmental Response, LLC, a California limited liability company pursuant to which the Company purchased all of the issued and outstanding capital stock of California Living Waters, Incorporated (“CLW”), a privately held company. CLW owns all of the issued and outstanding capital stock of Santa Clara Waste Water Company (“SCWW”) a California corporation. CLW's only operating subsidiary is SCWW. On November 25, 2009, the Company entered into an Agreement with Luntz Acquisition (Delaware), LLC. (“Buyer”) pursuant to which the Company sold to Luntz all of the issued and outstanding stock of the Company's primary operating subsidiaries for cash (the “Sale”). On February 26, 2010, after approval of the transaction by the Company’s shareholders at a special meeting held on February 19, 2010, the Company completed the sale of the entities created out of GEM DE. The net cash proceeds from the transaction were used by the Company to retire senior debt and other obligations of the Company. The Company was not merged out of Nevada pursuant to this transaction. Subsequent to the Luntz transaction, the Company’s revenues and expenses, operations, assets and liabilities were discontinued from February 2010 until January 2021. On March 19, 2019, Small Cap Compliance, LLC was awarded custodianship of the Company by the Eighth Judicial District Court of Nevada. On May 19, 2019, the Company was revived in Nevada. On May 30, 2019, the custodian filed an Amendment to the Designations of the Series A Convertible Preferred Shares of the Company, and filed a Custodian’s Certification of Amendment certifying the same. F- 6 On January 15, 2021, the Company filed a Certificate of Conversion from a Non-Delaware Corporation to a Delaware Corporation, and the associated Certificate of Incorporation, to become a corporation in Delaware. Delaware recognized this domestication of the Company. On March 31, 2021, the Company formed General Entertainment Ventures, Inc. (“GEVI”) in Delaware as a wholly owned subsidiary of the Company. The purpose of the formation of GEVI was to merge the Company into GEVI pursuant to Section 251(g) of the General Corporation Law of the State of Delaware. On April 10, 2021, after approval by the board of directors and shareholders of the Company, the Company was merged into GEVI pursuant to an Agreement and Plan of Merger dated as of the same date. GEVI is the accounting and legal acquiror of the Company. On June 3, 2021, after approval by the board of directors and shareholders of the Company, the Company was redomiciled to the State of Wyoming. On October 11, 2021, after approval by the board of directors and shareholders of the Company, the Company was renamed General Enterprise Ventures, Inc., in the State of Wyoming. The Company’s year-end is December 31st BASIS OF PRESENTATION The consolidated interim financial statements included herein have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission, in the opinion of management, include all adjustments which, except, as described elsewhere herein, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, and cash flows for the period presented. Because the Company was dormant from the period from February 2010 through January 2021, the Company used the following methodology to prepare its financial statements. All assets on the Company’s March 31, 2010 balance were deemed disposed of for no value to a related party for the quarter beginning April 1, 2010. All Company activities at that time became discontinued operations with the exception of accrued interest recorded on outstanding debt. All liabilities outstanding as of March 31, 2010 remained on the Company’s balance sheet accruing interest until the quarter ending March 31, 2017 when they were written off due to the expiration of the Statue of Limitations. GOING CONCERN The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company utilized cash in operations of $0- for the year ended December 31, 2018 and as of December 31, 2018 the Company had no cash on hand and a stockholders’ deficit of $57,381,515. These matters raise substantial doubt about the Company’s ability to continue as a going concern. F- 7 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Principles of Consolidation The consolidated financial statements include the accounts of General Enterprise Ventures Inc. and its wholly owned subsidiaries, General Environmental Management, Inc., a Delaware corporation, Island Environmental Services, Inc., a California corporation, General Environmental Management of Rancho Cordova, LLC and California Living Waters Inc. Inter-company accounts and transactions have been eliminated. (b) Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company’s management to make certain estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of the contingent assets and liabilities at the date of the financial statements. These estimates and assumptions will also affect the reported amounts of certain revenues and expenses during the reporting period. Actual results could differ materially based on any changes in the estimates and assumptions that the Company uses in the preparation of its financial statements that are reviewed no less than annually. Actual results could differ materially from these estimates and assumptions due to changes in environmental-related regulations or future operational plans, and the inherent imprecision associated with estimating such future matters. (c) Revenue Recognition The Company's business activities include providing wastewater treatment for companies and haulers in Ventura County, California, and in adjacent counties. The Company recognizes revenue at the time its customers unload untreated wastewater at the Company's facility. Concurrent with the recognition of revenue, the Company records the estimated costs to treat and dispose of the wastewater on hand. The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable, and collection is reasonably assured. (d) Concentrations of Credit Risks The Company’s financial instruments that are exposed to concentrations of credit risk consist principally of cash and trade receivables. The Company places its cash in what it believes to be credit-worthy financial institutions. However, cash balances have exceeded FDIC insured levels at various times. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risk in cash. The Company’s trade receivables result primarily from removal or transportation of waste, and the concentration of credit risk is limited to a broad customer base located throughout the Western United States. (e) Fair Value of Financial Instruments Fair Value Measurements are adopted by the Company based on the authoritative guidance provided by the Financial Accounting Standards Board , with the exception of the application of the statement to non-recurring, non-financial assets and liabilities as permitted. The adoption based on the authoritative guidance provided by the Financial Accounting Standards Board did not have a material impact on the Company's fair value measurements. Based on the authoritative guidance provided by the Financial Accounting Standards Board defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. FASB authoritative guidance establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1- Quoted prices in active markets for identical assets or liabilities. Level 2- Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3- Unobservable inputs based on the Company's assumptions. F- 8 FASB issued authoritative guidance that requires the use of observable market data if such data is available without undue cost and effort. (f) Stock Compensation Costs The Company periodically issues stock options and warrants to employees and non-employees in capital raising transactions, for services and for financing costs. Stock-based compensation is measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite service period. Options vest and expire according to terms established at the grant date. (g) Earnings per share Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding during the period. The diluted earnings per share calculation give effect to all potentially dilutive common shares outstanding during the period using the treasury stock method for warrants and options and the if-converted method for convertible debentures. Recent Accounting Pronouncements In October 2009, the FASB issued authoritative guidance on revenue recognition that will become effective for the Company beginning July 1, 2010, with earlier adoption permitted. Under the new guidance on arrangements that include software elements, tangible products that have software components that are essential to the functionality of the tangible product will no longer be within the scope of the software revenue recognition guidance, and software-enabled products will now be subject to other relevant revenue recognition guidance. We believe adoption of this new guidance will not have a material impact on our financial statements. In January 2010, the FASB issued guidance on improving disclosures about fair value measurements to add new disclosure requirements for significant transfers in and out of Level 1 and 2 measurements and to provide a gross presentation of the activities within the Level 3 roll-forward. The guidance also clarifies existing fair value disclosures about the level of disaggregation and about inputs and valuation techniques used to measure fair value. The disclosure requirements are effective for interim and annual reporting periods beginning after December 15, 2009, except for the requirement to present the Level 3 roll-forward on a gross basis, which is effective for fiscal years beginning after December 15, 2010. The adoption of this guidance was limited to the form and content of disclosures, and will not have a material impact on the Company’s results of operations or financial condition. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements. 3. COMMITMENTS AND CONTINGENCIES None 4. EQUITY As of December 31, 2018 Company has 1,000,000,000 shares of common authorized and 22,945,388 shares of common stock issued and outstanding. F- 9 ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None ITEM 9A (T). Controls and Procedures Evaluation of Disclosure Controls and Procedures We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act (defined below)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented. Because the Company was dormant from February 2010 to January 2021 disclosure controls and procedures as of December 31, 2018 are deemed to be ineffective. Changes in Internal Control Over Financial Reporting In addition, our management with the participation of our Principal Executive Officer and Principal Financial Officer have determined that change in our internal control over financial reporting (as that term is defined in Rules 13(a)-15(f) and 15(d)-15(f) of the Securities Exchange Act of 1934) occurred during or subsequent to the year ended December 31, 2018 that internal control over financial reporting is deemed to be ineffective. ITEM 9B. Triggering Events That Accelerate or Increase a Direct Financial Obligation None 5 PART III ITEM 10. Directors, Executive Officers, and Corporate Governance Not applicable ITEM 11. Executive Compensation Not applicable ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Not applicable EQUITY COMPENSATION PLAN INFORMATION Not applicable ITEM 13. Certain Relationships and Related Transactions and Director Independence Not applicable ITEM 14. Principal Accountant Fees and Services Not applicable 6 PART IV ITEM 15. Exhibits, Financial Statements Schedules The following are exhibits filed as part of GEM's Form 10-K for the year ended December 31, 2018: EXHIBIT NUMBER DESCRIPTION 2.1 Articles of Incorporation of the Registrant * 3.1 Articles of Amendment of Articles of Incorporation of the Registrant * 3.2 Bylaws of the Registrant * 31.1 Section 302 Certification by the Corporation’s Chief Executive Officer ** 31.2 Section 302 Certification by the Corporation’s Chief Financial Officer ** 32.1 Section 906 Certification by the Corporation’s Chief Executive Officer ** 32.2 Section 906 Certification by the Corporation’s Chief Financial Officer ** __________ * Previously Filed ** Filed Herewith Reports on Form 8-K (1) As filed with the commission on Form 8K dated September 24,2008 (2) As filed with the commission on Form 8K dated June 4, 2009 (3) As filed with the commission on Form 8K dated September 8, 2009 (4) As filed with the commission on Form 8K dated September 11, 2009 (5) As filed with the commission on Form 8K dated November 18, 2009 (6) As filed with the commission on Form 8K dated December 3, 2009 (7) As filed with the commission on Form 8K dated December 23, 2009 7 SIGNATURES In accordance with the requirements of the Exchange Act, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. GENERAL ENTERPRISE VENTURES, INC Dated: April 10, 2023 By: /s/ Joshua Ralston Joshua Ralston President, CEO and Chairman of the Board of Directors 8