DERIVATIVE LIABILITIES

9 Months Ended

May 31, 2020

Disclosure Text Block [Abstract]

Derivatives and Fair Value [Text Block]

NOTE 7 – DERIVATIVE LIABILITIES

The Company accounts for the embedded conversion features included in its convertible instruments as derivative liabilities. The aggregate fair value of derivative liabilities at May 31, 2020, and August 31, 2019 amounted to $763,241 and $772,732 respectively.  At each measurement date, the fair value of the embedded conversion features was based on the lattice binomial method using the following assumptions:

	May 31, 2020		August 31, 2019
Effective Exercise price		0.00085 - 0.00136		0.0003 - 0.0010
Effective Market price		0.0017		0.0006
Volatility		78.26%		78.95%
Risk-free interest		0.17%		1.76%
Terms	365 days		365 days
Expected dividend rate		0%		0%

The expected volatility is based on the historical volatility of comparable companies.

Changes in the derivative liabilities during the nine-month period ended May 31, 2020 is as follows:

Balance at August 31, 2019	$	772,732
Embedded conversion features at issuance		-
Changes in fair value of derivative liabilities		(9,491	)
Balance, May 31, 2020	$	763,241