Derivative Liability and Fair Value Measurements (Tables)

12 Months Ended

Aug. 31, 2021

Notes to Financial Statements

Fair Value, Assets Measured on Recurring Basis

Items recorded or measured at fair value on a recurring basis in the accompanying financial statements consisted of the following items as of August 31, 2021 and August 31, 2020:

	August 31, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Derivative liability	$	4,747,614	$	—	$	—	$	4,764,614

	August 31, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Derivative liability	$	1,125,803	$	—	$	—	$	1,125,803

Summary of changes in fair value of Level 3 financial liabilities

The following table provides a summary of changes in fair value of the Company’s Level 3 financial liabilities for the fiscal year ending August 31, 2021:

Balance, August 31, 2020	$	1,125,803
Transfers in due to issuance of convertible promissory notes		7,452,815
Transfers out due to repayments of convertible promissory notes		(1,850,488	)
Transfers out due to conversions of convertible promissory notes		(1,808,944	)
Change in fair value of derivative liability		(171,572	)
Balance, August 31, 2021	$	4,764,614