Note 2 - Restatement of Previously Issued Financial Statements

12 Months Ended

Dec. 31, 2015

Notes to Financial Statements

Note 2 - Restatement of Previously Issued Financial Statements

Note 2 – Restatement of Previously Issued Financial Statements

The Company subsequently discovered an inadvertent omission of two consulting agreements entered into in November and December 2015 which contained promissory notes with conversion privileges based on an undeterminable number of common stock shares as payment for services under the agreements. These financial statements and notes have been updated to properly reflect these transactions.

The following tables present a summary of the effects of the restatement adjustments on the Company’s consolidated balance sheet at December 31, 2015 and the consolidated statement of operations and cash flows for the year ended December 31, 2015:

	Consolidated Balance Sheet
		As Previously
As of December 31, 2015		Reported		Adjustments		As Restated
Other current assets	$	2,900	$	333,333	$	336,233
Total current assets	$	44,373	$	333,333	$	377,706
Total assets	$	76,030	$	333,333	$	409,363
Derivative liability	$	1,970,241	$	2,003,301	$	3,973,542
Total current liabilities	$	7,482,852	$	2,003,301	$	9,486,153
Notes payable, net of discounts (non-current)	$	10,987	$	16,667	$	27,654
Total liabilities	$	7,665,455	$	2,019,968	$	9,685,423
Accumulated deficit	$	(11,371,976)	$	(1,686,635)	$	(13,058,611)
Total shareholders' deficit	$	(7,589,425)	$	(1,686,635)	$	(9,276,060)
	Consolidated Statement of Operations
		As Previously
Year ended December 31, 2015		Reported		Adjustments		As Restated
Operating activities:
Operating expenses	$	2,500,097	$	66,667	$	2,566,764
Loss from operations	$	(2,497,994)	$	(66,667)	$	(2,564,661)
Interest expense, net	$	(1,348,244)	$	(193,680)	$	(1,541,924)
Change in fair value of derivative liability	$	(1,105,189)	$	(1,426,288)	$	(2,531,477)
Total other income (expense)	$	(2,581,107)	$	(1,619,968)	$	(4,201,075)
Net loss	$	(5,079,101)	$	(1,686,635)	$	(6,765,736)
LOSS PER COMMON SHARE
Basic and diluted	$	(0.05)	$	(0.02)	$	(0.07)
	Consolidated Statement of Cash Flows
		As Previously
Year ended December 31, 2015		Reported		Adjustments		As Restated
Cash flow from operating activities:
Net loss	$	(5,079,101)	$	(1,686,635)	$	(6,765,736)
Fair value of notes issued for services	$	-	$	66,667	$	66,667
Non-cash interest	$	1,180,807	$	193,680	$	1,374,487
Change in fair value of derivative liability	$	1,105,189	$	1,426,288	$	2,531,477