NOTE 1 - ORGANIZATION AND OPERATIONS:

Peregrine Industries, Inc. (the "Company") was formed on October 1, 1995 for the purpose of manufacturing residential pool heaters. The Company was formerly located in Deerfield Beach, Florida. Products were primarily sold throughout the United States, Canada, and Brazil. In June 2002, the Registrant and its subsidiaries filed a petition for bankruptcy in the U.S. Bankruptcy Court for the Southern District of Florida. At present, the Company has no business operations and is deemed to be a shell company. The Company had a change in control on July 8, 2013 as a result of the sale by our former principal shareholders, Richard Rubin, Thomas J. Craft, Jr. and Ivo Heiden, of their  i 324,000 shares of common stock, representing approximately  i 61.8% of the Company's outstanding common stock, to Dolomite Industries Ltd ("Dolomite"). In connection with the private sale of their shares of common stock to Dolomite on July 2, 2013, Messrs. Rubin and Heiden agreed to waive a total of $ i 224,196 in liabilities owed to them at June 30, 2013. In connection with the change of control transaction, two former principal shareholders transferred and assigned all $ i 195,000 of their two convertible notes to three unaffiliated third parties and one affiliated party. See also note 3. On June 12, 2017, the Board of Directors of the Registrant appointed Mr. Zohar Shpitz as Chief Financial Officer (CFO) of the Registrant. Mr. Shpitz was appointed as CFO in connection with the resignation of Mr. Ofer Naveh as the Registrant's CFO, effective June 19, 2017.  On July 21, 2017, new management acquired,  i 22,477,843 or  i 97.7% of the issued common restricted shares.  The new management is developing a business plan which they anticipate implementing within the current fiscal year.

On September 3, 2021, through our wholly owned subsidiary Mace Merger, Corp., Mace, Corporation was merged into our Company, through the issuance to each shareholders of one share of Peregrine, Industries for each four share of Mace, Corporation which they held. A total of  i 250,000,000 were issued. The  i 22,477,843 shares held, by the new management, per the above paragraph, were returned to the Company for cancelation.

NOTE 2 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES:

Basis of Presentation

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from the estimates.

On October 28, 2021, Mace Corporation completed the sale of its land and building, located at 9171 W Flamingo Rd., Las Vegas, Nevada.  Net proceeds of $ i 632,629, resulting from the sale price of $ i 679,000, were held in escrow and received by the Company on November 2, 2021.

Accounts receivable are stated at the amount management expects to collect from outstanding balances. Accounts receivable as of January 31, 2023, and July 31, 2022 were $ i 19,384 and $ i 22,654, respectively. An allowance for doubtful accounts will be provided for those accounts receivable considered to be uncollectable based on historical experience and management’s evaluation of outstanding accounts receivable at the end of the period. Management has reviewed the current accounts receivable and has concluded that no allowance was necessary as of January31, 2023 and July 31, 2022.  Bad debts will be written off against the allowance when identified.

As at January 31, 2023 and July 31, 2022, respectively, the Company had $ i 736,004 and $ i 784,294 worth of inventory, stated at the lower of cost or market, valued on an average cost basis. The inventory is reviewed at least quarterly and adjusted for discrepancies and value. Managements’ evaluation was that impairment of $ i 47,356 was required on October 31, 2022.  No additional impairment was required for the quarter ended January 31, 2023 nor on July 31, 2022.

Patent costs consist of the legal fees paid to prepare, file and process the patent applications. Patents will be amortized, utilizing the straight line method, over the useful life of the patent and will be reviewed quarterly to determine if impairment is required. Research and development costs are not included in the cost of patents, and, are expensed as incurred.  Our company paid $ i 3,090 new patent fees during the six months ended January 31, 2023 compared to $ i 7,149 during the same six months last year.  During the six months ended January 31, 2023, the Company reviewed and fully impaired patents with an original cost of $ i 3,725.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations.

The Company follows ASC Topic 740 for recording the provision for income taxes. Deferred tax assets and liabilities are computed based upon the difference between the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable when the related asset or liability is expected to be realized or settled. Deferred income tax expenses or benefits are based on the changes in the asset or liability each period. If available evidence suggests that it is more likely than not that some portion or all of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount that is more likely than not to be realized. Future changes in such valuation allowance are included in the provision for deferred income taxes in the period of change.

Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate. Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.

The Company applies a more-likely-than-not recognition threshold for all tax uncertainties. ASC Topic 740 only allows the recognition of those tax benefits that have a greater than fifty percent likelihood of being sustained upon examination by the taxing authorities. As of July 31, 2020, the Company reviewed its tax positions and determined there were no outstanding, or retroactive tax positions with less than a  i 50% likelihood of being sustained upon examination by the taxing authorities, therefore this standard has not had a material effect on the Company.

The Company does not anticipate any significant changes to its total unrecognized tax benefits within the next 12 months.

The Company classifies tax-related penalties and net interest as income tax expense. As of January 31, 2023, no income tax expense has been incurred.

NOTE 3 – GOING CONCERN:

The Company's financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business for the foreseeable future. The Company has accumulated losses aggregating $ i 4,597,622 and $ i 4,434,068 as of January 31, 2023, and July 31, 2022, respectively. During the six months ended January 31, 2023, the Company recorded a loss of $ i 163,553, which included an inventory valuation write down of $ i 47,356, compared to a profit for the six months ended January 31, 2022 of $ i 24,577 which included profit of $ i 198,204 derived from the sale of its building, plus $ i 10,000 from debt forgiveness. 

NOTE 4 – RELATED PARTY TRANSACTIONS:

On May 17, 2021, a related party loaned the Company $ i 50,000 non-interest bearing, unsecured and without repayment terms.  The loan was repaid on  i November 8, 2021.

The four controlling shareholders, as a condition of the Merger Agreement, returned, for cancellation, their  i 22,477,843 common restricted shares to the Company.

NOTE 5 – STOCKHOLDERS’ DEFICIT:

Common Stock          

The articles of incorporation authorize the issuance of  i 500,000,000 shares of common stock, par value $ i 0.0001. All issued shares of common stock are entitled to one vote per share of common stock.  Effective July 31, 2021, the Company issued  i 250,000,000 common restricted shares to the Mace shareholders to acquire  i 100% of the Mace Corporation. The Company’s controlling shareholders, simultaneously, returned, for cancellation, their 22,477,843 common shares.

During December 2022, the Company sold  i 1,000,000 of its common restricted shares, for $ i 10,000 cash, or $ i 0.01 per share.

Preferred Stock

The articles of incorporation authorize the issuance of  i 5,000,000 shares of preferred stock with a par value of $ i 0.0001 per share. None are issued.

NOTE 6 – COMMITMENTS AND CONTINGIES

Leases

Prior to April 1, 2022, our office was located in 9171 W Flamingo Rd, Las Vegas. We sold the property on October 28, 2021 and subsequently signed a lease agreement for the same building for approximately 8 months from October 28, 2021 to June 30, 2022.  No ASC Topic 842 was implemented under this agreement since it’s under 1 year. Effective April 1, 2022, we moved to 4525 W Reno Avenue, Las Vegas  i under a 24-month rental agreement covering April 1, 2022 through March 31, 2024, with an initial monthly rental rate of $1,525 in first year increasing to a monthly rate of $1,600 in second year. At January 31, 2023, in accordance with ASC Topic 842, we recognized a right of use (“ROU”) asset of $ i 19,779 and an operating lease liability of $ i 21,659, of which $ i 19,050 was classified as a current liability and $ i 2,609 as non-current liability.. The lease liability is determined by discounting the future lease payments under the lease terms and applying a  i 5% per annum discount rate to determine the current lease liability.

U.S. Small Business Administration Loan and Agreement

On February 19, 2022 the U.S. Small Business Administration authorized a secured loan, in the amount of $ i 116,700, to Mace Corporation. The loan balance, bearing interest of  i 3.75%, with  i payments of $602 per month beginning 24 months after the aforementioned date, will be due and payable in 30 years.

NOTE 7 – SUBSEQUENT EVENTS:

Subsequent to March 7, 2023 and through the date when this report was completed, the Company has evaluated subsequent events through the date the financial statements were issued and has not identified any reportable events.