0001399306-18-000031.txt : 20181001 0001399306-18-000031.hdr.sgml : 20181001 20181001152150 ACCESSION NUMBER: 0001399306-18-000031 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 48 CONFORMED PERIOD OF REPORT: 20180630 FILED AS OF DATE: 20181001 DATE AS OF CHANGE: 20181001 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Simlatus Corp CENTRAL INDEX KEY: 0001399306 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 202675800 FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-53276 FILM NUMBER: 181097262 BUSINESS ADDRESS: STREET 1: 175 JOERSCHKE DR. STREET 2: SUITE A CITY: GRASS VALLEY STATE: CA ZIP: 94945-5259 BUSINESS PHONE: (530) 205-3437 MAIL ADDRESS: STREET 1: 175 JOERSCHKE DR. STREET 2: SUITE A CITY: GRASS VALLEY STATE: CA ZIP: 94945-5259 FORMER COMPANY: FORMER CONFORMED NAME: Grid Petroleum Corp. DATE OF NAME CHANGE: 20091120 FORMER COMPANY: FORMER CONFORMED NAME: Sunberta Resources Inc. DATE OF NAME CHANGE: 20070511 10-Q 1 form-10q.htm FORM-10Q
 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

xQUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended June 30, 2018

 

oTRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

 

For the transition period from ______ to _______

 

Commission File Number 000-53276

 

SIMLATUS CORPORATION

(Name of small business issuer in its charter)

 

Nevada   20-2675800
(State of incorporation)  

(I.R.S. Employer Identification No.)

 

175 Joerschke Dr., Ste. A

Grass Valley, CA 95945

(Address of principal executive offices)

 

(530) 205-3437

(Registrant’s telephone number)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x  No o

 

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 o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer o     Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company)   Smaller reporting company x
Emerging growth company o        

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 

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

 

As of September 28, 2018, there were 2,914,797 shares of the registrant’s $0.00001 par value common stock issued and outstanding.

 

 

 

 

 

 

SIMLATUS CORP.

 

TABLE OF CONTENTS

 

   Page
PART I. FINANCIAL INFORMATION   
    
ITEM 1.  CONDENSED FINANCIAL STATEMENTS  3
ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  20
ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  23
ITEM 4.  CONTROLS AND PROCEDURES  23
       
PART II. OTHER INFORMATION   
    
ITEM 1.  LEGAL PROCEEDINGS  24
ITEM 1A.  RISK FACTORS  24
ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS  24
ITEM 3.  DEFAULTS UPON SENIOR SECURITIES  24
ITEM 4.  MINE SAFETY DISCLOSURES  24
ITEM 5.  OTHER INFORMATION  24
ITEM 6.  EXHIBITS  25

 

Special Note Regarding Forward-Looking Statements

 

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Simlatus Corp. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

 

Please note that throughout this Quarterly Report, and unless otherwise noted, the words “we,”“SIML,” “our,” “us,” the “Company,” refers to Simlatus Corp.

2

 

PART I - FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

SIMLATUS CORP.
CONDENSED BALANCE SHEETS

 

   June 30,   March 31, 
   2018   2018 
   (Unaudited)       
ASSETS         
Current Assets          
Cash  $1,688   $2,431 
Accounts receivable       4,760 
Inventory, net   659    1,435 
Total Current Assets   2,347    8,626 
           
TOTAL ASSETS  $2,347   $8,626 
           
LIABILITIES          
Current Liabilities:          
Accounts payable  $245,143   $230,553 
Accrued wages   853,697    751,754 
Deferred revenue       3,528 
Derivative liabilities   6,957,489    6,627,023 
Convertible notes payable in default, net of discount   505,601    511,923 
Convertible notes payable, net of discount   333,438    262,910 
Convertible notes payable, interest   3,682,371    3,289,044 
Related party liabilities   143,223    126,494 
Total Current Liabilities   12,720,962    11,803,229 
           
Long term notes payable   61,000    61,000 
           
Total Liabilities   12,781,962    11,864,229 
           
Commitments and contingencies        
           
SHAREHOLDERS’ DEFICIT          
Preferred stock, $0.001 par value 20,000,000 shares authorized          
Series A: 10,000,000 shares authorized   3,490    3,490 
    3,489,510 shares issued and outstanding at June 30, 2018          
    3,489,510 shares issued and outstanding at March 31, 2018          
Series B: 10,000,000 shares authorized   1    1 
500 shares issued and outstanding at June 30, 2018          
500 shares issued and outstanding at March 31, 2018          
Common stock, $0.00001 par value 900,000,000 authorized   29    29 
2,914,797 shares issued and outstanding at June 30, 2018          
2,914,797 shares issued and outstanding at March 31, 2018          
Additional paid in capital   (937,626)   (954,735)
Accumulated deficit   (11,845,509)   (10,904,388)
Total Shareholders’ Deficit   (12,779,615)   (11,855,603)
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT  $2,347   $8,626 

 

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

3

 

SIMLATUS CORP.
 CONDENSED STATEMENT OF OPERATIONS
(Unaudited)

 

   Three months ended 
   June 30, 
   2018   2017 
Sales  $8,028   $8,351 
Cost of materials   2,571    6,617 
Gross profit (loss)   5,457    1,734 
           
Operating expenses:          
G&A expenses   22,730    52,364 
Professional fees   28,297    95,956 
Salaries and wages   81,250    102,083 
Total operating expenses   132,277    250,403 
           
Loss from operations   (126,820)   (248,669)
           
Other income (expense):          
Gain (loss) on settlement of debt   (13,000)   (62,421)
Gain (loss) in fair value of derivative liability   (307,073)   942,273 
Interest expense   (494,228)   (660,384)
Total other expense   (814,301)   219,468 
           
Net loss before income taxes   (941,121)   (29,201)
Income tax expense        
Net loss  $(941,121)  $(29,201)
           
Per share information          
Weighted number of common shares outstanding, basic and diluted   2,914,797    917,859 
Net loss per common share, basic and diluted   (0.32)   (0.03)

 

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

4

 

SIMLATUS CORP.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)

 

   Three months ended 
   June 30, 
   2018   2017 
Cash flows from operating activities:          
Net loss  $(941,121)  $(29,201)
Adjustments to reconcile net income to net cash provided by operating activities:          
Amortization of convertible debt discount   70,170    165,561 
Imputed interest   5,057     
New derivatives recorded as loan fees       57,487 
Common stock issued for services       20,500 
Change in fair value of derivative liability   307,073    (942,273)
Loss on settlement of debt   13,000    62,421 
Decrease (increase) in operating assets:          
Accounts receivable   4,760     
Inventory   776    (591)
Prepaid expenses       6,000 
Increase (decrease) in operating liabilities:          
Accounts payable   31,071    91,346 
Accrued expenses   98,415    115,754 
Accrued interest   393,327    419,165 
Advances from related parties   16,729     
Net cash used in operating activities   (743)   (33,831)
           
Cash flows from investing activities:        
           
Cash flows from financing activities:          
Proceeds from convertible notes payable       20,000 
Proceeds from (payments to) related parties, net       15,223 
Net cash provided by financing activities       35,223 
           
Net increase (decrease) in cash   (743)   1,392 
           
Cash, beginning of period   2,431    1,330 
Cash, end of period  $1,688   $2,722 
           
Supplemental disclosures of cash flow information:          
Cash paid for income taxes  $   $ 
Cash paid for interest  $   $ 
           
Schedule of non-cash investing & financing activities:          
Accounts payable converted to note payable  $16,481   $ 
Preferred Series A stock issued to settle debt  $   $960,069 
Shares issued for liabilities  $   $383,215 
Derivative debt discount  $27,945   $55,817 
Derivative settlements  $12,052   $ 
Preferred Series A stock converted to common stock  $   $1,918 
Accrued interest on note payable transferred to principal  $   $872 

 

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

5

 

SIMLATUS CORP.

NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS

June 30, 2018

(Unaudited)

 

1.BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Organization and Description of Business

 

Simlatus Corporation (“SIML” or “Company”) was incorporated in the State of Nevada under the name Sunberta Resources Inc. on November 15, 2006, as a mining and exploration of mineral claims business.  On November 18, 2009, the Company changed its name to Grid Petroleum Corp. and continued with the mining and exploration of mineral claims operations, exploring mining claims in Alberta, Canada, Vancouver Island, British Columbia, England and the United States.

 

On March 9, 2016, the Company entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with RJM and Associates, LLC, a California limited liability company (“RJM”) whereby RJM’s owners became the directors of the Company and were to be issued $6,250,000 worth of the Company’s stock; $5,000,000 of Restricted Common Stock 90 days from the date of this agreement and $1,250,000 of Preferred Series-A Shares of the Company’s Preferred Stock (the “Acquisition”). On the same date, the entire management of RJM became the entire management of the Company. The Company’s transaction with RJM has been treated as a reverse recapitalization of the Company, with the Company (the legal acquirer of RJM) considered the accounting acquiree and RJM, whose management took control of the Company (the legal acquiree of the Company), considered the accounting acquirer. The historical financial statements include the operations of the accounting acquirer (RJM) for all periods presented.

 

RJM was incorporated in the State of California on June 11, 2014, for the purpose of operating a broadcast equipment production business.

 

On March 25, 2016, the Company approved a name change to Simlatus Corporation, stock symbol SIML, which was executed on April 4, 2016. The new name change better describes the Company’s new business and new revenues in selling commercial broadcast equipment on a global basis. Simlatus Corporation develops, manufactures, markets and owns proprietary advanced broadcast equipment and software and sells this audio and video broadcast equipment worldwide. These systems have been sold worldwide over the past 15 years including some of the major broadcast companies.   

 

The Company currently sells approximately 55 different audio/video products and is preparing to market its newest audio/video product referred to as SyncPal™. In addition to the Company’s traditional line of audio/video products, it has commenced the research & development of its Immersive Broadcast System, referred to as the Simlatus-IBS™. The Simlatus-IBS™ will include commercial augmented reality and virtual reality applications for studio engineers. These applications, both hardware and software, will allow the customer to control and manage the studio audio/video systems from anywhere in the world. These products are being developed to serve a market segment that is presently being strongly embraced by consumers and is forecasted, by some of the most widely recognized tech companies in the world, as becoming a multi-billion-dollar market in the very near future. The Market Analysis and IP Portfolio will include new patents specifically developed for these products and owned by the Company.

 

Financial Statement Presentation

 

The accompanying unaudited Condensed Financial Statements have been prepared in accordance with the instructions to interim financial reporting as prescribed by the Securities and Exchange Commission (the “SEC”). The results for the interim periods are not necessarily indicative of results for the entire year. These interim financial statements do not include all disclosures required by U.S. generally accepted accounting principles (“GAAP”), and should be read in conjunction with the consolidated financial statements and notes thereto filed with the SEC in our Annual Report on Form 10-K for the fiscal year ended March 31, 2018. In the opinion of management, the unaudited Condensed Financial Statements contained in this report include all known accruals and adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods reported herein. Any such adjustments are of a normal recurring nature.

6

 

Fiscal Year End 

 

The Company has selected March 31 as its fiscal year end.

 

Use of Estimates

 

The preparation of the Company’s financial statements in conformity with generally accepted accounting principles of United States of America 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.

 

Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Actual results could differ from those estimates.

 

Cash Equivalents

 

The Company considers all highly liquid investments with maturities of 90 days or less from the date of purchase to be cash equivalents.

 

Revenue recognition and Related Allowances

 

Effective April 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

 

Accounts Receivable and Allowance for Doubtful Accounts

 

Accounts receivable are stated at the amount that management expects to collect from outstanding balances. Bad debts and allowances are provided based on historical experience and management’s evaluation of outstanding accounts receivable. Management evaluates past due or delinquency of accounts receivable based on the open invoices aged on due date basis. The allowance for doubtful accounts at June 30, 2018 and March 31, 2018 is $0.

 

Accounts Payable and Accrued Expenses

 

Accounts payable and accrued expenses are carried at amortized cost and represent liabilities for goods and services provided to the Company prior to the end of the fiscal year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services.

 

Loss Per Share

 

Basic loss per share of common stock is computed by dividing the net loss by the weighted average number of common shares outstanding during the period after giving retroactive effect to the reverse stock split affected on November 1, 2017 (see Note 8). Diluted earnings (loss) per share is equal to the basic per share for the three months ended June 30, 2018 and 2017. Common stock equivalents are not included in the loss per share since they are anti-dilutive. All per share amounts have been adjusted for the reverse stock split.

7

 

Inventories

 

Inventories are stated at the lower of cost, computed using the first-in, first-out method and net realizable value. Any adjustments to reduce the cost of inventories to their net realizable value are recognized in earnings in the current period. During the year ended March 31, 2018, the Company recorded an impairment to inventory of $61,188. As of June 30, 2018 and March 31, 2018, the Company’s inventories consist primarily of raw materials and supplies rather than finished goods and are presented, net of an allowance for obsolete inventory, as $659 and $1,435, respectively.

 

Fair Value of Financial Instruments

 

Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk.

 

In addition to defining fair value, the standard expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs is expanded. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels and which is determined by the lowest level input that is significant to the fair value measurement in its entirety.

 

These levels are:

 

Level 1 - inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

 

Level 2 - inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 

Level 3 - inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

 

The following table represents the Company’s financial instruments that are measured at fair value on a recurring basis as of June 30, 2018 and March 31, 2018 for each fair value hierarchy level:

 

June 30, 2018  Derivative Liabilities   Total 
Level 1  $    $  
Level 2  $    $  
Level 3  $6,957,489   $6,957,489 
           
March 31, 2018  Derivative Liabilities   Total 
Level 1  $   $ 
Level 2  $   $ 
Level 3  $6,627,023   $6,627,023 

 

In management’s opinion, the fair value of convertible notes payable and advances payable is approximate to carrying value as the interest rates and other features of these instruments approximate those obtainable for similar instruments in the current market. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, exchange or credit risks arising from these financial instruments. As of June 30, 2018 and March 31, 2018, the balances reported for cash, accounts receivable, prepaid expenses, accounts payable, and accrued liabilities, approximate the fair value because of their short maturities.

8

 

Income Taxes

 

The Company records deferred taxes in accordance with FASB ASC No. 740, Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and loss carry-forwards and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

 

As of the date of this filing, the Company is delinquent in filing their tax returns, and there is uncertainty regarding potential penalties and interest.  The last return filed by the Company was March 31, 2012, and the Company has not accrued any potential penalties or interest from that period forward.  The Company will need to file returns for the years ending March 31, 2013, 2014, 2015, 2016, 2017 and 2018 which, are still open for examination.

 

Recent Accounting Pronouncements

 

In May 2014, the FASB issued ASU 2014-09 regarding ASC Topic 606, “Revenue from Contracts with Customers.” ASU 2014-09 provides principles for recognizing revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14 to defer the effective date by one year with early adoption permitted as of the original effective date. ASU 2014-09 will be effective for our fiscal year beginning April 1, 2018. In addition, the FASB issued ASU 2016-08, ASU 2016-10, and ASU 2016-12 in March 2016, April 2016, and May 2016, respectively, to help provide interpretive clarifications on the new guidance in ASC Topic 606. The Company is currently evaluating the accounting, transition, and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption.

 

While the Company does not expect the adoption of this standard to have a material impact on the Company’s net Revenues in the Statements of Income, the Company anticipates revenues for certain wholesale transactions and substantially all digital commerce sales will be recognized upon shipment rather than upon delivery to the customer.

 

Additionally, provisions for post-invoice sales discounts, returns and miscellaneous claims will be recognized as accrued liabilities rather than as reductions to Accounts receivable, net; and the estimated cost of inventory associated with the provision for sales returns will be recorded within Prepaid expenses and other current assets on the Balance Sheets. The Company continues to evaluate the impact of this new standard, including on accounting policies, disclosures, internal control over financial reporting and its contracts with customers.

 

In February 2016, the FASB issued ASU 2016-02 (ASC Topic 842), Leases. The ASU amends a number of aspects of lease accounting, including requiring lessees to recognize operating leases with a term greater than one year on their balance sheet as a right-of-use asset and corresponding lease liability, measured at the present value of the lease payments. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is in the process of assessing the impact on its financial statements.

 

Effective April 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

9

 

2.GOING CONCERN

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As of June 30, 2018, the Company has an accumulated deficit of $11,845,509 since its inception and working capital deficit of $12,718,615, negative cash flows from operations, and has limited business operations, which raises substantial doubt about the Company’s ability to continue as going concern. The ability of the Company to meet its commitments as they become payable is dependent on the ability of the Company to obtain necessary financing or achieving a profitable level of operations. There is no assurance the Company will be successful in achieving these goals.

 

The Company does not have sufficient cash to fund its desired research and development objectives for its augmented/virtual reality product development for the next 12 months. The Company has arranged financing and intends to utilize the cash received to fund the research and development project. This financing may be insufficient to fund expenditures or other cash requirements required to complete the product design for the augmented/virtual reality markets. There can be no assurance the Company will be successful in completing any new product development. The Company plans to seek additional financing if necessary in private or public equity offering(s) to secure future funding for operations. There can be no assurance the Company will be successful in raising additional funding. If the Company is not able to secure additional funding, the implementation of the Company’s business plan will be impaired. There can be no assurance that such additional financing will be available to the Company on acceptable terms or at all.

 

These financial statements do not give effect to adjustments to the amounts and classification to assets and liabilities that would be necessary should the Company be unable to continue as a going concern.

 

3.CONVERTIBLE NOTES PAYABLE

 

As of June 30, 2018 and the year ended March 31, 2018, notes payable were comprised of the following:

 

   Original  Due  Interest  Conversion  June 30,   March 31, 
   Note Date  Date  Rate  Rate  2018   2018 
ARC Capital Ltd  10/1/2015  4/2/2016  24%  Variable  $2,625   $2,625 
Asher Enterprises #4  9/16/2011  6/20/2012  22%  Variable       13,000 
Auctus Fund #1  12/16/2016  9/16/2017  24%  Variable   46,750    46,750 
Auctus Fund #2  8/9/2017  5/9/2017  24%  Variable   46,750    46,750 
Blackbridge Capital #2  5/3/2016  5/3/2017  5%  Variable   80,400    80,400 
EMA Financial  11/9/2016  11/9/2017  24%  Variable   272,576    272,576 
Emunah Funding #1  10/18/2017  10/18/2018  0%  Variable   110,000    110,000 
Emunah Funding #2  10/18/2017  10/18/2018  0%  Variable   20,000    20,000 
Emunah Funding #3  10/18/2017  10/18/2018  0%  Variable   30,000    30,000 
Emunah Funding #4  10/20/2018  7/20/2018  8%  Variable   55,440    55,440 
Emunah Funding #5  5/15/2018  5/15/2019  10%  Variable   37,778     
GW Holdings  10/13/2015  4/1/2015  24%  Variable   42,500    42,500 
James Powell  9/7/2015  Demand  8%  Variable   150,875    150,875 
Syndication Capital #1  12/31/2012  10/10/2011  22%  0.01   5,000    5,000 
Tri-Bridge Ventures #1  1/19/2017  10/19/2017  8%  Variable   9,000    9,000 
V2IP #2  5/13/2016  Demand  12%  Variable   10,000    10,000 
                919,694    894,916 
Less debt discount         (80,655)   (120,083)
Notes payable, net of discount*        $839,039   $774,833 

 

*During the three months ended June 30, 2018 and the year ended March 31, 2018, the balance of notes payable, net of discount that are in default is $505,601 and $511,923, respectively.

10

 

ARC Capital Ltd

 

On October 1, 2015, the Company accepted and agreed to a Debt Purchase Agreement, whereby ARC Capital Ltd acquired $16,000 in principal and $5,625 of interest of a Direct Capital Group, Inc. convertible note in exchange for $21,625. The note bears interest at 8% per annum (increases to 24% per annum upon an event of default), matured on April 2, 2016, and is convertible into common stock at 50% of the lowest closing market price of the prior 15 trading days including the day upon which the notice of conversion is received by the Company. The Company recorded a debt discount from the derivative equal to $21,625 due to this conversion feature. The note had accrued interest of $8,417 as of June 30, 2018 and $8,260 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $0 and $0 at March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $2,625 and $2,625, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Asher Enterprises, Inc.

 

On September 16, 2011, the Company accepted and agreed to a Debt Purchase Agreement, whereby Asher Enterprises, Inc. acquired $40,000 of a Special Situations Fund One convertible note in exchange for $40,000. The note bears interest at 8% per annum (increases to 22% per annum upon an event of default), matured on June 20, 2012, and is convertible into common stock at 50% multiplied by the average of the 3 lowest closing market prices of the 10 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $40,000 due to this conversion feature. The note had accrued interest of $0 as of June 30, 2018 and $0 as of March 31,2018. The debt discounts had a balance of $0 at June 30, 2018 and $0 at March 31, 2018.

 

On May 12, 2018, the Company entered into a Debt Settlement Agreement with Asher Enterprises, Inc. to settle the outstanding debt of $13,000 in exchange for a cash payment of $26,000, resulting in a loss on settlement of debt of $13,000. As of June 30, 2018 and March 31, 2018, the note had a balance of $0 and $13,000, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Auctus Fund LLC

 

On December 16, 2016, the Company issued a convertible note to Auctus Fund LLC for $46,750, of which $40,000 was received in cash $6,750 was recorded as transaction fees. The note bears interest at 10% (increases to 24% per annum upon an event of default), matured on September 16, 2017, and is convertible into the lower of 1) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the date of the note, and 2) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the conversion date. The Company recorded a debt discount from the derivative equal to $46,750 due to this conversion feature. Pursuant to the default terms of the note, the Company entered a penalty of $191,562 in interest during the year ended March 31, 2018. The note had accrued interest of $206,924 as of June 30, 2018 and $204,127 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $204,127 as of March 31, 2017. The Company recorded debt discount amortization expense of $0 and $28,835 as of June 30, 2018 and 2017, respectively. The principal balance as of June 30, 2018 and 2017, was $46,750 and $46,750, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On August 9, 2017, the Company issued a convertible note to Auctus Fund LLC for $46,750, of which $40,000 was received in cash $6,750 was recorded as transaction fees. The note bears interest at 10% (increases to 24% per annum upon an event of default), matured on August 22, 2017, and is convertible into the lower of 1) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the date of the note, and 2) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the conversion date. The Company recorded a debt discount from the derivative equal to $46,750 due to this conversion feature. Pursuant to the default terms of the note, the Company entered a penalty of $210,097 in interest during the year ended March 31, 2018. The note had accrued interest of $214,260 as of June 30, 2018 and $213,094 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $6,679 as of March 31, 2018. The Company recorded debt discount amortization expense of $6,679 and $40,071 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $46,750 and $46,750, respectively. This note is currently in default.

11

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Blackbridge Capital

 

On May 3, 2016, the Company accepted and agreed to a Debt Purchase Agreement, whereby Blackbridge Capital acquired $100,000 in principal of a Direct Capital Group, Inc. convertible note in exchange for $100,000. The note bears interest at 5% per annum, matured on May 3, 2017, and is convertible into common stock at 50% of the lowest market price of the 20 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $100,000 due to this conversion feature. The note had accrued interest of $8,705 as of June 30, 2018 and $7,703 as of March 31,2018. The debt discounts had a balance of $0 at June 30, 2018 and $0 at March 31, 2018. The Company recorded debt discount amortization expense of $0 and $7,269 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $80,400 and $80,400, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

EMA Financial, LLC

 

On November 9, 2016, the Company issued a convertible note to EMA Financial, LLC for $35,000, of which $30,000 was received in cash $5,000 was recorded as transaction fees. The note bears interest at 10% (increases to 24% per annum upon an event of default), matured on November 9, 2017, and is convertible into the lower of 1) the closing market price on the trading day immediately preceding the closing date of the note, and 2) 50% of the lowest trading price during the 25 trading days prior to the conversion date. The Company recorded a debt discount from the derivative equal to $35,000 due to this conversion feature. Pursuant to the default terms of the note, the Company entered a penalty of $250,330 in principal and $23,143 in interest during the year ended March 31, 2018. The note had accrued interest of $42,725 as of June 30, 2018 and $26,415 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $0 as of March 31, 2018. During the year ended March 31, 2018, the principal amount of $12,754 was converted into shares. The Company recorded debt discount amortization expense of $0 and $21,384 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $272,576 and $272,576, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Emunah Funding LLC

 

On October 18, 2017, the Company issued a convertible note to Emunah Funding LLC in consideration of liquidated damages in the amount of $110,000. The note bears no interest, matures on October 18, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $110,000 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $33,151 and $60,575 at March 31, 2017. The Company recorded debt discount amortization expense of $27,425 during the three months ended June 30, 2018 and $49,425 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $110,000 and $110,000, respectively.

12

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On October 18, 2017, the Company accepted and agreed to a Debt Purchase Agreement, whereby Emunah Funding LLC acquired $20,000 of debt from a Tri-Bridge Ventures LLC convertible note in exchange for $25,000. The note bears no interest, matures on October 18, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $25,000 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $7,534 and $13,767 at March 31, 2017. During the year ended March 31, 2018 the principal amount of $5,000 was converted into shares. The Company recorded debt discount amortization expense of $6,233 during the year ended June 30, 2018 and $11,233 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $20,000 and $20,000 respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On October 18, 2017, the Company accepted and agreed to a Debt Purchase Agreement, whereby Emunah Funding LLC acquired $35,817 of debt from a Tri-Bridge Ventures LLC convertible note in exchange for $30,000. The note bears no interest, matures on October 18, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $30,000 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $9,041 and $16,521 at March 31, 2018. The Company recorded debt discount amortization expense of $7,479 during the three months ended June 30, 2018 and $13,479 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31 2018, was $30,000 and $30,000, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On October 20, 2017, the Company issued a convertible note to Emunah Funding LLC for $33,840, which includes $26,741 to settle outstanding accounts payable, transaction costs of $4,065, OID interest of $2,840, and cash consideration of $194. On November 6, 2017, the Company issued an Allonge to the convertible debt in the amount of $9,720. The Company received $7,960 in cash and recorded transaction fees of $1,000 and OID interest of $760. On November 30, 2017, the Company issued an Allonge to the convertible debt in the amount of $6,480. The Company received $5,000 in cash and recorded transaction fees of $1,000 and OID interest of $480. On January 11, 2018, the Company issued an Allonge to the convertible debt in the amount of $5,400. The Company received $5,000 in cash and recorded OID interest of $480. The note bears interest of 8% (increases to 24% per annum upon an event of default), matures on July 20, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The note had accrued interest of $2,882 as of June 30, 2018 and $1,776 as of March 31,2018. The Company recorded a debt discount from the derivative equal to $55,440 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $4,062 and $22,542 at March 31, 2018. The Company recorded debt discount amortization expense of $18,480 during the three months ended June 30, 2018 and $32,898 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $55,440 and $55,440, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On May 15, 2018, the Company issued a convertible note to Emunah Funding LLC for $37,778, which includes $26,000 to settle the convertible note with Asher Enterprises, $8,000 to settle outstanding accounts payable, and OID interest of $3,778. The note bears interest of 10% (increases to 24% per annum upon an event of default), matures on May 15, 2019, and is convertible into common stock at 60% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $26,964 due to this conversion feature. The note had accrued interest of $476 as of June 30, 2018 and $0 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $26,868 and $0 at March 31, 2018. The Company recorded debt discount amortization expense of $3,874 during the three months ended June 30, 2018 and $0 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $37,778 and $0, respectively.

13

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

GW Holdings Group, LLC

 

On October 13, 2015, the Company accepted and agreed to a Debt Purchase Agreement, whereby GW Holdings Group, LLC acquired $50,000 in principal and $10,411 of interest of a New Venture Attorneys convertible note in exchange for $60,411. The note bears interest at 8% per annum (increases to 24% per annum upon an event of default), matured on April 1, 2015, and is convertible into common stock at 50% multiplied by the average of the 3 lowest closing prices of the 10 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $60,411 due to this conversion feature. On April 27, 2016 and May 23, 2016, GW Holdings requested conversions which were not honored. Pursuant to the terms of the note, penalties of $2,000 per day per conversion were accrued as interest. The note had accrued interest of $3,136,750 as of June 30, 2018 and $2,770,200 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $0 and $0 at March 31, 2018. he Company The principal balance as of June 30, 2018 and March 31, 2018, was $42,500 and $42,500, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

James Powell

 

On September 7, 2015, the Company issued a convertible note with the Company’s former President, James Powell for non-cash consideration for accrued fees of $150,875. The note bears interest at 8%, is due on demand, and is convertible into convertible into common stock at 50% of the lowest trading price for the 15 days prior to the date of conversion. The note had accrued interest of $33,961 as of June 30, 2018 and $30,952 as of March 31,2018. The principal balance as of June 30, 2018 and March 31, 2018 was $150,875 and $150,875, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Syndication Capital, LLC

 

On December 31, 2012, the Company issued a convertible note with Syndication Capital, LLC, Inc. for non-cash consideration for unpaid consulting fees of $105,000. The note bears interest of 22%, matured on October 10, 2011 and is convertible into convertible into common stock at a fixed rate of $.0001. On August 4, 2013, Gel Properties, LLC acquired $100,000 of the note. The note had accrued interest of $19,129 as of June 30, 2018 and $18,855 as of March 31,2018. The principal balance as of June 30, 2018 and March 31, 2018, was $5,000 and $5,000, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Tri-Bridge Ventures LLC

 

On January 19, 2017, the Company issued a convertible note to Tri-Bridge Ventures LLC for $25,000 for cash consideration. The note bears interest at 8%, matured on October 19, 2017, and is convertible into common stock at 57.5% of the volume weighted average price of the daily trading prices during the 20 day period ending on the latest complete trading day prior to the conversion date. The Company recorded a debt discount from the derivative equal to $25,000 due to this conversion feature. The note had accrued interest of $1,486 as of June 30, 2018 and $1,306 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $0 as of March 31, 2018. During the year ended March 31, 2018, the principal amount of $16,000 was converted into shares. The Company recorded debt discount amortization expense of $0 and $18,498 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $9,000 and $9,000, respectively. This note is currently in default.

14

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

V2IP, LLC

 

On May 31, 2016, the Company accepted and agreed to a Debt Purchase Agreement, whereby V2IP, LLC acquired $20,000 in accrued interest from a Direct Capital Group, Inc convertible note in exchange for $20,000. The note bears interest at 6% per annum (increases to 12% per annum upon an event of default), is due on demand, and is convertible into common stock at 50% of the lowest trading price of the 10 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $20,000 due to this conversion feature. The note had accrued interest of $1,428 as of June 30, 2018 and $1,129 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $0 and $0 at March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $10,000 and $10,000, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

As of June 30, 2018, we have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities.

 

Convertible Note Conversions

 

During the three months ended June 30, 2018, the Company issued no shares of common stock upon the conversion of portions of the Convertible Notes.

 

During the year ended March 31, 2018, the Company issued the following shares of common stock upon the conversions of portions of the Convertible Notes:

 

   Principal   Note Fee   Total   Conversion   Shares Issued   Shares Issued    
Date  Conversion   Conversion   Conversion   Price   Pre-Split   Post-Split   Issued to
4/5/2017  $4,800   $   $4,800   $0.0160    48,000,000    32,000   Rockwell
4/11/2017   9,500.00        9,500    0.0154    44,186,047    29,457   GHS
4/12/2017   5,000.00        5,000    0.0128    50,000,000    33,333   Rockwell
4/17/2017   5,200.00        5,200    0.0129    52,000,000    34,667   Rockwell
4/18/2017   14,000.00        14,000    0.0138    61,135,372    40,757   GHS
4/24/2017   4,781.62        4,782    0.0136    47,816,200    31,877   Rockwell
5/1/2017   14,000.00        14,000    0.0129    68,292,683    45,528   GHS
5/10/2017   12,000.00        12,000    0.0128    69,364,162    46,243   GHS
5/12/2017   2,600.00        2,600    0.0097    130,000,000    86,667   Tri-Bridge
5/17/2017   4,440.00    900    5,340    0.0080    89,000,000    59,333   EMA
5/22/2017   9,000.00        9,000    0.0075    180,000,000    120,000   ARC
5/22/2017   3,600.00        3,600    0.0056    180,000,000    120,000   Tri-Bridge
5/23/2017   14,000.00        14,000    0.0055    93,959,732    62,640   GHS
5/30/2017   4,600.00        4,600    0.0056    230,000,000    153,333   Tri-Bridge
5/31/2017   2,700.00    900    3,600    0.0055    120,000,000    80,000   EMA
6/2/2017   5,200.00        5,200    0.0056    260,000,000    173,333   Tri-Bridge
6/5/2017   480.00    900    1,380    0.0058    138,000,000    92,000   EMA
6/5/2017   10,000.00        10,000    0.0056    97,087,379    64,725   GHS
6/14/2017   2,245.00        2,245    0.0056    314,500,000    209,667   EMA
6/16/2017   12,800.00        12,800    0.0056    182,857,143    121,905   GHS
6/22/2017   2,889.00    900    3,789    0.0058    378,900,000    252,600   EMA
6/23/2017   12,500.00        12,500    0.0059    178,571,429    119,048   GHS
11/13/2017   5,000.00    1,250    6,250    0.0001    108,695,652    72,464   Emunah
   $161,336   $4,850   $166,186         3,122,365,799    194,559,520    

15

 

4. LONG TERM NOTE PAYABLE

 

On October 1, 2017, Direct Capital Group, Inc. agreed to cancel two convertible notes in the principal amounts of $25,000 and $36,000, and $6,304 in accrued interest, in exchange for a Promissory Note in the amount of $61,000. The note bears no interest and is due on or before October 1, 2020. The Company recorded a gain of $6,304 in accrued interest and the derivative liability of $87,505 was revalued and settled to additional paid in capital.

 

5. DERIVATIVE LIABILITIES

 

As of June 30, 2018, the Company revalued the embedded conversion feature of the Convertible Notes, warrants and stock payables. The fair values were calculated based on the Monte Carlo simulation method consistent with the terms of the related debt.

 

A summary of the derivative liability balance as of June 30, 2018, is as follows:

 

   Notes   Warrants   Stock Payable   Total 
Balance, beginning of period  $4,019,289   $2,131   $2,605,603   $6,627,023 
Initial recognition of derivative liability   26,964    981    7,500    35,445 
Reduction for debt settlement   (12,052)           (12,052)
Loss on derivative liability valuation   299,573        7,500    307,073 
Balance, end of period  $4,333,774   $3,112   $2,620,603   $6,957,489 

 

Convertible Notes

 

The fair value at the commitment date for the convertible notes and the revaluation dates for the Company’s derivative liabilities were based upon the following management assumptions as of June 30, 2018:

 

   Commitment date     Valuation date
Expected dividends  0%  0%
Expected volatility  338%-423%  91.6%-102%
Expected term  .5 – 2 years  .25 – 2 years
Risk free interest  .92%-1.41%  1.66%-2.12%

 

Warrants

 

On October 20, 2017, the Company executed a Common Stock Purchase Warrant for 52,840,909 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on October 20, 2022.

 

On November 6, 2017, the Company executed a Common Stock Purchase Warrant for 15,338,160 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on November 6, 2022.

16

 

On November 30, 2017, the Company executed a Common Stock Purchase Warrant for 10,225,440 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on November 30, 2022.

 

On January 11, 2018, the Company executed a Common Stock Purchase Warrant for 8,521,200 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on January 11, 2023.

 

On May 15, 2018, the Company executed a Common Stock Purchase Warrant for 40,000,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on May 15, 2023.

 

The Company evaluated all outstanding warrants to determine whether these instruments may be tainted. All warrants outstanding were considered tainted. The Company valued the embedded derivatives within the warrants based on the Monte Carlo simulation.

 

The fair value at the inception date for the warrants and the revaluation dates were based upon the following management assumptions:

 

   Commitment date    Valuation date
Expected dividends  0%  0%
Expected volatility  105.3%-106.8%  105.3%-106.8%
Expected term  5 years  4.56 - 5 years
Risk free interest  1.99%-2.32%  2.14%-2.56%

 

Stock Payable

 

During the year ended March 31, 2018, the Company reclassified stock payables due to related parties of $2,791,250 to derivative liabilities, due to the company having a tainted equity environment. The payables to be issued in stock are at 100% of the lowest closing market price with a 15 day look back. The effective discount to the stock at March 31, 2018 due to the 100% of the lowest closing market price of the previous 15 days using a 6-month average was $0, and therefore the value is equal to the face amount.

 

During the three month ended June 30, 2018, the Company recorded $7,500 in stock payables due to the conversion of accounts payable to stock payable, which were derivatives due to their tainted equity environment.

 

6. RELATED PARTY TRANSACTIONS

 

The Company is periodically advanced noninterest bearing operating funds from related parties. The advances are due on demand and unsecured. During the three month ended June 30, 2018, the Company advanced $16,729 to related parties. As of June 30, 2018 and March 31, 2018 the Company owed related parties $143,223 and $126,494, respectively. During the three months ended June 30, 2018 and the year ended March 31, 2018, the Company recorded imputed interest of $5,057 and $13,257, respectively, to the statement of operations with a corresponding increase to additional paid in capital.

 

7. PREFERRED STOCK

 

On January 25, 2011, the Company filed an amendment to its Nevada Certificate of Designation to create two classes of Preferred Stock, Series A and Series B, with a par value of $0.001. Each class has 10,000,000 shares authorized.

 

On July 1, 2015, the Company’s Board of Directors authorized the creation of shares of Series B Voting Preferred Stock and on July 27, 2015 a Certificate of Designation was filed with the Nevada Secretary of State. The holder of the shares of the Series B Voting Preferred Stock has the right to vote those shares of the Series B Voting Preferred Stock regarding any matter or action that is required to be submitted to the shareholders of the Company for approval. The vote of each share of the Series B Voting Preferred Stock is equal to and counted as 4 times the votes of all of the shares of the Company’s (i) common stock, and (ii) other voting preferred stock issued and outstanding on the date of each and every vote or consent of the shareholders of the Company regarding each and every matter submitted to the shareholders of the Company for approval.

17

 

On January 3, 2017, the Company filed an Amendment to Certificate of Designation with the Nevada Secretary of State defining the rights and preferences of the Series A Preferred shares. Series A Preferred stock shall be convertible into common shares at the rate of the closing market price on the day of the conversion notice equal to the dollar amount of the value of the Series A shares, and holders shall have no voting rights on corporate matters, unless and until they convert their Series A shares into Common Shares, at which time they will have the same voting rights as all Common Shareholders have; their consent shall not be required for taking any corporate action.

 

On June 1, 2017, the Company issued 536,351 Series A Preferred shares valued at $960,068 to Gary Tilden, a former officer and director, which reduced liabilities owed to him of $819,460, and recorded a loss on conversion of $140,608. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

On August 21, 2017, the Company retired 250 Series B Voting Preferred shares issued and 81,061 common shares issued to Gary Tilden, in accordance with his resignation arrangement. Additionally, the Company issued Mr. Tilden 747,208 Series A Preferred shares, with a value of $1,337,499, thereby recording a loss on conversion of $1,325,340. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

On February 7, 2018, the Company issued 5,587 Series A Preferred stock at $1.79 per share, pursuant to a debt settlement agreement with a convertible note holder. The note holder agreed to extinguish the principal balance of $348,000 and accrued interest of $217,133 for $10,000 to be issued in Series A Preferred stock. The Company recorded a gain of $555,633 on settlement of debt, a gain on derivative liability of $501,506, and reclassed $161,343 in derivative liabilities to additional paid in capital. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

During the year ended March 31, 2018, the Company also retired 250 Series B Voting Preferred shares issued to Donna Murtaugh. Ms. Murtaugh also sold 174,581 Series A Preferred shares to a new shareholder, of which 12,788 Series A Preferred shares were converted into 127,888 common shares. Both resulted in $0 due to the value being within the terms of the agreement at $0 per share.

 

As of June 30, 2018, 10,000,000 Series A Preferred shares and 10,000,000 Series B Preferred shares were authorized, of which 3,489,610 Series A shares were issued and outstanding, (3,489,610 shares as of March 31, 2018) and 500 Series B shares were issued and outstanding (500 shares as of March 31, 2018).

 

8. COMMON STOCK

 

On June 15, 2016, the Company approved the authorization of a 1 for 1,000 reverse stock split of the Company’s outstanding shares of common stock, which was effective on July 22, 2016. The financial statements have been retroactively adjusted to take this into account for all periods presented.

 

On August 29, 2016, the Company filed a Certificate of Amendment to reduce the amount of authorized common shares to 163,000,000 shares, par value of $0.00001.

 

On November 14, 2016, the Company filed a Certificate of Amendment to increase the number of authorized common shares to 1,500,000,000 with a par value of $0.00001.

 

On December 8, 2016, the Company filed a Certificate of Amendment to increase the number of authorized common shares to 3,000,000,000 with a par value of $0.00001.

 

On January 26, 2017, the Company filed a Certificate of Amendment with the State of Nevada in order to increase the number of authorized shares of Common Stock. The number of authorized common stock the Company shall have the authority to issue is 7,000,000,000; par value $0.00001 per share.

18

 

On April 27, 2017, the Company issued 53,333 shares of common stock for services valued $24,000, based on the market price of the Company’s common stock on the date of agreement.

 

On August 21, 2017, the Company retired 250 Series B Voting Preferred shares and 81,061 common shares issued to Gary Tilden, in accordance with his resignation arrangement. Additionally, the Company issued Mr. Tilden 747,208 Series A Preferred shares, with a value of $1,337,499, thereby recording a loss on conversion of $1,325,340. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

On October 31, 2017, the Company approved the authorization of a 1 for 1,500 reverse stock split of the Company’s outstanding shares of common stock. The Company’s financial statements have been retroactively adjusted for this stock split for all periods presented.

 

On November 1, 2017, the Company filed a Certificate of Amendment with the Secretary of State in Nevada, to amendment its Articles of Incorporation pursuant to the reverse split and to reduce the number of authorized common shares to 900,000,000 having a par value of $0.00001. Any fractional shares which results from that reverse stock split will be rounded up to the next whole share. All common share amounts and per share amounts in the financial statements reflect the one-for-fifteen hundred reverse stock split.

 

During the year ended March 31, 2018, 127,888 common shares were issued in exchange for 12,788 shares of Series A Preferred shares. No gain or loss was recorded due to the conversion occurring within the terms of the agreement.

 

During the year ended March 31, 2018, the holders of convertible notes converted a total of $161,336 of principal into 2,081,577 shares of common stock. The issuance extinguished $722,055 worth of derivative liabilities and $201,809 was recorded as a loss on settlement of debt.

 

As of June 30, 2018, 900,000,000 common shares, par value $0.00001, were authorized, of which 2,914,797 shares were issued and outstanding (2,914,797 shares as of March 31, 2018).

 

9. INCOME TAX

 

Deferred income taxes are determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes are measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases.

 

Operating loss carry-forwards generated from inception through June 30, 2018 of approximately $5,781,805 will begin to expire in 2034. The Company applies a statutory income tax rate of 21%. Accordingly, deferred tax assets related to net operating loss carry-forwards total approximately $1,164,672 at June 30, 2018.

 

10. COMMITMENTS AND CONTINGENCIES

 

On June 27, 2016, the Company entered into a Consulting Agreement with Axeman Capital LLC (formerly Channel Sales & Consulting, LLC). The Company has agreed to pay Axeman Capital (“Axeman”) $3,000 per month for the first two months, and $4,000 per month for a period of one year. Axeman will also be paid a 10% commission on all gross sales generated through a licensed dealer and 30% commission on non-licensed dealers. If within the first twelve months of the Agreement, Axeman generates gross sales above $2,000,000, the Company will pay an additional 5% commission on gross sales, either in cash or restricted common stock. On October 12, 2017, the Company accepted a letter from Axeman agreeing to not accept a bonus fee of $100,000 in restricted common shares of the Company.

 

On June 15, 2018, the Company entered into a Debt Settlement Agreement (“Agreement”) with Axeman regarding the original contract dated June 27, 2016. The Agreement settles all outstanding debt owed to Axeman as of May 30, 2018, which includes unpaid monthly retainers and commissions of $28,103 and a $100,000 bonus fee, which the Company agreed to reinstate pursuant to the terms of the Agreement. The Company has agreed to settle this debt in full, in the amount of $140,000. The company has agreed to issue 78,212 Series A shares in value of $1.79 per share for the total value of $140,000 and this amount was accrued as of March 31, 2018 and June 30, 2018. All contracts have been canceled with Axeman, and the Company has authorized the Transfer Agent to issue said shares in the name of Axeman Capital, LLC. As of the date of this filing, the shares have not been issued.

19

 

On February 1, 2017, the Company entered into a standard office lease for approximately 1,700 square feet of office space at 175 Joerschke Drive, Suite A, Grass Valley, CA 95945. The lease has a term of 1 year, from February 1, 2017 through January 31, 2018, with a monthly rent of $1,400. On February 1, 2018, the Company entered into a month-to-month lease with a monthly rent of $1,400. Rental expenses incurred for this operating lease during the years ended March 31, 2018 and 2017 were $16,800 and $16,800 respectively.

 

11. SUBSEQUENT EVENTS

 

On July 3, 2018, the Company issued a convertible note to Fourth Man LLC for $24,200, which includes $1,238 in cash paid to the company, $20,762 to settle outstanding accounts payable and transaction costs of $2,200. The note bears interest of 10% (increases to 24% per annum upon an event of default), matures on July 3, 2019.

 

On July 3, 2018, the Company executed a Common Stock Purchase Warrant for 48,400,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on July 3, 2023.

 

On July 17, 2018, the Company executed an Allonge with Fourth Man LLC to the note dated July 3, 2018. The Purchaser agrees that in exchange for a $7,700 payment to the Company to settle accounts payable, the note principal is being increased by $8,470.

 

On July 17, 2018, the Company executed a Common Stock Purchase Warrant for 16,940,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on July 17, 2023.

 

On August 22, 2018, the Company executed an Allonge with Fourth Man LLC to the note dated July 3, 2018. The Purchaser agrees that in exchange for a $7,000 payment to the Company to settle accounts payable, the note principal is being increased by $7,700.

 

On August 22, 2018, the Company executed a Common Stock Purchase Warrant for 15,400,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on August 22, 2023.

 

The Company has evaluated subsequent events pursuant to ASC Topic 855 and has determined that there are no additional subsequent events to disclose.

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

 

FORWARD-LOOKING STATEMENTS

 

This Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements. Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

20

 

RESULTS OF OPERATIONS

 

Results for the Three months Ended June 30, 2018 Compared to the Three months Ended June 30, 2017

 

Revenues:

 

The Company’s revenues were $8,028 for the three months ended June 30, 2018 compared to $8,351 for the three months ended June 30, 2017. The decrease in revenue was due to a decrease in audio and video broadcasting product orders from the prior three months.

 

Cost of Sales:

 

The Company’s cost of materials was $2,571 for the three months ended June 30, 2018, compared to $6,617 for the three months ended June 30, 2017. The decrease was due to a decrease in purchases of materials required to fulfill customer orders.

 

Operating Expenses:

 

Operating expenses consisted primarily of consulting fees, professional fees, salaries and wages, office expenses and fees associated with preparing reports and SEC filings relating to being a public company. Operating expenses for the three months ended June 30, 2018, and June 30, 2017, were $132,277 and $250,403, respectively. The decrease was primarily attributable to a decrease in salary and wages.

 

Other Income (Expense):

 

Other income (expense) for the three months ended June 30, 2018, and June 30, 2017, was $(814,301) and $219,468, respectively. Other income (expense) consisted of gain or loss on debt forgiveness, gain or loss on derivative valuation and interest expense. The gain or loss on derivative valuation is directly attributable to the change in fair value of the derivative liability. Interest expense is primarily attributable to interest and penalties on outstanding notes payable, the initial interest expense associated with the valuation of derivative instruments at issuance, and the accretion of the convertible debentures over their respective terms. The increase primarily resulted from the fluctuation of the Company’s stock price which impacted the valuation of the derivative liabilities and the change in the gain/loss on debt settlement between periods based on the amount of debt converted and the difference between the value of the stock issued and the debt extinguished.

 

Net Loss:

 

Net loss for the three months ended June 30, 2018, was $941,121 compared with a net loss of $29,201 for the three months ended June 30, 2017. The increased net loss can be explained by the changes in fair value of derivative liabilities offset with and the loss on settlement of debt recorded in the prior period.

 

Impact of Inflation

 

We believe that the rate of inflation has had a negligible effect on our operations.

 

Liquidity and Capital Resources

 

   June 30,   March 31, 
   2018   2018 
Current Assets  $2,347   $8,626 
Current Liabilities   12,720,962    11,803,229 
Working Capital (Deficit)  $(12,718,615)  $(11,794,603)

21

 

The overall working capital (deficit) increased from $(11,794,603) at March 31, 2018 to $(12,718,615) at June 30, 2018.

 

   June 30,   June 30, 
   2018   2017 
Cash Flows from (used in) Operating Activities  $(734)  $(33,831)
Cash Flows from (used in) Investing Activities        
Cash Flows from (used in) Financing Activities       35,223 
Net Increase (decrease) in Cash During Period  $734   $1,392 

 

During the three months ended June 30, 2018, cash used in operating activities was $734 compared to $33,831 for the three months ended June 30, 2017. The decrease in the cash used in operating activities is primarily attributed to a loss in the fair value of derivative liabilities and accrued interest.

 

During the three months ended June 30, 2018 cash used in investing activities was $0 compared to $0 for the three months ended June 30, 2017.

 

During the three months ended June 30, 2018, cash from financing activity was $0 compared to $35,223 for the three months ended June 30, 2017. The decrease in cash from financing activity primarily resulted from a decrease in the proceeds from convertible notes during the three months ended June 30, 2018.

 

As of June 30, 2018, the Company had a cash balance and asset total of $1,688 and $2,347 respectively, compared with $2,431 and $8,626 of cash and total assets, respectively, as of March 31, 2018. The decrease in assets was due to a decrease in accounts receivable.

 

As of June 30, 2018, the Company had total liabilities of $12,781,962 compared with $11,864,229 as of March 31, 2018. The increase in total liabilities was primarily attributed to the to an increase in the fair value of derivative liabilities and an increase in convertible note payable accrued interest.

 

Going Concern

 

The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan. Since its inception, the Company has been funded by related parties through capital investment and borrowing funds.

 

As of June 30, 2018, we have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities. For these reasons, our auditors stated in their report on our March 31, 2018 audited financial statements that they have substantial doubt that we will be able to continue as a going concern.

 

Future Financings

 

We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund planned acquisitions and exploration activities.

 

Off-Balance Sheet Arrangements

 

We have no significant 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 are material to stockholders.

 

Critical Accounting Policies

 

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

22

 

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

 

Recently Issued Accounting Pronouncements

 

In May 2014, the FASB issued ASU 2014-09 regarding ASC Topic 606, “Revenue from Contracts with Customers.” ASU 2014-09 provides principles for recognizing revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14 to defer the effective date by one year with early adoption permitted as of the original effective date. ASU 2014-09 will be effective for our fiscal year beginning April 1, 2018. In addition, the FASB issued ASU 2016-08, ASU 2016-10, and ASU 2016-12 in March 2016, April 2016, and May 2016, respectively, to help provide interpretive clarifications on the new guidance in ASC Topic 606. The Company is currently evaluating the accounting, transition, and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption.

 

In February 2016, the FASB issued ASU 2016-02 (ASC Topic 842), Leases. The ASU amends a number of aspects of lease accounting, including requiring lessees to recognize operating leases with a term greater than one year on their balance sheet as a right-of-use asset and corresponding lease liability, measured at the present value of the lease payments. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is in the process of assessing the impact on its consolidated financial statements.

 

In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815). Among other provisions, this ASU requires that when determining whether certain financial instruments should be classified as liabilities or equity instruments, an entity should not consider the down round feature. The ASU also recharacterizes as a scope exception the indefinite deferral available to private companies with mandatorily redeemable financial instrument and certain noncontrolling interests, which does not have an accounting effect but addresses navigational concerns within the FASB Accounting Standards Codification. The provisions of the ASU related to down rounds are effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The Company is in the process of assessing the impact on its consolidated financial statements.

 

Contractual Obligations

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

We are a non-accelerated filer and a smaller reporting company, as defined in Rule 12b-2 of the of the Securities Exchange Act of 1934, and as such, are not required to provide the information under this item.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us in the reports that we file or submit 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 and that such information is accumulated and communicated to our Company’s officers, as appropriate to allow timely decisions regarding required disclosure. We carried out an evaluation, under the supervision and with the participation of our Company’s officers, of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2018. Based on the evaluation of these disclosure controls and procedures, and in light of the material weaknesses in our internal control over financial reporting identified in our Annual Report on Form 10-K for the year ended March 31, 2018, that was filed with the SEC on September 24, 2018, the Company’s officers concluded that our disclosure controls and procedures are ineffective.

23

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) promulgated under the Exchange Act, during the quarter ended June 30, 2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II- OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which our director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 

ITEM 1A. RISK FACTORS

 

Our Annual Report on Form 10-K for the fiscal year ended March 31, 2018 includes a detailed discussion of our risk factors.

 

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

 

1.Quarterly Issuances:

 

None.

 

2.Subsequent Issuances:

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

24

 

ITEM 6. EXHIBITS

 

Exhibit Number  Description of Exhibit  Filing
3.1  Articles of Incorporation  Filed with the SEC on June 8, 2007 as part of our Registration of Securities on Form SB-2.
3.1a  Amended Articles of Incorporation  Filed with the SEC on November 11, 2009, on our Current Report on Form 8-K.
3.2  Bylaws  Filed with the SEC on June 8, 2007 as part of our Registration of Securities on Form SB-2.
10.45  Asset Purchase Agreement, by and between the Company and RJM and Associates, dated March 9, 2016  Filed with the SEC on March 10, 2016 as part of our Current Report on Form 8-K.
31.01  Certification of Principal Executive Officer Pursuant to Rule 13a-14  Filed herewith.
31.02  Certification of Principal Financial Officer Pursuant to Rule 13a-14  Filed herewith.
32.01  Certification of CEO and CFO Pursuant to Section 906 of the Sarbanes-Oxley Act  Filed herewith.
101.INS  XBRL Instance Document  Filed herewith.
101.SCH  XBRL Taxonomy Extension Schema Document  Filed herewith.
101.CAL  XBRL Taxonomy Extension Calculation Linkbase Document  Filed herewith.
101.LAB  XBRL Taxonomy Extension Labels Linkbase Document  Filed herewith.
101.PRE  XBRL Taxonomy Extension Presentation Linkbase Document  Filed herewith.
01.DEF  XBRL Taxonomy Extension Definition Linkbase Document  Filed herewith.

 

*Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

25

 

SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the dates indicated.

 

Dated: September 28, 2018
 
  /s/ Robert Stillwaugh
  By: Robert Stillwaugh
  Its: President, Chief Executive Officer

26

EX-31 2 ex31-1.htm CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO RULE 13A-14
 

 

Exhibit 31.1

 

CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER PURSUANT TO RULE 13a-14

 

I, Robert Stillwaugh, certify that:

 

1. I have reviewed this Quarterly Report on Form 10-Q of Simlatus Corporation;

 

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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my 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: September 28, 2018
  /s/ Robert Stillwaugh
  By: Robert Stillwaugh
  Its: Principal Executive Officer

 

EX-31 3 ex31-2.htm CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO RULE 13A-14
 

 

Exhibit 31.2

 

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO RULE 13a-14

 

I, Robert Stillwaugh, certify that:

 

1. I have reviewed this Quarterly Report on Form 10-Q of Simlatus Corporation;

 

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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my 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: September 28, 2018
  /s/ Robert Stillwaugh
  By: Robert Stillwaugh
  Its: Principal Financial Officer

 

EX-32 4 ex32-1.htm CERTIFICATION OF CEO AND CFO PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT
 

 

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

 

In connection with the Quarterly Report of Simlatus Corporation (the “Company”) on Form 10-Q for the period ending June 30, 2018, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Robert Stillwaugh, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:

 

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

/s/ Robert Stillwaugh

By: Robert Stillwaugh

Principal Executive Officer and Principal Financial Officer

Dated: September 28, 2018

 

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

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Document and Entity Information - shares
3 Months Ended
Jun. 30, 2018
Sep. 28, 2018
Document and Entity Information [Abstract]    
Entity Registrant Name Simlatus Corp  
Entity Central Index Key 0001399306  
Amendment Flag false  
Trading Symbol SIML  
Current Fiscal Year End Date --03-31  
Document Type 10-Q  
Document Period End Date Jun. 30, 2018  
Document Fiscal Period Focus Q1  
Document Fiscal Year Focus 2019  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   2,914,797
Entity Current Reporting Status Yes  
Entity Well-known Seasoned Issuer No  
Entity Voluntary Filers No  
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CONDENSED BALANCE SHEETS (Unaudited) - USD ($)
Jun. 30, 2018
Mar. 31, 2018
Current Assets    
Cash $ 1,688 $ 2,431
Accounts receivable 4,760
Inventory, net 659 1,435
Total Current Assets 2,347 8,626
TOTAL ASSETS 2,347 8,626
Current Liabilities:    
Accounts payable 245,143 230,553
Accrued wages 853,697 751,754
Deferred revenue 3,528
Derivative liabilities 6,957,489 6,627,023
Convertible notes payable in default, net of discount 505,601 511,923
Convertible notes payable, net of discount 333,438 262,910
Convertible notes payable, interest 3,682,371 3,289,044
Related party liabilities 143,223 126,494
Total Current Liabilities 12,720,962 11,803,229
Long term notes payable 61,000 61,000
Total Liabilities 12,781,962 11,864,229
SHAREHOLDERS' EQUITY    
Common stock, $0.00001 par value 900,000,000 authorized 2,914,797 shares issued and outstanding at June 30, 2018 2,914,797 shares issued and outstanding at March 31, 2018 29 29
Additional paid in capital (937,626) (954,735)
Accumulated deficit (11,845,509) (10,904,388)
Total Shareholders' Equity (12,779,615) (11,855,603)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 2,347 8,626
Series A Preferred Stock [Member]    
SHAREHOLDERS' EQUITY    
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Series B Preferred Stock [Member]    
SHAREHOLDERS' EQUITY    
Preferred stock, $0.001 par value 20,000,000 shares authorized Series A: 10,000,000 shares authorized 3,489,510 shares issued and outstanding at June 30, 2018 3,489,510 shares issued and outstanding at March 31, 2018 Series B: 10,000,000 shares authorized 500 shares issued and outstanding at June 30, 2018 500 shares issued and outstanding at March 31, 2018 $ 1 $ 1
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CONDENSED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares
Jun. 30, 2018
Mar. 31, 2018
Nov. 01, 2017
Preferred stock, par value $ 0.001 $ 0.001  
Preferred stock, shares authorized 20,000,000 20,000,000  
Common stock, par value $ 0.00001 $ 0.00001 $ 0.00001
Common stock, shares authorized 900,000,000 900,000,000 900,000,000
Common stock, shares issued 2,914,797 2,914,797  
Common stock, shares outstanding 2,914,797 2,914,797  
Series A Preferred Stock [Member]      
Preferred stock, shares authorized 10,000,000 10,000,000  
Preferred stock, shares issued 2,213,154 3,489,610  
Preferred stock, shares outstanding 2,213,154 3,489,610  
Series B Preferred Stock [Member]      
Preferred stock, shares authorized 10,000,000 10,000,000  
Preferred stock, shares issued 1,000 500  
Preferred stock, shares outstanding 1,000 500  
XML 14 R4.htm IDEA: XBRL DOCUMENT v3.10.0.1
CONDENSED STATEMENT OF OPERATIONS (Unaudited) - USD ($)
3 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Income Statement [Abstract]    
Sales $ 8,028 $ 8,351
Cost of materials 2,571 6,617
Gross profit (loss) 5,457 1,734
Operating expenses:    
G&A expenses 22,730 52,364
Professional fees 28,297 95,956
Salaries and wages 81,250 102,083
Total Operating expenses 132,277 250,403
Loss from operations (126,820) (248,669)
Other income (expense):    
Gain (loss) on settlement of debt (13,000) (62,421)
Change in fair value of derivative liability (307,073) 942,273
Interest expenses (494,228) (660,384)
Total other income (expense) (814,301) 219,468
Net income (loss) before income taxes (941,121) (29,201)
Income tax expense
Net income (loss) $ (941,121) $ (29,201)
Per share information    
Weighted number of common shares outstanding, basic and diluted 2,914,797 917,859
Net income (loss) per common share $ (0.32) $ (0.03)
XML 15 R5.htm IDEA: XBRL DOCUMENT v3.10.0.1
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)
3 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Cash flows from operating activities:    
Net loss $ (941,121) $ (29,201)
Adjustments to reconcile net income to net cash provided by operating activities:    
Amortization of convertible debt discount 70,170 165,561
Imputed interest 5,057
New derivatives recorded as loan fees 57,487
Common stock issued for services 20,500
Change in fair value of derivative liability 307,073 (942,273)
Gain on settlement of debt 13,000 62,421
Decrease (increase) in operating assets    
Accounts receivable 4,760
Inventory 776 (591)
Prepaid expenses 6,000
Increase (decrease) in operating liabilities    
Accounts payable 31,071 91,346
Accrued wages 98,415 115,754
Accrued interest 393,327 419,165
Advances from related parties 16,729
Net cash used in operating activities (743) (33,831)
Cash flows from investing activities
Cash flows from financing activities:    
Proceeds from convertible notes payable 20,000
Proceeds from (payments to) related parties, net 15,223
Net cash provided by financing activities 35,223
Net increase (decrease) in cash (743) 1,392
Cash, beginning of period 2,431 1,330
Cash, end of period 1,688 2,722
Supplemental disclosures of cash flow information:    
Cash paid for income taxes
Cash paid for interest
Schedule of non-cash investing & financing activities:    
Accounts payable converted to note payable 16,481
Preferred Series A stock issued to settle debt 960,069
Shares issued for liabilities 383,215
Derivative debt discount 27,945 55,817
Derivative settlements 12,052
Preferred Series A stock converted to common stock 1,918
Accrued interest on note payable transferred to principal $ 872
XML 16 R6.htm IDEA: XBRL DOCUMENT v3.10.0.1
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3 Months Ended
Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Organization and Description of Business

 

Simlatus Corporation (“SIML” or “Company”) was incorporated in the State of Nevada under the name Sunberta Resources Inc. on November 15, 2006, as a mining and exploration of mineral claims business.  On November 18, 2009, the Company changed its name to Grid Petroleum Corp. and continued with the mining and exploration of mineral claims operations, exploring mining claims in Alberta, Canada, Vancouver Island, British Columbia, England and the United States.

 

On March 9, 2016, the Company entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with RJM and Associates, LLC, a California limited liability company (“RJM”) whereby RJM’s owners became the directors of the Company and were to be issued $6,250,000 worth of the Company’s stock; $5,000,000 of Restricted Common Stock 90 days from the date of this agreement and $1,250,000 of Preferred Series-A Shares of the Company’s Preferred Stock (the “Acquisition”). On the same date, the entire management of RJM became the entire management of the Company. The Company’s transaction with RJM has been treated as a reverse recapitalization of the Company, with the Company (the legal acquirer of RJM) considered the accounting acquiree and RJM, whose management took control of the Company (the legal acquiree of the Company), considered the accounting acquirer. The historical financial statements include the operations of the accounting acquirer (RJM) for all periods presented.

 

RJM was incorporated in the State of California on June 11, 2014, for the purpose of operating a broadcast equipment production business.

 

On March 25, 2016, the Company approved a name change to Simlatus Corporation, stock symbol SIML, which was executed on April 4, 2016. The new name change better describes the Company’s new business and new revenues in selling commercial broadcast equipment on a global basis. Simlatus Corporation develops, manufactures, markets and owns proprietary advanced broadcast equipment and software and sells this audio and video broadcast equipment worldwide. These systems have been sold worldwide over the past 15 years including some of the major broadcast companies.   

 

The Company currently sells approximately 55 different audio/video products and is preparing to market its newest audio/video product referred to as SyncPal™. In addition to the Company’s traditional line of audio/video products, it has commenced the research & development of its Immersive Broadcast System, referred to as the Simlatus-IBS™. The Simlatus-IBS™ will include commercial augmented reality and virtual reality applications for studio engineers. These applications, both hardware and software, will allow the customer to control and manage the studio audio/video systems from anywhere in the world. These products are being developed to serve a market segment that is presently being strongly embraced by consumers and is forecasted, by some of the most widely recognized tech companies in the world, as becoming a multi-billion-dollar market in the very near future. The Market Analysis and IP Portfolio will include new patents specifically developed for these products and owned by the Company.

 

Financial Statement Presentation

 

The accompanying unaudited Condensed Financial Statements have been prepared in accordance with the instructions to interim financial reporting as prescribed by the Securities and Exchange Commission (the “SEC”). The results for the interim periods are not necessarily indicative of results for the entire year. These interim financial statements do not include all disclosures required by U.S. generally accepted accounting principles (“GAAP”), and should be read in conjunction with the consolidated financial statements and notes thereto filed with the SEC in our Annual Report on Form 10-K for the fiscal year ended March 31, 2018. In the opinion of management, the unaudited Condensed Financial Statements contained in this report include all known accruals and adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods reported herein. Any such adjustments are of a normal recurring nature.

 

Fiscal Year End 

 

The Company has selected March 31 as its fiscal year end.

 

Use of Estimates

 

The preparation of the Company’s financial statements in conformity with generally accepted accounting principles of United States of America 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.

 

Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Actual results could differ from those estimates.

 

Cash Equivalents

 

The Company considers all highly liquid investments with maturities of 90 days or less from the date of purchase to be cash equivalents.

 

Revenue recognition and Related Allowances

 

Effective April 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

 

Accounts Receivable and Allowance for Doubtful Accounts

 

Accounts receivable are stated at the amount that management expects to collect from outstanding balances. Bad debts and allowances are provided based on historical experience and management’s evaluation of outstanding accounts receivable. Management evaluates past due or delinquency of accounts receivable based on the open invoices aged on due date basis. The allowance for doubtful accounts at June 30, 2018 and March 31, 2018 is $0.

 

Accounts Payable and Accrued Expenses

 

Accounts payable and accrued expenses are carried at amortized cost and represent liabilities for goods and services provided to the Company prior to the end of the fiscal year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services.

 

Loss Per Share

 

Basic loss per share of common stock is computed by dividing the net loss by the weighted average number of common shares outstanding during the period after giving retroactive effect to the reverse stock split affected on November 1, 2017 (see Note 8). Diluted earnings (loss) per share is equal to the basic per share for the three months ended June 30, 2018 and 2017. Common stock equivalents are not included in the loss per share since they are anti-dilutive. All per share amounts have been adjusted for the reverse stock split.

 

Inventories

 

Inventories are stated at the lower of cost, computed using the first-in, first-out method and net realizable value. Any adjustments to reduce the cost of inventories to their net realizable value are recognized in earnings in the current period. During the year ended March 31, 2018, the Company recorded an impairment to inventory of $61,188. As of June 30, 2018 and March 31, 2018, the Company’s inventories consist primarily of raw materials and supplies rather than finished goods and are presented, net of an allowance for obsolete inventory, as $659 and $1,435, respectively.

 

Fair Value of Financial Instruments

 

Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk.

 

In addition to defining fair value, the standard expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs is expanded. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels and which is determined by the lowest level input that is significant to the fair value measurement in its entirety.

 

These levels are:

 

Level 1 - inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

 

Level 2 - inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 

Level 3 - inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

 

The following table represents the Company’s financial instruments that are measured at fair value on a recurring basis as of June 30, 2018 and March 31, 2018 for each fair value hierarchy level:

 

June 30, 2018   Derivative Liabilities     Total  
Level 1   $     $  
Level 2   $     $  
Level 3   $ 6,957,489     $ 6,957,489  
                 
March 31, 2018   Derivative Liabilities     Total  
Level 1   $     $  
Level 2   $     $  
Level 3   $ 6,627,023     $ 6,627,023  

 

In management’s opinion, the fair value of convertible notes payable and advances payable is approximate to carrying value as the interest rates and other features of these instruments approximate those obtainable for similar instruments in the current market. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, exchange or credit risks arising from these financial instruments. As of June 30, 2018 and March 31, 2018, the balances reported for cash, accounts receivable, prepaid expenses, accounts payable, and accrued liabilities, approximate the fair value because of their short maturities.

 

Income Taxes

 

The Company records deferred taxes in accordance with FASB ASC No. 740, Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and loss carry-forwards and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

 

As of the date of this filing, the Company is delinquent in filing their tax returns, and there is uncertainty regarding potential penalties and interest.  The last return filed by the Company was March 31, 2012, and the Company has not accrued any potential penalties or interest from that period forward.  The Company will need to file returns for the years ending March 31, 2013, 2014, 2015, 2016, 2017 and 2018 which, are still open for examination.

 

Recent Accounting Pronouncements

 

In May 2014, the FASB issued ASU 2014-09 regarding ASC Topic 606, “Revenue from Contracts with Customers.” ASU 2014-09 provides principles for recognizing revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14 to defer the effective date by one year with early adoption permitted as of the original effective date. ASU 2014-09 will be effective for our fiscal year beginning April 1, 2018. In addition, the FASB issued ASU 2016-08, ASU 2016-10, and ASU 2016-12 in March 2016, April 2016, and May 2016, respectively, to help provide interpretive clarifications on the new guidance in ASC Topic 606. The Company is currently evaluating the accounting, transition, and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption.

 

While the Company does not expect the adoption of this standard to have a material impact on the Company’s net Revenues in the Statements of Income, the Company anticipates revenues for certain wholesale transactions and substantially all digital commerce sales will be recognized upon shipment rather than upon delivery to the customer.

 

Additionally, provisions for post-invoice sales discounts, returns and miscellaneous claims will be recognized as accrued liabilities rather than as reductions to Accounts receivable, net; and the estimated cost of inventory associated with the provision for sales returns will be recorded within Prepaid expenses and other current assets on the Balance Sheets. The Company continues to evaluate the impact of this new standard, including on accounting policies, disclosures, internal control over financial reporting and its contracts with customers.

 

In February 2016, the FASB issued ASU 2016-02 (ASC Topic 842), Leases. The ASU amends a number of aspects of lease accounting, including requiring lessees to recognize operating leases with a term greater than one year on their balance sheet as a right-of-use asset and corresponding lease liability, measured at the present value of the lease payments. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is in the process of assessing the impact on its financial statements.

 

Effective April 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

XML 17 R7.htm IDEA: XBRL DOCUMENT v3.10.0.1
GOING CONCERN
3 Months Ended
Jun. 30, 2018
Going Concern [Abstract]  
GOING CONCERN
2. GOING CONCERN

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As of June 30, 2018, the Company has an accumulated deficit of $11,845,509 since its inception and working capital deficit of $12,718,615, negative cash flows from operations, and has limited business operations, which raises substantial doubt about the Company’s ability to continue as going concern. The ability of the Company to meet its commitments as they become payable is dependent on the ability of the Company to obtain necessary financing or achieving a profitable level of operations. There is no assurance the Company will be successful in achieving these goals.

 

The Company does not have sufficient cash to fund its desired research and development objectives for its augmented/virtual reality product development for the next 12 months. The Company has arranged financing and intends to utilize the cash received to fund the research and development project. This financing may be insufficient to fund expenditures or other cash requirements required to complete the product design for the augmented/virtual reality markets. There can be no assurance the Company will be successful in completing any new product development. The Company plans to seek additional financing if necessary in private or public equity offering(s) to secure future funding for operations. There can be no assurance the Company will be successful in raising additional funding. If the Company is not able to secure additional funding, the implementation of the Company’s business plan will be impaired. There can be no assurance that such additional financing will be available to the Company on acceptable terms or at all.

 

These financial statements do not give effect to adjustments to the amounts and classification to assets and liabilities that would be necessary should the Company be unable to continue as a going concern.

XML 18 R8.htm IDEA: XBRL DOCUMENT v3.10.0.1
CONVERTIBLE NOTES PAYABLE
3 Months Ended
Jun. 30, 2018
Debt Disclosure [Abstract]  
CONVERTIBLE NOTES PAYABLE
3. CONVERTIBLE NOTES PAYABLE

 

As of June 30, 2018 and the year ended March 31, 2018, notes payable were comprised of the following:

 

    Original   Due   Interest   Conversion   June 30,     March 31,  
    Note Date   Date   Rate   Rate   2018     2018  
ARC Capital Ltd   10/1/2015   4/2/2016   24%   Variable   $ 2,625     $ 2,625  
Asher Enterprises #4   9/16/2011   6/20/2012   22%   Variable           13,000  
Auctus Fund #1   12/16/2016   9/16/2017   24%   Variable     46,750       46,750  
Auctus Fund #2   8/9/2017   5/9/2017   24%   Variable     46,750       46,750  
Blackbridge Capital #2   5/3/2016   5/3/2017   5%   Variable     80,400       80,400  
EMA Financial   11/9/2016   11/9/2017   24%   Variable     272,576       272,576  
Emunah Funding #1   10/18/2017   10/18/2018   0%   Variable     110,000       110,000  
Emunah Funding #2   10/18/2017   10/18/2018   0%   Variable     20,000       20,000  
Emunah Funding #3   10/18/2017   10/18/2018   0%   Variable     30,000       30,000  
Emunah Funding #4   10/20/2018   7/20/2018   8%   Variable     55,440       55,440  
Emunah Funding #5   5/15/2018   5/15/2019   10%   Variable     37,778        
GW Holdings   10/13/2015   4/1/2015   24%   Variable     42,500       42,500  
James Powell   9/7/2015   Demand   8%   Variable     150,875       150,875  
Syndication Capital #1   12/31/2012   10/10/2011   22%   0.01     5,000       5,000  
Tri-Bridge Ventures #1   1/19/2017   10/19/2017   8%   Variable     9,000       9,000  
V2IP #2   5/13/2016   Demand   12%   Variable     10,000       10,000  
                      919,694       894,916  
Less debt discount             (80,655 )     (120,083 )
Notes payable, net of discount*           $ 839,039     $ 774,833  

 

  * During the three months ended June 30, 2018 and the year ended March 31, 2018, the balance of notes payable, net of discount that are in default is $505,601 and $511,923, respectively.

 

ARC Capital Ltd

 

On October 1, 2015, the Company accepted and agreed to a Debt Purchase Agreement, whereby ARC Capital Ltd acquired $16,000 in principal and $5,625 of interest of a Direct Capital Group, Inc. convertible note in exchange for $21,625. The note bears interest at 8% per annum (increases to 24% per annum upon an event of default), matured on April 2, 2016, and is convertible into common stock at 50% of the lowest closing market price of the prior 15 trading days including the day upon which the notice of conversion is received by the Company. The Company recorded a debt discount from the derivative equal to $21,625 due to this conversion feature. The note had accrued interest of $8,417 as of June 30, 2018 and $8,260 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $0 and $0 at March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $2,625 and $2,625, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Asher Enterprises, Inc.

 

On September 16, 2011, the Company accepted and agreed to a Debt Purchase Agreement, whereby Asher Enterprises, Inc. acquired $40,000 of a Special Situations Fund One convertible note in exchange for $40,000. The note bears interest at 8% per annum (increases to 22% per annum upon an event of default), matured on June 20, 2012, and is convertible into common stock at 50% multiplied by the average of the 3 lowest closing market prices of the 10 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $40,000 due to this conversion feature. The note had accrued interest of $0 as of June 30, 2018 and $0 as of March 31,2018. The debt discounts had a balance of $0 at June 30, 2018 and $0 at March 31, 2018.

 

On May 12, 2018, the Company entered into a Debt Settlement Agreement with Asher Enterprises, Inc. to settle the outstanding debt of $13,000 in exchange for a cash payment of $26,000, resulting in a loss on settlement of debt of $13,000. As of June 30, 2018 and March 31, 2018, the note had a balance of $0 and $13,000, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Auctus Fund LLC

 

On December 16, 2016, the Company issued a convertible note to Auctus Fund LLC for $46,750, of which $40,000 was received in cash $6,750 was recorded as transaction fees. The note bears interest at 10% (increases to 24% per annum upon an event of default), matured on September 16, 2017, and is convertible into the lower of 1) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the date of the note, and 2) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the conversion date. The Company recorded a debt discount from the derivative equal to $46,750 due to this conversion feature. Pursuant to the default terms of the note, the Company entered a penalty of $191,562 in interest during the year ended March 31, 2018. The note had accrued interest of $206,924 as of June 30, 2018 and $204,127 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $204,127 as of March 31, 2017. The Company recorded debt discount amortization expense of $0 and $28,835 as of June 30, 2018 and 2017, respectively. The principal balance as of June 30, 2018 and 2017, was $46,750 and $46,750, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On August 9, 2017, the Company issued a convertible note to Auctus Fund LLC for $46,750, of which $40,000 was received in cash $6,750 was recorded as transaction fees. The note bears interest at 10% (increases to 24% per annum upon an event of default), matured on August 22, 2017, and is convertible into the lower of 1) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the date of the note, and 2) 54% multiplied by the average of the two lowest trading prices during the 25 day trading period on the trading day prior to the conversion date. The Company recorded a debt discount from the derivative equal to $46,750 due to this conversion feature. Pursuant to the default terms of the note, the Company entered a penalty of $210,097 in interest during the year ended March 31, 2018. The note had accrued interest of $214,260 as of June 30, 2018 and $213,094 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $6,679 as of March 31, 2018. The Company recorded debt discount amortization expense of $6,679 and $40,071 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $46,750 and $46,750, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Blackbridge Capital

 

On May 3, 2016, the Company accepted and agreed to a Debt Purchase Agreement, whereby Blackbridge Capital acquired $100,000 in principal of a Direct Capital Group, Inc. convertible note in exchange for $100,000. The note bears interest at 5% per annum, matured on May 3, 2017, and is convertible into common stock at 50% of the lowest market price of the 20 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $100,000 due to this conversion feature. The note had accrued interest of $8,705 as of June 30, 2018 and $7,703 as of March 31,2018. The debt discounts had a balance of $0 at June 30, 2018 and $0 at March 31, 2018. The Company recorded debt discount amortization expense of $0 and $7,269 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $80,400 and $80,400, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

EMA Financial, LLC

 

On November 9, 2016, the Company issued a convertible note to EMA Financial, LLC for $35,000, of which $30,000 was received in cash $5,000 was recorded as transaction fees. The note bears interest at 10% (increases to 24% per annum upon an event of default), matured on November 9, 2017, and is convertible into the lower of 1) the closing market price on the trading day immediately preceding the closing date of the note, and 2) 50% of the lowest trading price during the 25 trading days prior to the conversion date. The Company recorded a debt discount from the derivative equal to $35,000 due to this conversion feature. Pursuant to the default terms of the note, the Company entered a penalty of $250,330 in principal and $23,143 in interest during the year ended March 31, 2018. The note had accrued interest of $42,725 as of June 30, 2018 and $26,415 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $0 as of March 31, 2018. During the year ended March 31, 2018, the principal amount of $12,754 was converted into shares. The Company recorded debt discount amortization expense of $0 and $21,384 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $272,576 and $272,576, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Emunah Funding LLC

 

On October 18, 2017, the Company issued a convertible note to Emunah Funding LLC in consideration of liquidated damages in the amount of $110,000. The note bears no interest, matures on October 18, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $110,000 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $33,151 and $60,575 at March 31, 2017. The Company recorded debt discount amortization expense of $27,425 during the three months ended June 30, 2018 and $49,425 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $110,000 and $110,000, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On October 18, 2017, the Company accepted and agreed to a Debt Purchase Agreement, whereby Emunah Funding LLC acquired $20,000 of debt from a Tri-Bridge Ventures LLC convertible note in exchange for $25,000. The note bears no interest, matures on October 18, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $25,000 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $7,534 and $13,767 at March 31, 2017. During the year ended March 31, 2018 the principal amount of $5,000 was converted into shares. The Company recorded debt discount amortization expense of $6,233 during the year ended June 30, 2018 and $11,233 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $20,000 and $20,000 respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On October 18, 2017, the Company accepted and agreed to a Debt Purchase Agreement, whereby Emunah Funding LLC acquired $35,817 of debt from a Tri-Bridge Ventures LLC convertible note in exchange for $30,000. The note bears no interest, matures on October 18, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $30,000 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $9,041 and $16,521 at March 31, 2018. The Company recorded debt discount amortization expense of $7,479 during the three months ended June 30, 2018 and $13,479 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31 2018, was $30,000 and $30,000, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On October 20, 2017, the Company issued a convertible note to Emunah Funding LLC for $33,840, which includes $26,741 to settle outstanding accounts payable, transaction costs of $4,065, OID interest of $2,840, and cash consideration of $194. On November 6, 2017, the Company issued an Allonge to the convertible debt in the amount of $9,720. The Company received $7,960 in cash and recorded transaction fees of $1,000 and OID interest of $760. On November 30, 2017, the Company issued an Allonge to the convertible debt in the amount of $6,480. The Company received $5,000 in cash and recorded transaction fees of $1,000 and OID interest of $480. On January 11, 2018, the Company issued an Allonge to the convertible debt in the amount of $5,400. The Company received $5,000 in cash and recorded OID interest of $480. The note bears interest of 8% (increases to 24% per annum upon an event of default), matures on July 20, 2018, and is convertible into common stock at 57.5% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The note had accrued interest of $2,882 as of June 30, 2018 and $1,776 as of March 31,2018. The Company recorded a debt discount from the derivative equal to $55,440 due to this conversion feature. The debt discounts had a balance at June 30, 2018 of $4,062 and $22,542 at March 31, 2018. The Company recorded debt discount amortization expense of $18,480 during the three months ended June 30, 2018 and $32,898 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $55,440 and $55,440, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

On May 15, 2018, the Company issued a convertible note to Emunah Funding LLC for $37,778, which includes $26,000 to settle the convertible note with Asher Enterprises, $8,000 to settle outstanding accounts payable, and OID interest of $3,778. The note bears interest of 10% (increases to 24% per annum upon an event of default), matures on May 15, 2019, and is convertible into common stock at 60% of the lowest trading price of the 20 trading day period ending on the latest complete day prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $26,964 due to this conversion feature. The note had accrued interest of $476 as of June 30, 2018 and $0 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $26,868 and $0 at March 31, 2018. The Company recorded debt discount amortization expense of $3,874 during the three months ended June 30, 2018 and $0 during the year ended March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $37,778 and $0, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

GW Holdings Group, LLC

 

On October 13, 2015, the Company accepted and agreed to a Debt Purchase Agreement, whereby GW Holdings Group, LLC acquired $50,000 in principal and $10,411 of interest of a New Venture Attorneys convertible note in exchange for $60,411. The note bears interest at 8% per annum (increases to 24% per annum upon an event of default), matured on April 1, 2015, and is convertible into common stock at 50% multiplied by the average of the 3 lowest closing prices of the 10 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $60,411 due to this conversion feature. On April 27, 2016 and May 23, 2016, GW Holdings requested conversions which were not honored. Pursuant to the terms of the note, penalties of $2,000 per day per conversion were accrued as interest. The note had accrued interest of $3,136,750 as of June 30, 2018 and $2,770,200 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $0 and $0 at March 31, 2018. he Company The principal balance as of June 30, 2018 and March 31, 2018, was $42,500 and $42,500, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

James Powell

 

On September 7, 2015, the Company issued a convertible note with the Company’s former President, James Powell for non-cash consideration for accrued fees of $150,875. The note bears interest at 8%, is due on demand, and is convertible into convertible into common stock at 50% of the lowest trading price for the 15 days prior to the date of conversion. The note had accrued interest of $33,961 as of June 30, 2018 and $30,952 as of March 31,2018. The principal balance as of June 30, 2018 and March 31, 2018 was $150,875 and $150,875, respectively.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Syndication Capital, LLC

 

On December 31, 2012, the Company issued a convertible note with Syndication Capital, LLC, Inc. for non-cash consideration for unpaid consulting fees of $105,000. The note bears interest of 22%, matured on October 10, 2011 and is convertible into convertible into common stock at a fixed rate of $.0001. On August 4, 2013, Gel Properties, LLC acquired $100,000 of the note. The note had accrued interest of $19,129 as of June 30, 2018 and $18,855 as of March 31,2018. The principal balance as of June 30, 2018 and March 31, 2018, was $5,000 and $5,000, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

Tri-Bridge Ventures LLC

 

On January 19, 2017, the Company issued a convertible note to Tri-Bridge Ventures LLC for $25,000 for cash consideration. The note bears interest at 8%, matured on October 19, 2017, and is convertible into common stock at 57.5% of the volume weighted average price of the daily trading prices during the 20 day period ending on the latest complete trading day prior to the conversion date. The Company recorded a debt discount from the derivative equal to $25,000 due to this conversion feature. The note had accrued interest of $1,486 as of June 30, 2018 and $1,306 as of March 31,2018. The debt discounts had a balance of $0 as of June 30, 2018 and $0 as of March 31, 2018. During the year ended March 31, 2018, the principal amount of $16,000 was converted into shares. The Company recorded debt discount amortization expense of $0 and $18,498 as of June 30, 2018 and March 31, 2018, respectively. The principal balance as of June 30, 2018 and March 31, 2018, was $9,000 and $9,000, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

V2IP, LLC

 

On May 31, 2016, the Company accepted and agreed to a Debt Purchase Agreement, whereby V2IP, LLC acquired $20,000 in accrued interest from a Direct Capital Group, Inc convertible note in exchange for $20,000. The note bears interest at 6% per annum (increases to 12% per annum upon an event of default), is due on demand, and is convertible into common stock at 50% of the lowest trading price of the 10 trading days prior to the date of conversion. The Company recorded a debt discount from the derivative equal to $20,000 due to this conversion feature. The note had accrued interest of $1,428 as of June 30, 2018 and $1,129 as of March 31,2018. The debt discounts had a balance at June 30, 2018 of $0 and $0 at March 31, 2018. The principal balance as of June 30, 2018 and March 31, 2018, was $10,000 and $10,000, respectively. This note is currently in default.

 

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were indeterminate due to the lack on conversion price floor and, as such, does constitute a derivative liability as the Company has insufficient authorized shares.

 

As of June 30, 2018, we have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities.

 

Convertible Note Conversions

 

During the three months ended June 30, 2018, the Company issued no shares of common stock upon the conversion of portions of the Convertible Notes.

 

During the year ended March 31, 2018, the Company issued the following shares of common stock upon the conversions of portions of the Convertible Notes:

 

    Principal     Note Fee     Total     Conversion     Shares Issued     Shares Issued      
Date   Conversion     Conversion     Conversion     Price     Pre-Split     Post-Split     Issued to
4/5/2017   $ 4,800     $     $ 4,800     $ 0.0160       48,000,000       32,000     Rockwell
4/11/2017     9,500.00             9,500       0.0154       44,186,047       29,457     GHS
4/12/2017     5,000.00             5,000       0.0128       50,000,000       33,333     Rockwell
4/17/2017     5,200.00             5,200       0.0129       52,000,000       34,667     Rockwell
4/18/2017     14,000.00             14,000       0.0138       61,135,372       40,757     GHS
4/24/2017     4,781.62             4,782       0.0136       47,816,200       31,877     Rockwell
5/1/2017     14,000.00             14,000       0.0129       68,292,683       45,528     GHS
5/10/2017     12,000.00             12,000       0.0128       69,364,162       46,243     GHS
5/12/2017     2,600.00             2,600       0.0097       130,000,000       86,667     Tri-Bridge
5/17/2017     4,440.00       900       5,340       0.0080       89,000,000       59,333     EMA
5/22/2017     9,000.00             9,000       0.0075       180,000,000       120,000     ARC
5/22/2017     3,600.00             3,600       0.0056       180,000,000       120,000     Tri-Bridge
5/23/2017     14,000.00             14,000       0.0055       93,959,732       62,640     GHS
5/30/2017     4,600.00             4,600       0.0056       230,000,000       153,333     Tri-Bridge
5/31/2017     2,700.00       900       3,600       0.0055       120,000,000       80,000     EMA
6/2/2017     5,200.00             5,200       0.0056       260,000,000       173,333     Tri-Bridge
6/5/2017     480.00       900       1,380       0.0058       138,000,000       92,000     EMA
6/5/2017     10,000.00             10,000       0.0056       97,087,379       64,725     GHS
6/14/2017     2,245.00             2,245       0.0056       314,500,000       209,667     EMA
6/16/2017     12,800.00             12,800       0.0056       182,857,143       121,905     GHS
6/22/2017     2,889.00       900       3,789       0.0058       378,900,000       252,600     EMA
6/23/2017     12,500.00             12,500       0.0059       178,571,429       119,048     GHS
11/13/2017     5,000.00       1,250       6,250       0.0001       108,695,652       72,464     Emunah
    $ 161,336     $ 4,850     $ 166,186               3,122,365,799       194,559,520      
XML 19 R9.htm IDEA: XBRL DOCUMENT v3.10.0.1
LONG TERM NOTE PAYABLE
3 Months Ended
Jun. 30, 2018
Debt Disclosure [Abstract]  
LONG TERM NOTE PAYABLE

4. LONG TERM NOTE PAYABLE

 

On October 1, 2017, Direct Capital Group, Inc. agreed to cancel two convertible notes in the principal amounts of $25,000 and $36,000, and $6,304 in accrued interest, in exchange for a Promissory Note in the amount of $61,000. The note bears no interest and is due on or before October 1, 2020. The Company recorded a gain of $6,304 in accrued interest and the derivative liability of $87,505 was revalued and settled to additional paid in capital.

XML 20 R10.htm IDEA: XBRL DOCUMENT v3.10.0.1
DERIVATIVE LIABILITIES
3 Months Ended
Jun. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE LIABILITIES

5. DERIVATIVE LIABILITIES

 

As of June 30, 2018, the Company revalued the embedded conversion feature of the Convertible Notes, warrants and stock payables. The fair values were calculated based on the Monte Carlo simulation method consistent with the terms of the related debt.

 

A summary of the derivative liability balance as of June 30, 2018, is as follows:

 

    Notes     Warrants     Stock Payable     Total  
Balance, beginning of period   $ 4,019,289     $ 2,131     $ 2,605,603     $ 6,627,023  
Initial recognition of derivative liability     26,964       981       7,500       35,445  
Reduction for debt settlement     (12,052 )                 (12,052 )
Loss on derivative liability valuation     299,573             7,500       307,073  
Balance, end of period   $ 4,333,774     $ 3,112     $ 2,620,603     $ 6,957,489  

 

Convertible Notes

 

The fair value at the commitment date for the convertible notes and the revaluation dates for the Company’s derivative liabilities were based upon the following management assumptions as of June 30, 2018:

 

    Commitment date      Valuation date
Expected dividends   0%   0%
Expected volatility   338%-423%   91.6%-102%
Expected term   .5 – 2 years   .25 – 2 years
Risk free interest   .92%-1.41%   1.66%-2.12%

 

Warrants

 

On October 20, 2017, the Company executed a Common Stock Purchase Warrant for 52,840,909 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on October 20, 2022.

 

On November 6, 2017, the Company executed a Common Stock Purchase Warrant for 15,338,160 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on November 6, 2022.

 

On November 30, 2017, the Company executed a Common Stock Purchase Warrant for 10,225,440 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on November 30, 2022.

 

On January 11, 2018, the Company executed a Common Stock Purchase Warrant for 8,521,200 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on January 11, 2023.

 

On May 15, 2018, the Company executed a Common Stock Purchase Warrant for 40,000,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on May 15, 2023.

 

The Company evaluated all outstanding warrants to determine whether these instruments may be tainted. All warrants outstanding were considered tainted. The Company valued the embedded derivatives within the warrants based on the Monte Carlo simulation.

 

The fair value at the inception date for the warrants and the revaluation dates were based upon the following management assumptions:

 

    Commitment date     Valuation date
Expected dividends   0%   0%
Expected volatility   105.3%-106.8%   105.3%-106.8%
Expected term   5 years   4.56 - 5 years
Risk free interest   1.99%-2.32%   2.14%-2.56%

 

Stock Payable

 

During the year ended March 31, 2018, the Company reclassified stock payables due to related parties of $2,791,250 to derivative liabilities, due to the company having a tainted equity environment. The payables to be issued in stock are at 100% of the lowest closing market price with a 15 day look back. The effective discount to the stock at March 31, 2018 due to the 100% of the lowest closing market price of the previous 15 days using a 6-month average was $0, and therefore the value is equal to the face amount.

 

During the three month ended June 30, 2018, the Company recorded $7,500 in stock payables due to the conversion of accounts payable to stock payable, which were derivatives due to their tainted equity environment.

XML 21 R11.htm IDEA: XBRL DOCUMENT v3.10.0.1
RELATED PARTY TRANSACTIONS
3 Months Ended
Jun. 30, 2018
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS

6. RELATED PARTY TRANSACTIONS

 

The Company is periodically advanced noninterest bearing operating funds from related parties. The advances are due on demand and unsecured. During the three month ended June 30, 2018, the Company advanced $16,729 to related parties. As of June 30, 2018 and March 31, 2018 the Company owed related parties $143,223 and $126,494, respectively. During the three months ended June 30, 2018 and the year ended March 31, 2018, the Company recorded imputed interest of $5,057 and $13,257, respectively, to the statement of operations with a corresponding increase to additional paid in capital.

XML 22 R12.htm IDEA: XBRL DOCUMENT v3.10.0.1
PREFERRED STOCK
3 Months Ended
Jun. 30, 2018
Equity [Abstract]  
PREFERRED STOCK

7. PREFERRED STOCK

 

On January 25, 2011, the Company filed an amendment to its Nevada Certificate of Designation to create two classes of Preferred Stock, Series A and Series B, with a par value of $0.001. Each class has 10,000,000 shares authorized.

 

On July 1, 2015, the Company’s Board of Directors authorized the creation of shares of Series B Voting Preferred Stock and on July 27, 2015 a Certificate of Designation was filed with the Nevada Secretary of State. The holder of the shares of the Series B Voting Preferred Stock has the right to vote those shares of the Series B Voting Preferred Stock regarding any matter or action that is required to be submitted to the shareholders of the Company for approval. The vote of each share of the Series B Voting Preferred Stock is equal to and counted as 4 times the votes of all of the shares of the Company’s (i) common stock, and (ii) other voting preferred stock issued and outstanding on the date of each and every vote or consent of the shareholders of the Company regarding each and every matter submitted to the shareholders of the Company for approval.

 

On January 3, 2017, the Company filed an Amendment to Certificate of Designation with the Nevada Secretary of State defining the rights and preferences of the Series A Preferred shares. Series A Preferred stock shall be convertible into common shares at the rate of the closing market price on the day of the conversion notice equal to the dollar amount of the value of the Series A shares, and holders shall have no voting rights on corporate matters, unless and until they convert their Series A shares into Common Shares, at which time they will have the same voting rights as all Common Shareholders have; their consent shall not be required for taking any corporate action.

 

On June 1, 2017, the Company issued 536,351 Series A Preferred shares valued at $960,068 to Gary Tilden, a former officer and director, which reduced liabilities owed to him of $819,460, and recorded a loss on conversion of $140,608. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

On August 21, 2017, the Company retired 250 Series B Voting Preferred shares issued and 81,061 common shares issued to Gary Tilden, in accordance with his resignation arrangement. Additionally, the Company issued Mr. Tilden 747,208 Series A Preferred shares, with a value of $1,337,499, thereby recording a loss on conversion of $1,325,340. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

On February 7, 2018, the Company issued 5,587 Series A Preferred stock at $1.79 per share, pursuant to a debt settlement agreement with a convertible note holder. The note holder agreed to extinguish the principal balance of $348,000 and accrued interest of $217,133 for $10,000 to be issued in Series A Preferred stock. The Company recorded a gain of $555,633 on settlement of debt, a gain on derivative liability of $501,506, and reclassed $161,343 in derivative liabilities to additional paid in capital. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

During the year ended March 31, 2018, the Company also retired 250 Series B Voting Preferred shares issued to Donna Murtaugh. Ms. Murtaugh also sold 174,581 Series A Preferred shares to a new shareholder, of which 12,788 Series A Preferred shares were converted into 127,888 common shares. Both resulted in $0 due to the value being within the terms of the agreement at $0 per share.

 

As of June 30, 2018, 10,000,000 Series A Preferred shares and 10,000,000 Series B Preferred shares were authorized, of which 3,489,610 Series A shares were issued and outstanding, (3,489,610 shares as of March 31, 2018) and 500 Series B shares were issued and outstanding (500 shares as of March 31, 2018).

XML 23 R13.htm IDEA: XBRL DOCUMENT v3.10.0.1
COMMON STOCK
3 Months Ended
Jun. 30, 2018
Equity [Abstract]  
COMMON STOCK

8. COMMON STOCK

 

On June 15, 2016, the Company approved the authorization of a 1 for 1,000 reverse stock split of the Company’s outstanding shares of common stock, which was effective on July 22, 2016. The financial statements have been retroactively adjusted to take this into account for all periods presented.

 

On August 29, 2016, the Company filed a Certificate of Amendment to reduce the amount of authorized common shares to 163,000,000 shares, par value of $0.00001.

 

On November 14, 2016, the Company filed a Certificate of Amendment to increase the number of authorized common shares to 1,500,000,000 with a par value of $0.00001.

 

On December 8, 2016, the Company filed a Certificate of Amendment to increase the number of authorized common shares to 3,000,000,000 with a par value of $0.00001.

 

On January 26, 2017, the Company filed a Certificate of Amendment with the State of Nevada in order to increase the number of authorized shares of Common Stock. The number of authorized common stock the Company shall have the authority to issue is 7,000,000,000; par value $0.00001 per share.

 

On April 27, 2017, the Company issued 53,333 shares of common stock for services valued $24,000, based on the market price of the Company’s common stock on the date of agreement.

 

On August 21, 2017, the Company retired 250 Series B Voting Preferred shares and 81,061 common shares issued to Gary Tilden, in accordance with his resignation arrangement. Additionally, the Company issued Mr. Tilden 747,208 Series A Preferred shares, with a value of $1,337,499, thereby recording a loss on conversion of $1,325,340. The value of the stock is based on the closing market price of the equivalent common stock conversion value on the date of the settlement agreement.

 

On October 31, 2017, the Company approved the authorization of a 1 for 1,500 reverse stock split of the Company’s outstanding shares of common stock. The Company’s financial statements have been retroactively adjusted for this stock split for all periods presented.

 

On November 1, 2017, the Company filed a Certificate of Amendment with the Secretary of State in Nevada, to amendment its Articles of Incorporation pursuant to the reverse split and to reduce the number of authorized common shares to 900,000,000 having a par value of $0.00001. Any fractional shares which results from that reverse stock split will be rounded up to the next whole share. All common share amounts and per share amounts in the financial statements reflect the one-for-fifteen hundred reverse stock split.

 

During the year ended March 31, 2018, 127,888 common shares were issued in exchange for 12,788 shares of Series A Preferred shares. No gain or loss was recorded due to the conversion occurring within the terms of the agreement.

 

During the year ended March 31, 2018, the holders of convertible notes converted a total of $161,336 of principal into 2,081,577 shares of common stock. The issuance extinguished $722,055 worth of derivative liabilities and $201,809 was recorded as a loss on settlement of debt.

 

As of June 30, 2018, 900,000,000 common shares, par value $0.00001, were authorized, of which 2,914,797 shares were issued and outstanding (2,914,797 shares as of March 31, 2018).

XML 24 R14.htm IDEA: XBRL DOCUMENT v3.10.0.1
INCOME TAXES
3 Months Ended
Jun. 30, 2018
Income Tax Disclosure [Abstract]  
INCOME TAXES

9. INCOME TAX

 

Deferred income taxes are determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes are measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases.

 

Operating loss carry-forwards generated from inception through June 30, 2018 of approximately $5,781,805 will begin to expire in 2034. The Company applies a statutory income tax rate of 21%. Accordingly, deferred tax assets related to net operating loss carry-forwards total approximately $1,164,672 at June 30, 2018.

XML 25 R15.htm IDEA: XBRL DOCUMENT v3.10.0.1
COMMITMENTS AND CONTINGENCIES
3 Months Ended
Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

10. COMMITMENTS AND CONTINGENCIES

 

On June 27, 2016, the Company entered into a Consulting Agreement with Axeman Capital LLC (formerly Channel Sales & Consulting, LLC). The Company has agreed to pay Axeman Capital (“Axeman”) $3,000 per month for the first two months, and $4,000 per month for a period of one year. Axeman will also be paid a 10% commission on all gross sales generated through a licensed dealer and 30% commission on non-licensed dealers. If within the first twelve months of the Agreement, Axeman generates gross sales above $2,000,000, the Company will pay an additional 5% commission on gross sales, either in cash or restricted common stock. On October 12, 2017, the Company accepted a letter from Axeman agreeing to not accept a bonus fee of $100,000 in restricted common shares of the Company.

 

On June 15, 2018, the Company entered into a Debt Settlement Agreement (“Agreement”) with Axeman regarding the original contract dated June 27, 2016. The Agreement settles all outstanding debt owed to Axeman as of May 30, 2018, which includes unpaid monthly retainers and commissions of $28,103 and a $100,000 bonus fee, which the Company agreed to reinstate pursuant to the terms of the Agreement. The Company has agreed to settle this debt in full, in the amount of $140,000. The company has agreed to issue 78,212 Series A shares in value of $1.79 per share for the total value of $140,000 and this amount was accrued as of March 31, 2018 and June 30, 2018. All contracts have been canceled with Axeman, and the Company has authorized the Transfer Agent to issue said shares in the name of Axeman Capital, LLC. As of the date of this filing, the shares have not been issued.

 

On February 1, 2017, the Company entered into a standard office lease for approximately 1,700 square feet of office space at 175 Joerschke Drive, Suite A, Grass Valley, CA 95945. The lease has a term of 1 year, from February 1, 2017 through January 31, 2018, with a monthly rent of $1,400. On February 1, 2018, the Company entered into a month-to-month lease with a monthly rent of $1,400. Rental expenses incurred for this operating lease during the years ended March 31, 2018 and 2017 were $16,800 and $16,800 respectively.

XML 26 R16.htm IDEA: XBRL DOCUMENT v3.10.0.1
SUBSEQUENT EVENTS
3 Months Ended
Jun. 30, 2018
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

11. SUBSEQUENT EVENTS

 

On July 3, 2018, the Company issued a convertible note to Fourth Man LLC for $24,200, which includes $1,238 in cash paid to the company, $20,762 to settle outstanding accounts payable and transaction costs of $2,200. The note bears interest of 10% (increases to 24% per annum upon an event of default), matures on July 3, 2019.

 

On July 3, 2018, the Company executed a Common Stock Purchase Warrant for 48,400,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on July 3, 2023.

 

On July 17, 2018, the Company executed an Allonge with Fourth Man LLC to the note dated July 3, 2018. The Purchaser agrees that in exchange for a $7,700 payment to the Company to settle accounts payable, the note principal is being increased by $8,470.

 

On July 17, 2018, the Company executed a Common Stock Purchase Warrant for 16,940,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on July 17, 2023.

 

On August 22, 2018, the Company executed an Allonge with Fourth Man LLC to the note dated July 3, 2018. The Purchaser agrees that in exchange for a $7,000 payment to the Company to settle accounts payable, the note principal is being increased by $7,700.

 

On August 22, 2018, the Company executed a Common Stock Purchase Warrant for 15,400,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0005 per share and expire on August 22, 2023.

 

The Company has evaluated subsequent events pursuant to ASC Topic 855 and has determined that there are no additional subsequent events to disclose.

XML 27 R17.htm IDEA: XBRL DOCUMENT v3.10.0.1
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
3 Months Ended
Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization and Description of Business

Organization and Description of Business

 

Simlatus Corporation (“SIML” or “Company”) was incorporated in the State of Nevada under the name Sunberta Resources Inc. on November 15, 2006, as a mining and exploration of mineral claims business.  On November 18, 2009, the Company changed its name to Grid Petroleum Corp. and continued with the mining and exploration of mineral claims operations, exploring mining claims in Alberta, Canada, Vancouver Island, British Columbia, England and the United States.

 

On March 9, 2016, the Company entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with RJM and Associates, LLC, a California limited liability company (“RJM”) whereby RJM’s owners became the directors of the Company and were to be issued $6,250,000 worth of the Company’s stock; $5,000,000 of Restricted Common Stock 90 days from the date of this agreement and $1,250,000 of Preferred Series-A Shares of the Company’s Preferred Stock (the “Acquisition”). On the same date, the entire management of RJM became the entire management of the Company. The Company’s transaction with RJM has been treated as a reverse recapitalization of the Company, with the Company (the legal acquirer of RJM) considered the accounting acquiree and RJM, whose management took control of the Company (the legal acquiree of the Company), considered the accounting acquirer. The historical financial statements include the operations of the accounting acquirer (RJM) for all periods presented.

 

RJM was incorporated in the State of California on June 11, 2014, for the purpose of operating a broadcast equipment production business.

 

On March 25, 2016, the Company approved a name change to Simlatus Corporation, stock symbol SIML, which was executed on April 4, 2016. The new name change better describes the Company’s new business and new revenues in selling commercial broadcast equipment on a global basis. Simlatus Corporation develops, manufactures, markets and owns proprietary advanced broadcast equipment and software and sells this audio and video broadcast equipment worldwide. These systems have been sold worldwide over the past 15 years including some of the major broadcast companies.   

 

The Company currently sells approximately 55 different audio/video products and is preparing to market its newest audio/video product referred to as SyncPal™. In addition to the Company’s traditional line of audio/video products, it has commenced the research & development of its Immersive Broadcast System, referred to as the Simlatus-IBS™. The Simlatus-IBS™ will include commercial augmented reality and virtual reality applications for studio engineers. These applications, both hardware and software, will allow the customer to control and manage the studio audio/video systems from anywhere in the world. These products are being developed to serve a market segment that is presently being strongly embraced by consumers and is forecasted, by some of the most widely recognized tech companies in the world, as becoming a multi-billion-dollar market in the very near future. The Market Analysis and IP Portfolio will include new patents specifically developed for these products and owned by the Company.

Financial Statement Presentation

Financial Statement Presentation

 

The accompanying unaudited Condensed Financial Statements have been prepared in accordance with the instructions to interim financial reporting as prescribed by the Securities and Exchange Commission (the “SEC”). The results for the interim periods are not necessarily indicative of results for the entire year. These interim financial statements do not include all disclosures required by U.S. generally accepted accounting principles (“GAAP”), and should be read in conjunction with the consolidated financial statements and notes thereto filed with the SEC in our Annual Report on Form 10-K for the fiscal year ended March 31, 2018. In the opinion of management, the unaudited Condensed Financial Statements contained in this report include all known accruals and adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods reported herein. Any such adjustments are of a normal recurring nature.

Fiscal Year End

Fiscal Year End 

 

The Company has selected March 31 as its fiscal year end.

Use of Estimates

Use of Estimates

 

The preparation of the Company’s financial statements in conformity with generally accepted accounting principles of United States of America 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.

 

Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash Equivalents

 

The Company considers all highly liquid investments with maturities of 90 days or less from the date of purchase to be cash equivalents.

Revenue Recognition and Related Allowances

Revenue recognition and Related Allowances

 

Effective April 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts Receivable and Allowance for Doubtful Accounts

 

Accounts receivable are stated at the amount that management expects to collect from outstanding balances. Bad debts and allowances are provided based on historical experience and management’s evaluation of outstanding accounts receivable. Management evaluates past due or delinquency of accounts receivable based on the open invoices aged on due date basis. The allowance for doubtful accounts at June 30, 2018 and March 31, 2018 is $0.

Accounts Payable and Accrued Expenses

Accounts Payable and Accrued Expenses

 

Accounts payable and accrued expenses are carried at amortized cost and represent liabilities for goods and services provided to the Company prior to the end of the fiscal year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services.

Loss Per Share

Loss Per Share

 

Basic loss per share of common stock is computed by dividing the net loss by the weighted average number of common shares outstanding during the period after giving retroactive effect to the reverse stock split affected on November 1, 2017 (see Note 8). Diluted earnings (loss) per share is equal to the basic per share for the three months ended June 30, 2018 and 2017. Common stock equivalents are not included in the loss per share since they are anti-dilutive. All per share amounts have been adjusted for the reverse stock split.

Inventories

Inventories

 

Inventories are stated at the lower of cost, computed using the first-in, first-out method and net realizable value. Any adjustments to reduce the cost of inventories to their net realizable value are recognized in earnings in the current period. During the year ended March 31, 2018, the Company recorded an impairment to inventory of $61,188. As of June 30, 2018 and March 31, 2018, the Company’s inventories consist primarily of raw materials and supplies rather than finished goods and are presented, net of an allowance for obsolete inventory, as $659 and $1,435, respectively.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

 

Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk.

 

In addition to defining fair value, the standard expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs is expanded. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels and which is determined by the lowest level input that is significant to the fair value measurement in its entirety.

 

These levels are:

 

Level 1 - inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

 

Level 2 - inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 

Level 3 - inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

 

The following table represents the Company’s financial instruments that are measured at fair value on a recurring basis as of June 30, 2018 and March 31, 2018 for each fair value hierarchy level:

 

June 30, 2018   Derivative Liabilities     Total  
Level 1   $     $  
Level 2   $     $  
Level 3   $ 6,957,489     $ 6,957,489  
                 
March 31, 2018   Derivative Liabilities     Total  
Level 1   $     $  
Level 2   $     $  
Level 3   $ 6,627,023     $ 6,627,023  

 

In management’s opinion, the fair value of convertible notes payable and advances payable is approximate to carrying value as the interest rates and other features of these instruments approximate those obtainable for similar instruments in the current market. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, exchange or credit risks arising from these financial instruments. As of June 30, 2018 and March 31, 2018, the balances reported for cash, accounts receivable, prepaid expenses, accounts payable, and accrued liabilities, approximate the fair value because of their short maturities.

Income Taxes

Income Taxes

 

The Company records deferred taxes in accordance with FASB ASC No. 740, Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and loss carry-forwards and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

 

As of the date of this filing, the Company is delinquent in filing their tax returns, and there is uncertainty regarding potential penalties and interest.  The last return filed by the Company was March 31, 2012, and the Company has not accrued any potential penalties or interest from that period forward.  The Company will need to file returns for the years ending March 31, 2013, 2014, 2015, 2016, 2017 and 2018 which, are still open for examination.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

 

In May 2014, the FASB issued ASU 2014-09 regarding ASC Topic 606, “Revenue from Contracts with Customers.” ASU 2014-09 provides principles for recognizing revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14 to defer the effective date by one year with early adoption permitted as of the original effective date. ASU 2014-09 will be effective for our fiscal year beginning April 1, 2018. In addition, the FASB issued ASU 2016-08, ASU 2016-10, and ASU 2016-12 in March 2016, April 2016, and May 2016, respectively, to help provide interpretive clarifications on the new guidance in ASC Topic 606. The Company is currently evaluating the accounting, transition, and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption.

 

While the Company does not expect the adoption of this standard to have a material impact on the Company’s net Revenues in the Statements of Income, the Company anticipates revenues for certain wholesale transactions and substantially all digital commerce sales will be recognized upon shipment rather than upon delivery to the customer.

 

Additionally, provisions for post-invoice sales discounts, returns and miscellaneous claims will be recognized as accrued liabilities rather than as reductions to Accounts receivable, net; and the estimated cost of inventory associated with the provision for sales returns will be recorded within Prepaid expenses and other current assets on the Balance Sheets. The Company continues to evaluate the impact of this new standard, including on accounting policies, disclosures, internal control over financial reporting and its contracts with customers.

 

In February 2016, the FASB issued ASU 2016-02 (ASC Topic 842), Leases. The ASU amends a number of aspects of lease accounting, including requiring lessees to recognize operating leases with a term greater than one year on their balance sheet as a right-of-use asset and corresponding lease liability, measured at the present value of the lease payments. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is in the process of assessing the impact on its financial statements.

 

Effective April 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

XML 28 R18.htm IDEA: XBRL DOCUMENT v3.10.0.1
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
3 Months Ended
Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of financial assets and liabilities measured at fair value on a recurring basis

The following table represents the Company’s financial instruments that are measured at fair value on a recurring basis as of June 30, 2018 and March 31, 2018 for each fair value hierarchy level:

 

June 30, 2018   Derivative Liabilities     Total  
Level 1   $     $  
Level 2   $     $  
Level 3   $ 6,957,489     $ 6,957,489  
                 
March 31, 2018   Derivative Liabilities     Total  
Level 1   $     $  
Level 2   $     $  
Level 3   $ 6,627,023     $ 6,627,023  
XML 29 R19.htm IDEA: XBRL DOCUMENT v3.10.0.1
CONVERTIBLE NOTES PAYABLE (Tables)
3 Months Ended
Jun. 30, 2018
Debt Disclosure [Abstract]  
Schedule of notes payable

As of June 30, 2018 and the year ended March 31, 2018, notes payable were comprised of the following:

 

    Original   Due   Interest   Conversion   June 30,     March 31,  
    Note Date   Date   Rate   Rate   2018     2018  
ARC Capital Ltd   10/1/2015   4/2/2016   24%   Variable   $ 2,625     $ 2,625  
Asher Enterprises #4   9/16/2011   6/20/2012   22%   Variable           13,000  
Auctus Fund #1   12/16/2016   9/16/2017   24%   Variable     46,750       46,750  
Auctus Fund #2   8/9/2017   5/9/2017   24%   Variable     46,750       46,750  
Blackbridge Capital #2   5/3/2016   5/3/2017   5%   Variable     80,400       80,400  
EMA Financial   11/9/2016   11/9/2017   24%   Variable     272,576       272,576  
Emunah Funding #1   10/18/2017   10/18/2018   0%   Variable     110,000       110,000  
Emunah Funding #2   10/18/2017   10/18/2018   0%   Variable     20,000       20,000  
Emunah Funding #3   10/18/2017   10/18/2018   0%   Variable     30,000       30,000  
Emunah Funding #4   10/20/2018   7/20/2018   8%   Variable     55,440       55,440  
Emunah Funding #5   5/15/2018   5/15/2019   10%   Variable     37,778        
GW Holdings   10/13/2015   4/1/2015   24%   Variable     42,500       42,500  
James Powell   9/7/2015   Demand   8%   Variable     150,875       150,875  
Syndication Capital #1   12/31/2012   10/10/2011   22%   0.01     5,000       5,000  
Tri-Bridge Ventures #1   1/19/2017   10/19/2017   8%   Variable     9,000       9,000  
V2IP #2   5/13/2016   Demand   12%   Variable     10,000       10,000  
                      919,694       894,916  
Less debt discount             (80,655 )     (120,083 )
Notes payable, net of discount*           $ 839,039     $ 774,833  

 

  * During the three months ended June 30, 2018 and the year ended March 31, 2018, the balance of notes payable, net of discount that are in default is $505,601 and $511,923, respectively.
XML 30 R20.htm IDEA: XBRL DOCUMENT v3.10.0.1
DERIVATIVE LIABILITIES (Tables)
3 Months Ended
Jun. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of derivative liability activity

A summary of the derivative liability balance as of June 30, 2018, is as follows:

 

    Notes     Warrants     Stock Payable     Total  
Balance, beginning of period   $ 4,019,289     $ 2,131     $ 2,605,603     $ 6,627,023  
Initial recognition of derivative liability     26,964       981       7,500       35,445  
Reduction for debt settlement     (12,052 )                 (12,052 )
Loss on derivative liability valuation     299,573             7,500       307,073  
Balance, end of period   $ 4,333,774     $ 3,112     $ 2,620,603     $ 6,957,489  

 

The fair value at the commitment date for the convertible notes and the revaluation dates for the Company’s derivative liabilities were based upon the following management assumptions as of June 30, 2018:

 

    Commitment date      Valuation date
Expected dividends   0%   0%
Expected volatility   338%-423%   91.6%-102%
Expected term   .5 – 2 years   .25 – 2 years
Risk free interest   .92%-1.41%   1.66%-2.12%

 

Warrants

 

The fair value at the inception date for the warrants and the revaluation dates were based upon the following management assumptions:

 

    Commitment date     Valuation date
Expected dividends   0%   0%
Expected volatility   105.3%-106.8%   105.3%-106.8%
Expected term   5 years   4.56 - 5 years
Risk free interest   1.99%-2.32%   2.14%-2.56%
XML 31 R21.htm IDEA: XBRL DOCUMENT v3.10.0.1
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Fair Value, Inputs, Level 3 [Member] - USD ($)
Jun. 30, 2018
Mar. 31, 2018
Derivative Liability $ 6,957,489 $ 6,627,023
Total Financial Liabilities $ 6,957,489 $ 6,627,023
XML 32 R22.htm IDEA: XBRL DOCUMENT v3.10.0.1
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)
Mar. 09, 2016
Mar. 31, 2018
Allowance for obsolete inventory   $ 61,188
Board of Directors Chairman [Member]    
Common stock value issued $ 6,250,000  
Restricted common stock, value $ 5,000,000  
Restricted common stock, description Restricted Common Stock 90 days from the date of this agreement and $1,250,000 of Preferred Series-A Shares of the Company's Preferred Stock (the "Acquisition").  
XML 33 R23.htm IDEA: XBRL DOCUMENT v3.10.0.1
PREPAID EXPENSES (Details Narrative) - USD ($)
3 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Prepaid Expenses [Abstract]    
Amortized prepaid expenses $ (6,000)
XML 34 R24.htm IDEA: XBRL DOCUMENT v3.10.0.1
CONVERTIBLE NOTES PAYABLE (Details) - USD ($)
3 Months Ended
Jun. 30, 2018
Mar. 31, 2018
Short-term Debt [Line Items]    
Notes payable, gross $ 919,694 $ 894,916
Debt discount (80,655) (120,083)
Notes payable, net of discount [1] $ 839,039 $ 774,833
Arc Capital Ltd [Member]    
Short-term Debt [Line Items]    
Original Note Date Oct. 01, 2015  
Due Date Apr. 02, 2016  
Interest Rate 24.00% 24.00%
Conversion Rate Variable  
Notes payable, gross $ 2,625 $ 2,625
Asher Enterprises #4    
Short-term Debt [Line Items]    
Original Note Date Sep. 16, 2011  
Due Date Jun. 20, 2012  
Interest Rate 22.00% 22.00%
Conversion Rate Variable  
Notes payable, gross $ 13,000
Auctus Fund One [Member]    
Short-term Debt [Line Items]    
Original Note Date Dec. 16, 2016  
Due Date Sep. 16, 2017  
Interest Rate 24.00% 24.00%
Conversion Rate Variable  
Notes payable, gross $ 46,750 $ 46,750
Auctus Fund #2    
Short-term Debt [Line Items]    
Original Note Date Aug. 09, 2017  
Due Date May 09, 2017  
Interest Rate 24.00% 24.00%
Conversion Rate Variable  
Notes payable, gross $ 46,750 $ 46,750
Blackbridge Capital Two [Member]    
Short-term Debt [Line Items]    
Original Note Date May 03, 2016  
Due Date May 03, 2017  
Interest Rate 5.00% 5.00%
Conversion Rate Variable  
Notes payable, gross $ 80,400 $ 80,400
Ema Financial [Member]    
Short-term Debt [Line Items]    
Original Note Date Nov. 09, 2016  
Due Date Nov. 09, 2017  
Interest Rate 24.00% 24.00%
Conversion Rate Variable  
Notes payable, gross $ 272,576 $ 272,576
Emunah Funding #1    
Short-term Debt [Line Items]    
Original Note Date Oct. 18, 2017  
Due Date Oct. 18, 2018  
Interest Rate 0.00% 0.00%
Conversion Rate Variable  
Notes payable, gross $ 110,000 $ 110,000
Emunah Funding #2    
Short-term Debt [Line Items]    
Original Note Date Oct. 18, 2017  
Due Date Oct. 18, 2018  
Interest Rate 0.00% 0.00%
Conversion Rate Variable  
Notes payable, gross $ 20,000 $ 20,000
Emunah Funding #3    
Short-term Debt [Line Items]    
Original Note Date Oct. 18, 2017  
Due Date Oct. 18, 2018  
Interest Rate 0.00% 0.00%
Conversion Rate Variable  
Notes payable, gross $ 30,000 $ 30,000
Emunah Funding #4    
Short-term Debt [Line Items]    
Original Note Date Oct. 20, 2018  
Due Date Jul. 20, 2018  
Interest Rate 8.00% 8.00%
Conversion Rate Variable  
Notes payable, gross $ 55,440 $ 55,440
Emunah Funding #5    
Short-term Debt [Line Items]    
Original Note Date May 15, 2018  
Due Date May 15, 2019  
Interest Rate 10.00% 10.00%
Conversion Rate Variable  
Notes payable, gross $ 37,778
Gw Holdings [Member]    
Short-term Debt [Line Items]    
Original Note Date Oct. 13, 2015  
Due Date Apr. 01, 2015  
Interest Rate 24.00% 24.00%
Conversion Rate Variable  
Notes payable, gross $ 42,500 $ 42,500
James Powell [Member]    
Short-term Debt [Line Items]    
Original Note Date Sep. 07, 2015  
Due Date, Description Demand  
Interest Rate 8.00% 8.00%
Conversion Rate Variable  
Notes payable, gross $ 150,875 $ 150,875
Syndication Capital #1    
Short-term Debt [Line Items]    
Original Note Date Dec. 31, 2012  
Due Date Oct. 10, 2011  
Interest Rate 22.00% 22.00%
Conversion Rate 0.01  
Notes payable, gross $ 5,000 $ 5,000
Tri Bridge Ventures One [Member]    
Short-term Debt [Line Items]    
Original Note Date Jan. 19, 2017  
Due Date Oct. 19, 2017  
Interest Rate 8.00% 8.00%
Conversion Rate Variable  
Notes payable, gross $ 9,000 $ 9,000
V2IP #2    
Short-term Debt [Line Items]    
Original Note Date May 13, 2016  
Due Date, Description Demand  
Interest Rate 12.00% 12.00%
Conversion Rate Variable  
Notes payable, gross $ 10,000 $ 10,000
[1] During the three months ended June 30, 2018 and the year ended March 31, 2018, the balance of notes payable, net of discount that are in default is $505,601 and $511,923, respectively.
XML 35 R25.htm IDEA: XBRL DOCUMENT v3.10.0.1
CONVERTIBLE NOTES PAYABLE (Details Narrative) - USD ($)
3 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Mar. 31, 2018
Short-term Debt [Line Items]      
Proceeds from convertible notes payable $ 20,000  
Accrued interest 3,682,371   $ 3,289,044
(Gain) loss on settlement of debt 13,000 62,421  
Debt discount write-offs 70,170 165,561  
Interest expense 1,259,992    
Convertible Notes Payable [Member]      
Short-term Debt [Line Items]      
Convertible promissory notes     61,000
Accrued interest 54,786   872
Convertible debt 86,952    
Convertible note principal 277,292   $ 168,000
(Gain) loss on settlement of debt 162,249 27,000  
Debt discount convertible notes payable 165,040 224,087  
Amortization 355,067 $ 275,784  
Beneficial conversion feature $ 35,817    
Conversion of notes payable convertible shares 43,046,202    
Interest expense $ 2,420,978    
XML 36 R26.htm IDEA: XBRL DOCUMENT v3.10.0.1
LONG TERM NOTE PAYABLE (Details Narrative) - Convertible Notes Payable [Member]
Oct. 02, 2017
USD ($)
Convertible note principal amount, cancelled $ 61,000
Accrued interest 6,304
Promissiory Notes Issued $ 87,505
Due Date Oct. 01, 2020
XML 37 R27.htm IDEA: XBRL DOCUMENT v3.10.0.1
DERIVATIVE LIABILITIES (Details)
3 Months Ended
Jun. 30, 2018
USD ($)
Balance, beginning of period $ 6,627,023
Initial recognition of derivative liability 35,445
Loss on derivative liability valuation 307,073
Reduction for debt settlement (12,052)
Balance, end of period 6,957,489
Warrant [Member]  
Balance, beginning of period 2,131
Initial recognition of derivative liability 981
Loss on derivative liability valuation
Reduction for debt settlement
Balance, end of period 3,112
Stock Payable [Member]  
Balance, beginning of period 2,605,603
Initial recognition of derivative liability 7,500
Loss on derivative liability valuation 7,500
Reduction for debt settlement
Balance, end of period 2,620,603
Convertible Notes [Member]  
Balance, beginning of period 4,019,289
Initial recognition of derivative liability 26,964
Loss on derivative liability valuation 299,573
Reduction for debt settlement (12,052)
Balance, end of period $ 4,333,774
XML 38 R28.htm IDEA: XBRL DOCUMENT v3.10.0.1
DERIVATIVE LIABILITIES (Details 2)
3 Months Ended
Jun. 30, 2018
Commitment Date [Member] | Warrant [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected dividend rate 0.00%
Fair value of derivatives, term 5 years
Commitment Date [Member] | Minimum [Member] | Warrant [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 105.30%
Fair value of derivatives, risk free interest rate 1.99%
Commitment Date [Member] | Maximum [Member] | Warrant [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 106.80%
Fair value of derivatives, risk free interest rate 2.32%
Commitment Date [Member] | Convertible Notes [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected dividend rate 0.00%
Commitment Date [Member] | Convertible Notes [Member] | Minimum [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 338.00%
Fair value of derivatives, term 2 years
Fair value of derivatives, risk free interest rate 0.92%
Commitment Date [Member] | Convertible Notes [Member] | Maximum [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 423.00%
Fair value of derivatives, term 6 months
Fair value of derivatives, risk free interest rate 1.41%
Valuation Date [Member] | Warrant [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected dividend rate 0.00%
Valuation Date [Member] | Minimum [Member] | Warrant [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 105.30%
Fair value of derivatives, term 4 years 6 months 21 days
Fair value of derivatives, risk free interest rate 2.14%
Valuation Date [Member] | Maximum [Member] | Warrant [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 106.80%
Fair value of derivatives, term 5 years
Fair value of derivatives, risk free interest rate 2.56%
Valuation Date [Member] | Convertible Notes [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected dividend rate 0.00%
Valuation Date [Member] | Convertible Notes [Member] | Minimum [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 91.60%
Fair value of derivatives, term 3 months
Fair value of derivatives, risk free interest rate 1.66%
Valuation Date [Member] | Convertible Notes [Member] | Maximum [Member]  
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair value of derivatives, expected stock volatility 102.00%
Fair value of derivatives, term 2 years
Fair value of derivatives, risk free interest rate 2.12%
XML 39 R29.htm IDEA: XBRL DOCUMENT v3.10.0.1
PREFERRED STOCK (Details Narrative) - USD ($)
3 Months Ended
Jun. 30, 2018
Mar. 31, 2018
Aug. 21, 2017
Jan. 25, 2011
Class of Stock [Line Items]        
Preferred stock, shares authorized 20,000,000 20,000,000    
Preferred stock par value, per share $ 0.001 $ 0.001    
Gary Tilden [Member]        
Class of Stock [Line Items]        
Unpaid expenses   $ 19,902    
Outstanding salary and interest $ 161,415      
Gary Tilden [Member] | Common Stock [Member]        
Class of Stock [Line Items]        
Shares issued     81,061  
Preferred Class A [Member]        
Class of Stock [Line Items]        
Preferred stock, shares authorized       10,000,000
Preferred stock par value, per share       $ 0.001
Class B Preferred Stock [Member]        
Class of Stock [Line Items]        
Preferred stock, shares authorized       10,000,000
Preferred stock par value, per share       $ 0.001
Series A Preferred Stock [Member]        
Class of Stock [Line Items]        
Preferred stock, shares authorized 10,000,000 10,000,000    
Preferred stock, shares issued 2,213,154 3,489,610    
Preferred stock value $ 3,490 $ 3,490    
Preferred stock, shares outstanding 2,213,154 3,489,610    
Series A Preferred Stock [Member] | Common Stock [Member]        
Class of Stock [Line Items]        
Shares issued   127,888    
Series A Preferred Stock [Member] | Gary Tilden [Member]        
Class of Stock [Line Items]        
Preferred stock, shares issued   536,351    
Preferred stock value   $ 960,069    
Shares issued     747,206  
Series A Preferred Stock [Member] | Donna Marie Murtaugh [Member]        
Class of Stock [Line Items]        
Shares issued   12,788    
Series B Preferred Stock [Member]        
Class of Stock [Line Items]        
Preferred stock, shares authorized 10,000,000 10,000,000    
Preferred stock, shares issued 1,000 500    
Preferred stock value $ 1 $ 1    
Preferred stock, shares outstanding 1,000 500    
Shares issued     250  
XML 40 R30.htm IDEA: XBRL DOCUMENT v3.10.0.1
COMMON STOCK (Details Narrative) - USD ($)
3 Months Ended
Oct. 31, 2017
Nov. 06, 2016
Oct. 20, 2016
Jun. 30, 2018
Jun. 30, 2017
Mar. 31, 2018
Nov. 01, 2017
Aug. 21, 2017
Common stock, shares authorized       900,000,000   900,000,000 900,000,000  
Common stock, par value       $ 0.00001   $ 0.00001 $ 0.00001  
Common stock, shares issued       2,914,797   2,914,797    
Common stock, shares outstanding       2,914,797   2,914,797    
Gain (loss) on settlement of debt       $ (13,000) $ (62,421)      
Common stock issued for services, shares       53,333        
Common stock issued for services       $ 24,000        
Reverse stock split On October 31, 2017, the Company approved the authorization of a 1 for 1,500 reverse stock split of the Company’s outstanding shares of common stock. The Company’s financial statements have been retroactively adjusted for this stock split for all periods presented.              
Common Stock [Member]                
Common stock issued for services, shares       53,333        
Common stock issued for services       $ 1        
Common Stock [Member] | Notes Payable, Other Payables [Member]                
Principal of convertible notes       $ 162,249 $ 281,732      
Convertible notes converted into common stock       2,081,577 57,776      
Common stock, value       $ 450,142 $ 934,588      
Extinguished derivative liabilities       233,807 773,578      
Debt Discount         19,063      
Gain (loss) on settlement of debt       $ 54,086 $ 101,658      
Warrant [Member]                
Common stock, par value   $ 0.0005 $ .0005          
Common stock, shares issued   15,338,160 52,840,909          
Expiry Date   Nov. 06, 2022 Oct. 20, 2022          
Gary Tilden [Member] | Common Stock [Member]                
Shares, Issued               81,061
Series A Preferred Stock [Member]                
Common share issue in exchange       12,788        
Series A Preferred Stock [Member] | Common Stock [Member]                
Shares, Issued           127,888    
Series A Preferred Stock [Member] | Gary Tilden [Member]                
Shares, Issued               747,206
XML 41 R31.htm IDEA: XBRL DOCUMENT v3.10.0.1
INCOME TAXES (Details 2) - USD ($)
3 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Income Tax Disclosure [Abstract]    
Income Tax Provision
XML 42 R32.htm IDEA: XBRL DOCUMENT v3.10.0.1
INCOME TAXES (Details Narrative)
Mar. 31, 2018
USD ($)
Income Tax Disclosure [Abstract]  
Net Operating Loss Carryforward $ 5,781,805
XML 43 R33.htm IDEA: XBRL DOCUMENT v3.10.0.1
COMMITMENTS AND CONTINGENCIES (Details)
1 Months Ended 3 Months Ended
Nov. 02, 2017
USD ($)
Oct. 23, 2017
USD ($)
Aug. 07, 2017
USD ($)
Jun. 01, 2017
USD ($)
Apr. 27, 2017
shares
Apr. 07, 2017
USD ($)
Apr. 02, 2017
USD ($)
Mar. 27, 2017
shares
Feb. 01, 2018
USD ($)
Mar. 06, 2017
USD ($)
Feb. 01, 2017
USD ($)
ft²
Jun. 27, 2016
Jun. 30, 2018
USD ($)
Jun. 30, 2017
USD ($)
Mar. 31, 2018
USD ($)
Payment of retainer services                         $ 24,000    
Accounts payable                         245,143   $ 230,553
Common Stock [Member]                              
Payment of retainer services                         1    
Channel Sales And Consulting Llc [Member]                              
Consulting agreement, description                       The Company has agreed to pay Channel $3,000 per month for the first two months, and $4,000 per month thereafter. Channel will also be paid a 10% commission on all gross sales generated through a licensed dealer and 30% commission on non-licensed dealers.      
Sale of stock, description of transaction                       If within the first twelve months of the Agreement, Channel generates gross sales above $2,000,000, the Company will pay an additional 5% commission on gross sales, either in cash or restricted common stock.      
Standard Office Lease [Member]                              
Area of land | ft²                     1,700        
Lease, term                     1 year        
Rental expenses                 $ 1,400   $ 1,400   $ 16,800 $ 16,800  
Ten Associates LLC [Member]                              
Lease, term                   6 months          
Rental expenses                   $ 3,000          
Stock Vest [Member]                              
Consulting agreement, description         The contract term through August 1, 2017.     The company entered into an Investor Relations Consulting Agreement with StockVest that covered the period from April 1, 2017 through July 1, 2017.              
Issuance of restricted common stock, shares | shares         53,333     13,333              
Hanson And Associates [Member]                              
Lease, term             3 months                
Payment of retainer services             $ 15,000                
Monthly fee             5,000                
Stock issued during period ,value             $ 25,000                
Term of agreement             6 months                
Greg Rogers [Member]                              
Payment of retainer services           $ 10,500                  
Monthly fee           $ 3,500                  
Term of agreement           6 months                  
Outstanding balance     $ 1,300                        
Greg Rogers [Member] | Common Stock [Member]                              
Stock issued during period ,value           $ 25,000                  
Gary Tilden [Member]                              
Monthly fee       $ 2,500                      
Accuring interest rate       6.00%                      
Haseltine Law Group [Member]                              
Payment of retainer services   $ 5,000                          
Unissued Shares, Value                             5,000
Unpaid Fees                             2,500
Accounts payable                             7,500
Jump Television Studios Llc [Member]                              
Payment of retainer services $ 30,000                            
Unissued Shares, Value                             250,000
Accounts payable                             $ 83,333
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