Fair Value Measurements

9 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

Note 5 – Fair Value Measurements

Fair Value on a Recurring Basis

The following table presents information about the assets that are measured at fair value on a recurring basis at March 31, 2020 and June 30, 2019 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical instruments. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates, and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the financial instrument, and include situations where there is little, if any, market activity for the instrument:

At March 31, 2020
		Total	Level 1		Level 2	Level 3
Liabilities:
	Original issue discount, convertible debt	$         145,701	$                 -		$               -	$      145,701
	Derivative liability, warrants	33,312	-		-	33,312
Total:		$         179,013	$                 -		$               -	$      179,013
At June 30, 2019
Liabilities:		Total	Level 1		Level 2	Level 3
	Original issue discount, convertible debt	$         979,569	$                 -		$               -	$      979,569
	Derivative liability, warrants	46,375	-		-	46,375
Total:		$      1,025,944		$                 -	$               -	$1,025,944

The Company measures the fair market value of the Level 3 components using the Monte Carlo model and projected discounted cash flows, as appropriate. These models are prepared by an independent third party and consider management's best estimate of the conversion price of the stock, an estimate of the expected time to conversion, an estimate of the stock volatility, and the risk-free rate of return expected for an instrument with a term equal to the duration of the convertible note.

The derivative liability was valued using the Monte Carlo pricing model with the following inputs at March 31, 2020 and June 30, 2019:

At March 31, 2020
	Risk-free interest rate:	0.05 – 1.15%
	Expected dividend yield:	0.00%
	Expected stock price volatility:	250.00%
	Expected option life in years:	0.01 – 1.94 years
At June 30, 2019
	Risk-free interest rate:	1.72% - 2.83%
	Expected dividend yield:	0.00%
	Expected stock price volatility:	180.00%
	Expected option life in years:	2.80 - 3.00 years

The following table sets forth a reconciliation of changes in the fair value of the Company's convertible debt components classified as Level 3 in the fair value hierarchy at March 31, 2020:

Balance at June 30, 2019	$                     1,025,944
Additional convertible securities at inception	2,026,000
Settlement of conversion features and warrants	(152,374)
Realized	(234,903)
Unrealized	(2,485,645)
Ending balance	$                        179,013

Fair Value on a Nonrecurring Basis

The Company measures certain non-financial assets on a non-recurring basis, including goodwill, the anti-dilutive nature of the employment agreement, and certain intangible assets. The following table presents information about the assets that are measured at fair value on a nonrecurring basis at March 31, 2020 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value, as follows:

At March 31, 2020
		Total	Level 1	Level 2	Level 3
Assets:
	Goodwill	$   834,220	$        -	$          -	$  834,220
	Customer list	792,900	-	-	792,900
	Vendor Relationship	$479,000	$         -	$          -	$ 479,000
		$2,058,200	$         -	$          -	$2,058,220

As of June 30, 2019 the only asset required to be measured on a nonrecurring basis was goodwill and the fair value of the asset amounted to $834,220 using level 3 valuation techniques.