UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~December 3031, 2015

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ______________

Commission file number: 333-184682

AVANGARD CAPITAL GROUP INC. ~~(Exact name of registrant as specified in its charter)~~

(Exact name of registrant as specified in its charter)

Nevada		45-5507359
(State or other jurisdiction		(IRS Employer
of incorporation)		Identification No.)

2708 Commerce Way Suite 300, Philadelphia PA		19154
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (215) 464-7300 ~~Not Applicable. (Former name or former address, if changed since last report)~~

Not Applicable.

(Former name or former address, if changed since last report)

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 [X] 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 (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] 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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act

Large accelerated filer	[ ]	Accelerated filer	[ ]

Non-accelerated filer	[ ]	Smaller reporting company	[X]
(Do not check if smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes [ ] No [X]

As of ~~November~~February 1112, ~~2015~~2016 there were 10,781,466 shares issued and outstanding of Registrant’s Common Stock.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION
Item 1	Financial Statements (unaudited)	F-1
	Condensed Balance Sheets as of September 30, 2015 (unaudited) and June 30, 2015	F-1
	Condensed Balance Sheets as of December 31, 2015 (unaudited) and June 30, 2015	F-1
	Condensed Statements of Operations for the Three Months Ended September 30, 2015 and 2014 (unaudited)	F-2
	Condensed Statements of Operations for the Three and Six Months Ended December 31, 2015 and 2014 (unaudited)	F-2
	Condensed Statements of Cash Flows for the Three Months Ended September 30, 2015 and 2014 (unaudited)	F-3
	Condensed Statements of Cash Flows for the Six Months Ended December 31, 2015 and 2014 (unaudited)	F-3
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	39
Item 3	Quantitative and Qualitative Disclosures About Market Risk	411
Item 4	Controls and Procedures	511
PART II - OTHER INFORMATION
Item 1	Legal Proceedings	611
Item 1A	Risk Factors	611
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	611
Item 3	Defaults Upon Senior Securities	612
Item 4	Mine Safety Disclosures	612
Item 5	Other Information	612
Item 6	Exhibits	612
Signatures		713

PART 1 - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

AVANGARD CAPITAL GROUP, INC.

CONDENSED BALANCE SHEETS

(unaudited)

	September 30, 2015			June 30, 2015
	December 31, 2015			June 30, 2015
ASSETS
Current assets:
Cash	$	1,~~305~~137		$	784
Due from related parties		5,024			5,024
Total current assets		6,~~329~~161			5,808
Property and equipment, net		2,~~667~~533			2,799
Total assets	$	8,~~996~~694		$	8,607
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable and accrued expenses	$	3545,~~166~~755		$	25,350
Due to related party	$	35,000		$	25,000
Total current liabilities	$	7080,~~166~~755		$	50,350
Stockholders’ deficit
Convertible Preferred Stock Series A, $0.0001 par value, 300,000,000 authorized, 585,000 issued and outstanding;		58			58
Common stock, $0.0001 par value, 100,000,000 authorized; Class A, 10,781,466 shares issued and outstanding		1,078			1,078
Additional paid in capital		787,837			787,837
Accumulated deficit		(~~850~~861,~~143~~034	)		(830,716	)
Total stockholders’ deficit		(6172,~~170~~061	)		(41,743	)
Total liabilities and stockholders’ deficit	$	8,~~996~~694		$	8,607

The accompanying notes are an integral part of these condensed financial statements.

F-1

AVANGARD CAPITAL GROUP, INC.

CONDENSED STATEMENTS OF OPERATIONS

(unaudited)

	For the three months ended September 30,
	For the three months ended December 31,						For the six months ended December 31,
	2015			2014			2015			2014
REVENUE
Fee revenue	$	-		$	-		$	-		$	-
Total revenue		-			-			-			-
OPERATING EXPENSES
Selling, general and administrative		1910,~~428~~890			4260,~~089~~343		$	30,318			102,401
Total operating expenses		1910,~~428~~890			4260,~~089~~343			30,318			102,401
Loss from operations		(1910,~~428~~890	)		(4260,~~089~~343	)		(30,318	)		(102,401	)
Other income
Interest and dividend income		-			12
Other income (inventory recovery)		-			26,355			-			26,355
Total other income		-			12
Interest and dividend income		-			287			-			298
Net loss	$	(19,428	)	$	(42,077	)
Total other income		-			26,642			-			26,653
Net loss per share attributable to common shareholders - basic and diluted	$	(0.00	)	$	(0.00	)
Net loss	$	(10,890	)	$	(33,701	)	$	(30,318	)	$	(75,748	)
Weighted average number of common shares used in computation - basic and diluted		10,781,466			9,719,727
Net loss per share attributable to common shareholders - basic and diluted		(0.00	)		(0.00	)		(0.00	)		(0.01	)
Weighted average number of common shares used in computation - basic and diluted		10,781,466			10,781,466			10,781,466			10,250,596

The accompanying notes are an integral part of these condensed financial statements.

F-2

AVANGARD CAPITAL GROUP, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(unaudited)

	For the Three Months Ended September 30,
	For the Six Months Ended December 31,
	2015			2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(1930,~~428~~318	)	$	(4275,~~077~~748	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		~~133~~265			~~133~~266
Other income (inventory recovery)		-			(26,355	)
Changes in operating assets and liabilities:
Floor plan financing receivable		-			(704	)
Used car inventory		-			25,511
Due from related party		-			7,000
Other assets		-			7,000
Accounts payable and accrued expenses		920,~~816~~406			(314,~~176~~505	)
NET CASH USED IN OPERATING ACTIVITIES		(9,~~479~~647	)		(3883,~~794~~831	)
CASH FLOWS FROM INVESTING ACTIVITIES
NET CASH USED IN INVESTING ACTIVITIES		-			-
CASH FLOWS FROM FINANCING ACTIVITIES
Due to related party		10,000			-
NET CASH PROVIDED BY FINANCING ACTIVITIES		10,000			-
Redemption of preferred stock		-			(320,000	)
Net increase (decrease) in cash		521			(38,824	)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		10,000			(320,000	)
Net increase (decrease) in cash		353			(403,831	)
Cash, beginning of the period		784			424,272
Cash, at end of the period	$	1,~~305~~137		$	~~385~~20,~~448~~441

The accompanying notes are an integral part of these condensed financial statements.

F-3

AVANGARD CAPITAL GROUP, INC.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

~~September~~December 3031, 2015

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Description of Business Avangard Capital Group, Inc., a Nevada corporation is referred to in this report as “we”, “us”, “our”, “ACG”, the “Company” or “Avangard Capital Group.”

We were incorporated June 13, 2012 under the laws of the State of Nevada. Our executive offices are located at 2708 Commerce Way, Suite 300, Philadelphia, PA 19154.

We were an independent auto sales finance company that ~~provides~~provided floor plan financing for independent used car dealers based on the value of collateral (the car) as determined by us using the automobile industry’s nationally-recognized valuation sources. We currently maintain licenses to operate in the states of New Jersey, Pennsylvania and Florida. We commenced business June 22, 2012 with the purchase of all floor plan receivables from Avangard Auto Finance, Inc. (“AAF”), an affiliate. Pursuant to an Assignment Agreement with AAF dated June 13, 2012, we acquired AAF’s floor plan financing portfolio for $151,979, the face value of the contracts plus accrued interest and fees at that time.

In January 2013 we received approval and were licensed by the States of Florida and New Jersey as a Sales Finance Company. In February 2013, we were licensed in the Commonwealth of Pennsylvania as a Sales Finance Company. These licenses permitted us to expand our operations to providing financing for auto sales by dealers. We have not commenced operations in Florida or New Jersey as we are evaluating the feasibility of expanding into these markets. In addition, we have suspended financing new loans as we explore alternative opportunities for our future growth.

On March 26, 2013 we acquired certain retail installment contract receivables from AAF and Avangard Financial Group, Inc., a related party (“AFG”) for $102,250. The receivables consisted of an aggregate principal balance of approximately $141,868 for current loans receivables and approximately $323,449 for non-current loans receivables. We recovered our initial investment and earned approximately 20% in interest on the investment.

On February 19, 2014 we transferred all remaining loans receivable to AAF as we determined that the outstanding balances were either uncollectible or difficult to collect and the Company did not believe that pursuing further collection efforts was a good use of the Company’s resources.

During the year ended June 30, 2015 we had repossessed 18 of 21 vehicles subject to the floor plan security arrangement. We recovered $123,425 of floor plan receivables through the sale of repossessed autos.

At ~~September~~December 3031, 2015 we have no inventory of repossessed autos.

Interim Financial Statements

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these financial statements are adequate to make the information presented not misleading. The unaudited condensed financial statements included in this document have been prepared on the same basis as the annual financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements. The results for the ~~quarter~~six months ended ~~September~~December 3031, 2015 are not necessarily indicative of the results expected for ~~the~~ the full year or for any subsequent interim periods. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and the notes to those statements included in our Annual Report on Form 10-K for the period ended June 30, 2015 filed with the SEC on October 13, 2015.

Use of Estimates

We use estimates and assumptions in preparing financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents include highly liquid investments with an original maturity of three months or less when purchased.

F-4

AVANGARD CAPITAL GROUP, INC.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

December 31, 2015

Revenue Recognition

Interest income from floor plan financing receivable is recognized using the interest method. Accrual of income on finance receivables is suspended when a contract is contractually delinquent for ninety (90) days or more. The accrual is resumed when the contract becomes contractually current and past due interest is recognized at that time.

Origination Fees are recognized for services provided during the loan origination process at the point in time the loan is funded.

The Company accounts for its investment in floor plan financing receivables using the interest method, under ASC 310 pools of accounts are established based on certain common risk criteria. Each pool is recorded at cost and is accounted for as a single unit for the recognition of income, principal payments and loss provision.

During the quarter ended ~~September~~December 3031, 2015 the Company had no revenue.

Floor Plan Financing Receivable

Floor plan financing receivable consists of purchased automobiles, which were assigned to us upon acquisition. The titles to the automobiles, which serve as security for the payment of the purchased contracts, are held by us.

As of ~~September~~December 3031, 2015 there are no floor plan financing receivables.

We perform periodic evaluations of the adequacy of the allowance for losses taking into consideration the past loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, as well as recovery potential of any underlying collateral, personal guarantees and current economic conditions. Any increases in the allowance for losses subsequent to the acquisition of the contract are charged to earnings.

Our primary floor plan customer defaulted on their agreement in February 2014. The floor plan agreement carried personal guarantees and confessions of judgment, in addition to first lien on all vehicles subject to the floor plan agreement. In March 2014, the customer filed for bankruptcy protection under Chapter 11 of the Federal Bankruptcy Code. We repossessed 18 of the 21 vehicles subject to the floor plan agreement from the debtor prior to its Chapter 11 filing. As of ~~September~~December 3031, 2015 we recovered $123,425 of floor plan receivables through the sale of repossessed autos. We continue to pursue guarantors of the agreement through the Federal bankruptcy Courts. However, we are unable to determine the amount, if any, that we may recover.

Inventory

As of ~~September~~December 3031, 2015 the Company has no inventory.

Concentrations of Credit Risk

The Company’s assets exposed to credit risk are cash and finance and interest receivables, of which there was none as of ~~September~~December 3031, 2015.

For the ~~quarter~~six months ended ~~September~~December 3031, 2015, the company had no revenue.

The Company maintains its cash balances in Federal Deposit Insurance Corporation (“FDIC”) insured financial institutions.

Property and Equipment

Fixed assets are recorded at their historical cost upon acquisition or cost of construction. The assets are depreciated using the straight-line method over their statutory lives. The fixed asset categories and their estimated lives are as follows:

Office Equipment 5 years

Income Taxes

We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company has incurred a net operating loss for financial-reporting and tax-reporting purposes. Accordingly, for Federal and state income tax purposes, the benefit for income taxes has been offset entirely by a valuation allowance against the related federal and state deferred tax asset for the quarter ended September 30, 2015.

F-5

AVANGARD CAPITAL GROUP, INC.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

December 31, 2015

Income Taxes

NOTE 2 - GOING CONCERN

The Company’s financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. During the ~~quarter~~six months ended ~~September~~December 3031, 2015 the Company recognized sales revenue of $-0- ~~and~~ and incurred a net loss of $1930,~~428~~318. As of ~~September~~December 3031, 2015 the Company had an accumulated deficit of $~~850~~861,~~143~~034. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability to raise equity or debt financing, and the attainment of profitable operations from future growth opportunities the Company’s ~~planned~~is ~~business~~exploring. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining capital from significant shareholders sufficient to meet its operating expenses and seeking equity and/or debt financing from third parties. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 3 - INCOME TAXES

The net deferred tax asset consists of the following:

	September 30, 2015			June 30, 2015
	December 31, 2015			June 30, 2015
Deferred Tax Asset	$	~~345~~349,~~102~~523		$	314,841
Less: Valuation Allowance		(~~345~~349,~~102~~523	)		(314,841	)
Net Deferred Tax Assets	$	-		$	-

As of ~~September~~December 3031, 2015, the Company has net operating loss carry forwards of $~~850~~861,~~143~~034 that can be utilized to offset future taxable income for Federal and State income tax purposes through 2025, generating a maximum deferred tax benefit of $~~345~~349,~~102~~523 by applying Federal and State statutory tax rates. The Company applied a 100% valuation reserve against the deferred tax benefit, as the realization of the benefit is not certain.

The following tax years remain subject to examination by the respective tax jurisdictions.

Fiscal Years ending

June 30,

Internal Revenue Service

2012 - 2015

Commonwealth of Pennsylvania

2012 - 2015

NOTE 4 - LOAN FROM SHAREHOLDER

On May 1, 2015, the Company entered into a loan agreement with a major shareholder to obtain financing up to $50,000. Advances under the agreement are non-interest bearing and due on demand. At ~~September~~December 3031, 2015, the amount due to the shareholder was $35,000, and unused amount representing availability to borrow was $15,000. Debt is secured by common stock of Avangard Capital Group, Inc.

NOTE 5 - COMMON AND PREFERRED STOCK

On June 20, 2014 the Board of Directors authorized the completion of the Reverse Stock Split, and effective as of June 30, 2014, the Company completed a reverse stock split of our issued and outstanding common stock on a 1 for 10 basis (the “Reverse Stock Split”) .

On July 10, 2014, the Board of Directors issued 9,768,000 unregistered shares of common stock to related parties and majority shareholder, Friedman Financial Group, in exchange for $977.

As of September 30, 2015 the Company is authorized to issue 100,000,000 shares of $0.0001 par value common stock.

The Company is authorized to issue 300,000,000 shares of $0.0001 par value Convertible Preferred Stock Series A. On December 29, 2014 the Board of Directors approved the redemption of 320,000 shares of Convertible Preferred Stock Series A at $1.00 per share.

F-6

AVANGARD CAPITAL GROUP, INC.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

December 31, 2015

Common Stock Purchase Warrants

A summary of the status of our outstanding common stock purchase warrants granted as of ~~September~~December 3031, 2015 and changes during the period is as follows:

	Shares		Weighted
	Underlying		Average
	Warrants	~~Warrants~~	exercise price	~~exercise price~~
Outstanding and exercisable at June 30, 2015		2,867	$	2.00
Additions		-		-
Outstanding and exercisable at September 30, 2015		2,867	$	2.00
Outstanding and exercisable at December 31, 2015		2,867	$	2.00

The following information applies to all warrants outstanding and exercisable at ~~September~~December 3031, 2015

Number of Warrants
outstanding and					~~Remaining contractual~~	Remaining contractual
exercisable			Exercise Price		~~life (Years)~~	life (Years)
~~2,867~~	2,867	$	~~2.00~~$	2.00	~~0.33~~		0.08

NOTE 6 - LOSS PER SHARE

Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. The Company’s potential dilutive shares, which include convertible preferred shares and shares issuable upon exercise of the Warrants, have not been included in the computation of diluted net loss per share as the result would be antidilutive. Such potentially dilutive shares are excluded when the effect would be to reduce net loss per share. All potential common shares have been excluded from the computation of the dilutive net loss per share for the period presented because the effect would have been antidilutive. Such potential common shares consist of the following:

	September 30, 2015		September 30, 2014
	December 31, 2015		December 31, 2014
Convertible preferred stock		1,755,000		21,~~715~~755,000
Warrants attached to units sold		2,867		2,867

NOTE 7 - RELATED PARTY TRANSACTIONS

We entered into a lease agreement for office space with Commerce Way, LLC (“CWL”). CWL is owned by DJS Investments, LLC and SELF, LP. SELF, LP is a shareholder of Friedman Financial Group, who is a principal shareholder of our Company. The lease requires monthly payments, commencing August 1, 2012, of $2,500 on a month to month basis. No security deposit was required. ~~The Company suspended operations and terminated the lease with Commerce Way, LLC.~~ Effective January 2015 the company resumed paying $2,500 per month rent on a month to month basis. For the quarter ended September 30, 2015 CWL did not charge the Company for use of the facilities. No rent was accrued or paid during the first quarter ended September 30, 2015. In October 2015 the Company resumed using the premises while it pursues other business opportunities. As a result the Company accrued $2,500 monthly rent expense. Rent expense for the ~~quarter~~ six months ended ~~September~~December 3031, 2015 and 2014 was $07,500 and $0 respectively.

~~Friedman~~On ~~Financial~~July ~~Group~~22, 2015, in a ~~related~~matter ~~party,~~before ~~entered~~the ~~into~~courts aof ~~financial~~Pennsylvania ~~agreement~~unrelated ~~with~~to ~~the~~Avangard ~~Company~~Capital toGroup, ~~provide~~Mr. ~~$50~~Gulko,~~000~~ ~~for~~former ~~operating~~officer ~~expenses.~~and ~~The~~director ~~advances~~of ~~bear~~the noCompany ~~interest~~agreed to a Stipulation and isConsent ~~payable~~Order onwith ~~demand~~Avangard Auto Finance, Inc., ~~Friedman~~a ~~Financial~~related ~~Group~~party. ~~has~~The ~~agreed~~order settled toclaims ~~provide~~by ~~additional~~Avangard ~~financing~~Auto ~~as required~~Finance, toInc. ~~pay~~against ~~necessary~~Mr. ~~operating~~Gulko ~~expenses~~and his companies. AtIn ~~September~~settlement ~~30,~~of ~~2015,~~all ~~the~~claims ~~amount~~Mr. ~~due~~Gulko agreed to ~~the~~relinquish ~~shareholder~~all ~~was~~ownership ~~$35~~of 490,000, shares of Common Stock and ~~unused amount~~48,237 ~~representing~~shares ~~availability~~of toSeries ~~borrow~~A ~~was~~Convertible ~~$15,000~~Preferred Stock. ~~Debt~~Avangard Auto isFinance ~~secured~~assigned bythe ~~common~~shares ~~stock~~received ofin ~~Avangard~~settlement ~~Capital~~to Friedman Financial Group, ~~Inc~~LLC on August 21, 2015.

OnAmounts ~~July~~due ~~22,~~from ~~2015,~~related inparties arepresent ~~matter~~legal ~~before~~expenses ~~the~~paid ~~courts~~by ~~of Pennsylvania unrelated to Avangard Capital Group, Mr. Gulko, former officer and director of~~ the Company ~~agreed~~that toare ~~a Stipulation and Consent Order with Avangard Auto Finance, Inc., a~~ related ~~party.~~to ~~The~~cases ~~order settled~~involving ~~claims by~~ Avangard Auto Finance, Inc. ~~against Mr. Gulko~~ and ~~his~~Commerce ~~companies.~~Way In settlement of all claims Mr. Gulko agreed to relinquish all ownership of 490,000 shares of Common and 48,237 shares of Series A Convertible Preferred Stock. Avangard Auto Finance assigned the shares received in settlement to Friedman Financial Group, LLC ~~on August 21, 2015~~.

~~Amounts~~Officers ~~due~~and ~~from~~ related parties of ~~$5,024~~our ~~represent~~Company ~~legal~~provide ~~expenses~~certain ~~paid~~administrative byduties at no charge. At December 31, 2015, the Company ~~that~~had ~~are~~accounts payable ~~related~~ to ~~cases~~Friedman ~~involving~~Financial ~~Avangard~~Group ~~Auto Finance~~of $14,941 ~~Inc.~~for ~~and~~reimbursable ~~Commerce~~expenses ~~Way~~incurred ~~LLC~~on behalf of the Company.

~~Officers~~Accounts ~~and~~payable ~~related~~to ~~parties~~Commerce ofWay ~~our~~Office ~~Company~~Complex ~~provide~~were ~~certain~~$9,505 ~~administrative~~and ~~duties~~$0 at noDecember ~~charge. At September 30~~31, 2015, ~~the~~and ~~Company~~June ~~had accounts payable to Friedman Financial Group of $11~~30,~~758~~ ~~for~~2015 ~~reimbursable expenses incurred on behalf of the Company~~respectively.

F-7

AVANGARD CAPITAL GROUP, INC.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

December 31, 2015

NOTE 8 - COMMITMENTS AND CONTINGENCIES

From time to time, the Company is a defendant in various lawsuits incident to the ordinary course of business. It is not possible to determine, with any precision, the probable outcome of the amount of any liability not covered by commercial insurance policies. Additionally, on September 1, 2015, the major shareholder entered into an indemnity agreement with the Company to indemnity the Company of any liability arising from judgments related to repossessed vehicles.

NOTE 9 - – SUBSEQUENT EVENTS

There are no subsequent events.

F-78

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Cautionary Note Regarding Forward-Looking Information and Factors That May Affect Future Results

This report contains forward-looking statements regarding our business, financial condition, results of operations and prospects. The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This Quarterly Report on Form 10-Q and other written and oral statements that we make from time to time contain such forward-looking statements that set out anticipated results based on management’s plans and assumptions regarding future events or performance. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance or results of current and anticipated sales efforts, expenses, the outcome of contingencies, such as legal proceedings, and financial results. A list of factors that could cause our actual results of operations and financial condition to differ materially is set forth below, and these factors are discussed in greater detail under the “Risk Factors” section of our Annual Report on Form 10-K as filed with the SEC on October 13, 2015:

●	Our limited operating history and ability to achieve profitability.

●	Our ability to assure that related party transactions are fair to our company.

●	Our ability to manage growth in our business.

●	Our dependence on one floor plan financing agreement.

●	The impact of the volatility in the worldwide credit and equity markets.

●	The departure of our CEO, director and principal financial officer has increased our dependence on the services provided by Simon Friedman, Chairman of the Board of Directors and interim CEO, who can exercise disproportionate voting control over corporate decisions.

●	The super voting power of our interim CEO and director who holds shares of the Series A Convertible Preferred Stock.

●	Write-Offs for losses and defaults on our floor plan receivables.

●	The impact of changes in interest rates.

●	Increased costs as a result of becoming a reporting company.

●	Our ability to maintain an effective system of internal controls over financial reporting.

●	The affects on our stock price as a result of sales of our common stock by existing shareholders pursuant to Rule 144.

We caution that the factors described herein and other factors could cause our actual results of operations and financial condition to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

OVERVIEW

We were an independent auto sales finance company that provided floor plan financing and auto financing for independent used car dealers. The loans made were based on the value of collateral (the car) as determined by us using the automobile industry’s nationally-recognized valuation sources. We maintain our licenses to operate in Pennsylvania, New Jersey and Florida. The Company has suspended financing new loans while Management and the Board of Directors explore alternative opportunities for our future growth.

Recent Developments

Effective June 30, 2014, we amended and restated our articles of incorporation in order to effectuate a 1-for-10 Reverse Stock Split of our issued and outstanding common stock. As a result of the Reverse Stock Split, every 10 shares of our pre-Reverse Stock Split common stock was combined and reclassified into one share of our common stock. No fractional shares of common stock were issued as a result of the Reverse Stock Split. Throughout this quarterly report on Form 10-Q, each instance that refers to a number of shares of our common stock, refers to the number of shares of common stock after giving effect to the Reverse Stock Split, unless otherwise indicated.

We define our accounting periods as follows:

	●	“fiscal 2013” - July 1, 2012 through June 30, 2013

	●	“fiscal 2014” - July 1, 2013 through June 30, 2014

	●	“fiscal 2015” - July 1, 2014 through June 30, 2015

	●	“fiscal 2016” - July 1, 2015 through June 30, 2016

RESULTS OF OPERATIONS

Revenue

Since the Company has ~~suspended~~not ~~operations~~financed innew loans since June 2014 it has $0 revenue for the ~~quarters~~three and six months ended ~~September~~December 3031, 2015 and 2014.

Operating Expenses

Total selling, general and administrative expenses decreased $2249,~~661~~453 to $1910,~~428~~890 for the three months ended ~~September~~December 3031, 2015 compared to the three months ended ~~September~~December 31, 2014. Total selling, general and administrative expenses decreased $72,083 to $30,318 for the six months ended December 31, 2015 compared to the six months ended December 31, 2014. ~~This~~These ~~decrease~~decreases isare primarily a result of temporary suspension of activities.

For the three months ended ~~September~~December 3031, 2015 our expenses were comprised primarily of rent and utilities of $9,505 and office related expenses of $1,385. For the six months ended December 31, 2015 our expenses comprised primarily of $17,596 related to legal, accounting and SEC compliance costs, $9,505 for rent and utilities, and $13,~~832~~217 for office expenses. For the ~~quarter~~three months ended ~~September~~December 3031, 2014 our expenses were comprised primarily of $1745,~~799~~436 related to legal, accounting and SEC compliance costs, $127,~~766,~~814 for office expenses, $3,~~800~~413 for auto repossession services, and $3,~~000~~261 for ~~temporary~~travel. ~~help~~For the six months ended December 31, 2014 our expenses were comprised primarily of $63,236 related to legal, accounting and SEC compliance costs, $316,~~018~~186 in office expenses, $10,442 for auto repossession services, $4,506 for wages and benefits, and $6,279 for travel and entertainment.

Other Income

Other income is comprised of interest income and income from disposition of repossessed cars. During the three and six months ended December 31, 2015 the Company had $0 other income. During the three and six months ended December 31, 2014 the Company had other income of $26,642 and $26,653 respectively. The Company realized a gain of $26,355 from repossessing inventory during the three months ended December 31, 2014.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements. As of ~~September 30,~~December 31, 2015 our working capital deficit amounted to $6374,~~837~~595. The Company has entered into a financing agreement with Friedman Financial Group, a related party, to provide a line of credit sufficient to finance corporate expenses while the Company pursues new business opportunities. The line of credit has a current limit of $50,000, payable on demand at no interest.

Cash Requirements

Our future capital requirements will depend on management’s ability to develop new lines of business.

We do not currently have any contractual restrictions on our ability to incur debt and, accordingly we could incur significant amounts of indebtedness to finance operations. Any such indebtedness could contain covenants that would restrict our operations.

Although we experienced a reduction in revenues as a result of the default and bankruptcy of our primary floor plan customer, we have adequate resources committed by current shareholders to operate at a minimal level while we pursue and explore new opportunities.

Off-Balance Sheet Arrangements

Under SEC regulations, we are required to disclose our off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, such as changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. As of ~~September~~December 3031, 2015 we have no off-balance sheet arrangements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable to smaller reporting companies.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”) that are designed to ensure that information required to be disclosed by us in reports that we file under the Exchange Act is recorded, processed, summarized and reported as specified in the SEC’s rules and forms and that such information required to be disclosed by us in reports that we file under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer, or CEO, who is also our Principal Financial and Accounting Officer, to allow timely decisions regarding required disclosure. Management, with the participation of our CEO who is also our Principal Financial and Accounting Officer performed an evaluation of the effectiveness of our disclosure controls and procedures as of ~~September~~December 3031, 2015. Based on that evaluation, our management, including our CEO who is also our Principal Financial and Accounting Officer concluded that our disclosure controls and procedures were ineffective as of ~~September~~December 3031, 2015.

In addition, management identified the following material weakness and significant deficiencies in its assessment of the effectiveness of internal control over financial reporting as of ~~September~~December 3031, 2015:

●	Material Weakness - The Company did not maintain effective controls over certain aspects of the financial reporting process because we lacked a sufficient complement of personnel with a level of accounting expertise and an adequate supervisory review structure that is commensurate with the Company’s financial reporting requirements.

●	Significant Deficiencies - Inadequate segregation of duties.

We expect to be materially dependent upon a third party to provide us with accounting consulting services for the foreseeable future. Until such time as we have a chief financial officer with the requisite expertise in U.S. GAAP, there are no assurances that the material weaknesses and significant deficiencies in our disclosure controls and procedures and internal control over financial reporting will not result in errors in our financial statements which could lead to a restatement of those financial statements.

Our management, including our Chief Executive Officer and our Principal Financial and Accounting Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. 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. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected.

Changes in Internal Control

There were no changes identified in connection with our internal control over financial reporting during the three months ended ~~September~~December 3031, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

The Company is pursuing all legal remedies to collect floor plan receivables and interest and penalties from our principal customer who is under the protection of the Federal Bankruptcy Court. We have instituted collection subject to personal guarantees issued by principal owners of the bankrupt party.

ITEM 1A. RISK FACTORS

Not applicable to smaller reporting companies.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable

ITEM 5. OTHER INFORMATION.

None

ITEM 6. EXHIBITS.

Exhibit No.		Description
31.1		Section 302 Certificate of Chief Executive Officer.*
31.2		Section 302 Certificate of Principal Financial and Accounting Officer.*
32.1		Section 906 Certificate of Chief Executive Officer and Principal Financial and Accounting Officer.*
101.INS		XBRL INSTANCE DOCUMENT **
101.SCH		XBRL TAXONOMY EXTENSION SCHEMA **
101.CAL		XBRL TAXONOMY EXTENSION CALCULATION LINKBASE **
101.DEF		XBRL TAXONOMY EXTENSION DEFINITION LINKBASE **
101.LAB		XBRL TAXONOMY EXTENSION LABEL LINKBASE **
101.PRE		XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE **

*	Filed herewith.
**	In accordance with Regulation S-T, the XBRL-formatted interactive data files that comprise Exhibit 101 in this 1 in this Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed”.

*	Filed herewith.

612

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.

	AVANGARD CAPITAL GROUP, INC.
Date: November 16, 2015	By:	/s/ Simon Friedman
Date: February 17, 2016	By:	/s/ Simon Friedman
		Simon Friedman
		Chairman and Chief Executive Officer
		(Principal Executive Officer and Principal Financial
		(Principal Executive Officer and Principal Financial and Accounting Officer)
		and Accounting Officer)

713

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