Annual report pursuant to Section 13 and 15(d)

NOTE 9. INCOME TAXES (Tables)

NOTE 9. INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2014

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

The provision for income taxes differs from the amount computed by applying the federal statutory income tax rate (35%) on operations due primarily to permanent differences attributable to organizational expenses for the purchase of Art Design, Inc. (the shell company) in the amount of $148,014.

	Fiscal Year			Fiscal Year
	Ended			Ended
	December 31, 2014			December 31, 2013

Income tax expense computed at statutory rates	$	(603,209	)	$	(304,646	)
Non-deductible items		468,253			24,823
Change in valuation allowance		134,956			279,823

Total	$	-		$	-

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

The components of the net deferred tax asset were as follows:

	December 31, 2013
	Gross Values			Tax Effect
Deferred tax assets
Book Impairment	$	-		$	-
Net operating loss carryforwards		3,417,844			1,196,245
Asset retirement obligation		-			-
Other		6,000			2,100
Total deferred tax assets		3,423,844			1,198,345

Deferred tax liabilities
O&G Properties		(1,280,525	)		(448,184	)
Other		-			-
Total deferred tax liabilities		(1,280,525	)		(448,184	)
Less: Valuation allowance		(2,143,319	)		(750,161	)
Net deferred tax assets (liabilities)	$	-		$	-

	December 31, 2014
	Gross Values			Tax Effect
Deferred tax assets
Book Impairment	$	-		$	-
Net operating loss carryforwards		4,235,227			1,482,329
Asset retirement obligation		-			-
Other		-			-
Total deferred tax assets		4,235,227			1,482,329

Deferred tax liabilities
O&G Properties		(1,631,976	)		(571,192	)
Other		-			-
Total deferred tax liabilities		(1,631,976	)		(571,192	)
Less: Valuation allowance		(2,603,251	)		(911,137	)
Net deferred tax assets (liabilities)	$	-		$	-