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0001446152-18-000008.txt : 20180122 0001446152-18-000008.hdr.sgml : 20180122 20180122140930 ACCESSION NUMBER: 0001446152-18-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 42 CONFORMED PERIOD OF REPORT: 20171130 FILED AS OF DATE: 20180122 DATE AS OF CHANGE: 20180122 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SAUER ENERGY, INC. CENTRAL INDEX KEY: 0001446152 STANDARD INDUSTRIAL CLASSIFICATION: DRILLING OIL & GAS WELLS [1381] IRS NUMBER: 263261559 STATE OF INCORPORATION: NV FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-53598 FILM NUMBER: 18539567 BUSINESS ADDRESS: STREET 1: 2326 TELLER ROAD CITY: NEWBURY PARK STATE: CA ZIP: 91320 BUSINESS PHONE: 888 829 8748 MAIL ADDRESS: STREET 1: 2326 TELLER ROAD CITY: NEWBURY PARK STATE: CA ZIP: 91320 FORMER COMPANY: FORMER CONFORMED NAME: BCO HYDROCARBON LTD DATE OF NAME CHANGE: 20080925 10-Q 1 f201810qq1_10q.htm FORM 10Q Converted by EDGARwiz

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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 November 30, 2017

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

For the transition period from __________ to __________

000-53598

Commission File Number

SAUER ENERGY, INC.

(Name of small business issuer in its charter)

Nevada

26-3261559

(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identificación No.)

1620 Emerson Avenue, Oxnard, CA 93033

(Address of principal executive offices)

888-829-8748

(Registrant’s telephone number, including area code)

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [ ]

Emerging Growth Company

If an emerging growth company, indicate by check mark if registrant has elected not to extended transition period for complying with any new of revise financial accounting standards provided pursuant to ‘Section 7(a)(2)(B) of the Security Act. YES [ ] NO [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company filer. 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]

Page 1 of 20

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ] No [X]

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 380,297,623 shares of common stock, par value $0.0001 per share, as of January 15.

Page 2 of 20

SAUER ENRGY, INC.

REPORT ON FORM 10-Q

TABLE OF CONTENTS


	Page
PART I – Financial Information
Item 1. Financial Statements (Unaudited)	4
Item 2. Management’s Discussion and Analysis of
Financial Condition and Results of Operations	14
Item 3. Quantitative and Qualitative Disclosures About Market Risk	15
Item 4T. Controls and Procedures	16
PART II – Other Information
Item 1. Legal Proceedings	19
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	19
Item 3. Defaults Upon Senior Securities	19
Item 4. Mine Safety Disclosures	19
Item 5. Other Information	19
Item 6. Exhibits	19

Signatures	20


SAUER ENERGY, INC.
Condensed Balance Sheets


	November 30, 2017	August 31, 2017
	(Unaudited)	(Audited)
ASSETS
Current Assets
Cash	$ 12,136	$ 1,952
Petty Cash	1,500	1,500
Prepaid Expenses	14,014	-
	27,650	3,452

Property and Equipment, net	32,155	41,635

Other Assets
Intangible Assets	1,090,087	1,112,631
Security Deposit	13,507	13,507
	1,103,594	1,126,138

Total Assets	$ 1,163,399	$ 1,171,225

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable and accrued liabilities	$ 59,225	$ 37,947
Accounts Payable and accrued liabilities - Related Party	5,000	3,000
Convertible note payable (net of discount)	11,444	105,000
Derivative liability	78,402	-
Total Current Liabilities	154,071	145,947

Commitments and Contingencies	$ -	$ -

Stockholders' Equity
Common Stock, $0.0001 par value; authorized
650,000,000 shares, issued and outstanding were
380,297,623 on November 30, 2017 and 351,229,209 outstanding on August 31, 2017	38,027	35,121
Additional Paid-In Capital	12,814,703	12,473,432
Accumulated deficit	(11,843,402)	(11,483,275)
Total Stockholders' Equity	1,009,328	1,025,278

Total Liabilities and Stockholders' Equity	$ 1,163,399	$ 1,171,225

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


SAUER ENERGY, INC.
Condensed Statements of Operations
for the three months ended November 30,

	(Unaudited) (Unaudited)
	2017	2016
Revenue	$ 29,649	$ -
Cost of goods sold	15,106	-
Gross Profit	14,543	-

General and Administrative Expenses:
Professional Fees	16,687	13,000
Consulting	54,773	52,850
Rent Expense	45,013	46,523
Research & development expense	44,855	71,933
Other general and administrative expenses	67,219	68,168
Total Operating Expenses	228,547	252,474
Loss from operations	(214,004)	(252,474)

Other Income (expense)
Interest and finance	(166,623)	(127,390)
Changes in derivative liability	20,500	-
	(146,123)	(127,390)
(Loss) before taxes	(360,127)	(379,864)
Provision (credit) for taxes	-	-
Net (Loss)	$ (360,127)	$ (379,864)

Earnings (loss) per common share, basic and diluted	$ (0.00)	$ (0.00)
Basic and diluted weighted average number of common shares outstanding, basic	364,680,552	284,580,339

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


SAUER ENERGY, INC.
Condensed Statements of Cash Flows
for the three months ended November 30,

	2017	2016
Cash flows from operating activities:
Net (loss)	$ (360,127)	$ (379,864)
Adjustments to reconcile net loss to
net cash provided (used) by operating activities:
Amortization	22,554	22,544
Depreciation	9,480	10,922
Change in derivative liability	(20,500)	-
Amortization of Debt discount	5,346	-
Financing costs paid in shares	159,178	125,417
Changes in operating assets and liabilities:
Other Assets	(14,014)	-
Accounts payable and accrued expenses - related party	2,000	-
Accounts payable and accrued expenses	21,277	(17,070)
Net cash flows (used by) operating activities	(174,816)	(238,051)

Cash flows from investing activities:
Purchase of furniture and equipment	-	-
Net cash (used by) investing activities	-	-

Cash flows from financing activities:
Proceeds from issuance of note payable	-	-
Payments on note payable	-	(79,283)
Proceeds from issuance of common stock, net of costs	185,000	322,500
Net cash (used by) provided by financing activities	185,000	243,217

Net increase (decrease) in cash	10,184	5,166
Cash, beginning of the period	1,952	46,585

Cash, end of the period	$ 12,136	$ 51,751

Supplemental cash flow disclosure:
Interest paid	$ -	$ 991
Taxes paid	$ -	$ -

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

Page 6 of 20

Sauer Energy, Inc.

Notes to the Financial Statements

November 30, 2017

(unaudited)

Note 1 - Organization and summary of significant accounting policies:

These unaudited interim financial statements as of and for the three months ended November 30, 2017, reflect all adjustments which, in the opinion of management, are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented, in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.

These unaudited interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s fiscal year end August 31, 2017, report. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three months ended November 30, 2017, are not necessarily indicative of results for the entire year ending August 31, 2018.

Organization

Sauer Energy, Inc. was incorporated in California on August 7, 2008. The Company was incorporated to develop and market wind power electric generators.

Current Business of the Company

On July 25, 2010, the Company executed a plan of reorganization with BCO Hydrocarbon Ltd., a Nevada exploration stage enterprise, in which Sauer Energy Inc. became a subsidiary of BCO. BCO changed its name to Sauer Energy, Inc.

The Company leases warehouse/office facilities in Oxnard, California, in which the Company develops wind power technology. A production prototype of a vertical axis wind turbine (“VAWT”) has been developed. Its compact size is aimed at the small business and home market. The company is focused on plans to manufacture and distribute the product. In May 2012, the acquisition of the entire assets of a wind turbine company added two more wind turbine models to the Company, together with patents and a distribution network. During 2016 and 2017, the Company continued to develop its technology.

NOTE 2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

These financial statements have been prepared using the basis of accounting generally accepted in the United States of America. Under this basis of accounting, revenues are recorded as earned and expenses are recorded at the time liabilities are incurred. The Company has adopted August 31 as the fiscal year-end.

Cash and Cash Equivalents

The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.

Page 7 of 20

Use of Estimates

The preparation of financial statements in conformity with 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. Actual results could differ from those estimates.

Fair Value of Financial Instruments

The Financial Accounting Standards Board issued ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures" for financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of the Company’s financial instruments as of November 30, 2017, reflect:

Level 1 Cash Measurement based on bank reporting.

Level 2 Loans from Officers and related parties

Level 2 Based on promissory notes.

Level 3 Derivatives

Federal income taxes

The Company utilizes FASB ACS 740, “Income Taxes”, 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 or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation allowance is recorded when, in the opinion of management, it is “more likely-than-not” that a deferred tax asset will not be realized. The Company generated a deferred tax credit through net operating loss carry-forward. A valuation allowance of 100% has been established.

Interest and penalties on tax deficiencies recognized in accordance with ASC accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.

Research and development costs

Page 8 of 20

The Company expenses costs of research and development cost as incurred. The costs for the three months ended November 30, 2017, and three months ended November 30, 2016, were $71,933 and $44,855 respectively.

Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options.

ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option-pricing model as its method of determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of operations over the requisite service period.

All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

Basic and Diluted Earnings (Loss) Per Share –

Net loss per share is calculated in accordance with FASB ASC 260, Earnings Per Share, for the period presented. Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. The Company has a convertible note payable which is potentially dilutive, however it has been omitted from the calculations as it is antidilutive.

Recent Accounting Pronouncements

Management has considered all recent accounting pronouncements.

A variety of proposed or otherwise potential accounting standards are currently under study by standard setting organizations and various regulatory agencies. Due to the tentative and preliminary nature of those proposed standards, the Company’s management has not determined whether implementation of such standards would be material to its financial statements.

The Company is reviewing the effects of following recent updates. The Company has no expectation that any of these items will have a material effect upon the financial statements.

Update 2017-04—Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

Update 2017-05—Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets

Page 9 of 20

Update 2016-15—Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)

Update 2016-09—Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting

Update 2016-07 —Investments—Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting

Update 2016-06 —Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments (a consensus of the Emerging Issues Task Force)

Update 2016-03—Intangibles—Goodwill and Other (Topic 350), Business Combinations (Topic 805), Consolidation (Topic 810), Derivatives and Hedging (Topic 815): Effective Date and Transition Guidance (a consensus of the Private Company Council)

Update 2016-01—Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities

Reclassifications

Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported losses, total assets, or stockholders’ equity as previously reported.

Note 3 – Going Concern

The Company's financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has accumulated a deficit of $(11,843,402) as of November 30, 2017, and had minimal revenues, which raises substantial doubt as to the Company’s ability to continue as a going concern.

In view of these matters, recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheets is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to raise additional capital, obtain financing and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Management plans to raise additional capital through the sale of stock to pursue business development activities.

Note 4 – Property and Equipment

Property and Equipment consisted of the following at November 30, 2017, and August 31, 2017:


	11/30/17	8/31/17
Property Plant and Equipment	$ 282,427	$ 282,427
Less accumulated depreciation	(250,272)	(240,972)
Property and equipment, net	$ 32,155	$ 41,635

Page 10 of 20

The Company depreciates its property and equipment using accelerated methods over lives of five or seven years. In the three months ended November 30, 2017, and November 30, 2016, depreciation was $9,480 and $10,922, respectively.

Note 5 – Intangible Property

The Company has acquired intangible property in patents, patents pending and goodwill. The patents are being amortized over their expected lives of not more than seventeen years. Those patent costs allocated to pending patents do not begin amortizing until the underlying patent is issued. If for some reason a patent is not issued the costs associated with the acquisition and the continuation of the application are fully amortized in the year of the denial.



	November 30, 2017	August 31, 2017
Patents	$ 109,092	$ 109,092
Purchased Patents	1,467,500	1,467,500
Goodwill	5,000	5,000
Less Amortization	(491,505)	(468,961)
	$ 1,090,087	$ 1,112,631

In three months ended November 30, 2017, and November 30, 2016, amortization was $22,544 and $22,544, respectively.

Note 6 - Notes Payable

On July 26, 2016, the Company entered into short term note agreement with Beaufort Capital Partners, LLC., in the amount of $50,000 with an interest rate of 10% per annum, with a due date of October 26, 2016. It has been paid in full.

On August 30, 2016, the Company entered into a short-term note agreement with Beaufort Capital Partners, LLC., in the amount of $40,000 with an interest rate of 10% per annum, with a due date of December 1, 2016. It has been paid in full.

On May 2, 2017, the Company entered into a short-term note agreement with an investor

in the amount of $50,000 with an interest rate of 10% per annum, with a due date of September 2, 2017. As of November 30, 2017, the outstanding balance due was $Zero.

On May 24, 2017, the Company entered into a convertible promissory note with an investor in the amount of $105,000 with an interest rate of 8% per annum, with a due date of May 24, 2018. Convertible 180 days after issuance, at 80% of the lowest trading price over the previous 20 trading days. This resulted in a derivative liability of $78,402 as of November 30, 2017.

Page 11 of 20

Note 7 -- Related Party Note

As of November 30, 2017, and August 31, 2017, we have related party payables to Dieter Sauer in the amounts of $5,000 and $3,000, respectively.

Note 8 – Commitments and Contingencies

Rental Agreement:

On August 7, 2015, the Company entered into a Commercial Single-Tenant Lease for a 26,550-square foot building in Oxnard, California, with monthly payments of $13,507 for sixty months, plus common area costs of $507.38 per month. All company operations will be concentrated at the site.

Lease Commitments – following five fiscal years:

Fiscal year ended

August 31,


	Year	Lease
2018		135,039
2019		168,173
2020		168,173

For the three months ended November 30, 2017 our rent expense was $45,013 compared to $46,523 for the three months ended November 30, 2016.

Note 9 - Federal income tax

No provision was made for federal income tax, since the Company has had significant net operating losses. Net operating loss carryforwards may be used to reduce taxable income through the year 2035. The availability of the Company’s net operating loss carryforwards are subject to limitation if there is a 50% or more positive change in the ownership of the Company’s stock, unless the same or similar business is carried on. The net operating loss carryforward for federal and state income tax purposes was approximately $11,843,422, which will expire in 2029 through 2035 if not utilized. The Company uses 21% for a composite tax rate to estimate the value of net operating losses for deferred taxes.

The Company as of the three months ended November 30, 2017, and November 30, 2016, recognized net operating losses of approximately $360,127 and $379,864, respectively. The total estimated deferred tax asset as of November 30, 2017, was $2,487,114. The Company recorded a 100% valuation allowance for the deferred tax asset since it is more likely than not that some part or all of the deferred tax asset will not be realized.

Although Management believes that its estimates are reasonable, no assurance can be given that the final tax outcome of these matters will not be different than that which is reflected in our tax provisions. Ultimately, the actual tax benefits to be realized will be based upon future taxable earnings levels, which are very difficult to predict.

Page 12 of 20

and in the State of California. These filings are subject to a three-year statute of limitations. The Company’s evaluation of income tax positions included in the years ended August 31, 2013 through 2016, could be subject to agency examinations. No filings are currently under examination. No adjustments have been made to reduce the estimated income tax benefit at fiscal year-end or at the quarterly reporting dates. Any valuations relating to these income tax provisions will comply with U.S. generally accepted accounting principles.

Note 10 – Capital Stock

The Company went public on 7/25/ 2010. Its Common Stock is traded on the open market under the symbol OTCQB: SENY.

During the quarter ending November 30, 2016, the Company issued 40,950,000 shares of common stock for services rendered.

During the quarter ending November 30, 2016, 75,000 shares were cancelled and returned to treasury.

During the quarter ending November 30, 2016, the Company issued 9,498,761 shares of common stock for $125,000 pursuant to a convertible note.

During the quarter ending November 30, 2016, the Company issued 26,075,562 shares of common stock for $322,500 pursuant to an Equity Purchase Agreement.

During the quarter ending February 28, 2017, the Company issued 24,365,406 shares of common stock for $367,000 pursuant to an Equity Purchase Agreement.

During the quarter ending May 31, 2017, the Company issued 5,259,032 shares of common stock for $73,075 pursuant to an Equity Purchase Agreement.

During the quarter ending August 31, 2017, the Company issued 22,095,545 shares of common stock for $210,000 pursuant to an Equity Purchase Agreement.

During the quarter ending November 30, 2017, the Company issued 29,068,414 shares of common stock for $185,000 pursuant to an Equity Purchase Agreement.

NOTE 11 - Contingencies, Litigation

There were no loss contingencies or legal proceedings against the Company with respect to matters arising in the ordinary course of business.

NOTE 12 – Subsequent Events

Management has reviewed and evaluated subsequent events and transactions occurring after the balance sheet date:

On December 4, 2017, the Company authorized 4,340,278 shares of common stock to be issued for $25,000 at $0.00576 per share pursuant to an Equity Purchase Agreement.

On December 15, 2017, the Company authorized 3,472,222 shares of common stock to be issued for $17,500 at $0.00504 per share pursuant to an Equity Purchase Agreement.

On January 3, 2018 the Company authorized 6,076,389 shares of common stock to be issued for $17,500 at $0.00288 per share pursuant to an Equity Purchase Agreement.

Page 13 of 20

On December 20, 2017, the Company authorized 3,000,000 shares of common stock at $0.00495 per share to be issued in exchange for cancellation of $14,850 of the convertible loan.

On December 22, 2017, the Company authorized 5,000,000 shares of common stock at $0.00495 per share to be issued in exchange for cancellation of $24,750 of the convertible loan.

On January 2, 2018, the Company authorized 5,000,000 shares of common stock at $0.00300 per share to be issued in exchange for cancellation of $15,000 of the convertible loan.

On January 5, 2018, the Company authorized 5,000,000 shares of common stock at $0.00300 per share to be issued in exchange for cancellation of $15,000 of the convertible loan.

On January 10, 2018, the Company authorized 7,000,000 shares of common stock at $0.00300 per share to be issued in exchange for cancellation of $21,000 of the convertible loan.

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operation

Overview

We caution you that reliance on any forward-looking statement involves risks and uncertainties, and that although we believe the assumptions on which our forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions could be incorrect. In light of these and other uncertainties, you should not conclude that we will necessarily achieve any plans and objectives or projected financial results referred to in any of the forward-looking statements. We do not undertake to release the results of any revisions of these forward-looking statements to reflect future events or circumstances. Some of the factors that may cause actual results, developments and business decisions to differ materially from those contemplated by such forward-looking statements.

RESULTS OF OPERATION

Three months ended November 30, 2017 v. three months ended November 30, 2016

During the 3 months ended November 30, 2017 we realized revenue in the amount of $29,649 due to the sale of an R&D unit.

Our operating expenses were $228,547 for the three months ending November 30, 2017, compared to $252,474 for the three months ended November 30, 2016.

Our interest and financing expenses increased to $146,123 for the three months ending November 30, 2017, from $127,390 for the three months ended November 30, 2016.

The overall decreases in operating expenses resulted in our net loss of $360,127 for the three months ended November 30, 2017 as compared to the net loss of $379,864 for the three months ended November 30, 2016.

We anticipate increased costs associated with increased levels of operation anticipatory to our entering into the manufacturing stage and our marketing processes which will begin in the current fiscal year.

LIQUIDITY AND CAPITAL RESOURCES

Page 14 of 20

Net cash flows used in operating activities for the three months ended November 30, 2017, and November 30, 2016, was $174,816 and $238,051 respectively.

Net cash flows used in investing activities for the three months ended November 30, 2017 and November 30, 2016, was $0 and $0 respectively.

Net cash flows provided by financing activities for the three months ended November 30, 2017 and November 30, 2016, was $185,000 and $243,217 respectively.

We had cash resources of $12,136 at November 30, 2017, and we intend to rely on the sale of stock in private placements to increase liquidity to enable us to execute on our plan to manufacture and market vertical axis wind turbines. As reported on a Current Report on Form 8-K filed on July 1, 2016, we have entered into an Equity Purchase Agreement.

As of May, 2017, the Registrant entered into two agreements with East Six Opportunity Fund, LLC, a New York limited liability corporation (“East Six”), an Equity Purchase Agreement (the “EPA”) and a Registration Rights Agreement (the “RRA”). The two agreements we filed as exhibits to the Registrant’s Current Report on Form 8-K dated May 12, 2017, and the Registrant’s Registration Statement on Form S-1 Number 333-218054 and the following summary is qualified in its entirety by reference to such exhibits.

The agreements required the Registrant to file a registration statement for the common stock underlying the EPA. Subject to various limitations set forth in the EPA, East Six, after effectiveness of such registration statement, was required to purchase up to $3,000,000 worth of the Registrant’s common stock at a price equal to 72% of the market price as determined under the EPA (prior ten trading days). The EPA provides for volume limitations on the number of shares that East Six must purchase at any time and provides that the Registrant will be paid for the common stock upon electronic delivery of the shares to East Six. East Six bore the attorney fees relating to the Registration Statement and is not charging the Registrant any additional fees.

Funds on hand are not sufficient to fund our operations and we intend to rely on the sale of stock in private placements to increase liquidity. If we are unable to raise cash through the sale of our stock, we may be required to severely restrict our operations.

Critical Accounting Policies

Financial Reporting Release No. 60 of the SEC encourages all companies to include a discussion of critical accounting policies or methods used in the preparation of the financial statements. There are no current revenue-generating activities that give rise to significant assumptions or estimates. Note 2 of our financial statements filed as part of our November 30, 2017, Quarterly Report on this Form 10-Q includes a summary of the significant accounting policies and methods used in the preparation of our financial statements.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Item 3. - Quantitative and Qualitative Disclosures About Market Risk

The Company is a smaller reporting company and is not required to provide this information.

Page 15 of 20

Item 4T. - Controls and Procedures

Disclosure Controls and Procedures

Regulations under the Securities Exchange Act of 1934 (the “Exchange Act”) require public companies to maintain “disclosure controls and procedures,” which are defined as controls and other procedures that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

We conducted an evaluation, with the participation of our Chief Executive Officer who is also our principal financial officer, of the effectiveness of our disclosure controls and procedures as of November 30, 2017. Based on that evaluation, our Chief Executive Officer has concluded that as of November 30, 2017, our disclosure controls and procedures were not effective at the reasonable assurance level due to the material weaknesses described below.

In light of the material weaknesses described below, we performed additional analysis and other post-closing procedures to ensure our financial statements were prepared in accordance with generally accepted accounting principles. Accordingly, we believe that the financial statements included in this report fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented.

A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or combination of control deficiencies that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Management has identified the following three material weaknesses that have caused management to conclude that, as of November 30, 2017, our disclosure controls and procedures were not effective at the reasonable assurance level:

1. We do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act which is applicable to us for the year ending August 31, 2017, and the quarter ended November 30, 2017. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

2. We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

Page 16 of 20

The Board of Directors has not provided an appropriate level of oversight of the Company’s financial reporting and procedures for internal control over financial reporting since there are, at present, no independent directors who could provide an appropriate level of oversight, including challenging management’s accounting for and reporting of transactions. Accordingly, we have determined that this control deficiency constitutes a material weakness.

To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented.

Management's Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, the issuer’s principal executive and principal financial officers and effected by the issuer’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external

purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:

Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the issuer;

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the issuer; and

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the issuer’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

As of the end of our most recent fiscal quarter, management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control—2013 Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") and SEC guidance on conducting such assessments. Based on that evaluation, they concluded that, as of November 30, 2017, such internal control over financial reporting was not effective. This was due to deficiencies that existed in the design or operation of our internal control over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.

Page 17 of 20

The matters involving internal control over financial reporting that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; and (2) inadequate segregation of duties consistent with control objectives of having segregation of the initiation of transactions, the recording of transactions and the custody of assets. The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our financial statements as of November 30, 2017.

Management believes that the material weaknesses set forth in items (1) and (2) above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of director’s results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

This quarterly report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only the management's report in this quarterly report.

Management's Remediation Initiatives

In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

We will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us. First, we will create a position to segregate duties consistent with control objectives of having separate individuals perform (i) the initiation of transactions, (ii) the recording of transactions and (iii) the custody of assets. Second, we will create a senior position to focus on financial reporting and standardizing and documenting our accounting procedures with the goal of increasing the effectiveness of the internal controls in preventing and detecting misstatements of accounting information. Third, we plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us. Although there is substantial uncertainty in any such estimate, we anticipate the costs of implementing these remediation initiatives will be approximately $100,000 to $150,000 a year in increased salaries, legal and accounting expenses.

Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board.

We anticipate that these initiatives will be at least partially, if not fully, implemented by August 31, 2018.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15 (f) under the Exchange Act) during the quarter ended November 30, 2017, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Page 18 of 20

PART II – OTHER INFORMATION

Item 1 – Legal Proceedings

None.

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

The following documents are filed as part of this Report:

10.1 Equity Purchase Agreement, dated as of May 9, 2017, by and between East Six Opportunity Fund, LLC, and Sauer Energy, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the SEC on May 12, 2017).

10.2 Registration Rights Agreement, dated as of May 9, 2017, by and between East Six Opportunity Fund, LLC, and Sauer Energy, Inc. (Incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed with the SEC on May 12, 2017).

31.1* Certification of Chief Executive and Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

32.1* Certification pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.

101.INS** XBRL Instance Document

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________________________

*Filed herewith.

Page 19 of 20

**Furnished herewith.

SIGNATURE

In accordance with the requirements of the Securities Exchange Act of 1934, as amended, the registrant caused this Report on Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized.

SAUER ENERGY, INC.

Date: January 22, 2018

By: /s/Dieter R. Sauer, Jr.

Name: Dieter R. Sauer, Jr., CEO

(Principal Executive, Accounting and Financial Officer)

Page 20 of 20

EX-31 2 f2018-10q-q1-exhibit311_ex31.htm EXHINBIT 31.1 Converted by EDGARwiz

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Dieter R. Sauer, Jr., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Sauer Energy, Inc. for the quarter ended November 30, 2017;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


		a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


		b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: January 22, 2018

/s/ Dieter R. Sauer, Jr.

Dieter R. Sauer

CEO and President

EX-32 3 f2018-10q-q1-exhibit321_ex32.htm E#XHIBIT 32.1 Converted by EDGARwiz

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned is the CEO and President (Principal Executive, Financial and Accounting Officer) of Sauer Energy, Inc. This Certification is made pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. This Certification accompanies the Quarterly Report on Form 10-Q of Sauer Energy, Inc. for the quarter ended November 30, 2017.

The undersigned certifies that such 10-Q Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such 10-Q Report fairly presents, in all material respects, the financial condition and results of operations of Sauer Energy, Inc. as of November 30, 2017.

This Certification is executed as of January 22, 2018.

/s/ Dieter R. Sauer, Jr.

Dieter R. Sauer, Jr.

CEO and President

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10-Q 2017-11-30 false SAUER ENERGY, INC. 0001446152 seny --08-31 336894876 4292836 Smaller Reporting Company Yes No No 2018 Q1

Note 1 - Organization and summary of significant accounting policies:   These unaudited interim financial statements as of and for the three months ended November 30, 2017, reflect all adjustments which, in the opinion of management, are necessary to fairly state the Companys financial position and the results of its operations for the periods presented, in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.   These unaudited interim financial statements should be read in conjunction with the Companys financial statements and notes thereto included in the Companys fiscal year end August 31, 2017, report. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three  months ended November 30, 2017, are not necessarily indicative of results for the entire year ending August 31, 2018.   Organization Sauer Energy, Inc. was incorporated in California on August 7, 2008. The Company was incorporated to develop and market wind power electric generators. Current Business of the Company On July 25, 2010, the Company executed a plan of reorganization with BCO Hydrocarbon Ltd., a Nevada exploration stage enterprise, in which Sauer Energy Inc. became a subsidiary of BCO.  BCO changed its name to Sauer Energy, Inc. The Company leases warehouse/office facilities in Oxnard, California, in which the Company develops wind power technology.  A production prototype of a vertical axis wind turbine (VAWT) has been developed.  Its compact size is aimed at the small business and home market. The company is focused on plans to manufacture and distribute the product.  In May 2012, the acquisition of the entire assets of a wind turbine company added two more wind turbine models to the Company, together with patents and a distribution network. During 2016 and 2017, the Company continued to develop its technology.   NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES These financial statements have been prepared using the basis of accounting generally accepted in the United States of America. Under this basis of accounting, revenues are recorded as earned and expenses are recorded at the time liabilities are incurred. The Company has adopted August 31 as the fiscal year-end.   Cash and Cash Equivalents The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.       Use of Estimates The preparation of financial statements in conformity with 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. Actual results could differ from those estimates.     Fair Value of Financial Instruments The Financial Accounting Standards Board issued   ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), Fair Value Measurements and Disclosures" for financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements.  FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date.  FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:   ·         Level 1:  Quoted prices in active markets for identical assets or liabilities. ·         Level 2:  Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities. ·         Level 3:  Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.   The carrying amounts of the Companys financial instruments as of November 30, 2017, reflect: ·         Level 1   Cash Measurement based on bank reporting. §  Level 2   Loans from Officers and related parties <ul type="disc" style='margin-top:0in'> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Level 2   Based on promissory notes.</li> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Level 3   Derivatives</li> </ul>       Federal income taxes The Company utilizes FASB ACS 740, Income Taxes, 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 or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.  A valuation allowance is recorded when, in the opinion of management, it is more likely-than-not that a deferred tax asset will not be realized. The Company generated a deferred tax credit through net operating loss carry-forward.  A valuation allowance of 100% has been established.   Interest and penalties on tax deficiencies recognized in accordance with ASC accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.     Research and development costs The Company expenses costs of research and development cost as incurred. The costs for the three months ended November 30, 2017, and three months ended November 30, 2016, were $71,933 and $44,855 respectively.     Stock-based Compensation The Company records stock-based compensation in accordance with ASC 718, Compensation  Stock Based Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options. ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option-pricing model as its method of determining fair value. This model is affected by the Companys stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Companys expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of operations over the requisite service period.   All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.     Basic and Diluted Earnings (Loss) Per Share  Net loss per share is calculated in accordance with FASB ASC 260, Earnings Per Share, for the period presented. Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. The Company has a convertible note payable which is potentially dilutive, however it has been omitted from the calculations as it is antidilutive.     Recent Accounting Pronouncements Management has considered all recent accounting pronouncements.   A variety of proposed or otherwise potential accounting standards are currently under study by standard setting organizations and various regulatory agencies.  Due to the tentative and preliminary nature of those proposed standards, the Companys management has not determined whether implementation of such standards would be material to its financial statements. The Company is reviewing the effects of following recent updates.  The Company has no expectation that any of these items will have a material effect upon the financial statements. <p style='margin-top:0in;margin-right:0in;margin-bottom:10.0pt;margin-left:.5in;line-height:115%;margin-top:0in;margin-right:10.75pt;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-indent:-.25in;line-height:normal;background:#F4F6F8'>§  Update 2017-04IntangiblesGoodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment <p style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-top:0in;margin-right:10.75pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal;background:#F4F6F8'>  <ul type="square" style='margin-top:0in'> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-right:10.75pt;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal;background:#F4F6F8'>Update 2017-05Other IncomeGains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets</li> </ul> <p style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-top:0in;margin-right:10.75pt;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;line-height:normal;background:#F4F6F8'>  <ul type="square" style='margin-top:0in'> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Update 2016-15Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)  </li> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Update 2016-09CompensationStock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting   </li> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Update 2016-07 InvestmentsEquity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting   </li> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Update 2016-06 Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments (a consensus of the Emerging Issues Task Force)</li> </ul>   <ul type="square" style='margin-top:0in'> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Update 2016-03IntangiblesGoodwill and Other (Topic 350), Business Combinations (Topic 805), Consolidation (Topic 810), Derivatives and Hedging (Topic 815): Effective Date and Transition Guidance (a consensus of the Private Company Council)   </li> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Update 2016-01Financial InstrumentsOverall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities </li> </ul>     Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation.  These reclassifications had no effect on reported losses, total assets, or stockholders equity as previously reported.

Note 5 Intangible Property The Company has acquired intangible property in patents, patents pending and goodwill.  The patents are being amortized over their expected lives of not more than seventeen years. Those patent costs allocated to pending patents do not begin amortizing until the underlying patent is issued.  If for some reason a patent is not issued the costs associated with the acquisition and the continuation of the application are fully amortized in the year of the denial. <table border="0" cellspacing="0" cellpadding="0" width="100%" style='line-height:115%;width:100.0%;border-collapse:collapse'> <tr style='height:.1in'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>   </td> <td width="40%" colspan="2" style='width:40.38%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'></td> </tr> <tr style='height:16.2pt'> <td width="59%" style='width:59.62%;padding:0in 5.4pt 0in 5.4pt;height:16.2pt'></td> <td width="20%" style='width:20.9%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:16.2pt'> November 30, 2017 </td> <td width="19%" style='width:19.48%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:16.2pt'> August 31, 2017 </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Patents </td> <td width="20%" style='width:20.9%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>   $         109,092  </td> <td width="19%" style='width:19.48%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>   $      109,092  </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Purchased Patents </td> <td width="20%" style='width:20.9%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>           1,467,500  </td> <td width="19%" style='width:19.48%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>        1,467,500  </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Goodwill </td> <td width="20%" style='width:20.9%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>                  5,000  </td> <td width="19%" style='width:19.48%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>               5,000  </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Less Amortization </td> <td width="20%" style='width:20.9%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>            (491,505) </td> <td width="19%" style='width:19.48%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>          (468,961) </td> </tr> <tr style='height:16.1pt'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:16.1pt'>  Intangible Assets Net </td> <td width="20%" style='width:20.9%;border-top:solid black 1.0pt;border-left:none;border-bottom:double black 2.25pt;border-right:none;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:16.1pt'>   $      1,090,087  </td> <td width="19%" style='width:19.48%;border-top:solid black 1.0pt;border-left:none;border-bottom:double black 2.25pt;border-right:none;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:16.1pt'>   $   1,112,631  </td> </tr> </table>   In three months ended November 30, 2017, and November 30, 2016, amortization was $22,544 and $22,544, respectively.

Note 8  Commitments and Contingencies Rental Agreement:                                                        On August 7, 2015, the Company entered into a Commercial Single-Tenant Lease for a 26,550-square foot building in Oxnard, California, with monthly payments of $13,507 for sixty months, plus common area costs of $507.38 per month.  All company operations will be concentrated at the site. Lease Commitments  following five fiscal years: Fiscal year ended                             <div style='border:none black 1.0pt;border-bottom:solid black 1.0pt;padding:0in 0in 1.0pt 0in'> August 31, </div> <table border="0" cellspacing="0" cellpadding="0" style='line-height:115%;margin-left:-5.4pt;border-collapse:collapse'> <tr style='height:3.4pt'> <td width="7" style='border:none;padding:0'> </td> <td width="2" style='width:1.15pt;padding:0;height:3.4pt'>   </td> <td width="2" style='width:1.15pt;padding:0;height:3.4pt'>   </td> <td width="51" valign="bottom" style='width:38.2pt;padding:0;height:3.4pt'> Year </td> <td width="168" colspan="2" valign="bottom" style='width:1.75in;padding:0;height:3.4pt'> Lease </td> <td width="2" valign="top" style='width:1.15pt;padding:0;height:3.4pt'>   </td> <td width="7" style='border:none;padding:0'> </td> </tr> <tr style='height:15.3pt'> <td width="7" style='border:none;padding:0'> </td> <td width="54" colspan="3" valign="bottom" style='width:40.5pt;padding:0;height:15.3pt'> 2018 </td> <td width="168" colspan="2" valign="bottom" style='width:1.75in;padding:0;height:15.3pt'> 135,039 </td> <td width="2" valign="top" style='width:1.15pt;padding:0;height:15.3pt'>   </td> <td width="7" style='border:none;padding:0'> </td> </tr> <tr style='height:11.7pt'> <td width="7" style='border:none;padding:0'> </td> <td width="54" colspan="3" valign="bottom" style='width:40.5pt;padding:0;height:11.7pt'> 2019 </td> <td width="168" colspan="2" valign="bottom" style='width:1.75in;padding:0;height:11.7pt'> 168,173 </td> <td width="2" valign="top" style='width:1.15pt;padding:0;height:11.7pt'>   </td> <td width="7" style='border:none;padding:0'> </td> </tr> <tr style='height:11.7pt'> <td width="7" style='border:none;padding:0'> </td> <td width="54" colspan="3" valign="bottom" style='width:40.5pt;padding:0;height:11.7pt'> 2020 </td> <td width="168" colspan="2" valign="bottom" style='width:1.75in;padding:0;height:11.7pt'> 168,173 </td> <td width="2" valign="top" style='width:1.15pt;padding:0;height:11.7pt'>   </td> <td width="7" style='border:none;padding:0'> </td> </tr> <tr style='height:12.75pt'> <td width="119" colspan="5" valign="bottom" style='width:89.25pt;padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>   </td> <td width="119" colspan="3" valign="bottom" style='width:89.15pt;padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>   </td> </tr> <tr align="left"> <td width="7" style='border:none'></td> <td width="2" style='border:none'></td> <td width="2" style='border:none'></td> <td width="51" style='border:none'></td> <td width="58" style='border:none'></td> <td width="110" style='border:none'></td> <td width="2" style='border:none'></td> <td width="7" style='border:none'></td> </tr> </table>   For the three months ended November 30, 2017 our rent expense was $45,013 compared to $46,523 for the three months ended November 30, 2016.

Note 10  Capital Stock The Company went public on 7/25/ 2010.  Its Common Stock is traded on the open market under the symbol OTCQB: SENY. During the quarter ending November 30, 2016, the Company issued 40,950,000 shares of common stock for services rendered. During the quarter ending November 30, 2016, 75,000 shares were cancelled and returned to treasury. During the quarter ending November 30, 2016, the Company issued 9,498,761 shares of common stock for $125,000 pursuant to a convertible note. During the quarter ending November 30, 2016, the Company issued 26,075,562 shares of common stock for $322,500 pursuant to an Equity Purchase Agreement. During the quarter ending February 28, 2017, the Company issued 24,365,406 shares of common stock for $367,000 pursuant to an Equity Purchase Agreement. During the quarter ending May 31, 2017, the Company issued 5,259,032 shares of common stock for $73,075 pursuant to an Equity Purchase Agreement. During the quarter ending August 31, 2017, the Company issued 22,095,545 shares of common stock for $210,000 pursuant to an Equity Purchase Agreement. During the quarter ending November 30, 2017, the Company issued  29,068,414 shares of common stock for $185,000 pursuant to an Equity Purchase Agreement.

Cash and Cash Equivalents The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.

Fair Value of Financial Instruments The Financial Accounting Standards Board issued   ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), Fair Value Measurements and Disclosures" for financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements.  FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date.  FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:   ·         Level 1:  Quoted prices in active markets for identical assets or liabilities. ·         Level 2:  Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities. ·         Level 3:  Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.   The carrying amounts of the Companys financial instruments as of November 30, 2017, reflect: ·         Level 1   Cash Measurement based on bank reporting. §  Level 2   Loans from Officers and related parties <ul type="disc" style='margin-top:0in'> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Level 2   Based on promissory notes.</li> <li style='margin-top:0in;margin-right:0in;margin-bottom:8.0pt;margin-left:0in;line-height:107%;margin-bottom:0in;margin-bottom:.0001pt;line-height:normal'>Level 3   Derivatives</li> </ul>

Federal income taxes The Company utilizes FASB ACS 740, Income Taxes, 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 or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.  A valuation allowance is recorded when, in the opinion of management, it is more likely-than-not that a deferred tax asset will not be realized. The Company generated a deferred tax credit through net operating loss carry-forward.  A valuation allowance of 100% has been established.   Interest and penalties on tax deficiencies recognized in accordance with ASC accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.

<table border="0" cellspacing="0" cellpadding="0" width="100%" style='line-height:115%;width:100.0%;border-collapse:collapse'> <tr style='height:15.75pt'> <td width="59%" style='width:59.2%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'></td> <td width="20%" style='width:20.4%;border:none;border-bottom:solid black 1.0pt;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> 11/30/17 </td> <td width="20%" style='width:20.4%;border:none;border-bottom:solid black 1.0pt;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> 8/31/17 </td> </tr> <tr style='height:15.0pt'> <td width="59%" style='width:59.2%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> Property Plant and Equipment </td> <td width="20%" style='width:20.4%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'>  $   282,427 </td> <td width="20%" style='width:20.4%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'>  $   282,427 </td> </tr> <tr style='height:15.0pt'> <td width="59%" style='width:59.2%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> Less accumulated depreciation </td> <td width="20%" style='width:20.4%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'>         (250,272) </td> <td width="20%" style='width:20.4%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'>         (240,972) </td> </tr> <tr style='height:15.75pt'> <td width="59%" style='width:59.2%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> Property and equipment, net </td> <td width="20%" style='width:20.4%;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'>  $    32,155 </td> <td width="20%" style='width:20.4%;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'>  $    41,635 </td> </tr> </table>

The Company has acquired intangible property in patents, patents pending and goodwill.  The patents are being amortized over their expected lives of not more than seventeen years. Those patent costs allocated to pending patents do not begin amortizing until the underlying patent is issued.  If for some reason a patent is not issued the costs associated with the acquisition and the continuation of the application are fully amortized in the year of the denial. <table border="0" cellspacing="0" cellpadding="0" width="100%" style='line-height:115%;width:100.0%;border-collapse:collapse'> <tr style='height:.1in'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>   </td> <td width="40%" colspan="2" style='width:40.38%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'></td> </tr> <tr style='height:16.2pt'> <td width="59%" style='width:59.62%;padding:0in 5.4pt 0in 5.4pt;height:16.2pt'></td> <td width="20%" style='width:20.9%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:16.2pt'> November 30, 2017 </td> <td width="19%" style='width:19.48%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:16.2pt'> August 31, 2017 </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Patents </td> <td width="20%" style='width:20.9%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>   $         109,092  </td> <td width="19%" style='width:19.48%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>   $      109,092  </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Purchased Patents </td> <td width="20%" style='width:20.9%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>           1,467,500  </td> <td width="19%" style='width:19.48%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>        1,467,500  </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Goodwill </td> <td width="20%" style='width:20.9%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>                  5,000  </td> <td width="19%" style='width:19.48%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:.1in'>               5,000  </td> </tr> <tr style='height:.1in'> <td width="59%" style='width:59.62%;padding:0in 5.4pt 0in 5.4pt;height:.1in'> Less Amortization </td> <td width="20%" style='width:20.9%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>            (491,505) </td> <td width="19%" style='width:19.48%;padding:0in 5.4pt 0in 5.4pt;height:.1in'>          (468,961) </td> </tr> <tr style='height:16.1pt'> <td width="59%" style='width:59.62%;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:16.1pt'>  Intangible Assets Net </td> <td width="20%" style='width:20.9%;border-top:solid black 1.0pt;border-left:none;border-bottom:double black 2.25pt;border-right:none;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:16.1pt'>   $      1,090,087  </td> <td width="19%" style='width:19.48%;border-top:solid black 1.0pt;border-left:none;border-bottom:double black 2.25pt;border-right:none;background:#D7FFD7;padding:0in 5.4pt 0in 5.4pt;height:16.1pt'>   $   1,112,631  </td> </tr> </table>

282427

-250272

-240972

32155

41635

109092

1467500 1467500

5000

-491505

-468961

1090087

1112631

0001446152 2016-02-28 0001446152 2017-09-01 2017-11-30 0001446152 2018-01-19 0001446152 2017-11-30 0001446152 2017-08-31 0001446152 2016-09-01 2016-11-30 0001446152 2016-08-31 0001446152 2016-11-30 0001446152 2017-11-30 2017-11-30 0001446152 2016-08-31 2016-08-31 shares iso4217:USD iso4217:USD shares EX-101.LAB 7 seny-20171130_lab.xml XBRL TAXONOMY EXTENSION LABELS LINKBASE DOCUMENT Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies Proceeds from Issuance of Common Stock Increase (Decrease) in Operating Liabilities {1} Increase (Decrease) in Operating Liabilities Weighted Average Number of Shares Outstanding, Basic Liabilities, Current Liabilities, Current Other Long-term Debt, Current Property, Plant and Equipment, Net Amortization of Intangible Assets Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment Use of Estimates, Policy Increase (Decrease) in Operating Assets Nonoperating Income (Expense) {1} Nonoperating Income (Expense) Selling and Marketing Expense Operating Expenses {1} Operating Expenses Cost of Revenue {1} Cost of Revenue Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest Commitments and Contingencies AssetRetirementObligation Other Short-term Borrowings Land Schedule of Intangible Assets and Goodwill Compensation Related Costs, Policy Depreciation Net Cash Provided by (Used in) Operating Activities {1} Net Cash Provided by (Used in) Operating Activities Earnings Per Share, Basic IncomeTaxExpenseBenefitContinuingOperationsAbstract Gross Profit Sales Revenue Goods, Net Income Statement Other Liabilities, Noncurrent Capital Lease Obligations, Noncurrent Derivative Instruments and Hedges, Liabilities Loans Payable, Current Assets, Noncurrent {1} Assets, Noncurrent Entity Central Index Key Document Period End Date Document Type Finite-Lived Patents, Gross Fair Value Change of Derivative Liability Amortization Net Income (Loss) Interest Expense Cost of Goods Sold Accounts Payable, Current Assets Assets Amendment Flag Document and Entity Information: Research, Development, and Computer Software, Policy Subsequent Events Debt Disclosure Weighted Average Number of Shares Outstanding, Diluted Cost of Revenue Common Stock, Shares Issued Common Stock, Value, Issued Other Assets, Noncurrent Due from Related Parties, Noncurrent Balance Sheets Entity Filer Category Other Intangible Assets, Net Property, Plant and Equipment, Gross Operating Income (Loss) Professional Fees Other Long-term Debt, Noncurrent Other Liabilities, Current Finite Lived Intangible Assets, Net Document Fiscal Year Focus Entity Common Stock, Shares Outstanding OtherComprehensiveIncomeLossNetOfTaxPortionAttributableToParentAbstract General and Administrative Expense Revenues Common Stock, Shares Authorized Liabilities and Equity Liabilities and Equity Retained Earnings (Accumulated Deficit) Line of Credit, Current Entity Well-known Seasoned Issuer Purchased Patents Represents the monetary amount of Purchased Patents, as of the indicated date. 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Document and Entity Information - USD ($)	3 Months Ended
Document and Entity Information - USD ($)	Nov. 30, 2017	Jan. 19, 2018	Feb. 28, 2016
Document and Entity Information:
Entity Registrant Name	SAUER ENERGY, INC.
Document Type	10-Q
Document Period End Date	Nov. 30, 2017
Amendment Flag	false
Entity Central Index Key	0001446152
Current Fiscal Year End Date	--08-31
Entity Common Stock, Shares Outstanding		336,894,876
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q1
Entity Public Float			$ 4,292,836
Trading Symbol	seny

XML 11 R2.htm IDEA: XBRL DOCUMENT

Statement of Financial Position - USD ($)	Nov. 30, 2017	Aug. 31, 2017
Assets, Current
Cash and Cash Equivalents, at Carrying Value	$ 12,136	$ 1,952
Other Assets, Current	15,514	1,500
Assets, Current	27,650	3,452
Assets, Noncurrent
Property, Plant and Equipment, Net	32,155	41,635
Goodwill	5,000
Indefinite-Lived Intangible Assets (Excluding Goodwill)	1,090,087	1,112,631
Other Assets, Noncurrent	13,507	13,507
Assets, Noncurrent	1,103,594	1,126,138
Assets	1,163,399	1,171,225
Liabilities, Current
Accrued Liabilities, Current	59,225	37,947
Due To Related Parties Current	5,000	3,000
Notes Payable, Current	11,444	105,000
Derivative Instruments and Hedges, Liabilities	78,402
Liabilities, Current	154,071	145,947
Liabilities, Noncurrent
Liabilities	154,071	145,947
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest
Common Stock, Value, Issued	38,027	35,121
Additional Paid in Capital, Common Stock	12,814,703	12,473,432
Retained Earnings (Accumulated Deficit)	(11,843,402)	(11,483,275)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	1,009,328	1,025,278
Liabilities and Equity	$ 1,163,399	$ 1,171,225

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Statement of Financial Position - Parenthetical - $ / shares	Nov. 30, 2017	Aug. 31, 2017
Balance Sheets
Common Stock, Par Value	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	650,000,000	650,000,000
Common Stock, Shares Issued	380,297,623	351,229,209
Common Stock, Shares Outstanding	380,297,623	273,433,664

XML 13 R4.htm IDEA: XBRL DOCUMENT

Statement of Income - USD ($)	3 Months Ended
Statement of Income - USD ($)	Nov. 30, 2017	Nov. 30, 2016
Revenues
Sales Revenue Goods, Net	$ 29,649
Revenues	29,649
Cost of Revenue
Cost of Goods Sold	15,106
Cost of Revenue	15,106
Gross Profit	14,543
Operating Expenses
Professional Fees	16,687	$ 13,000
Consulting	54,773	52,850
Rent Expense	45,013	46,523
Research and Development Expense	44,855	71,933
Selling and Marketing Expense		9,005
General and Administrative Expense	67,219	59,163
Operating Expenses	228,547	252,474
Operating Income (Loss)	(214,004)	(252,474)
Interest and Debt Expense
Interest Expense	166,623	127,390
Derivative Loss On Derivative	(20,500)
Interest and Debt Expense	146,123	127,390
Income (Loss) from Continuing Operations before Income Taxes, Extraordinary Items, Noncontrolling Interest	(360,127)	(379,864)
IncomeTaxExpenseBenefitContinuingOperationsAbstract
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest	(360,127)	(379,864)
Net Income (Loss) Attributable to Parent	(360,127)	(379,864)
OtherComprehensiveIncomeLossNetOfTaxPortionAttributableToParentAbstract
ComprehensiveIncomeNetOfTax	$ (360,127)	$ (379,864)
Earnings Per Share
Earnings Per Share, Basic	$ (0.00)	$ (0.00)
Weighted Average Number of Shares Outstanding, Basic	364,680,552	284,580,339
Earnings Per Share, Diluted	$ (0.00)	$ (0.00)
Weighted Average Number of Shares Outstanding, Diluted	364,680,552	284,580,339

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Statement of Cash Flows - USD ($)	3 Months Ended
Statement of Cash Flows - USD ($)	Nov. 30, 2017	Nov. 30, 2016
Net Cash Provided by (Used in) Operating Activities
Net Income (Loss)	$ (360,127)	$ (379,864)
Adjustments, Noncash Items, to Reconcile Net Income (Loss) to Cash Provided by (Used in) Operating Activities
Depreciation	9,480	10,922
Amortization	22,544	22,544
Fair Value Change of Derivative Liability	(15,154)
Issuance of Stock and Warrants for Services or Claims	159,178	125,417
Adjustments, Noncash Items, to Reconcile Net Income (Loss) to Cash Provided by (Used in) Operating Activities	(184,079)	(220,981)
Increase (Decrease) in Operating Assets
Increase (Decrease) in Prepaid Expense and Other Assets	(14,014)
Increase (Decrease) in Other Operating Assets
Increase (Decrease) in Operating Assets	(14,014)
Increase (Decrease) in Operating Liabilities
Increase (Decrease) in Accounts Payable and Accrued Liabilities	23,277	(17,070)
Increase (Decrease) in Operating Capital	23,277	(17,070)
Net Cash Provided by (Used in) Operating Activities	(174,816)	(238,051)
Net Cash Provided by (Used in) Financing Activities
Proceeds from (Repayments of) Short-term Debt		(79,283)
Proceeds from Issuance of Common Stock	185,000	322,500
Net Cash Provided by (Used in) Financing Activities	185,000	243,217
Cash and Cash Equivalents, Period Increase (Decrease)	10,184	5,166
Cash and Cash Equivalents, at Carrying Value	1,952	46,585
Cash and Cash Equivalents, at Carrying Value	$ 12,136	$ 51,751

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Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies

3 Months Ended

Nov. 30, 2017

Notes

Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies

Note 1 - Organization and summary of significant accounting policies:

Organization

Sauer Energy, Inc. was incorporated in California on August 7, 2008. The Company was incorporated to develop and market wind power electric generators.

Current Business of the Company

NOTE 2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents

The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.

Use of Estimates

Fair Value of Financial Instruments

· Level 1: Quoted prices in active markets for identical assets or liabilities.

· Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

· Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of the Company’s financial instruments as of November 30, 2017, reflect:

· Level 1 Cash Measurement based on bank reporting.

§ Level 2 Loans from Officers and related parties

Level 2 Based on promissory notes.
Level 3 Derivatives

Federal income taxes

The Company utilizes FASB ACS 740, “Income Taxes”, 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 or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation allowance is recorded when, in the opinion of management, it is “more likely-than-not” that a deferred tax asset will not be realized. The Company generated a deferred tax credit through net operating loss carry-forward. A valuation allowance of 100% has been established.

Interest and penalties on tax deficiencies recognized in accordance with ASC accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.

Research and development costs

Stock-based Compensation

Basic and Diluted Earnings (Loss) Per Share –

Recent Accounting Pronouncements

Management has considered all recent accounting pronouncements.

The Company is reviewing the effects of following recent updates. The Company has no expectation that any of these items will have a material effect upon the financial statements.

§ Update 2017-04—Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

Update 2017-05—Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets

Update 2016-15—Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)
Update 2016-09—Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting
Update 2016-07 —Investments—Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting
Update 2016-06 —Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments (a consensus of the Emerging Issues Task Force)

Update 2016-03—Intangibles—Goodwill and Other (Topic 350), Business Combinations (Topic 805), Consolidation (Topic 810), Derivatives and Hedging (Topic 815): Effective Date and Transition Guidance (a consensus of the Private Company Council)
Update 2016-01—Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities

Reclassifications

XML 16 R7.htm IDEA: XBRL DOCUMENT

Substantial Doubt about Going Concern

3 Months Ended

Nov. 30, 2017

Notes

Substantial Doubt about Going Concern

Note 3 – Going Concern

XML 17 R8.htm IDEA: XBRL DOCUMENT

Property, Plant and Equipment Disclosure

3 Months Ended

Nov. 30, 2017

Notes

Property, Plant and Equipment Disclosure

Note 4 – Property and Equipment

Property and Equipment consisted of the following at November 30, 2017, and August 31, 2017:

	11/30/17	8/31/17
Property Plant and Equipment	$ 282,427	$ 282,427
Less accumulated depreciation	(250,272)	(240,972)
Property and equipment, net	$ 32,155	$ 41,635

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Goodwill and Intangible Assets Disclosure

3 Months Ended

Nov. 30, 2017

Notes

Goodwill and Intangible Assets Disclosure

Note 5 – Intangible Property


	November 30, 2017	August 31, 2017
Patents	$ 109,092	$ 109,092
Purchased Patents	1,467,500	1,467,500
Goodwill	5,000	5,000
Less Amortization	(491,505)	(468,961)
Intangible Assets Net	$ 1,090,087	$ 1,112,631

In three months ended November 30, 2017, and November 30, 2016, amortization was $22,544 and $22,544, respectively.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

XML 19 R10.htm IDEA: XBRL DOCUMENT

Debt Disclosure

3 Months Ended

Nov. 30, 2017

Notes

Debt Disclosure

Note 6 - Notes Payable

On May 2, 2017, the Company entered into a short-term note agreement with an investor in the amount of $50,000 with an interest rate of 10% per annum, with a due date of September 2, 2017. As of November 30, 2017, the outstanding balance due was $Zero.

Note 7 -- Related Party Note

As of November 30, 2017, and August 31, 2017, we have related party payables to Dieter Sauer in the amounts of $5,000 and $3,000, respectively.

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Commitments and Contingencies Disclosure

3 Months Ended

Nov. 30, 2017

Notes

Commitments and Contingencies Disclosure

Note 8 – Commitments and Contingencies

Rental Agreement:

Lease Commitments – following five fiscal years:

Fiscal year ended

August 31,

	Year	Lease
2018		135,039
2019		168,173
2020		168,173

For the three months ended November 30, 2017 our rent expense was $45,013 compared to $46,523 for the three months ended November 30, 2016.

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Income Tax Disclosure

3 Months Ended

Nov. 30, 2017

Notes

Income Tax Disclosure

Note 9 - Federal income tax

For the three months ended November 30, 2017, and November 30, 2016, no income tax expense has been realized as a result of operations and no income tax penalties and/or interest have been accrued related to uncertain tax positions. The Company files income tax returns in the U.S. federal jurisdiction and in the State of California. These filings are subject to a three-year statute of limitations. The Company’s evaluation of income tax positions included in the years ended August 31, 2013 through 2016, could be subject to agency examinations. No filings are currently under examination. No adjustments have been made to reduce the estimated income tax benefit at fiscal year-end or at the quarterly reporting dates. Any valuations relating to these income tax provisions will comply with U.S. generally accepted accounting principles.

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Stockholders' Equity Note Disclosure

3 Months Ended

Nov. 30, 2017

Notes

Stockholders' Equity Note Disclosure

Note 10 – Capital Stock