INCOME TAXES	9 Months Ended
Sep. 30, 2014
Notes to Financial Statements
Note 2 - INCOME TAXES	The Company’s effective tax rate differs from the U.S. federal statutory rate primarily due to earnings taxed at the lower foreign tax rate in Cyprus. Our wholly-owned Cypriot subsidiary, Amplerissimo, has taxable income in Cyprus, where the statutory corporate income tax rate is 12.5%. Prior to the acquisition of Amplerissimo, the Company had net operating losses in the U.S. which, although offset by a valuation allowance due to the uncertainty of profitable operations in the future, were available to be applied to future taxable income (if any). However, the Internal Revenue Code (“IRC“) Section 382 limits the amount of net operating loss carry-forwards that can be utilized upon a change in control. Future tax benefits of net operating loss carryforwards generated in the U.S. by the Company represent the primary component of the Company’s deferred tax assets. Under Accounting Standards Codification (“ASC”) 740 “Accounting for Income Taxes”, the Company evaluates at every reporting period whether the benefit of such losses will more likely than not be realized. Based on the Company’s history of taxable losses in the U.S. and the potential annual limitation on future utilization if it is determined that a change in ownership as defined in IRC 382 has occurred, the Company has determined that it is not more likely than not that the tax benefit of such losses will be realized prior to their expiration. At September 30, 2014, the Company had maintained a full valuation allowance against its net deferred tax assets. The Company applied the “more-likely-than-not” recognition threshold to all tax positions taken or expected to be taken in a tax return, which resulted in no unrecognized tax benefits as of September 30, 2014. The Company has elected to classify interest and penalties that would accrue according to the provisions of relevant tax law as interest and other expense, respectively. The Company’s tax years since inception through 2014 remain open to examination by most taxing authorities. The Company’s foreign subsidiary Amplerissimo recognized significant earnings in the third quarter, of which € 5,540,000 ($7,027,490) has been paid in connection with a pending acquisition as described in Note 6. As such, the Company is asserting its position under ASC 740-30-25-17 that the investment in its foreign subsidiary is essentially permanent in duration. No deferred tax liability has been recorded on the outside basis difference of the foreign subsidiary primarily driven by Amplerissimo’s cumulative earnings of $7,645,531.

INCOME TAXES

9 Months Ended

Sep. 30, 2014

The Company’s effective tax rate differs from the U.S. federal statutory rate primarily due to earnings taxed at the lower foreign tax rate in Cyprus. Our wholly-owned Cypriot subsidiary, Amplerissimo, has taxable income in Cyprus, where the statutory corporate income tax rate is 12.5%.

Prior to the acquisition of Amplerissimo, the Company had net operating losses in the U.S. which, although offset by a valuation allowance due to the uncertainty of profitable operations in the future, were available to be applied to future taxable income (if any). However, the Internal Revenue Code (“IRC“) Section 382 limits the amount of net operating loss carry-forwards that can be utilized upon a change in control. Future tax benefits of net operating loss carryforwards generated in the U.S. by the Company represent the primary component of the Company’s deferred tax assets. Under Accounting Standards Codification (“ASC”) 740 “Accounting for Income Taxes”, the Company evaluates at every reporting period whether the benefit of such losses will more likely than not be realized. Based on the Company’s history of taxable losses in the U.S. and the potential annual limitation on future utilization if it is determined that a change in ownership as defined in IRC 382 has occurred, the Company has determined that it is not more likely than not that the tax benefit of such losses will be realized prior to their expiration. At September 30, 2014, the Company had maintained a full valuation allowance against its net deferred tax assets.

The Company applied the “more-likely-than-not” recognition threshold to all tax positions taken or expected to be taken in a tax return, which resulted in no unrecognized tax benefits as of September 30, 2014.

The Company has elected to classify interest and penalties that would accrue according to the provisions of relevant tax law as interest and other expense, respectively.

The Company’s tax years since inception through 2014 remain open to examination by most taxing authorities.

The Company’s foreign subsidiary Amplerissimo recognized significant earnings in the third quarter, of which € 5,540,000 ($7,027,490) has been paid in connection with a pending acquisition as described in Note 6. As such, the Company is asserting its position under ASC 740-30-25-17 that the investment in its foreign subsidiary is essentially permanent in duration. No deferred tax liability has been recorded on the outside basis difference of the foreign subsidiary primarily driven by Amplerissimo’s cumulative earnings of $7,645,531.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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