2. Significant Accounting Policies (Policies)

9 Months Ended

Dec. 31, 2014

Accounting Policies [Abstract]

Principles of Consolidation

a) Principles of Consolidation

The condensed consolidated financial statements include the consolidated operations of American Sands Energy Corp. and its wholly owned subsidiary Green River Resources Inc. (“GRI”). All significant intercompany balances and transactions have been eliminated in consolidation.

Mineral Leases

b) Mineral Leases

In certain cases, the Company capitalizes costs related to investments in mineral lease interests. Such costs include mineral lease acquisition costs. Costs are deferred until such time as the extent of proved developed reserves has been determined and mineral lease interests are either developed, the property sold or the mineral lease rights are allowed to lapse. To date, all exploration and lease costs have been expensed.

Research and Development

c) Research and Development

The Company continues to develop additional technology related to its proprietary bitumen extraction process. To date, the Company has expensed costs associated with developing its technology as research and development costs. For the nine months ended December 31, 2014 and 2013, the Company incurred costs of $472,126 and $374,138, respectively, for research and development of its technologies.

Stock-based Compensation

d) Stock-based Compensation

The Company uses the Black-Scholes option-pricing model to determine the fair value of stock options and warrants granted. For employee stock options, the Company records the grant-date fair value as expense over the period in which it is earned, typically the vesting period. For consultants, the fair value of the stock-based award is recorded as expense over the term of the service period, and unvested amounts are revalued using the Black-Scholes model at each reporting period. For warrants issued to lenders, the Company records the grant-date fair value of the warrants, and any resulting beneficial conversion feature for convertible debt, as a debt discount. The discount is then amortized over the term of the convertible debt as non-cash interest expense.

Net Loss Per Common Share

e) Net Loss Per Common Share

Basic earnings or loss per common share is computed on the basis of the weighted average number of shares outstanding during the periods. Diluted earnings or loss per common share is calculated on the basis of the weighted average number of common shares outstanding during the period plus the effect of dilutive common share equivalents during the period. Common share equivalents include preferred stock, outstanding stock options and warrants and convertible debt instruments. For periods in which a net loss is reported, common share equivalents are excluded because they are antidilutive. Therefore, basic loss per common share is the same as diluted loss per common share for the three and nine months ended December 31, 2014 and 2013. As of December 31, 2014 and 2013, the Company had cumulative, undeclared, dividends that had not been accrued related to its preferred stock of $323,617 and $0, respectively. For the three months ended December 31, 2014 and 2013, the Company had accrued preferred stock dividends of $106,137 and $0, respectively, which were added to net loss in the consolidated statements of operations in order to calculate net loss per common share attributable to common stockholders. For the nine months ended December 31, 2014 and 2013, the Company had accrued preferred stock dividends of $276,214 and $0, respectively, which were added to net loss in the consolidated statements of operations in order to calculate net loss per common share attributable to common stockholders.

Recent Accounting Pronouncements

f) Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date.  If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption.

In June 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-10, Development Stage Entities. The amendments in ASU 2014-10 remove the definition of a development stage entity from Topic 915, Development Stage Entities, thereby removing the distinction between development stage entities and other reporting entities from US GAAP. In addition, the amendments eliminate the requirements for development stage entities to (1) present inception-to-date information in the statements of operations, cash flows, and stockholders’ equity, (2) label the financial statements as those of a development stage entity, (3) disclose a description of the development stage activities in which the entity is engaged, and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage. The amendments also clarify that the guidance in Topic 275, Risks and Uncertainties, is applicable to entities that have not commenced planned principal operations. ASU 2014-10 is effective for annual reporting periods beginning after December 15, 2014, and interim periods therein, but early adoption is permitted.

The Company adopted ASU 2014-10 effective April 1, 2014. As a result, the Company has removed inception-to-date information in the Company’s statements of operations, cash flows, and stockholders’ equity.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers. The amendments in ASU 2014-09 affect any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards (e.g., insurance contracts or lease contracts). ASU 2014-09 will supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance, and creates a Topic 606, Revenue from Contracts with Customers.

The core principle of the guidance is that an entity should recognize 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. To achieve that core principle, an entity should apply the following steps:

Step 1: Identify the contract(s) with a customer.

Step 2: Identify the performance obligations in the contract.

Step 3: Determine the transaction price.

Step 4: Allocate the transaction price to the performance obligations in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. Until the Company begins to recognize revenue, its financial statements will not be affected by the adoption of ASU 2014-09.