Organization and Description of Business: Derivative Financial Instruments (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Derivative Financial Instruments

d.  Derivative Financial Instruments

In the 4^th quarter of 2015 the Company issued a note payable which terms require that the transaction be accounted for as a derivative financial instrument.  The Company is accounting for this financial instrument in accordance with ASC 815, Derivatives and Hedging, which requires that every derivative instrument be recorded on the balance sheet as either an asset or liability, measured at its fair value as of the reporting date.  ASC 815 also requires that changes in the derivatives’ fair value be recognized in earnings.  The Company recorded the effective portion of the gain or loss on derivative comprehensive income for the three and nine months ended September 30, 2016 in the accompanying balance sheets and income statements.  (See Note 7).