SK3-Group-Financial-Statements-3-31-2013

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SK3 GROUP, INC
BALANCE SHEET
March 31, 2013

March 31, 2013

Current Assets

Accounts Receivable
$ 5,096,700


Total Current Assets
5,096,700


Property and Equipment



Total Property and Equipment
-


Other Assets

Medical Greens contracts
100,000
Trademark license
62,427


Total Other Assets
162,427


Total Assets
$ 5,259,127




Liabilities and Stockholders' Equity


Current Liabilities

Accounts payable
$ 157,084
Accrued liabilities
15,705
Convertible notes
598,454


Total Current Liabilities
771,243


Long-Term Liabilities



Total Long-Term Liabilities
-


Total Liabilities
771,243


Stockholders' Equity

Additional paid-in capital
554,997
Common stock
36,206
Preferred stock
500
Retained Earnings
(1,032,642)
Net Income
4,928,823


Total Stockholders' Equity
4,487,884


Total Liabilities and Stockholders' Equity
$ 5,259,127



SK3 GROUP, INC.
STATEMENT OF OPERATIONS
3 Months ended March 31, 2013
March 31,

2013
Revenue

Sales
$ 5,096,700


Total Revenue
5,096,700


Cost of Goods Sold



Total Cost of Goods Sold
-


Gross Profit
5,096,700


Operating Expenses

Consulting expense
150,000
Reimbursement of expenses
2,815


Total Operating Expenses
152,815


Operating Income (Loss)
4,943,885


Other Income



Total Other Income
-


Other Expenses

Interest
15,062


Total Other Expenses
15,062


Income (Loss) Before Income Taxes
4,928,823


Income Tax



Net Income (Loss)
$ 4,928,823















SK3 GROUP, INC.
STATEMENT OF CASH FLOWS



Mar 31, 2013






Cash Flows from Operating Activities



Net Income

Net Income (Loss)
$ 4,928,823
Total Net Income
4,928,823


Adjustments to Net Income



Adjustments to reconcile Net Income (Loss) to net Cash:

(Increase) Decrease in:

Accounts Receivable
(5,096,700)
Increase (Decrease) in:

Accounts payable
152,815
Accrued liabilities
15,062
Total Adjustments
(4,928,823)


Net Cash Provided By (Used In) Operating Activities
-


Cash Flows from Investing Activities

Medical Greens contracts
(100,000)
Trademark license
(62,427)


Net Cash Provided By (Used In) Investing Activities
(162,427)


Cash Flows from Financing Activities

Additional paid-in capital
161,927
Preferred stock
500


Net Cash Provided By (Used In) Financing Activities
162,427


Net Increase (Decrease) in Cash
-


Cash at Beginning of Period



Total Cash at Beginning of Period
-


Cash at End of Period
$ -

SK3 Group, Inc.
Notes to Financial Statements
March 31, 2013
(Unaudited)






Note 1 Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with
accounting principles generally accepted in the United States of America and the rules and
regulations of the United States Securities and Exchange Commission for financial information
presentation. It is management's opinion that all material adjustments (consisting of normal
recurring adjustments) have been made which are necessary for a fair financial statement
presentation.

Note 2 Nature of Operations and Summary of Significant Accounting Policies

Nature of Operations

SK3 Group, Inc. was incorporated in Delaware on January 14, 2000 as Slabsdirect.com,
Inc. and changed its corporate name to CTT International Distributors, Inc. on January 7, 2005,
and again changed its corporate name to SK3 Group, Inc. on May 14, 2007.

In March 2010, SK3 Group, Inc. agreed to acquire two healthcare providers, Medical Billing
Specialists, Inc. and Angels of the Valley Hospice Care, LLC, both based in the Los Angeles,
CA area.

In December 2010, SK3 Group, Inc. agreed to acquire PRN Staffing Services, Inc. ("PRN") from
Healthcare of Today, Inc. for 100,000,000 shares of common stock and 5,000,000 shares of
voting preferred stock with a non-dilutive vote of 51 percent of total votes of all classes of stock.
The acquisitions all closed by December 31, 2010. The financial statements for SK3 Group, Inc.,
for the period ended December 31, 2010 were filed on a consolidated basis with its then wholly-
owned subsidiaries. In early 2011, the Company agreed to acquire Healthstaff Training Institute
and W&M Medical Management.

In late 2011, the Company changed its business model and rescinded all of its acquisitions by
October, 2011, at which time new management changed the business direction and began
developing the business of providing administrative, financial, legal, accounting and similar
services to medical marijuana collectives operating in California.

The Company continued this development activity throughout 2012, arranging licenses, contracts
and services to be provided in the medical marijuana market. In early 2013, the Company
announced the acquisition of Medical Greens, including all existing contracts and trademarks
owned by it, and also the first in a series of signed licensing and support agreements with
California collectives. The Company also established its offices in Miami, Florida.

During the quarter ended March 31, 2013, the Company entered into licensing, marketing and
administrative ,management agreements with 11 separate medical marijuana collectives in

SK3 Group, Inc. and Subsidiaries
Notes to Financial Statements
March 31, 2013
(Unaudited)

Note 2 Nature of Operations and Summary of Significant Accounting Policies (continued)

California. The Company also has signed agreements to act as Medical Cannabis Administrator
for 13 healthcare facilities in California and entered into a lease-purchase arrangement for 0ver
40 acres of land in Southern California for sub-lease to collectives for their growing operations.
The Company currently operates as a holding and service company providing administrative,
financial, legal, HR and similar services to its subsidiary, Medical Greens, Inc., and its collective
clients.

Risks and Uncertainties


The Company operates in an industry that is very competitive, highly regulated and subject to
rapid technological change. The Company's operations will be subject to significant risk and
uncertainties including financial, operational, technological, regulatory and other risks associated
with a development stage company, including the potential risk of business failure.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses during the reporting
period. A significant estimate in 2012 and 2011 included a 100% valuation allowance for
deferred taxes assets arising from net operating losses incurred since inception.

Making estimates requires management to exercise significant judgment. It is at least reasonably
possible that the estimate of the effect of a condition, situation or set of circumstances that
existed at the date of the financial statements, which management considered in formulating its
estimate could change in the near term due to one or more future confirming events.
Accordingly, the actual results could differ materially from estimates.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with a maturity of three months
or less to be cash equivalents. At March 31, 2013, respectively, the Company had no cash
equivalents.

The Company minimizes its credit risk associated with cash by periodically evaluating the credit
quality of its primary financial institution. The balance at times may exceed federally insured
limits. At March 31, 2013, respectively, there were no balances that exceeded the federally
insured limit.




SK3 Group, Inc.
Notes to Financial Statements
March 31, 2013
(Unaudited)

Note 2 Nature of Operations and Summary of Significant Accounting Policies (continued)

Earnings per Share

In accordance with accounting guidance now codified as FASB ASC Topic 260, "Earnings per
Share,"
Basic earnings per share ("EPS") is computed by dividing net loss available to common
stockholders by the weighted average number of common shares outstanding during the period,
excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive
potential of shares of common stock outstanding during the period including stock options or
warrants, using the treasury stock method (by using the average stock price for the period to
determine the number of shares assumed to be purchased from the exercise of stock options or
warrants), and convertible debt or convertible preferred stock, using the if-converted method.
Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-
dilutive. The computation of basic and diluted loss per share for the period from inception to
March 31, 2013, is equivalent since the Company has had continuing losses. The Company also
has no common stock equivalents.

Share Based Payments

Generally, all forms of share-based payments, including stock option grants, restricted stock
grants and stock appreciation rights, are measured at their fair value on the awards' grant date,
and based on the estimated number of awards that are ultimately expected to vest. Share-based
payment awards issued to non-employees for services rendered are recorded at either the fair
value of the services rendered or the fair value of the share-based payment, whichever is more
readily determinable. The expense resulting from share-based payments are recorded as a
component of general and administrative expense.

Intangible Assets

Intangible assets are stated at cost less accumulated amortization and, if impaired, at fair value.
They are amortized in accordance with the relevant income stream or by using the straight line
method over their useful lives from the time they are first available for use. The estimated useful
lives vary according to the specific asset but are typically:

1 to 12 years for customer contracts and relationships;
3 to 8 years for capitalized software;
3 to 10 years for patents, trademarks and licenses; and
3 to 8 years for capitalized development currently being amortized.
Intangible assets which are not yet being amortized are subject to annual impairment reviews.


SK3 Group, Inc.
Notes to Financial Statements
March 31, 2013
(Unaudited)

Note 2 Nature of Operations and Summary of Significant Accounting Policies (continued)
Segment Information

During the quarters ended March 31, 2013, the Company only operated in one segment;
therefore, segment information has not been presented.

Fair Value of Financial Instruments

The carrying amounts of the Company's short-term financial instruments, including accounts
payable and accrued liabilities, approximate fair value due to the relatively short period to
maturity for these instruments.

Reclassifications

Certain amounts from the prior period financial statements have been reclassified to conform to
current period presentation.

Fair Value Measurement

The fair value of the Company's financial assets and liabilities reflects the Company's estimate of
amounts that it would have received in connection with the sale of the assets or paid in
connection with the transfer of the liabilities in an orderly transaction between market
participants at the measurement date. In connection with measuring the fair value of its assets
and liabilities, the Company seeks to maximize the use of observable inputs (market data
obtained from sources independent from the Company) and to minimize the use of unobservable
inputs (the Company's assumptions about how market participants would price assets and
liabilities). The following fair value hierarchy is used to classify assets and liabilities based on
the observable inputs and unobservable inputs used in order to value the assets and liabilities:
Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for
an asset or liability is a market in which transactions for the asset or liability occur
with sufficient frequency and volume to provide pricing information on an ongoing
basis.
Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include
quoted prices in active markets for similar assets or liabilities and quoted prices for
identical assets or liabilities in markets that are not active.


Level 3: Unobservable inputs based on the Company's assessment of the assumptions that
market participants would use in pricing the asset or liability.




SK3 Group, Inc.
Notes to Financial Statements
March 31, 2013
(Unaudited)

Note 2 Nature of Operations and Summary of Significant Accounting Policies (continued)

Recent Accounting Pronouncements


The Company continually assesses any new accounting pronouncements to determine their
applicability to the Company. Where it is determined that a new accounting pronouncement
affects the Company's financial reporting, the Company undertakes a study to determine the
consequence of the change to its financial statements and assures that there are proper controls in
place to ascertain that the Company's financials properly reflect the change. There were no
recently issued accounting pronouncements during the quarter impacting the company's
business.

Note 3 Convertible Notes and Other Liabilities

In December 2010, the Company issued a convertible note to Crystal Falls Investments, LLC, in
the original principal amount of $2,474, converting an outstanding open account due to Crystal
Falls for its direct payment of the outstanding balance due to the Company's transfer agent. The
note is a three year note due December 31, 2013, bears interest at 10 percent and is in the
principal amount of $2,474. The note is convertible into common stock at any time after 180
days at the election of the holder, at a price equal to the par value of the common stock at the
date of election to convert. There is a limitation on the total shares held by the holder of the
note, to 4.99 percent of all common shares outstanding. Interest of $247 has been accrued on the
note for each of the fiscal years 2011 and 2012 and for the quarter ended March 31, 2013.

In December 2011, the Company issued a second convertible note to Crystal Falls Investments,
LLC, converting an outstanding open account due to Crystal Falls for direct payments made by
Crystal Falls to DTC to obtain NOBO lists, totaling $1,680. The note is a two year note due
December 31, 2013, bears interest at 10 percent and is in the principal amount of $1,680. The
note is convertible into common stock at any time after 180 days at the election of the holder, at
a price equal to 75 percent of the average closing price of the common stock for the 30 trading
days prior to the date of election to convert, but not less than $0.001. There is a limitation on the
total shares held by the holder of the note, to 4.99 percent of all common shares outstanding.
Interest of $168 has been accrued on the note for 2012.

At December 31, 2011, the Company had accounts payable of $148,671, of which $144,400
were due to CFOs to Go, Inc. under a consulting agreement dated March 1, 2010, which was
terminated September 30, 2011, and $4,271 due to the Company's transfer agent. On December
30, 2012, the balance due to CFOs to Go, Inc. was converted into a convertible promissory note
in the same amount, due December 31, 2013. In January, 2013, CFOPs to Go, Inc. merged with
and into Matriarch Management, Inc. and Matriarch has since assigned the note balance to six
unrelated parties.




SK3 Group, Inc.
Notes to Financial Statements
March 31, 2013
(Unaudited)

Note 3 Convertible Notes and Other Liabilities (continued)


Effective May 1, 2012, the Company entered into a Consulting Agreement with iEquity Corp.
under which iEquity Corp. agreed to undertake the research and business development necessary
to implement the new business of the Company already u8nder development. The Consulting
Agreement provides for a monthly fee of $50,000 and a total of $450,000 in fees had accrued as
of December 31, 2012. The accrued amount was converted into a promissory note in the same
amount on December 31, 2012 convertible into common stock at the election of the holder.
iEquity Corp. is now the controlling shareholder of the Company.

Note 4 Subsidiaries and Subsequent Events.
In March 2013, SK3 Group acquired the assets and business of Medical Greens from iEquity
Corp. for the issuance of 5 million shares of Series A Convertible Preferred Stock having voting
power equal to 60 percent of the total vote of all classes of stock entitled to vote and convertible
at any time after one year from the date of issue into 60 percent of the resulting common stock
outstanding. As of April 22, 2013, the Series A Preferred has not been issued because the
Company was not then in good standing in Delaware and the Statement of Rights and
Preferences had not yet been filed in Delaware. The Company is now in good standing in
Delaware and the Statement of Rights and Preferences is expected to be filed by April 30, 2013,
at which time the shares will be issued.
In April, 2013, the Company formed Medical Greens, Inc. in California and contributed the
assets and business of Medical Greens to its new wholly-owned subsidiary. Through Medical
Greens, the Company has contracts in place to provide management services, marketing services,
administrative services and licensing rights to 11 medical marijuana collectives. Under the terms
of these agreements, each collective has engaged Medical Greens to provide licensing rights for
an annual fee of $2,500,000, Marketing services and rights for an annual fee of $2,500,000 and
general management services for an annual fee of $100,000 and each collective was billed for the
services to be rendered for March, 2013, which is reflected in gross income for the quarter ended
March 31, 2013 of more than $5 million.
In March, 2013, the Company also entered into a line of credit arrangement for up to $3 million
with its parent company, iEquity Corp., for use in management and growth of the Company.
Note 5 Stockholders' Equity (Deficit)
As of December 31, 2012, the Company had 362,991,308 common shares issued and outstanding
and 5,000,000 convertible preferred shares issuable but not yet outstanding. The preferred shares
will be issued as soon as the required statement of rights and preferences has been filed in
Delaware, and when issued, the preferred will carry 60 percent of the total vote of all classes of

stock voting on any matter, and will be convertible into a resulting 650 percent of the then issued
and outstanding common shares, at the election of the holder. No additional shares were issued
during the quarter ended March 31, 2013. iEquity Corp. will hold the preferred shares as
consideration for its transfer of the Medical Greens business to the Company.

There were 500,000,000 common shares, par value $0.001, and 5,000,000 preferred shares, par
value $0.001, authorized at December 31, 2012. In March 2013, the Articles of Incorporation
were amended to increase the authorized shares to 1,500,000,000 shares of common stock, par
value $0.10, and 5,000,000 preferred shares, par value $0.001.