UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10- Q

(Mark one)
x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
	ACT OF 1934
	For the Quarterly Period Ended June 30, 2015
or
	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
	ACT OF 1934
	For the transition period from ________________ to ________________
Commission File Number: 000-53735

———————

CONSOLIDATED GEMS, INC.

(Exact name of registrant as specified in its charter)

———————

Delaware	26-0267587
(State or Other Jurisdiction	(I.R.S. Employer
of Incorporation)	Identification No.)

Level 1A, 42 Moray Street
Southbank, Victoria, Australia	3006
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: 001 (613) 8532 2838

(Former Name or Former Address, if changed since Last Report)

Level 8, 580 St Kilda Road, Melbourne, Victoria, Australia 3004

———————

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “accelerated filer,” “large accelerated filer” and “smaller reporting company” in Rule 12-b2 of the Exchange Act.

(Check one): Large accelerated filer  Accelerated filer  Non-accelerated filer  Smaller reporting company 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12-b2 of the Exchange Act).  Yes  No

There were 175,315,350 shares of common stock outstanding on March 16, 2016.

Table Of Contents

		PAGE NO

PART I.	FINANCIAL INFORMATION

Item 1	Financial Statements	2
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10
Item 3	Quantitative and Qualitative Disclosure about Market Risk	13
Item 4	Controls and Procedures	13

PART II	OTHER INFORMATION

Item 1	Legal Proceedings	15
Item 1A	Risk Factors	15
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	15
Item 3	Defaults Upon Senior Securities	15
Item 4	Mining Safety Disclosures	15
Item 5	Other Information	15
Item 6	Exhibits	15


SIGNATURES		16

EXHIBIT INDEX		17

Exh. 31.1	Certification	18
Exh. 31.2	Certification	19
Exh. 32.1	Certification	20
Exh. 32.2	Certification	21

PART I – FINANCIAL INFORMATION

Item 1.

FINANCIAL STATEMENTS

Introduction to Interim Financial Statements.

The interim financial statements included herein have been prepared by Consolidated Gems, Inc. (“Consolidated Gems” or the “Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (The “Commission”). Certain information and footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These interim financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

In the opinion of management, all adjustments, consisting of normal recurring adjustments necessary to present fairly the financial position of the Company as of June 30, 2015, the results of its operations for the three and six month periods ended June 30, 2015 and 2014 and the changes in its cash flows for the six month periods ended June 30, 2015 and 2014 have been included. The results of operations for the interim periods are not necessarily indicative of the results for the full year.

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

Foreign Currency Translation

The Company’s functional and reporting currency is the Australian dollar. Revenue and expenses incurred in a currency other than Australian dollars are translated at the date incurred or invoiced. Assets and liabilities are re-valued at the period end exchange rate where appropriate. Gains or losses from foreign currency transactions are included in the results of operations.

UNLESS OTHERWISE INDICATED, ALL FINANCIAL INFORMATION PRESENTED IS IN AUSTRALIAN DOLLARS.

CONSOLIDATED GEMS, INC.

Balance Sheets

	June 30, 2015 (Unaudited)			December 31, 2014

		A$			A$

ASSETS

Current Assets:
Cash		3,413			2,172
Receivables		803			1,510
Prepayments		4,820			2,660
Total Current Assets		9,036			6,342

Non-Current Assets:
Deposits		-			10,000
Total Non-Current Assets		-			10,000

Total Assets		9,036			16,342

LIABILITIES AND STOCKHOLDERS’ (DEFICIT)

Current Liabilities:
Accounts payable and accrued expenses		107,274			85,432
Total Current Liabilities		107,274			85,432

Non-Current Liabilities:
Advances from affiliate		1,076,952			1,066,199
Total Non-Current Liabilities		1,076,952			1,066,199

Total Liabilities		1,184,226			1,151,631

Stockholders’ (Deficit):
Preferred stock: US$.0001 par value, 20,000,000 share authorised none issued and outstanding
Common stock: US$.0001 par value 500,000,000 shares authorised, and 175,315,350 shares issued and outstanding		16,825			16,825
Additional paid-in capital		1,574,323			1,574,323
Accumulated (deficit)		(2,766,338	)		(2,726,437	)
Total Stockholders’ (deficit)		(1,175,190	)		(1,135,289	)

Total Liabilities and Stockholders’ (Deficit)		9,036			16,342

See notes to financial statements

CONSOLIDATED GEMS, INC.

Statements of Operations

(Unaudited)

	For the three months ended June 30						For the six months ended June 30
	2015			2014			2015			2014
Revenues		A$-			A$-			A$-			A$-

Cost and expenses
Legal, accounting and professional		16,255			9,431			26,442			18,833
Administration expense		770			9,896			2,697			22,860
Exploration expenditure		-			3,907			-			10,633
		17,025			23,234			29,139			52,326

(Loss) from operations		(17,025	)		(23,234	)		(29,139	)		(52,326	)
Foreign currency exchange (loss)		(10,653	)		(1,745	)		(10,762	)		(1,314	)
(Loss) before income tax		(27,678	)		(24,979	)		(39,901	)		(53,640	)
Provision for income tax		-			-			-			-

Net (loss)		(27,678	)		(24,979	)		(39,901	)		(53,640	)

Basic net (loss) per common equivalent shares		(0.00	)		(0.00	)		(0.00	)		(0.00	)

Weighted number of common equivalent shares (000’s)		175,315			175,315			175,315			175,315

See notes to financial statements

CONSOLIDATED GEMS, INC.

Statements of Stockholders’ (Deficit)

for the period ended June 30, 2015

(Unaudited)

	Shares		Common Stock Amount		Additional Paid-in Capital		Accumulated (Deficit)			Total
	.			A$		A$		A$			A$


Balance, December 31, 2014		175,315,350		16,825		1,574,323		(2,726,437	)		(1,135,289	)


Net (loss)		-		-		-		(39,901	)		(39,901	)

Balance, June 30, 2015		175,315,350		16,825		1,574,323		(2,766,338	)		(1,175,190	)

See notes to financial statements

CONSOLIDATED GEMS, INC.

Statements of Cash Flows

(Unaudited)

	For the six months ended June 30
	2015 A$			2014 A$

CASH FLOWS FROM OPERATING ACTIVITIES
Net (Loss)		(39,901	)		(53,640	)

Adjustments to reconcile net (loss) to net cash (used) in operating activities
Foreign currency exchange loss		10,762			1,314
Net change in prepayments		(2,160	)		3,846
Net change in receivables and deposits		10,707			4,189
Net change in accounts payable and accrued expenses		11,080			(4,148	)

Net Cash (used) in Operating Activities		(9,512	)		(48,439	)

CASH FLOWS FROM FINANCING ACTIVITIES

Advances from affiliate		10,753			49,858

Net Cash provided by Financing Activities		10,753			49,858

Effects of exchange rate on cash		-			(1,314	)

Net increase in Cash		1,241			105

Cash at Beginning of Period		2,172			2,270

Cash at End of Period		3,413			2,375

See notes to financial statements

CONSOLIDATED GEMS, INC.

Notes to Financial Statements

June 30, 2015

(1)	ORGANIZATION AND BUSINESS

Consolidated Gems, Inc. ("Consolidated Gems” or the “Company"), is a Delaware corporation originally incorporated in Florida as We Sell for U Corp. The principal stockholder of Consolidated Gems is Power Developments Pty Ltd., an Australian corporation (“Power”), an entity majority owned by the Company’s President, which owned 94.46% of Consolidated Gems as of June 30, 2015.

In order to take advantage of management’s substantial experience in the location and development of mineral exploration properties, the Company planned to look for opportunities in the resources industry.

The Company had decided to expand its focus to include precious gems in order to generate value for shareholders and is currently assessing several gem opportunities. In March 2015, following a review of the results of exploration on the gem tenement, the Company decided to relinquish the exploration license.

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”), which contemplates continuation of Consolidated Gems as a going concern. The Company has not yet commenced revenue producing operations and has incurred net losses since inception and may continue to incur substantial and increasing losses for the next several years, all of which raises substantial doubt as to its ability to continue as a going concern. The financial statements do not contain any adjustments that could arise as a result of this uncertainty.

In addition, Consolidated Gems is reliant on loans and advances from corporations affiliated with the Company. Based on discussions with these affiliate companies the Company believes this source of funding will continue to be available. Other than the arrangements noted above, the Company has not confirmed any other arrangement for ongoing funding. As a result the Company may be required to raise funds by additional debt or equity offerings in order to meet its cash flow requirements during the forthcoming year; however there can be no assurance that the Company will be successful in these efforts.

(2)	RECENT ACCOUNTING PRONOUNCEMENTS

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

(3)	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of the significant accounting policies followed in connection with the preparation of the financial statements.

Basis of Presentation and Used Estimates

The preparation of financial statements in conformity with US GAAP 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 revenue and expenses during the reporting period. Actual results could differ from those estimates.

The functional and reporting currency is the Australian dollar.

Mineral Property Acquisition, Exploration Costs and Amortization of Mineral Rights

Mineral property acquisition, exploration and development costs are expensed as incurred until such time as economic reserves are quantified. To date, the Company has not established any proven or probable reserves on its mineral properties. When it is determined that a mining deposit can be economically and legally extracted or produced based on established proven and probable reserves, further exploration costs and development costs incurred after such determination will be capitalized. The establishment of proven and probable reserves is based on results of final feasibility studies which indicate whether a property is economically feasible. Upon commencement of commercial production, capitalized costs will be transferred to the appropriate asset category and amortized over their estimated useful lives. Capitalized costs, net of salvage values, relating to a deposit which is abandoned or considered uneconomic for the foreseeable future, will be written off. Mineral rights are amortized over their estimated useful lives being the Company’s estimated rights to tenure.

Foreign Currency Translation

Effective April 1, 2013, the Company’s functional and reporting currency is the Australian dollar. Revenue and expenses incurred in a currency other than Australian dollars are translated at the date incurred or invoiced. Assets and liabilities are re-valued at the period end exchange rate where appropriate. Gains or losses from foreign currency transactions are included in the results of operations.

Prior to April 1, 2013, the Company’s functional currency was the US dollar. However, as a result of Australian based activities in the second quarter of 2013 relating to potential gem projects, the Company’s revenue and expenses are now primarily denominated in Australian dollars (A$). ASC 830 Foreign Currency Translation states that the functional currency of an entity is the currency of the primary economic environment in which the entity operates. Accordingly, the Company determined that from April 1, 2013, the functional currency of the Company is the Australian dollar. Assets, liabilities and equity were translated at the rate of exchange at April 1, 2013. Revenue and expenses were translated at rates at date of transaction. Translation gains and losses, if material, are included as part of accumulated other comprehensive income. The resulting translation at April 1, 2013 was not material.

Goods and Services Tax (“GST”)

Revenues, expenses and assets generated in Australia are subject to Australian GST which requires the supplier to add a 10% GST to predominately all expenses and the cost of assets and for the Company to include a 10% GST to the selling price of a product. Revenues, expenses and assets are recognized net of the amount of GST except where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognized as part of the cost of acquisition of the assets or as part of the expense item as applicable, and receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet. Cash flows are included in the cash flow statement on a gross basis and the GST component of cash flows arising from investing and financing activities which is recoverable from, or payable to, the taxation authority are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority

Comparative Figures

Where necessary, comparative figures have been reclassified to be consistent with current year presentation with no effect on operations.

(4)	AFFILIATE TRANSACTIONS

In January 2009, the Company entered into an agreement with AXIS Consultants Pty Ltd (“AXIS”) to provide geological, management and administration services to the Company. AXIS is affiliated through common management and is incorporated in Australia. The Company’s former President and director, Mr. Gutnick, is also a director of AXIS and Mr. Lee is Chief Financial Officer and Secretary of the Company and is also Company Secretary of AXIS. The Company is one of nine affiliated companies under common management with AXIS. Each of the companies has some common Directors, officers and shareholders. In addition, each of the companies is substantially dependent upon AXIS for its senior management and administration staff. It has been the intention of the affiliated companies and respective Boards of Directors that each of such arrangements or transactions should accommodate the respective interest of the relevant affiliated companies in a manner which is fair to all parties and equitable to the shareholders of each. Currently, there are no material arrangements or planned transactions between the Company and any of the other affiliated companies other than AXIS.

During the six months ended June 30, 2015, AXIS provided services in accordance with the services agreement, incurred direct costs on behalf of the Company and provided funding of A$10,753. The amounts owed to the affiliate as of June 30, 2015 is A$1,076,952.

(5)	INCOME TAXES

Consolidated Gems files its income tax returns on an accrual basis.

The Company files tax returns in the United States. Consolidated Gems has carry-forward losses of approximately US$1,900,000 as of December 31, 2014 which expire in years 2028 through 2034. Due to the uncertainty of the availability and future utilization of those operating loss carry-forwards, management has provided a full valuation against the related tax benefit. The Company’s tax returns for all years since December 31, 2011 remain open to examination by the respective tax authorities. There are currently no tax examinations in progress.

(6)	FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company’s financial instruments consist of cash, receivables, accounts payable and accrued expenses, and advances from affiliate. The carrying amounts of cash, receivables, accounts payable and accrued expenses approximate their respective fair values because of the short term nature of those instruments. The fair value of the advances from affiliate is not determinable as it is due to an affiliated entity, no market exists for similar instruments and settlement date is uncertain.

(7)	SUBSEQUENT EVENTS

The Company has evaluated events and transactions after the balance sheet date and through the date the financial statements were issued, and believes that all relevant disclosures have been included herein and there are no other events which require recognition or disclosure in the accompanying interim financial statements. On September 30, 2015, Mr Joseph Gutnick resigned as President, Chief Executive Officer and a Director and was replaced by Mr Mordechai Gutnick. In February 2016, the Company commenced a private placement and to-date has received subscriptions for 20,333,333 shares of common stock at a price of A$0.04 for A$940,000.

On March 8, 2016, the Company announced it had entered into a Term Sheet with Noam Levavi and Eran Galil (the “Vendors”) for the acquisition of all of the issued shares of Byondata (“Byondata”), a company incorporated under the laws of Israel. The Company has a 90 day period to conduct due diligence and negotiate a formal share sale agreement.

Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

General

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the Financial Statements and accompanying notes and the other financial information appearing elsewhere in this report. This report contains numerous forward-looking statements relating to our business. Such forward-looking statements are identified by the use of words such as believes, intends, expects, hopes, may, should, plan, projected, contemplates, anticipates or similar words. Actual operating schedules, results of operations, ore grades and mineral deposit estimates and other projections and estimates could differ materially from those projected in the forward-looking statements. The functional and reporting currency of the Company is the Australian Dollar. These interim financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

Overview

Consolidated Gems, Inc. (“Consolidated Gems” or the “Company”), formerly Electrum International, Inc. is a Delaware corporation originally incorporated in Florida as We Sell For U Corp. (“We Sell For U”). Consolidated Gems was originally established with the intention to develop and provide service offerings to facilitate auctions on eBay for individuals and companies who lack the eBay expertise and/or time to list/sell and ship items they wish to sell. In December 2008, Power Developments Pty Ltd, an Australian corporation ("Power") acquired approximately a 96% interest in Consolidated Gems from Edward T. Farmer and certain other stockholders. Mr. Farmer resigned as Sole Director and Officer of Consolidated Gems, Joseph Gutnick was appointed President, Chief Executive Officer and a Director and Peter Lee was appointed Chief Financial Officer and Secretary. On September 30, 2015, Joseph Gutnick resigned as President, Chief Executive Officer and a Director and Mr Mordechai Gutnick was appointed as President, Chief Executive Officer and a Director.

On August 12, 2009, the Company re-incorporated in the state of Delaware (the “Reincorporation”) through a merger involving We Sell for U Corp. and Consolidated Gems, a Delaware Corporation that was a wholly owned subsidiary of We Sell for U. The Reincorporation was effected by merging We Sell for U with Consolidated Gems, with Consolidated Gems being the surviving entity. For purposes of the Company’s reporting status with the Securities and Exchange Commission, Consolidated Gems is deemed a successor to We Sell for U.

We have incurred net losses since our inception and may continue to incur substantial and increasing losses for the next several years. Since inception we have incurred accumulated losses of A$2,766,338 which was funded primarily by the sale of equity securities and loans from affiliates.

Description of Current Business Plans and Activities

The following is a description of the Company’s current business plans and activities.

As a result of management’s decision to refocus its efforts from energy opportunities to explore opportunities in the resources industry, effective March 31, 2013, the Company ceased reporting as a development stage company. Since April 1, 2013, the Company had been evaluating potential gem related projects and had been granted an exploration tenement in New South Wales, Australia. Accordingly, from April 1, 2013 the Company had been classified as an exploration stage company. In March 2015, following a review of the results of exploration on the gem tenement, the Company decided to relinquish the exploration license.

RESULTS OF OPERATIONS

Three Months Ended June 30, 2015 vs. Three Months Ended June 30, 2014.

Costs and expenses are incurred in both Australian and US dollars. Costs incurred in US dollars are converted to Australian dollars. The Australian dollar has fallen by approximately 30% against the US dollar over the past 12 months and therefore the comparison of amounts for the three month period ended June 30, 2015 versus the three month period ended June 30, 2014 does not provide a true comparison of the movement as it may have been heavily influenced by the movement in the exchange rate depending on whether the cost or expenses was initially incurred in US dollars or Australian dollars.

Costs and expenses decreased from A$23,234 in the three months ended June 30, 2014 to A$17,025 in the three months ended June 30, 2015.

The decrease in costs and expenses is a net result of:

an increase in legal, accounting and professional expense from A$9,431 for the three months ended June 30, 2014 to A$16,255 for the three months ended June 30, 2015. Included within legal, accounting and professional expense for the three months ended June 30, 2015 is A$257 (2014: A$507) for costs associated with the Company’s SEC compliance obligations; A$3,292 (2014: A$1,998) which relates to stock agent transfer fees; and accounting fees for the three months ended June 30, 2015 of A$12,706 (2014: A$6,926).

a decrease in administrative expense from A$9,896 in the three months ended June 30, 2014 to A$770 in the three months ended June 30, 2015, primarily as a result of a decrease in the cost of services provided by AXIS in accordance with the service agreement. Included within the administrative expenses of A$770 (2014: A$9,896) is an amount of A$(12,043) credited to us by AXIS (2014: A$3,950 billed to us by AXIS).

a decrease in exploration expenditure expense from A$3,907 for the three months ended June 30, 2014 to A$nil for the three months ended June 30, 2015. During 2014, the Company assessed the results of these activities conducted in 2013 resulting in reduced exploration activities. During the three months to March 31, 2015, the Company relinquished the tenement.

As a result of the foregoing, the loss from operations decreased from A$23,234 for the three months ended June 30, 2014 to a loss from operations of A$17,025 for the three months ended June 30, 2015.

A foreign currency exchange loss of A$1,745 for the three months ended June 30, 2014 compared to a foreign currency exchange loss of A$10,653 for the three months ended June 30, 2015 was recorded as a result of the movement in the US dollar versus the Australian dollar.

The net loss was A$27,678 for the three months ended June 30, 2015 compared to a net loss of A$24,979 for the three months ended June 30, 2014.

Six Months Ended June 30, 2015 vs. Six Months Ended June 30, 2014.

Costs and expenses are incurred in both Australian and US dollars. Costs incurred in US dollars are converted to Australian dollars. The Australian dollar has fallen by approximately 30% against the US dollar over the past 12 months and therefore the comparison of amounts for the six month period ended June 30, 2015 versus the six month period ended June 30, 2014 does not provide a true comparison of the movement as it may have been heavily influenced by the movement in the exchange rate depending on whether the cost or expenses was initially incurred in US dollars or Australian dollars.

Costs and expenses decreased from A$52,326 in the six months ended June 30, 2014 to A$29,139 in the six months ended June 30, 2015.

The decrease in costs and expenses is a net result of:

An increase in legal, accounting and professional expense from A$18,833 for the six months ended June 30, 2014 to A$26,442 for the six months ended June 30, 2015. Included within legal, accounting and professional expense for the six months ended June 30, 2014 is A$257 (2014: A$784) for costs associated with the Company’s SEC compliance; accounting fee costs for the six months ended June 30, 2014 of A$21,159 (2014: A$13,426); and A$5,026 (2014: A$4,106) which relates to stock agent transfer fees.

A decrease in administrative expense from A$22,860 in the six months ended June 30, 2014 to A$2,697 in the six months ended June 30, 2015. Included within administrative expenses for the six months ended June 30, 2015 are: A$nil (2014: A$16) for accounting support fees; A$3,038 (2014: A$14,466) for costs associated with the Company’s SEC compliance obligations; A$360 (2014: A$390) for bank charges; insurance costs of A$8,984 (2014: A$3,847); A$530 (2014: A$421) for storage costs; consultants fees A$11,000 (2014: A$nil) and A$(21,271) credited to us by AXIS (2014: A$4,213) for wages and salaries expenditure. Included within the administrative expenses of A$2,697 (2014: A$22,860) is an amount of A$(10,048) credited to us by AXIS (2014: A$9,381 billed to us by AXIS).

A decrease in exploration expenditure expense from A$10,633 for the six months ended June 30, 2014 to A$nil for the six months ended June 30, 2015. During 2014, the Company assessed the results of these activities conducted in 2013 resulting in reduced exploration activities. During the six months to June 30, 2015, the Company relinquished the tenement.

As a result of the foregoing, the loss from operations decreased from A$52,326 for the six months ended June 30, 2014 to a loss from operations of A$29,139 for the six months ended June 30, 2015.

A foreign currency exchange loss of A$1,314 for the six months ended June 30, 2014 compared to a foreign currency exchange loss of A$10,762 for the six months ended June 30, 2015 was recorded as a result of the movement in the US dollar versus the Australian dollar.

The net loss was A$39,901 for the six months ended June 30, 2015 compared to a net loss of A$53,640 for the six months ended June 30, 2014.

Liquidity and Capital Resources

For the six months ended June 30, 2015, net cash used in operating activities was A$9,512 consisting of the net loss of A$39,901 offset by a non-cash charge for foreign currency exchange loss of A$10,762, an increase in accounts payable and accrued expenses of A$11,080, an increase in prepayments of A$2,160 and a decrease in receivables and deposits of A$10,707. For the six months ended June 30, 2015, net cash provided by financing activities was A$10,753 consisting of an advance from affiliate.

As of June 30, 2015, the Company had short-term obligations of A$107,274 comprising accounts payable and accrued expenses

The Company has funded operations since inception through advances from affiliated entities. The Company’s ability to continue operations through 2016 is dependent upon future funding from affiliated entities, capital raisings, or its ability to commence revenue producing operations and positive cash flows, of which there can be no assurance. AXIS has advised it does not currently intend to require repayment of these advances prior to June 30, 2016, accordingly the Company has decided to classify the amounts payable as non-current in the accompanying balance sheets.

The Company continues to search for additional sources of capital, as and when needed; however, there can be no assurance funding will be successfully obtained. Even if it is obtained, there is no assurance that it will not be secured on terms that are not highly dilutive to existing shareholders.

The accompanying financial statements have been prepared in conformity with US GAAP, which contemplates continuation of Consolidated Gems as a going concern. However, Consolidated Gems, Inc. has limited assets, negative working capital, a stockholders’ deficit; has not yet commenced revenue producing operations and has sustained recurring losses since inception.

Our budget for general and administration and for professional expenses for the remainder of fiscal 2015 is A$0.05 million. Once we have identified a specific exploration or mining project we will also need to prepare a budget for these activities. We are currently investigating capital raising opportunities which may be in the form of either equity or debt, to provide funding for working capital purposes. There can be no assurance that such a capital raising will be successful, or that even if an offer of financing is received by the Company, it is on terms acceptable to the Company.

Information Concerning Forward-Looking Statements

This report and other reports, as well as other written and oral statements made or released by us, may contain forward-looking statements. Forward-looking statements are statements that describe, or that are based on, our current expectations, estimates, projections and beliefs. Forward-looking statements are based on assumptions made by us, and on information currently available to us. Forward-looking statements describe our expectations today of what we believe is most likely to occur or may be reasonably achievable in the future, but such statements do not predict or assure any future occurrence and may turn out to be wrong. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. The words "believe", "anticipate", "intend", "expect", "estimate", "project", "predict", "hope", "should", "may", and "will", other words and expressions that have similar meanings, and variations of such words and expressions, among others, usually are intended to help identify forward-looking statements.

Forward-looking statements are subject to both known and unknown risks and uncertainties and can be affected by inaccurate assumptions we might make. Risks, uncertainties and inaccurate assumptions could cause actual results to differ materially from historical results or those currently anticipated. Consequently, no forward-looking statement can be guaranteed. The potential risks and uncertainties that could affect forward looking statements include, but are not limited to:

●	The risk factors set forth in Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014,

●	The possibility that we do not find gems or other minerals or that the gems or other minerals we find are not commercially economical to mine,

●	The risks and hazards inherent in the mineral exploration and development business (including environmental hazards, industrial accidents, weather or geologically related conditions),

●	Changes in the market price of minerals or gems,

●	The effects of environmental and other governmental regulations,

●	The uncertainties inherent in our exploratory activities, including risks relating to permitting and regulatory delays,

●	Estimates of proven and probable reserves are subject to considerable uncertainty,

●	Movements in foreign exchange rates,

●	Increased competition, governmental regulation,

●	Performance of information systems,

●	Ability of the Company to hire, train and retain qualified employees,

In addition, other risks, uncertainties, assumptions, and factors that could affect the Company's results and prospects are described in this Quarterly Report on Form 10-Q and in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014, including under the heading “Risk Factors” and elsewhere herein and therein and may further be described in the Company's prior and future filings with the Securities and Exchange Commission and other written and oral statements made or released by the Company.

We caution you not to place undue reliance on any forward-looking statements, which speak only as of the date of this document. The information contained in this report is current only as of its date, and we assume no obligation to update any forward-looking statements.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

At June 30, 2015, the Company had no outstanding loan facilities.

Item 4.

Controls and Procedures.

(a)	Disclosure Controls and Procedures

Our principal executive officer and our principal financial officer evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 as amended) as of the end of the period covered by this report. Based on that evaluation, such principal executive officer and principal financial officer concluded that, the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report at the reasonable level of assurance.

(b)	Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the second quarter of 2015 that materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

(c)

Other

We believe that a controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Therefore, 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. Our disclosure controls and procedures are designed to provide such reasonable assurance of achieving our desired control objectives, and our principal executive officer and principal financial officer have concluded, as of June 30, 2015, that our disclosure controls and procedures were effective in achieving that level of reasonable assurance.

PART II – OTHER INFORMATION

Item 1.

Legal Proceedings.

Not Applicable

Item 1A.

Risk Factors.

Not Applicable

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

Not Applicable

Item 3.

Defaults Upon Senior Securities.

Not Applicable

Item 4.

Mining Safety Disclosures.

Not Applicable

Item 5.

Other Information.

Not Applicable

Item 6.

Exhibits.

(a)

Exhibit No.

Description

31.1

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Mordechai Zev Gutnick

31.2

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Peter James Lee

32.1

Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley act of 2002 by Mordechai Zev Gutnick

32.2

Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley act of 2002 by Peter James Lee

101

The following materials from the Consolidated Gems, Inc. Quarterly Report on Form 10-Q for the three months ended June 30, 2015 formatted in Extensible Business Reporting Language (XBRL): (i) the Balance Sheets, (ii) the Statements of Operations, (iii) Statement of Stockholders’ (Deficit), (iv) the Statements of Cash Flows and (v) related notes.

#101.INS XBRL

Instance Document.

#101.SCHXBRL

Taxonomy Extension Schema Document.

#101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document.

#101.LAB

XBRL Taxonomy Extension Label Linkbase Document.

#101.PREXBRL

Taxonomy Extension Presentation Linkbase Document.

#101.DEF

XBRL Taxonomy Extension Definition Linkbase Document.

_________________

Filed herewith. In accordance with Rule 406T of Regulation S-T, these interactive data files are deemed “not filed” for purposes of section 18 of the Exchange Act, and otherwise are not subject to liability under that section.

FORM 10-Q

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Consolidated Gems, Inc.

	By:	/s/ Mordechai Z Gutnick

		Mordechai Z. Gutnick
		Chairman of the Board, President and Chief Executive Officer
		(Principal Executive Officer)




	By:	/s/ Peter Lee

		Peter Lee
		Secretary and Chief Financial Officer
		(Principal Financial Officer)


Date: March 16, 2016

EXHIBIT INDEX

Exhibit No. Description

31.1

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Mordechai Zev Gutnick

31.2

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Peter James Lee

32.1

Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley act of 2002 by Mordechai Zev Gutnick

32.2

Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley act of 2002 by Peter James Lee

101

The following materials from the Consolidated Gems, Inc. Quarterly Report on Form 10-Q for the three months ended June 30, 2015 formatted in Extensible Business Reporting Language (XBRL): (i) the Statements of Operations, (ii) the Balance Sheets, (iii) the Statement of Stockholders’ (deficit), (iv) the Statements of Cash Flows and (v) related notes.

#101.INS

XBRL Instance Document.

#101.SCH XBRL

Taxonomy Extension Schema Document..

#101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document.

#101.LAB

XBRL Taxonomy Extension Label Linkbase Document.

#101.PRE XBRL

Taxonomy Extension Presentation Linkbase Document.

#101.DEF

XBRL Taxonomy Extension Definition Linkbase Document.17

__________________

# Filed herewith. In accordance with Rule 406T of Regulation S-T, these interactive data files are deemed “not filed” for purposes of section 18 of the Exchange Act, and otherwise are not subject to liability under that section.

CONSOLIDATED GEMS, INC. 10-Q