10. INCOME TAXES

The Company accounts for income taxes under an asset and liability approach. The Company determines whether a tax position is more likely than not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The Company files income tax returns in the United States (“U.S.”), including Federal and the States of Hawaii and California jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply.

The Company has experienced net operating losses each year since its inception.  The Internal Revenue Code allows net operating losses (NOL's) to be carried forward and applied against future profits for a period of twenty years.  Malaysia does not have a limitation on loss carryforwards.  The potential benefit of these carryovers has been recognized on the books of the Company, but it has been offset by a valuation allowance.  If not used, these NOL's will expire in the U.S. as follows:

Under pronouncements of the FASB, recognition of deferred tax assets is permitted unless it is more likely than not that the assets will not be realized. The Company has recorded deferred tax assets as follows:

The valuation allowance changed by $16,708 during the fiscal year ended November 30, 2017.

The Internal Revenue Code permits audits by the Internal Revenue Service for periods up to three years from the date tax returns are filed.  Malaysia has no stated limitation.  Tax returns of the Company are subject to audit for the years ended November 30, 2015, 2016 and 2017.