10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2018

OR

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to __________

Commission File Number: 333-167667

TWO HANDS CORPORATION

 (Exact name of registrant as specified in its charter)

Delaware	42-1770123
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)
33 Davis Avenue, Level 2 Toronto, Ontario, Canada   (Address of Principal Executive Offices)	M4M 2A9 (Zip Code)

(416) 357-0399

(Registrant's telephone number, including area code)

N/A

 (Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 ¨

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 ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
Emerging growth company	¨

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

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date:  As of November 14, 2018, the issuer had 145,199,289 shares of its common stock issued and outstanding, par value $0.0001 per share.

1

TWO HANDS CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED SEPTEMBER 30, 2018

TABLE OF CONTENTS

PART I		PAGE
Item 1.	Financial Statements (Unaudited)	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	20
Item 4.	Controls and Procedures	20
PART II
Item 1.	Legal Proceedings	21
Item 1A.	Risk Factors	21
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	21
Item 3.	Defaults Upon Senior Securities	21
Item 4.	Mining Safety Disclosures	21
Item 5.	Other Information	21
Item 6.	Exhibits	22
	Signatures	23

2

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

TWO HANDS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
			September 30, 2018	December 31, 2017
ASSETS			(Unaudited)
Current assets
	Cash		$ 5,413	$ 18,771
	Accounts receivable, net		33,832	-
	Prepaid expense		1,152,465	-
		Total current assets	1,191,710	18,771
Property and equipment, net			2,629	1,694
Total assets			$ 1,194,339	$ 20,465
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities
	Accounts payable and accrued liabilities		$ 87,671	$ 251,679
	Non-redeemable convertible notes, net of unamortized debt discount of $34,259 and $0, respectively		456,051	164,763
	Notes payable		75,691	258,995
	Due to related party		34,412	41,734
		Total current liabilities	653,825	717,171
Total liabilities			653,825	717,171
Commitments and Contingencies			-	-
Stockholder's equity (deficit)
	Preferred stock; $0.001 par value; 1,000,000 shares authorized, 0 issued and outstanding		-	-
	Common stock; $0.0001 par value; 3,000,000,000 shares authorized, 145,199,289 and 812,435 shares issued and outstanding, respectively		14,520	81
	Shares to be issued		61,638	469,218
	Additional paid-in capital		30,620,754	23,288,457
	Accumulated deficit		(30,156,398)	(24,454,462)
	Total stockholders' equity (deficit)		540,514	(696,706)
Total liabilities and stockholders' equity (deficit)			$ 1,194,339	$ 20,465

The accompanying footnotes are an integral part of these financial statements.

3

TWO HANDS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
		Three months ended September 30,		Nine months ended September 30,
		2018	2017	2018	2017
Sales		$ 77,631	$ -	$ 352,788	$ -
Operating expenses
	Bad debts	-	-	6,200	-
	General and administrative	478,824	50,726	872,473	345,611
	Stock-based compensation - services	1,745,800	-	1,745,800	-
	Stock-based compensation - salaries	663,638	231,500	1,126,638	232,250
Total expenses		2,888,262	282,226	3,751,111	577,861
Loss from operations		(2,810,631)	(282,226)	(3,398,323)	(577,861)
Other income (loss)
	Amortization of debt discount and interest expense	(28,754)	(7,255)	(74,493)	(21,529)
	Loss on settlement of debt	(1,904,700)	-	(2,229,100)	-
		(1,933,454)	(7,255)	(2,303,593)	(21,529)
Net loss for the period		$ (4,744,085)	$ (289,481)	$ (5,701,916)	$ (599,390)
Net loss per common share - basic		$ (0.15)	$ (0.36)	$ (0.50)	$ (0.74)
Weighted average number of common shares outstanding - basic		31,688,421	812,635	11,292,634	812,435

The accompanying footnotes are an integral part of these financial statements.

4

		TWO HANDS CORPORATION
		CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
		(Unaudited)
			Nine months ended September 30,
			2018	2017
Cash flows from operating activities
	Net loss for the period		$ (5,701,936)	$ (599,390)
	Adjustments to reconcile net loss
	to cash (used in) provided by operating activities
		Depreciation and amortization	808	41
		Bad debt	6,200	-
		Stock-based compensation	2,872,438	232,250
		Amortization of debt discount	74,493	21,529
		Loss on settlement of debt	2,229,100	-
	Change in operating assets and liabilities
		Accounts receivable	(40,032)	10,188
		Prepaid expense	285,335	(7,400)
		Accounts payable and accrued liabilities	73,610	200,551
		Net cash used in operating activities	(199,984)	(142,231)
Cash flows from investing activities
		Purchase of fixed assets	(1,743)	(1,978)
		Net cash used in investing activities	(1,743)	(1,978)
Cash flow from financing activities
		Advance by related party	59,668	35,522
		Repayment of advances to related party	(66,990)	(6,443)
		Proceeds from notes payable	195,691	119,195
		Net cash provided by financing activities	188,369	148,274
Net change in cash			(13,358)	4,065
Cash, beginning of the period			18,771	1,280
Cash, end of the period			$ 5,413	$ 5,345
Cash paid during the period
		Interest paid	$ -	$ -
		Income taxes paid	$ -	$ -
Supplemental disclosure of non-cash investing and financing activities
		Issue of share for prepaid expense	$ 1,437,800	$ -
		Issue of shares to settle accounts payable and accrued liabilities	$ 237,616	$ -
		Issue of convertible notes to settle notes payable	$ 378,995	$ -
		Issue of shares to settle non-redeemable convertible notes	$ 162,200	$ -
		Issue of shares to settle shares to be issued	$ 932,218	$ -

The accompanying footnotes are an integral part of these financial statements.

5

TWO HANDS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Two Hands Corporation (formerly Innovative Product Opportunities Inc.)  (the "Company") was incorporated on April 3, 2009 in the State of Delaware and established a fiscal year end of December 31.  

From inception (April 3, 2009) until June 30, 2014 our business was a product development firm creating products designed, prototyped and produced in numerous industries including consumer and household goods, office products, furniture, and toys.

On March 1, 2012 the Company entered into a license agreement with Szar International, Inc. (dba Cigar & Spirits Magazine) (“Cigar & Spirits”). The agreement granted the Company the right to market the products of Cigar & Spirits including but not limited to the sales, promotion, and advertising vehicles of the Magazine. On July 8, 2013, The Company received written notice that Cigar & Spirits will cancel the license agreement on August 1, 2013.

Since July 1, 2014, our business is a research and product development firm.  Over the past few years we have specialized in computer vision and gesture recognition technologies.  We have leveraged our relationship with our product development team of programmers and designers to implement our vision for building a state of the art co-parenting application.

The Two Hands Application launched on July 25, 2018.

The Company is also in the business of working with other independent contractors to build brand awareness campaigns for clients and their products. The Company provides assistance in building brand awareness for the products it sells through its internet website, out-of-home, mobile, online and other media outlets as required. Additionally, the Company develops the creative media to support the client’s media buys. The Company also assists Clients in developing and assisting in matters of developing brand strategies and discussions pertaining thereof. The Company executes and/or oversee the research, planning, pricing, creative development, tracking and deployment of all online and out-of-home advertising projects needed to promote client products and services.

The operations of the business are carried on by a 100% owned subsidiary, I8 Interactive Corporation, a company incorporated under the laws of Canada.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying financial statements of Two Hands Corporation have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission requirements for interim financial statements. Therefore, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The financial statements should be read in conjunction with the annual financial statements for the year ended December 31, 2017 of Two Hands Corporation in our Form 10-K filed on March 29, 2018.

The interim financial statements present the balance sheets, statements of operations and cash flows of Two Hands Corporation.  The financial statements have been prepared in accordance with accounting principles generally accepted in the United States.

The interim financial information is unaudited. In the opinion of management, all adjustments necessary to present fairly the financial position as of September 30, 2018 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are of a normal and recurring nature.  Interim results are not necessarily indicative of results of operations for the full year.

Reclassifications

On the condensed consolidated statement of cash flows for the nine months ended September 30, 2017, expenses paid by third party and expenses paid by related party of $21,265 and $35,522, respectively, totaling $56,787 were reclassified from cash flows from operating activities to cash flows from financing activities. As a result, cash flows from financing activities was increased by $56,787 and cash flows from operating activities was decreased by $56,787.

6

GOING CONCERN

The Company's financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business.  During the nine months ended September 30, 2018, the Company incurred a net loss of $5,701,936 and used cash in operating activities of $199,984, and at September 30, 2018, had a stockholders’ equity of $540,514. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued.   The Company will be dependent upon the raising of additional capital through placement of its common stock in order to implement its business plan. There can be no assurance that the Company will be successful in this situation.  Accordingly, these factors raise substantial doubt as to the Company's ability to continue as a going concern.  These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classifications of liabilities that might result from this uncertainty. The Company is funding its initial operations by way of loans from its Chief Executive Officer and others, and the use of equity to pay some operating expenses.  The Company's officers and directors have committed to advancing certain operating costs of the Company.

PRINCIPLES OF CONSOLIDATION

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, I8 Interactive Corporation. All intercompany transactions and balances have been eliminated in consolidation.

USE OF ESTIMATES AND ASSUMPTIONS

Preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.

CASH AND CASH EQUIVALENTS

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

PROPERTY AND EQUIPMENT

Property and equipment is stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to expense when incurred, while renewals and betterments that materially extend the life of an asset are capitalized.

The costs of assets sold, retired, or otherwise disposed of, and the related allowance for depreciation, are eliminated from the accounts, and any resulting gain or loss is recognized in the results from operations. Depreciation is provided over the estimated useful lives of the assets, which are as follows:

Computer equipment

50% declining balance

In the year of acquisition, one half the normal rate of depreciation is provided.

REVENUE RECOGNITION

In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods or services. The provisions of ASC 606 include a five-step process by which we determine revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which we expect to be entitled in exchange for those goods or services. ASC 606 requires us to apply the following steps: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, we satisfy the performance obligation.

7

INCOME TAXES

The Company accounts for income taxes in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("FASB ASC") 740, Income Taxes. Under the assets and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value.

NET LOSS PER SHARE

Basic net income (loss) per share includes no dilution and is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period.  Diluted earnings per share is computed by dividing earnings available to common shareholders by the weighted average number of common shares outstanding for the period increased to include the number of additional common shares that would have been outstanding if potentially dilutive securities had been issued. At September 30, 2018 and December 31, 2017, we excluded the common stock issuable upon conversion of convertible promissory notes of 4,681,502,947 shares and 412,602 shares, respectively, as their effect would have been anti-dilutive.

FOREIGN CURRENCY TRANSLATION

The financial statements are presented in the Company’s functional currency which is the United States dollars.  In accordance with FASB ASC 830, Foreign Currency Matters, foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date.  Non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expenses are translated at average rates of exchange during the periods presented.  Related translation adjustments are reported as a separate component of stockholders' deficit, whereas gains or losses resulting from foreign currency transactions are included in results of operations.

STOCK-BASED COMPENSATION

The Company measures stock-based compensation at the grant date based on the fair value of the award and recognizes stock-based compensation expense over the requisite service period.

The Company also grants awards to non-employees and determines the fair value of such stock-based compensation awards granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty's performance is completed.

The Company has not adopted a stock option plan and has not granted any stock options.

COMPREHENSIVE INCOME (LOSS)

The Company has adopted ASC Topic 220 - Comprehensive Income, which establishes standards for reporting and the display of comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners or distributions to owners. Among other disclosures, Topic 220 requires that all items that are required to be recognized under the current accounting standards as a component of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. Comprehensive income is displayed in the statement of stockholders' deficit and in the balance sheet as a component of stockholders' deficit.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company’s financial instruments such as cash, accounts and sundry receivable, accounts payable and accrued liabilities, non-redeemable convertible notes, notes payable and due to related parties are reported at cost, which approximates fair value due to the short term nature of these financial instruments.

8

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers.  ASU 2014-09 is a comprehensive revenue recognition standard that will supersede nearly all existing revenue recognition guidance under current U.S. GAAP and replace it with a principle based approach for determining revenue recognition.  ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract.  The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.  In addition, during 2016 the FASB has issued ASU 2016-08, ASU 2016-10 and ASU 2016-12, all of which clarify certain implementation guidance within ASU 2014-09, and ASU 2016-11, which rescinds certain SEC guidance effective upon an entity’s adoption of ASU 2014-09.  ASU 2014-09 is effective for interim and annual periods beginning after December 15, 2017.  Early adoption is permitted only in annual reporting periods beginning after December 15, 2016, including interim periods therein.  The standard can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption.  The Company adopted ASU 2014-09 in the first quarter of fiscal 2018 under the modified retrospective approach. ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in the Company’s condensed consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases.  ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months.  ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018.  Early adoption is permitted.  A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  The Company does not anticipate a material impact to its condensed consolidated financial statements on adopting ASU 2016-02. However, the ultimate impact of adopting ASU 2016-02 will depend on the Company’s lease portfolio as of the adoption date.

In June 2018, the FASB issued ASU 2018-07—Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees subject to certain exceptions. ASC 2018-07 expands the scope of ASC Topic 718, Compensation-Stock Compensation (“ASC 718”) to include share-based payments granted to nonemployees in exchange for goods or services used or consumed in an entity’s own operations and supersedes the guidance in ASC 505-50 by moving it to ASC 718. This amendment is effective beginning January 1, 2019. Early adoption is permitted, but no earlier than an entity’s adoption date of ASC 606. The Company adopted ASU 2018-07 with respect to grants of shares of common stock of the Company made in June 2018.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

9

NOTE 3 – NON-REDEEMABLE CONVERTIBLE NOTES

On June 10, 2014, the Company agreed to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable issued to The Cellular Connection Ltd. during the period from February 22, 2013 to June 10, 2014 with a total carrying value $42,189. The issue price of the Note is $42,189 with a face value of $54,193 and the Note has a maturity date of December 31, 2014. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $200.00 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. On June 20 and 26, 2014 the Company elected to convert $5,500 of principal into 27.5 shares of the Company's common stock. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2015, the face value increased by 20% and the maturity date was extended to December 31, 2015. From January 1 to December 31, 2015, the Company elected to convert $31,932 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 319.32 shares of common stock of the Company at a fixed conversion price of $100.00 per share. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2016, the face value increased by 20% and the maturity date was extended to December 31, 2016. On March 21, 2016 the Company elected to convert $16,750 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 167.5 shares of common stock of the Company at a fixed conversion price of $100.00 per share. On September 1, 2016 the Company elected to convert $2,000 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 40,000 shares of common stock of the Company at a fixed conversion price of $0.05 per share. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2017, the face value increased by 20% and the maturity date was extended to December 31, 2017. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2018, the face value increased by 20% and the maturity date was extended to December 31, 2018. On February 7, 2018 the Company elected to convert $2,000 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 40,000 shares of common stock of the Company at a fixed conversion price of $0.05 per share. This conversion resulted in a loss on debt settlement of $150,000 due to the requirement to record the share issuance at fair value on the date the shares were issued (February 7, 2018). On May 22, 2018 the Company elected to convert $2,600 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 52,000 shares of common stock of the Company at a fixed conversion price of $0.05 per share. This conversion resulted in a loss on debt settlement of $114,400 due to the requirement to record the share issuance at fair value on the date the shares were issued (May 22, 2018). On September 10, 2018 the Company elected to convert $1,100 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 11,000,000 shares of common stock of the Company at a fixed conversion price of $0.0001 per share. This conversion resulted in a loss on debt settlement of $330,000 due to the requirement to record the share issuance at fair value on the date the shares were issued (September 10, 2018). On September 25, 2018 the Company elected to convert $500 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 5,000,000 shares of common stock of the Company at a fixed conversion price of $0.0001 per share. This conversion resulted in a loss on debt settlement of $1,249,500 due to the requirement to record the share issuance at fair value on the date the shares were issued (September 25, 2018).The condensed consolidated statement of operations includes interest expense of $789 and $2,343 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $11,803 (face value of $12,592 less $789 unamortized discount) and $15,660 (face value of $15,660 less $0 unamortized discount), respectively.

10

On September 1, 2016, Doug Clark, former Chief Executive Officer and related party, assigned the Side Letter Agreement (“Note”) dated June 10, 2014 with a total carrying value $382,016 to DC Design Inc. (“DC Design”). In addition on September 1, 2016, the Company entered into an amended Side Letter Agreement with DC Design to amend and add certain terms to the Side Letter Agreement and advances from the period from June 25, 2014 to December 24, 2014. Under the terms of the amended Side Letter Agreement, the issue price of the Note is $174,252 with an interest rate 20% per annum and maturity date of December 31, 2017. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $1.50 per share of the Company’s common stock. The modification of the Note has been accounted for as debt extinguishment and the issuance of a new debt instrument. Accordingly, in connection with extinguishment of the original debt, the Company recognized a $207,764 gain with a related party as an increase in additional paid-in capital in the condensed consolidated statement of equity. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the note.  On September 1, 2016 the Company elected to convert $60,000 of principal and interest of the non-redeemable convertible note due to DC Design into 40,000 shares of common stock of the Company at a fixed conversion price of $1.50 per share. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2018, the face value increased by 20% and the maturity date was extended to December 31, 2018. On May 22, 2018 the Company elected to convert $120,000 of principal and interest of a non-redeemable convertible note due to DC Design into 80,000 shares of common stock of the Company at a fixed conversion price of $1.50 per share. This conversion resulted in a loss on debt settlement of $60,000 due to the requirement to record the share issuance at fair value on the date the shares were issued (May 22, 2018). On September 10, 2018 the Company elected to convert $36,000 of principal and interest of a non-redeemable convertible note due to DC Design into 12,000,000 shares of common stock of the Company at a fixed conversion price of $0.003 per share. This conversion resulted in a loss on debt settlement of $325,200 due to the requirement to record the share issuance at fair value on the date the shares were issued (September 10, 2018).The condensed consolidated statement of operations includes interest expense of $7,516 and $22,304 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $15,407 (face value of $22,923 less $7,516 unamortized discount) and $149,103 (face value of $149,103 less $0 unamortized discount), respectively.

On January 8, 2018, the Company entered into a Side Letter Agreement (“Note”) with The Cellular Connection Ltd., to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $14,930 issued by the Company during the period of June 2014 and December 2017. The issue price of the Note is $14,930 with a face value of $17,916 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full.The condensed consolidated statement of operations includes interest expense of $767 and $2,219 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $17,149 (face value of $17,916 less $767 unamortized discount) and $0, respectively.

On January 8, 2018, the Company entered into a Side Letter Agreement (“Note”) with Stuart Turk, to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $244,065 issued by the Company during the period of July 2014 and December 2017. The issue price of the Note is $244,065 with a face value of $292,878 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $12,544 and $36,269 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $280,335 (face value of $292,879 less $12,544 unamortized discount) and $0, respectively.

11

On April 12, 2018, the Company entered into a Side Letter Agreement (“Note”) with Jordan Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $45,000 issued by the Company during the period of March 19, 2018 to April 12, 2018. The issue price of the Note is $45,000 with a face value of $54,000 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $3,149 and $5,851 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $50,851 (face value of $54,000 less $3,149 unamortized discount) and $0, respectively.

On May 10, 2018, the Company entered into a Side Letter Agreement (“Note”) with Jordan Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $35,000 issued by the Company on May 9, 2018. The issue price of the Note is $35,000 with a face value of $42,000 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $2,741 and $4,259 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $39,259 (face value of $42,000 less $2,741 unamortized discount) and $0, respectively.

On September 13, 2018, the Company entered into a Side Letter Agreement (“Note”) with Jordan Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $40,000 issued by the Company during the period of July 10 to September 13, 2018. The issue price of the Note is $40,000 with a face value of $48,000 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $1,248 and $1,248 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $41,247 (face value of $48,000 less $6,753 unamortized discount) and $0, respectively.

NOTE 4 – NOTES PAYABLE

As of September 30, 2018 and December 31, 2017 notes payable due to Stuart Turk, Jordan Turk and The Cellular Connection Limited, a corporation controlled by Stuart Turk, totaling $75,691 and $258,995, respectively, were outstanding. The balances are non-interest bearing, unsecured and have no specified terms of repayment.

NOTE 5 – RELATED PARTY TRANSACTIONS

As of September 30, 2018 and December 31, 2017 advances of $34,412 and $41,734, respectively, were due to Nadav Elituv, the Company's Chief Executive Officer. The balance is non-interest bearing, unsecured and have no specified terms of repayment.

Employment Agreements

On July 1, 2016, the Company executed an employment agreement for the period from July 1, 2016 to June 30, 2017 with Nadav Elituv, the Chief Executive Officer of the Company whereby the Company shall pay 15 shares of Common Stock of the Company with a fair value of $1,500 ($100.00 per share) and an annual salary of $360,000 payable monthly on the first day of each month from available funds.

12

On July 1, 2017, the Company executed an employment agreement for the period from July 1, 2017 to June 30, 2018 with Nadav Elituv, the Chief Executive Officer of the Company whereby the Company shall pay 20,000 shares of Common Stock of the Company with a fair value of $926,000 ($46.30 per share).

On September 10, 2018, the Company executed an employment agreement for the period from July 1, 2018 to June 30, 2019 with Nadav Elituv, the Chief Executive Officer of the Company whereby the Company shall pay 50,000,000 shares of Common Stock of the Company and an annual salary of $151,200 payable monthly on the first day of each month from available funds.

Stock-based compensation – salaries expense related to these employment agreements for the nine months ended September 30, 2018 and 2017 is $1,126,638 and $232,250, respectively. Stock-based compensation – salaries expense is recognized ratably over the requisite service period.

NOTE 6 - STOCKHOLDERS’ DEFICIT

The Company is authorized to issue an aggregate of 3,000,000,000 common shares with a par value of $0.0001 per share and 1,000,000 shares of preferred stock with a par value of $0.0001 per share. No preferred shares have been issued.

Effective August 14, 2018, the Company’s Board of Directors and a majority of the shareholders of the Company amended the Company’s Articles of Incorporation to) effect a 1-for-500 reverse common stock split. All common stock share and per-share amounts for all periods presented in these consolidated financial statements have been adjusted retroactively to reflect the reverse stock split.

On February 7, 2018 the Company elected to convert $2,000 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 40,000 shares of common stock of the Company valued at $152,000 ($3.80 per share) at a fixed conversion price of $0.05 per share. The conversion resulted in a loss on settlement of debt of $150,000.

On February 7, 2018, the Company issued 50,000 shares of common stock valued at $190,000 ($3.80 per share) to settle accrued liabilities for salary of $180,000 and shares to be issued of $10,000 due to the Nadav Elituv, the Chief Executive Officer of the Company.

On May 22, 2018 the Company elected to convert $2,600 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 52,000 shares of common stock of the Company valued at $117,000 ($2.25 per share) at a fixed conversion price of $0.05 per share. The conversion resulted in a loss on settlement of debt of $114,400.

On May 22, 2018 the Company elected to convert $120,000 of principal and interest of a non-redeemable convertible note due to DC Design Inc. into 80,000 shares of common stock of the Company valued at $180,000 ($2.25 per share) at a fixed conversion price of $1.50 per share. The conversion resulted in a loss on settlement of debt of $60,000.

On May 22, 2018, the Company issued 17,431 shares of common stock to settle shares to be issued (stock payable) valued at $922,218, which has been recorded over the contract period ended June 30, 2018, for stock based compensation due to the Nadav Elituv, the Chief Executive Officer of the Company.

On May 22, 2018, the Company issued 25,607 shares of common stock valued at $57,616 ($2.25 per share) for accounts payable of $57,616.

On June 26, 2018, the Company issued 120,000 shares of common stock valued at $294,000 ($2.45 per share) for the services to be provided in a period of June 26, 2018 to December 31, 2018.

On September 10, 2018 the Company elected to convert $1,100 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 11,000,000 shares of common stock of the Company valued at $331,100 ($0.0301 per share) at a fixed conversion price of $0.0001 per share. The conversion resulted in a loss on settlement of debt of $330,000.

On September 10, 2018 the Company elected to convert $36,000 of principal and interest of a non-redeemable convertible note due to DC Design Inc. into 12,000,000 shares of common stock of the Company valued at $361,200 ($0.0301 per share) at a fixed conversion price of $0.003 per share. The conversion resulted in a loss on settlement of debt of $325,200.

13

On September 10, 2018, the Company issued 20,000,000 shares of common stock valued at $602,000 ($0.0301 per share) to the Nadav Elituv, the Chief Executive Officer of the Company for officer compensation.

On September 10, 2018, the Company issued 18,000,000 shares of common stock valued at $541,800 ($0.0301 per share) for the services to be provided in a period of September 10, 2018 to December 31, 2018.

On September 10, 2018, the Company issued 20,000,000 shares of common stock valued at $602,000 ($0.0301 per share) for the services to be provided in a period of September 10, 2018 to September 10, 2019.

On September 10, 2018, the Company issued 58,000,000 shares of common stock valued at $1,745,800 ($0.0301 per share) for the consulting services.

On September 25, 2018 the Company elected to convert $500 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 5,000,000 shares of common stock of the Company valued at $1,250,000 ($0.2500 per share) at a fixed conversion price of $0.0001 per share. The conversion resulted in a loss on settlement of debt of $1,249,500.

Shares to be issued

As at September 30, 2018 and December 31, 2017, the Company had total shares to be issued of 2,047,782 shares of common stock and 10,062 shares of common stock, respectively, for stock-based compensation –salaries (see Note 5).

NOTE 7 – CONCENTRATION RISK

The company is subject to risk of non-payment on its trade accounts receivable. For the nine months ended September 30, 2018, the company has few customers. One customer represents 100% of the total outstanding accounts receivable and one customer represents 98% of total sales. Management consistently monitors its client credit terms with customers to reduce credit risk exposure.

14

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report on Form 10-Q contains "forward-looking statements" that involve risks and uncertainties.  You should not place undue reliance on these forward-looking statements.  Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including the risks described in our Form 10-K filed on March 29, 2018, and other filings we make with the Securities and Exchange Commission.  Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made. We do not intend to update any of the forward-looking statements after the date of this report to conform these statements to actual results or to changes in our expectations, except as required by law.

The following discussion and analysis of financial condition and results of operations is based upon, and should be read in conjunction with our audited financial statements and related notes thereto included elsewhere in this report, and in our Form 10-K filed on March 29, 2018.

BUSINESS OVERVIEW

Two Hands Corporation (formerly Innovative Product Opportunities Inc.)  (the "Company") was incorporated on April 3, 2009 in the State of Delaware and established a fiscal year end of December 31.  

Effective August 14, 2018, the Company’s Board of Directors and a majority of the shareholders of the Company amended the Company’s Articles of Incorporation to) effect a 1-for-500 reverse common stock split. All common stock share and per-share amounts for all periods presented in these consolidated financial statements have been adjusted retroactively to reflect the reverse stock split.

From inception (April 3, 2009) until June 30, 2014 our business was a product development firm creating products designed, prototyped and produced in numerous industries including consumer and household goods, office products, furniture, and toys

On March 1, 2012 the Company entered into a license agreement with Szar International, Inc. (dba Cigar & Spirits Magazine) (“Cigar & Spirits”). The agreement granted the Company the right to market the products of Cigar & Spirits including but not limited to the sales, promotion, and advertising vehicles of the Magazine. On July 8, 2013, The Company received written notice that Cigar & Spirits will cancel the license agreement on August 1, 2013.

Since July 1, 2014, our business is a research and product development firm.  Over the past few years we have specialized in computer vision and gesture recognition technologies.  We have leveraged our relationship with our product development team of programmers and designers to implement our vision for building a state of the art co-parenting application.

The Two Hands Application launched on July 25, 2018.

The Company is also in the business of working with other independent contractors to build brand awareness campaigns for clients and their products. The Company provides assistance in building brand awareness for the products it sells through its internet website, out-of-home, mobile, online and other media outlets as required. Additionally, the Company develops the creative media to support the client’s media buys. The Company also assists Clients in developing and assisting in matters of developing brand strategies and discussions pertaining thereof. The Company executes and/or oversee the research, planning, pricing, creative development, tracking and deployment of all online and out-of-home advertising projects needed to promote client products and services.

The operations of the business are carried on by a 100% owned subsidiary, I8 Interactive Corporation, a company incorporated under the laws of Canada.

15

MANAGEMENT'S STRATEGIC VISION

We strive to create a complete co-parenting solution. It is our ultimate goal to improve the lives of families especially the lives of children that are affected by a divorce.

“Two Hands” is the product of years of searching for the ideal solution that will reduce the stress and worries of co-parenting. Our application fulfills our mission and vision that focuses on organization and communication to improve family relationships despite a divorce.

We would like to be recognized as the company that improves family relationships and improved organization and communication between family members.

Our mission is to equip parents with the best tools to be able to communicate with each other in a divorced or separated household.  “Two Hands App” began as an idea to help ease the worries of parents when it comes to co-parenting after a divorce or a separation.

A personal experience has led the creator of the app to come up with a better solution that uses the internet foremost to provide better communication and organization between divorced parties.

After years of collaborating with fellow parents and co-parents, and through the help of our designers and programmers, “Two Hands App” was conceived. It has all the important features that any parent, co-parent or caregiver would ever need to deal with any kind of activity concerning children. “Two Hands App” focuses on reducing the stress of parents and their children.

“Two Hands App” is accessed primarily through the internet which makes it easier to connect to people and manage one or two households at the same time. We have made it possible for the application to be accessed from all kinds of devices and have made it easier to understand even for someone who is not tech savvy.

Our team of designers and developers understand that along with constant changes in technology, the lives of families and children are also changing as well. There is no doubt that we keep abreast with life’s constant changes to provide the best service for co-parents everywhere.

The Two Hands Application launched on July 25, 2018 and currently has approximately 13,000 pre-registered users. We are on-boarding the pre-registered users and new customers.  We continue to further refine the Application for direct use by family law professionals and mediators.

Our user fees for the Two Hands Application are $14.96 per month or $119.88 per year or $215.76 per two year period.

We anticipate earning revenue as users finish their initial 14 free trial period.  

RESULTS OF OPERATIONS

COMPARISON OF RESULTS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017.

REVENUES

Our revenue for the three months ended September 30, 2018 was $77,631, compared to $0 for the three months ended September 30, 2017. The increase in revenue was due to services provided for brand awareness campaigns for clients and their products. During the three months ended September 30, 2018, 100% of revenue was earned from one customer.

COSTS OF GOODS SOLD

Our cost of sales for the three months ended September 30, 2018 and September 30, 2017 was $0.

16

OPERATING EXPENSES

Our general and administrative expense for the three months ended September 30, 2018 was $479,824, compared to $50,726 for the three months ended September 30, 2017, respectively. The increase in general and administrative expense is primarily due to an increase in consulting, salary, investor relations, professional and travel. Included in general and administrative expense for the three months ended September 30, 2018 is salary expense of $37,800 for our Chief Executive Officer.

Stock-based compensation – services for the three months ended September 30, 2018 comprises of 58,000,000 shares of common stock valued at $1,745,800 ($0.0301 per share) for the consulting services.

Stock-based compensation – salaries for the three months ended September 30, 2018 comprises of 20,000,000 shares of common stock valued at $602,000 ($0.0301 per share) and shares to be issued valued at $61,638 for salary to our Chief Executive Officer.

OTHER INCOME (EXPENSE)

Interest expense for the three months ended September 30, 2018 was $28,754, compared to $7,255 for the three months ended September 30, 2017. The increase in interest expense is primarily due to the issuance of five non-redeemable convertible notes on January 8, 2018, January 8, 2018, April 12, 2018, May 10, 2018 and September 13, 2018 with a total issue price of $378,995.

On September 10, 2018 the Company elected to convert $1,100 of principal and interest of a non-redeemable convertible note into 11,000,000 shares of common stock of the Company resulting in a loss on settlement of debt of $330,000.

On September 10, 2018 the Company elected to convert $36,000 of principal and interest of a non-redeemable convertible note into 12,000,000 shares of common stock of the Company resulting in a loss on settlement of debt of $325,200.

On September 25, 2018 the Company elected to convert $500 of principal and interest of a non-redeemable convertible note into 5,000,000 shares of common stock of the Company resulting in a loss on settlement of debt of $1,249,500.

NET INCOME/LOSS

Our net loss for the three months ended September 30, 2018 was $4,745,085, compared to $289,481 for the three months ended September 30, 2017, respectively. Our losses during the three months ended September 30, 2018 and 2017 are due to costs associated with professional fees, our transfer agent, investor relations, stock-based compensation for services and loss on settlement of debt.

COMPARISON OF RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017.

REVENUES

Our revenue for the nine months ended September 30, 2018 was $352,788, compared to $0 for the nine months ended September 30, 2017. The increase in revenue was due to services provided for brand awareness campaigns for clients and their products. During the nine months ended September 30, 2018, 98% of revenue was earned from one customer.

COSTS OF GOODS SOLD

Our cost of sales for the nine months ended September 30, 2018 and September 30, 2017 was $0.

OPERATING EXPENSES

Our general and administrative expense for the nine months ended September 30, 2018 was $872,493, compared to $345,611 for the nine months ended September 30, 2017, respectively. The increase in general and administrative expense is primarily due to an increase in consulting, salary, investor relations, professional and travel. Our bad debt expenses for the nine months ended September 30, 2018 was $6,200 compared to $0 for the nine months ended September 30, 2017. Included in general and administrative expense for the nine months ended September 30, 2018 is salary expense of $37,800 for our Chief Executive Officer,

Stock-based compensation – services for the nine months ended September 30, 2018 comprises of 58,000,000 shares of common stock valued at $1,745,800 ($0.0301 per share) for the consulting services.

17

Stock-based compensation – salaries for the nine months ended September 30, 2018 comprises of 20,010,000 shares of common stock valued at $1,065,000 and shares to be issued valued at $61,638 for salaries to our Chief Executive Officer.

OTHER INCOME (EXPENSE)

Interest expense for the nine months ended September 30, 2018 was $74,493, compared to $21,529 for the nine months ended September 30, 2017. The increase in interest expense is primarily due to the issuance of five non-redeemable convertible notes on January 8, 2018, January 8, 2018, April 12, 2018, May 10, 2018 and September 13, 2018 with a total issue price of $378,995.

On February 7, 2018 the Company elected to convert $2,000 of principal and interest of a non-redeemable convertible note into 40,000 shares of common stock of the Company resulting in a loss on settlement of debt of $150,000.

On May 22, 2018 the Company elected to convert $2,600 of principal and interest of a non-redeemable convertible note into 52,000 shares of common stock of the Company resulting in a loss on settlement of debt of $114,400.

On May 22, 2018 the Company elected to convert $120,000 of principal and interest of a non-redeemable convertible note into 80,000 shares of common stock of the Company resulting in a loss on settlement of debt of $60,000.

On September 10, 2018 the Company elected to convert $1,100 of principal and interest of a non-redeemable convertible note into 11,000,000 shares of common stock of the Company resulting in a loss on settlement of debt of $330,000.

On September 10, 2018 the Company elected to convert $36,000 of principal and interest of a non-redeemable convertible note into 12,000,000 shares of common stock of the Company resulting in a loss on settlement of debt of $325,200.

On September 25, 2018 the Company elected to convert $500 of principal and interest of a non-redeemable convertible note into 5,000,000 shares of common stock of the Company resulting in a loss on settlement of debt of $1,249,500.

NET INCOME/LOSS

Our net loss for the nine months ended September 30, 2018 was $5,701,936, compared to $599,390 for the nine months ended September 30, 2017, respectively. Our losses during the nine months ended September 30, 2018 and 2017 are due to costs associated with professional fees, our transfer agent, investor relations, stock-based compensation for services and loss on settlement of debt.

LIQUIDITY AND CAPITAL RESOURCES

LIQUIDITY

As of September 30, 2018, we had cash of $5,413 and total liabilities of $653,825.  Our current cash balance and cash flow from operating activities will not be sufficient to fund our operations. We are completely dependent upon the willingness of our management to fund our initial operations by way of loans from our Chief Executive Officer, shareholders and others.

The Company’s financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.  During the nine months ended September 30, 2018, the Company incurred a net loss of $5,701,936 and used cash in operating activities of $199,984, and at September 30, 2018, had a stockholders’ deficit of $540,514. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued.  The Company’s independent registered public accounting firm, in their report on the Company’s financial statements for the year ending December 31, 2017, expressed substantial doubt about the Company’s ability to continue as a going concern.  The Company’s financial statements do not include any adjustments that might result from the outcome of this uncertainty should we be unable to continue as a going concern.

Over the next 12 months we expect to expend approximately $50,000 in cash for legal, accounting and related services and an additional $150,000 in cash to implement our business plan. We hope to be able to compensate our independent contractors with stock-based compensation, which will not require us to use our cash, although there can be no assurances that we will be successful in these efforts.

18

We expect to be able to secure capital through advances from our Chief Executive Officer, note holders, shareholders and others in order to pay expenses such as organizational costs, filing fees, accounting fees and legal fees. We believe it will be difficult to secure capital in the future because we have no assets to secure debt and there is currently no trading market for our securities.  We will need additional capital in the next twelve months and if we cannot raise such capital on acceptable terms, we may have to curtail our operations or terminate our business entirely.

The inability to obtain financing or generate sufficient cash from operations could require us to reduce or eliminate expenditures for developing products and services, or otherwise curtail or discontinue our operations, which could have a material adverse effect on our business, financial condition and results of operations. Furthermore, to the extent that we raise additional capital through the sale of equity or convertible debt securities, the issuance of such securities may result in dilution to existing stockholders. If we raise additional funds through the issuance of debt securities, these securities may have rights, preferences and privileges senior to holders of our common stock and the terms of such debt could impose restrictions on our operations.  Regardless of whether our cash assets prove to be inadequate to meet our operational needs, we may seek to compensate providers of services by issuing stock in lieu of cash, which may also result in dilution to existing stockholders.

OPERATING CAPITAL AND CAPITAL EXPENDITURE REQUIREMENTS

We are currently funding our operations by way of cash advances from our Chief Executive Officer, note holders, shareholders and others.  We hope to be able to compensate our independent contractors with stock-based compensation, which will not require us to use our cash, although there can be no assurances that we will be successful in these efforts.  We expect that we will be required to raise an additional $200,000 in cash by issuing new debt or equity for operating costs in order to implement our business plan in the next twelve months. The funds are loaned to the Company as required to pay amounts owed by the Company.  As such, our operating capital is currently limited to the personal resources of our Chief Executive Officer, note holders, shareholders and others.  The loans from our Chief Executive Officer, note holders, shareholders and others are unsecured and non-interest bearing and have no set terms of repayment. Our common stock started trading over the counter and has been quoted on the Over-The Counter Bulletin Board since February 17, 2011. The stock currently trades under the symbol “TWOH.OB.”

OFF-BALANCE SHEET TRANSACTIONS

We currently have no off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

19

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a Smaller Reporting Company, as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore are not required to provide the information requested by this Item.

ITEM 4T. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

As required by Rule 13a-15 of the Securities Exchange Act of 1934, our principal executive officer and principal financial officer evaluated our company's disclosure controls and procedures (as defined in Rules 13a-15(e) of the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based on this evaluation, our principal executive officer and principal financial officer concluded that as of the end of the period covered by this report, these disclosure controls and procedures were not effective to ensure that the information required to be disclosed by our company in reports it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities Exchange Commission and to ensure that such information is accumulated and communicated to our company's management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. The conclusion that our disclosure controls and procedures were not effective was due to the presence of the following material weaknesses in internal control over financial reporting which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both United States generally accepted accounting principles and Securities and Exchange Commission guidelines. Management anticipates that such disclosure controls and procedures will not be effective until the material weaknesses are remediated.

We plan to take steps to enhance and improve the design of our internal controls over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the following changes during our fiscal year ending December 31, 2018, subject to obtaining additional financing: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out above are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2018 that have materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

20

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

We may be involved from time to time in ordinary litigation, negotiation and settlement matters that will not have a material effect on our operations or finances. We are not aware of any pending or threatened litigation against our Company or our officers and directors in their capacity as such that could have a material impact on our operations or finances.

ITEM 1A. RISK FACTORS

A smaller reporting company is not required to provide the information required by this Item.

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

During the quarter ended September 30, 2018, we did not have any unregistered sales of equity securities.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

During the quarter ended September 30, 2018, we did not have any defaults upon senior securities.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION.

Not applicable.

21

ITEM 6. EXHIBITS

			Incorporated by reference
Exhibit	Exhibit Description	Filed herewith	Form	Period ending	Exhibit	Filing date
3.1	Certificate of Incorporation, dated April 3, 2009	(i)	S-1		3.1	6/22/2010
3.2	Bylaws, dated April 3, 2009	(ii)	S-1		3.2	6/22/2010
3.3	Certificate of Amendment to the Certificate of Incorporation, dated August 8, 2013	(iii)	10-Q		3.3	8/14/2013
4.1	Specimen Stock Certificate	(iv)	S-1		4.1	6/22/2010
4.2	Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock, dated August 6, 2013		10-Q		4.2	8/14/2013
10.1	Innovative Product Opportunities Inc. Trust Agreement		S-1		10.1	6/22/2010
10.2	Side Letter Agreement, The Cellular Connection Ltd., dated January 8, 2018		10-K		10.2	3/29/2018
10.3	Side Letter Agreement, Stuart Turk, dated January 8, 2018		10-K		10.3	3/29/2018
10.4	Side Letter Agreement, Jordan Turk, dated April 12, 2018		10-Q		10.4	5/21/2018
10.5	Side Letter Agreement, Jordan Turk, dated May 10, 2018		10-Q		10.5	5/21/2018
31.1	Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	X
32.1	Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X
101.INS	XBRL Instance Document	X
101.SCH	XBRL Taxonomy Extension Schema Document	X
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document	X
101.LAB	XBRL Taxonomy Extension Label Linkbase Document	X
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document	X
101.DEF	XBRL Taxonomy Extension Definition Linkbase Definition	X

22

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	TWO HANDS CORPORATION
November 16, 2018	By:  /s/ Nadav Elituv Nadav Elituv, Chief Executive Officer and Principal Financial Officer

23

EX-31.1

EXHIBIT 31.1

TWO HANDS CORPORATION

OFFICER'S CERTIFICATE PURSUANT TO SECTION 302

I, Nadav Elituv, certify that:

1.   I have reviewed this Form 10-Q of TWO HANDS 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 our 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 my 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. 

Dated: November 16, 2018

By:  /s/ Nadav Elituv  

Nadav Elituv

President (Principal Executive Officer), Principal Financial Officer and Director

EX-32.1

EXHIBIT 32.1

TWO HANDS CORPORATION

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 TWO HANDS CORPORATION (the Registrant) on Form 10-Q for the period ended September 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Nadav Elituv, Principal  Executive Officer and Principal Financial Officer of the Company, certify,  pursuant to 18 U.S.C.  ss.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(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 results of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to Nadav Elituv and will be retained by TWO HANDS CORPORATION and furnished to the Securities and Exchange Commission or its staff upon request.

Dated:  November 16, 2018

By:  /s/ Nadav Elituv  

Nadav Elituv

President (Principal Executive Officer), Principal Financial Officer and Director

XML

Document and Entity Information	9 Months Ended	114 Months Ended
	Sep. 30, 2018 shares	Sep. 30, 2018 shares
Document and Entity Information:
Entity Registrant Name	TWO HANDS Corp
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Trading Symbol	twoh
Amendment Flag	false
Entity Central Index Key	0001494413
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding	145,199,289	145,199,289
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Entity Incorporation, Date of Incorporation		Apr. 03, 2009
Entity Incorporation, State Country Name		Delaware

XML

TWO HANDS CORPORATION. - Condensed Consolidated Balance Sheets - USD ($)		Sep. 30, 2018	Dec. 31, 2017
Current Assets:
Cash		$ 5,413	$ 18,771
Accounts receivable, net		33,832
Prepaid expense		1,152,465
TOTAL CURRENT ASSETS		1,191,710	18,771
Property and equipment, net		2,629	1,694
Total Assets		1,194,339	20,465
Current Liabilities:
Accounts payable and accrued liabilities		87,671	251,679
Non-redeemable convertible notes, net	[1]	456,051	164,763
Notes payable		75,691	258,995
Due to related party		34,412	41,734
Total Current Liabilities		653,825	717,171
TOTAL LIABILITIES		653,825	717,171
Commitments and Contingencies
Stockholders' Deficit
Preferred stock
Common stock		14,520	40,621
Shares to be issued		61,638	469,218
Additional paid-in capital		30,620,754	23,247,917
Accumulated deficit		(30,156,398)	(24,454,462)
TOTAL STOCKHOLDERS' DEFICIT		540,514	(696,706)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT		$ 1,194,339	$ 20,465

[1] Non-redeemable convertible notes, net of unamortized debt discount of $34,259 and $0, respectively.

XML

Statement of Financial Position - Parenthetical - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Statement of Financial Position
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	1,000,000	1,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par Value	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	3,000,000,000	3,000,000,000
Common Stock, Shares Issued	145,199,289	812,435
Common Stock, Shares Outstanding	145,199,289	812,435

XML

TWO HANDS CORPORATION - Condensed Consolidated Statements of Operations - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement
Sales	$ 77,631		$ 352,788
Operating Expenses:
Bad debts			6,200
General and administrative	479,824	$ 50,726	872,493	$ 345,611
Stock-based compensation- services	1,745,800		1,745,800
Stock-based compensation- salaries	663,638	231,500	1,126,638	232,250
TOTAL EXPENSES	2,889,262	282,226	3,751,131	577,861
Loss from operations	(2,811,631)	(282,226)	(3,398,343)	(577,861)
Other income (loss)
Amortization of debt discount and interest expense	(28,754)	(7,255)	(74,493)	(21,529)
Loss on settlement of debt	(1,904,700)		(2,229,100)
Total other income (expense)	(1,933,454)	(7,255)	(2,303,593)	(21,529)
Net loss for the period	$ (4,745,085)	$ (289,481)	$ (5,701,936)	$ (599,390)
Net loss per comon share- basic	$ (0.15)	$ (0.36)	$ (0.50)	$ (0.74)
Weighted average number of common shares outstanding- basic	31,688,421	812,435	11,292,634	812,435

XML

TWO HANDS CORPORATION - Condensed Consolidated Statements of Cash Flows - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities:
Net loss for the period	$ (5,701,936)	$ (599,390)
Adjustments to reconcile net loss to cash (used in) provided by operating activities:
Depreciation and amortization	808	41
Bad debts	6,200
Stock based compensation	2,872,438	232,250
Amortization of debt discount	74,493	21,529
Loss on settlement of debt, increase decrease	2,229,100
Change in operating assets and liabilities:
Decrease (increase) in accounts receivable	(40,032)	10,188
Decrease (increase) in prepaid expense	285,335	(7,400)
Increase in accounts payable and accrued liabilities	73,610	200,551
Net Cash used in operating activities	(199,984)	(142,231)
Cash flow from investing activities
Purchase of fixed assets	(1,743)	(1,978)
Net cash used in investing activities	(1,743)	(1,978)
Cash flows from financing activities:
Advances by related party	59,668	35,522
Repayment of advances to related party	(66,990)	(6,443)
Proceeds from notes payable	195,691	119,195
Net Cash provided by financing activities	188,369	148,274
Net change in cash	(13,358)	4,065
Cash, beginning of period	18,771	1,280
Cash, end of period	5,413	5,345
Cash paid during the period
Interest paid
Income tax paid
Supplemental disclosure of non-cash investing and financing activities
Issue of shares for prepaid expense	1,437,800
Issue of shares to settle accounts payable and accrued liabilities	237,616
Issue of convertible notes to settle notes payable	378,995
Issue of shares to settle non-redeemable convertible notes	162,200
Issue of shares to settle shares to be issued	$ 932,218

XML

Note 1 - Nature of Operations and Basis of Presentation

9 Months Ended

Sep. 30, 2018

Notes

Note 1 - Nature of Operations and Basis of Presentation

NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Two Hands Corporation (formerly Innovative Product Opportunities Inc.)  (the "Company") was incorporated on April 3, 2009 in the State of Delaware and established a fiscal year end of December 31. 

From inception (April 3, 2009) until June 30, 2014 our business was a product development firm creating products designed, prototyped and produced in numerous industries including consumer and household goods, office products, furniture, and toys.

On March 1, 2012 the Company entered into a license agreement with Szar International, Inc. (dba Cigar & Spirits Magazine) (“Cigar & Spirits”). The agreement granted the Company the right to market the products of Cigar & Spirits including but not limited to the sales, promotion, and advertising vehicles of the Magazine. On July 8, 2013, The Company received written notice that Cigar & Spirits will cancel the license agreement on August 1, 2013.

Since July 1, 2014, our business is a research and product development firm.  Over the past few years we have specialized in computer vision and gesture recognition technologies.  We have leveraged our relationship with our product development team of programmers and designers to implement our vision for building a state of the art co-parenting application.

The Two Hands Application launched on July 25, 2018.

The Company is also in the business of working with other independent contractors to build brand awareness campaigns for clients and their products. The Company provides assistance in building brand awareness for the products it sells through its internet website, out-of-home, mobile, online and other media outlets as required. Additionally, the Company develops the creative media to support the client’s media buys. The Company also assists Clients in developing and assisting in matters of developing brand strategies and discussions pertaining thereof. The Company executes and/or oversee the research, planning, pricing, creative development, tracking and deployment of all online and out-of-home advertising projects needed to promote client products and services.

The operations of the business are carried on by a 100% owned subsidiary, I8 Interactive Corporation, a company incorporated under the laws of Canada.

XML

Note 2 - Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2018

Notes

Note 2 - Summary of Significant Accounting Policies

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying financial statements of Two Hands Corporation have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission requirements for interim financial statements. Therefore, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The financial statements should be read in conjunction with the annual financial statements for the year ended December 31, 2017 of Two Hands Corporation in our Form 10-K filed on March 29, 2018.

The interim financial statements present the balance sheets, statements of operations and cash flows of Two Hands Corporation.  The financial statements have been prepared in accordance with accounting principles generally accepted in the United States.

The interim financial information is unaudited. In the opinion of management, all adjustments necessary to present fairly the financial position as of September 30, 2018 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are of a normal and recurring nature.  Interim results are not necessarily indicative of results of operations for the full year.

Reclassifications

On the condensed consolidated statement of cash flows for the nine months ended September 30, 2017, expenses paid by third party and expenses paid by related party of $21,265 and $35,522, respectively, totaling $56,787 were reclassified from cash flows from operating activities to cash flows from financing activities. As a result, cash flows from financing activities was increased by $56,787 and cash flows from operating activities was decreased by $56,787.

GOING CONCERN

The Company's financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business.  During the nine months ended September 30, 2018, the Company incurred a net loss of $5,701,936 and used cash in operating activities of $199,984, and at September 30, 2018, had a stockholders’ equity of $540,514. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued.   The Company will be dependent upon the raising of additional capital through placement of its common stock in order to implement its business plan. There can be no assurance that the Company will be successful in this situation.  Accordingly, these factors raise substantial doubt as to the Company's ability to continue as a going concern.  These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classifications of liabilities that might result from this uncertainty. The Company is funding its initial operations by way of loans from its Chief Executive Officer and others, and the use of equity to pay some operating expenses.  The Company's officers and directors have committed to advancing certain operating costs of the Company.

PRINCIPLES OF CONSOLIDATION

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, I8 Interactive Corporation. All intercompany transactions and balances have been eliminated in consolidation.

USE OF ESTIMATES AND ASSUMPTIONS

Preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.

CASH AND CASH EQUIVALENTS

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

PROPERTY AND EQUIPMENT

Property and equipment is stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to expense when incurred, while renewals and betterments that materially extend the life of an asset are capitalized.

The costs of assets sold, retired, or otherwise disposed of, and the related allowance for depreciation, are eliminated from the accounts, and any resulting gain or loss is recognized in the results from operations. Depreciation is provided over the estimated useful lives of the assets, which are as follows:

Computer equipment                                                                          50% declining balance

In the year of acquisition, one half the normal rate of depreciation is provided.

REVENUE RECOGNITION

In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods or services. The provisions of ASC 606 include a five-step process by which we determine revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which we expect to be entitled in exchange for those goods or services. ASC 606 requires us to apply the following steps: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, we satisfy the performance obligation.

INCOME TAXES

The Company accounts for income taxes in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("FASB ASC") 740, Income Taxes. Under the assets and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value.

NET LOSS PER SHARE

Basic net income (loss) per share includes no dilution and is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period.  Diluted earnings per share is computed by dividing earnings available to common shareholders by the weighted average number of common shares outstanding for the period increased to include the number of additional common shares that would have been outstanding if potentially dilutive securities had been issued. At September 30, 2018 and December 31, 2017, we excluded the common stock issuable upon conversion of convertible promissory notes of 4,681,502,947 shares and 412,602 shares, respectively, as their effect would have been anti-dilutive.

FOREIGN CURRENCY TRANSLATION

The financial statements are presented in the Company’s functional currency which is the United States dollars.  In accordance with FASB ASC 830, Foreign Currency Matters, foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date.  Non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expenses are translated at average rates of exchange during the periods presented.  Related translation adjustments are reported as a separate component of stockholders' deficit, whereas gains or losses resulting from foreign currency transactions are included in results of operations.

STOCK-BASED COMPENSATION

The Company measures stock-based compensation at the grant date based on the fair value of the award and recognizes stock-based compensation expense over the requisite service period.

The Company also grants awards to non-employees and determines the fair value of such stock-based compensation awards granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty's performance is completed.

The Company has not adopted a stock option plan and has not granted any stock options.

COMPREHENSIVE INCOME (LOSS)

The Company has adopted ASC Topic 220 - Comprehensive Income, which establishes standards for reporting and the display of comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners or distributions to owners. Among other disclosures, Topic 220 requires that all items that are required to be recognized under the current accounting standards as a component of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. Comprehensive income is displayed in the statement of stockholders' deficit and in the balance sheet as a component of stockholders' deficit.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company’s financial instruments such as cash, accounts and sundry receivable, accounts payable and accrued liabilities, non-redeemable convertible notes, notes payable and due to related parties are reported at cost, which approximates fair value due to the short term nature of these financial instruments.

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers.  ASU 2014-09 is a comprehensive revenue recognition standard that will supersede nearly all existing revenue recognition guidance under current U.S. GAAP and replace it with a principle based approach for determining revenue recognition.  ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract.  The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.  In addition, during 2016 the FASB has issued ASU 2016-08, ASU 2016-10 and ASU 2016-12, all of which clarify certain implementation guidance within ASU 2014-09, and ASU 2016-11, which rescinds certain SEC guidance effective upon an entity’s adoption of ASU 2014-09.  ASU 2014-09 is effective for interim and annual periods beginning after December 15, 2017.  Early adoption is permitted only in annual reporting periods beginning after December 15, 2016, including interim periods therein.  The standard can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption.  The Company adopted ASU 2014-09 in the first quarter of fiscal 2018 under the modified retrospective approach. ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in the Company’s condensed consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases.  ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months.  ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018.  Early adoption is permitted.  A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  The Company does not anticipate a material impact to its condensed consolidated financial statements on adopting ASU 2016-02. However, the ultimate impact of adopting ASU 2016-02 will depend on the Company’s lease portfolio as of the adoption date.

In June 2018, the FASB issued ASU 2018-07—Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees subject to certain exceptions. ASC 2018-07 expands the scope of ASC Topic 718, Compensation-Stock Compensation (“ASC 718”) to include share-based payments granted to nonemployees in exchange for goods or services used or consumed in an entity’s own operations and supersedes the guidance in ASC 505-50 by moving it to ASC 718. This amendment is effective beginning January 1, 2019. Early adoption is permitted, but no earlier than an entity’s adoption date of ASC 606. The Company adopted ASU 2018-07 with respect to grants of shares of common stock of the Company made in June 2018.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

XML

Note 3 - Non-redeemable Convertible Notes

9 Months Ended

Sep. 30, 2018

Notes

Note 3 - Non-redeemable Convertible Notes

NOTE 3 – NON-REDEEMABLE CONVERTIBLE NOTES

On June 10, 2014, the Company agreed to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable issued to The Cellular Connection Ltd. during the period from February 22, 2013 to June 10, 2014 with a total carrying value $42,189. The issue price of the Note is $42,189 with a face value of $54,193 and the Note has a maturity date of December 31, 2014. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $200.00 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. On June 20 and 26, 2014 the Company elected to convert $5,500 of principal into 27.5 shares of the Company's common stock. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2015, the face value increased by 20% and the maturity date was extended to December 31, 2015. From January 1 to December 31, 2015, the Company elected to convert $31,932 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 319.32 shares of common stock of the Company at a fixed conversion price of $100.00 per share. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2016, the face value increased by 20% and the maturity date was extended to December 31, 2016. On March 21, 2016 the Company elected to convert $16,750 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 167.5 shares of common stock of the Company at a fixed conversion price of $100.00 per share. On September 1, 2016 the Company elected to convert $2,000 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 40,000 shares of common stock of the Company at a fixed conversion price of $0.05 per share. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2017, the face value increased by 20% and the maturity date was extended to December 31, 2017. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2018, the face value increased by 20% and the maturity date was extended to December 31, 2018. On February 7, 2018 the Company elected to convert $2,000 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 40,000 shares of common stock of the Company at a fixed conversion price of $0.05 per share. This conversion resulted in a loss on debt settlement of $150,000 due to the requirement to record the share issuance at fair value on the date the shares were issued (February 7, 2018). On May 22, 2018 the Company elected to convert $2,600 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 52,000 shares of common stock of the Company at a fixed conversion price of $0.05 per share. This conversion resulted in a loss on debt settlement of $114,400 due to the requirement to record the share issuance at fair value on the date the shares were issued (May 22, 2018). On September 10, 2018 the Company elected to convert $1,100 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 11,000,000 shares of common stock of the Company at a fixed conversion price of $0.0001 per share. This conversion resulted in a loss on debt settlement of $330,000 due to the requirement to record the share issuance at fair value on the date the shares were issued (September 10, 2018). On September 25, 2018 the Company elected to convert $500 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 5,000,000 shares of common stock of the Company at a fixed conversion price of $0.0001 per share. This conversion resulted in a loss on debt settlement of $1,249,500 due to the requirement to record the share issuance at fair value on the date the shares were issued (September 25, 2018). The condensed consolidated statement of operations includes interest expense of $789 and $2,343 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $11,803 (face value of $12,592 less $789 unamortized discount) and $15,660 (face value of $15,660 less $0 unamortized discount), respectively.

On September 1, 2016, Doug Clark, former Chief Executive Officer and related party, assigned the Side Letter Agreement (“Note”) dated June 10, 2014 with a total carrying value $382,016 to DC Design Inc. (“DC Design”). In addition on September 1, 2016, the Company entered into an amended Side Letter Agreement with DC Design to amend and add certain terms to the Side Letter Agreement and advances from the period from June 25, 2014 to December 24, 2014. Under the terms of the amended Side Letter Agreement, the issue price of the Note is $174,252 with an interest rate 20% per annum and maturity date of December 31, 2017. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $1.50 per share of the Company’s common stock. The modification of the Note has been accounted for as debt extinguishment and the issuance of a new debt instrument. Accordingly, in connection with extinguishment of the original debt, the Company recognized a $207,764 gain with a related party as an increase in additional paid-in capital in the condensed consolidated statement of equity. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the note.  On September 1, 2016 the Company elected to convert $60,000 of principal and interest of the non-redeemable convertible note due to DC Design into 40,000 shares of common stock of the Company at a fixed conversion price of $1.50 per share. In accordance with the original terms of the Side Letter Agreement, the non-redeemable convertible note was renewed on January 1, 2018, the face value increased by 20% and the maturity date was extended to December 31, 2018. On May 22, 2018 the Company elected to convert $120,000 of principal and interest of a non-redeemable convertible note due to DC Design into 80,000 shares of common stock of the Company at a fixed conversion price of $1.50 per share. This conversion resulted in a loss on debt settlement of $60,000 due to the requirement to record the share issuance at fair value on the date the shares were issued (May 22, 2018). On September 10, 2018 the Company elected to convert $36,000 of principal and interest of a non-redeemable convertible note due to DC Design into 12,000,000 shares of common stock of the Company at a fixed conversion price of $0.003 per share. This conversion resulted in a loss on debt settlement of $325,200 due to the requirement to record the share issuance at fair value on the date the shares were issued (September 10, 2018). The condensed consolidated statement of operations includes interest expense of $7,516 and $22,304 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $15,407 (face value of $22,923 less $7,516 unamortized discount) and $149,103 (face value of $149,103 less $0 unamortized discount), respectively.

On January 8, 2018, the Company entered into a Side Letter Agreement (“Note”) with The Cellular Connection Ltd., to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $14,930 issued by the Company during the period of June 2014 and December 2017. The issue price of the Note is $14,930 with a face value of $17,916 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $767 and $2,219 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $17,149 (face value of $17,916 less $767 unamortized discount) and $0, respectively.

On January 8, 2018, the Company entered into a Side Letter Agreement (“Note”) with Stuart Turk, to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $244,065 issued by the Company during the period of July 2014 and December 2017. The issue price of the Note is $244,065 with a face value of $292,878 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $12,544 and $36,269 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $280,335 (face value of $292,879 less $12,544 unamortized discount) and $0, respectively.

On April 12, 2018, the Company entered into a Side Letter Agreement (“Note”) with Jordan Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $45,000 issued by the Company during the period of March 19, 2018 to April 12, 2018. The issue price of the Note is $45,000 with a face value of $54,000 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $3,149 and $5,851 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $50,851 (face value of $54,000 less $3,149 unamortized discount) and $0, respectively.

On May 10, 2018, the Company entered into a Side Letter Agreement (“Note”) with Jordan Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $35,000 issued by the Company on May 9, 2018. The issue price of the Note is $35,000 with a face value of $42,000 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $2,741 and $4,259 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $39,259 (face value of $42,000 less $2,741 unamortized discount) and $0, respectively.

On September 13, 2018, the Company entered into a Side Letter Agreement (“Note”) with Jordan Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $40,000 issued by the Company during the period of July 10 to September 13, 2018. The issue price of the Note is $40,000 with a face value of $48,000 and the Note has a maturity date of December 31, 2018. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note is not paid on the maturity date, the outstanding face amount of the Note shall increase by 20% on January 1, 2019. The outstanding face value of the Note shall increase by another 20% on January 1, 2020 and again on each one year anniversary of the Note until the Note has been paid in full. The condensed consolidated statement of operations includes interest expense of $1,248 and $1,248 for the three and nine months ended September 30, 2018, respectively. At September 30, 2018 and December 31, 2017 the carrying amount of the Note is $41,247 (face value of $48,000 less $6,753 unamortized discount) and $0, respectively.

XML

Note 4 - Notes Payable

9 Months Ended

Sep. 30, 2018

Notes

Note 4 - Notes Payable

NOTE 4 – NOTES PAYABLE

As of September 30, 2018 and December 31, 2017 notes payable due to Stuart Turk, Jordan Turk and The Cellular Connection Limited, a corporation controlled by Stuart Turk, totaling $75,691 and $258,995, respectively, were outstanding. The balances are non-interest bearing, unsecured and have no specified terms of repayment.

XML

Note 5 - Related Party Transactions

9 Months Ended

Sep. 30, 2018

Notes

Note 5 - Related Party Transactions

NOTE 5 – RELATED PARTY TRANSACTIONS

As of September 30, 2018 and December 31, 2017 advances of $34,412 and $41,734, respectively, were due to Nadav Elituv, the Company's Chief Executive Officer. The balance is non-interest bearing, unsecured and have no specified terms of repayment.

Employment Agreements

On July 1, 2016, the Company executed an employment agreement for the period from July 1, 2016 to June 30, 2017 with Nadav Elituv, the Chief Executive Officer of the Company whereby the Company shall pay 15 shares of Common Stock of the Company with a fair value of $1,500 ($100.00 per share) and an annual salary of $360,000 payable monthly on the first day of each month from available funds.

On July 1, 2017, the Company executed an employment agreement for the period from July 1, 2017 to June 30, 2018 with Nadav Elituv, the Chief Executive Officer of the Company whereby the Company shall pay 20,000 shares of Common Stock of the Company with a fair value of $926,000 ($46.30 per share).

On September 10, 2018, the Company executed an employment agreement for the period from July 1, 2018 to June 30, 2019 with Nadav Elituv, the Chief Executive Officer of the Company whereby the Company shall pay 50,000,000 shares of Common Stock of the Company and an annual salary of $151,200 payable monthly on the first day of each month from available funds.

Stock-based compensation – salaries expense related to these employment agreements for the nine months ended September 30, 2018 and 2017 is $1,126,638 and $232,250, respectively. Stock-based compensation – salaries expense is recognized ratably over the requisite service period.

XML

Note 6 - Stockholders' Deficit

9 Months Ended

Sep. 30, 2018

Notes

Note 6 - Stockholders' Deficit

NOTE 6 - STOCKHOLDERS’ DEFICIT

The Company is authorized to issue an aggregate of 3,000,000,000 common shares with a par value of $0.0001 per share and 1,000,000 shares of preferred stock with a par value of $0.001 per share. No preferred shares have been issued.

Effective August 14, 2018, the Company’s Board of Directors and a majority of the shareholders of the Company amended the Company’s Articles of Incorporation to) effect a 1-for-500 reverse common stock split. All common stock share and per-share amounts for all periods presented in these consolidated financial statements have been adjusted retroactively to reflect the reverse stock split.

On February 7, 2018 the Company elected to convert $2,000 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 40,000 shares of common stock of the Company valued at $152,000 ($3.80 per share) at a fixed conversion price of $0.05 per share. The conversion resulted in a loss on settlement of debt of $150,000.

On February 7, 2018, the Company issued 50,000 shares of common stock valued at $190,000 ($3.80 per share) to settle accrued liabilities for salary of $180,000 and shares to be issued of $10,000 due to the Nadav Elituv, the Chief Executive Officer of the Company.

On May 22, 2018 the Company elected to convert $2,600 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 52,000 shares of common stock of the Company valued at $117,000 ($2.25 per share) at a fixed conversion price of $0.05 per share. The conversion resulted in a loss on settlement of debt of $114,400.

On May 22, 2018 the Company elected to convert $120,000 of principal and interest of a non-redeemable convertible note due to DC Design Inc. into 80,000 shares of common stock of the Company valued at $180,000 ($2.25 per share) at a fixed conversion price of $1.50 per share. The conversion resulted in a loss on settlement of debt of $60,000.

On May 22, 2018, the Company issued 17,431 shares of common stock to settle shares to be issued (stock payable) valued at $922,218, which has been recorded over the contract period ended June 30, 2018, for stock based compensation due to the Nadav Elituv, the Chief Executive Officer of the Company.

On May 22, 2018, the Company issued 25,607 shares of common stock valued at $57,616 ($2.25 per share) for accounts payable of $57,616.

On June 26, 2018, the Company issued 120,000 shares of common stock valued at $294,000 ($2.45 per share) for the services to be provided in a period of June 26, 2018 to December 31, 2018.

On September 10, 2018 the Company elected to convert $1,100 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 11,000,000 shares of common stock of the Company valued at $331,100 ($0.0301 per share) at a fixed conversion price of $0.0001 per share. The conversion resulted in a loss on settlement of debt of $330,000.

On September 10, 2018 the Company elected to convert $36,000 of principal and interest of a non-redeemable convertible note due to DC Design Inc. into 12,000,000 shares of common stock of the Company valued at $361,200 ($0.0301 per share) at a fixed conversion price of $0.003 per share. The conversion resulted in a loss on settlement of debt of $325,200.

On September 10, 2018, the Company issued 20,000,000 shares of common stock valued at $602,000 ($0.0301 per share) to the Nadav Elituv, the Chief Executive Officer of the Company for officer compensation.

On September 10, 2018, the Company issued 18,000,000 shares of common stock valued at $541,800 ($0.0301 per share) for the services to be provided in a period of September 10, 2018 to December 31, 2018.

On September 10, 2018, the Company issued 20,000,000 shares of common stock valued at $602,000 ($0.0301 per share) for the services to be provided in a period of September 10, 2018 to September 10, 2019.

On September 10, 2018, the Company issued 58,000,000 shares of common stock valued at $1,745,800 ($0.0301 per share) for the consulting services.

On September 25, 2018 the Company elected to convert $500 of principal and interest of a non-redeemable convertible note due to The Cellular Connection Ltd. into 5,000,000 shares of common stock of the Company valued at $1,250,000 ($0.2500 per share) at a fixed conversion price of $0.0001 per share. The conversion resulted in a loss on settlement of debt of $1,249,500.

Shares to be issued

As at September 30, 2018 and December 31, 2017, the Company had total shares to be issued of 2,047,782 shares of common stock and 10,062 shares of common stock, respectively, for stock-based compensation –salaries (see Note 5).

XML

Note 7 - Concentration Risk

9 Months Ended

Sep. 30, 2018

Notes

Note 7 - Concentration Risk

NOTE 7 – CONCENTRATION RISK

The company is subject to risk of non-payment on its trade accounts receivable. For the nine months ended September 30, 2018, the company has few customers. One customer represents 100% of the total outstanding accounts receivable and one customer represents 98% of total sales. Management consistently monitors its client credit terms with customers to reduce credit risk exposure.

XML

Note 2 - Summary of Significant Accounting Policies: Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Basis of Presentation

BASIS OF PRESENTATION

The accompanying financial statements of Two Hands Corporation have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission requirements for interim financial statements. Therefore, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The financial statements should be read in conjunction with the annual financial statements for the year ended December 31, 2017 of Two Hands Corporation in our Form 10-K filed on March 29, 2018.

The interim financial statements present the balance sheets, statements of operations and cash flows of Two Hands Corporation.  The financial statements have been prepared in accordance with accounting principles generally accepted in the United States.

The interim financial information is unaudited. In the opinion of management, all adjustments necessary to present fairly the financial position as of September 30, 2018 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are of a normal and recurring nature.  Interim results are not necessarily indicative of results of operations for the full year.

XML

Note 2 - Summary of Significant Accounting Policies: Reclassifications (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Reclassifications

Reclassifications

On the condensed consolidated statement of cash flows for the nine months ended September 30, 2017, expenses paid by third party and expenses paid by related party of $21,265 and $35,522, respectively, totaling $56,787 were reclassified from cash flows from operating activities to cash flows from financing activities. As a result, cash flows from financing activities was increased by $56,787 and cash flows from operating activities was decreased by $56,787.

XML

Note 2 - Summary of Significant Accounting Policies: Going Concern (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Going Concern

GOING CONCERN

The Company's financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business.  During the nine months ended September 30, 2018, the Company incurred a net loss of $5,701,936 and used cash in operating activities of $199,984, and at September 30, 2018, had a stockholders’ equity of $540,514. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued.   The Company will be dependent upon the raising of additional capital through placement of its common stock in order to implement its business plan. There can be no assurance that the Company will be successful in this situation.  Accordingly, these factors raise substantial doubt as to the Company's ability to continue as a going concern.  These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classifications of liabilities that might result from this uncertainty. The Company is funding its initial operations by way of loans from its Chief Executive Officer and others, and the use of equity to pay some operating expenses.  The Company's officers and directors have committed to advancing certain operating costs of the Company.

XML

Note 2 - Summary of Significant Accounting Policies: Principles of Consolidation (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Principles of Consolidation

PRINCIPLES OF CONSOLIDATION

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, I8 Interactive Corporation. All intercompany transactions and balances have been eliminated in consolidation.

XML

Note 2 - Summary of Significant Accounting Policies: Use of Estimates and Assumptions (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Use of Estimates and Assumptions

USE OF ESTIMATES AND ASSUMPTIONS

Preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.

XML

Note 2 - Summary of Significant Accounting Policies: Cash and Cash Equivalents (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Cash and Cash Equivalents

CASH AND CASH EQUIVALENTS

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

XML

Note 2 - Summary of Significant Accounting Policies: Property and Equipment (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Property and Equipment

PROPERTY AND EQUIPMENT

Property and equipment is stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to expense when incurred, while renewals and betterments that materially extend the life of an asset are capitalized.

The costs of assets sold, retired, or otherwise disposed of, and the related allowance for depreciation, are eliminated from the accounts, and any resulting gain or loss is recognized in the results from operations. Depreciation is provided over the estimated useful lives of the assets, which are as follows:

Computer equipment                                                                          50% declining balance

In the year of acquisition, one half the normal rate of depreciation is provided.

XML

Note 2 - Summary of Significant Accounting Policies: Revenue Recognition (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Revenue Recognition

REVENUE RECOGNITION

In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods or services. The provisions of ASC 606 include a five-step process by which we determine revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which we expect to be entitled in exchange for those goods or services. ASC 606 requires us to apply the following steps: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, we satisfy the performance obligation.

XML

Note 2 - Summary of Significant Accounting Policies: Income Taxes (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Income Taxes

INCOME TAXES

The Company accounts for income taxes in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("FASB ASC") 740, Income Taxes. Under the assets and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value.

XML

Note 2 - Summary of Significant Accounting Policies: Net Loss Per Share (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Net Loss Per Share

NET LOSS PER SHARE

Basic net income (loss) per share includes no dilution and is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period.  Diluted earnings per share is computed by dividing earnings available to common shareholders by the weighted average number of common shares outstanding for the period increased to include the number of additional common shares that would have been outstanding if potentially dilutive securities had been issued. At September 30, 2018 and December 31, 2017, we excluded the common stock issuable upon conversion of convertible promissory notes of 4,681,502,947 shares and 412,602 shares, respectively, as their effect would have been anti-dilutive.

XML

Note 2 - Summary of Significant Accounting Policies: Foreign Currency Translation (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Foreign Currency Translation

FOREIGN CURRENCY TRANSLATION

The financial statements are presented in the Company’s functional currency which is the United States dollars.  In accordance with FASB ASC 830, Foreign Currency Matters, foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date.  Non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expenses are translated at average rates of exchange during the periods presented.  Related translation adjustments are reported as a separate component of stockholders' deficit, whereas gains or losses resulting from foreign currency transactions are included in results of operations.

XML

Note 2 - Summary of Significant Accounting Policies: Stock-based Compensation (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Stock-based Compensation

STOCK-BASED COMPENSATION

The Company measures stock-based compensation at the grant date based on the fair value of the award and recognizes stock-based compensation expense over the requisite service period.

The Company also grants awards to non-employees and determines the fair value of such stock-based compensation awards granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty's performance is completed.

The Company has not adopted a stock option plan and has not granted any stock options.

XML

Note 2 - Summary of Significant Accounting Policies: Comprehensive Income (loss) (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Comprehensive Income (loss)

COMPREHENSIVE INCOME (LOSS)

The Company has adopted ASC Topic 220 - Comprehensive Income, which establishes standards for reporting and the display of comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners or distributions to owners. Among other disclosures, Topic 220 requires that all items that are required to be recognized under the current accounting standards as a component of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. Comprehensive income is displayed in the statement of stockholders' deficit and in the balance sheet as a component of stockholders' deficit.

XML

Note 2 - Summary of Significant Accounting Policies: Fair Value of Financial Instruments (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Fair Value of Financial Instruments

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company’s financial instruments such as cash, accounts and sundry receivable, accounts payable and accrued liabilities, non-redeemable convertible notes, notes payable and due to related parties are reported at cost, which approximates fair value due to the short term nature of these financial instruments.

XML

Note 2 - Summary of Significant Accounting Policies: Recent Accounting Pronouncements (Policies)

9 Months Ended

Sep. 30, 2018

Policies

Recent Accounting Pronouncements

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers.  ASU 2014-09 is a comprehensive revenue recognition standard that will supersede nearly all existing revenue recognition guidance under current U.S. GAAP and replace it with a principle based approach for determining revenue recognition.  ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract.  The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.  In addition, during 2016 the FASB has issued ASU 2016-08, ASU 2016-10 and ASU 2016-12, all of which clarify certain implementation guidance within ASU 2014-09, and ASU 2016-11, which rescinds certain SEC guidance effective upon an entity’s adoption of ASU 2014-09.  ASU 2014-09 is effective for interim and annual periods beginning after December 15, 2017.  Early adoption is permitted only in annual reporting periods beginning after December 15, 2016, including interim periods therein.  The standard can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption.  The Company adopted ASU 2014-09 in the first quarter of fiscal 2018 under the modified retrospective approach. ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in the Company’s condensed consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases.  ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months.  ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018.  Early adoption is permitted.  A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  The Company does not anticipate a material impact to its condensed consolidated financial statements on adopting ASU 2016-02. However, the ultimate impact of adopting ASU 2016-02 will depend on the Company’s lease portfolio as of the adoption date.

In June 2018, the FASB issued ASU 2018-07—Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees subject to certain exceptions. ASC 2018-07 expands the scope of ASC Topic 718, Compensation-Stock Compensation (“ASC 718”) to include share-based payments granted to nonemployees in exchange for goods or services used or consumed in an entity’s own operations and supersedes the guidance in ASC 505-50 by moving it to ASC 718. This amendment is effective beginning January 1, 2019. Early adoption is permitted, but no earlier than an entity’s adoption date of ASC 606. The Company adopted ASU 2018-07 with respect to grants of shares of common stock of the Company made in June 2018.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

XML

Note 1 - Nature of Operations and Basis of Presentation (Details)	114 Months Ended
	Sep. 30, 2018
Details
Entity Incorporation, Date of Incorporation	Apr. 03, 2009
Entity Incorporation, State Country Name	Delaware

XML

Note 3 - Non-redeemable Convertible Notes (Details) - USD ($)										3 Months Ended	9 Months Ended
	Sep. 13, 2018	May 10, 2018	Apr. 12, 2018	Jan. 08, 2018	Sep. 04, 2016	Jan. 02, 2016	Jan. 02, 2015	Jun. 26, 2014	Jun. 10, 2014	Sep. 30, 2018	Sep. 30, 2018	Feb. 07, 2018	Dec. 31, 2017	Sep. 02, 2016	Sep. 01, 2016	Mar. 31, 2016	Mar. 21, 2016	Dec. 31, 2015
Common Stock, Shares Issued										145,199,289	145,199,289		812,435
Convertible Note Issued to Doug Clark
Debt Conversion, Converted Instrument, Amount					$ 174,252
Promissory Note Issued from February 22, 2013 to June 10, 2014- The Cellular Connection Ltd.
Long-term Debt, Gross									$ 42,189
Debt Conversion, Converted Instrument, Amount									42,189
Convertible Note- The Ceullular Connection ltd
Debt Instrument, Face Amount									$ 54,193
Debt Instrument, Maturity Date				Dec. 31, 2018		Dec. 31, 2017	Dec. 31, 2015		Dec. 31, 2014
Debt Instrument, Convertible, Conversion Price									$ 200.00
Interest expense										$ 789	$ 2,343
Convertible Notes- The Cellular Connection Ltd- Common Stock
Long-term Debt, Gross										11,803	11,803		$ 15,660
Debt Instrument, Convertible, Conversion Price																$ 0.05
Debt Conversion, Original Debt, Amount								$ 5,500
Debt Conversion, Converted Instrument, Shares Issued								27.5
Convertible Note- The Cellular Connection ltd
Long-term Debt, Gross				$ 14,930						17,149	17,149		0
Debt Conversion, Converted Instrument, Amount				14,930
Debt Instrument, Face Amount				$ 17,916
Debt Instrument, Convertible, Conversion Price				$ 0.0001								$ 0.05					$ 100.00	$ 100.00
Conversion of Principal and Interest												$ 2,000			$ 2,000		$ 16,750	$ 31,932
Common Stock, Shares Issued												40,000			40,000		167.5	319.32
Interest expense										767	2,219
Doug Clark Former CEO
Long-term Debt, Gross										15,407	15,407		149,103
Debt Instrument, Convertible, Conversion Price														$ 1.50
Conversion of Principal and Interest														$ 60,000
Common Stock, Shares Issued														40,000
Due to Other Related Parties, Noncurrent														$ 382,016
Gain on Extinguishment of Debt														$ 207,764
Doug Clark Former CEO | Convertible Note Issued to Doug Clark
Debt Instrument, Maturity Date					Dec. 31, 2017
Debt Instrument, Convertible, Conversion Price														$ 1.50
Debt Instrument, Interest Rate, Stated Percentage														20.00%
SideLetterAgreementStuartTurkMember
Long-term Debt, Gross				$ 244,065						280,335	280,335		0
Debt Conversion, Converted Instrument, Amount				244,065
Debt Instrument, Face Amount	$ 48,000	$ 42,000	$ 54,000	$ 292,878
Debt Instrument, Maturity Date	Dec. 31, 2018	Dec. 31, 2018	Dec. 31, 2018	Dec. 31, 2018
Debt Instrument, Convertible, Conversion Price				$ 0.0001
Interest expense										12,544	36,269
Jordan Turk
Long-term Debt, Gross	$ 40,000	$ 35,000	$ 45,000							50,851	50,851		0
Debt Conversion, Converted Instrument, Amount	$ 40,000	$ 35,000	$ 45,000
Interest expense										3,149	5,851
Jordan Turk | Convertible Note 2 Issued to Jordan Turk
Long-term Debt, Gross										39,259	39,259		0
Interest expense										2,741	4,259
Jordan Turk | Convertible Note 3 Issued to Jordan Turk
Long-term Debt, Gross										41,247	41,247		$ 0
Interest expense										$ 1,248	$ 1,248

XML

Note 4 - Notes Payable (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Details
Other Notes Payable	$ 75,691	$ 258,995

XML

Note 5 - Related Party Transactions (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Due to related party	$ 34,412	$ 41,734
Nadav Elituv- CEO
Due to related party	$ 34,412	$ 41,734

XML

Note 6 - Stockholders' Deficit (Details) - USD ($)	Sep. 30, 2018	Sep. 25, 2018	Sep. 10, 2018	Jun. 26, 2018	May 22, 2018	Feb. 07, 2018	Dec. 31, 2017
Common Stock, Shares Authorized	3,000,000,000						3,000,000,000
Common Stock, Par Value	$ 0.0001						$ 0.0001
Preferred Stock, Shares Authorized	1,000,000						1,000,000
Preferred Stock, Par Value	$ 0.001						$ 0.001
Common Stock, Shares Issued	145,199,289						812,435
Common stock	$ 14,520						$ 40,621
The Cellular Connection Ltd.
Interest on Convertible Note		$ 500	$ 1,100		$ 2,600	$ 2,000
Common Stock, Shares Issued		5,000,000	11,000,000		52,000	40,000
Sale of Stock, Price Per Share					$ 0.05	$ 0.05
Nadav Elituv
Common Stock, Shares Issued			20,000,000		17,431	50,000
Common stock						$ 190,000
DC Design Inc.
Interest on Convertible Note			$ 36,000		$ 120,000
Common Stock, Shares Issued			12,000,000		80,000
Sale of Stock, Price Per Share			$ 0.003		$ 1.50
Accounts Payable
Common Stock, Shares Issued					25,607
Services Provided
Common Stock, Shares Issued			18,000,000	120,000
Services Provided2
Common Stock, Shares Issued			20,000,000
Consulting Services
Common Stock, Shares Issued			58,000,000