ACQUISITION

12 Months Ended

Oct. 31, 2015

Notes to Financial Statements

NOTE 13 - ACQUISITION

On November 1, 2014, the Company acquired all the outstanding shares of NiC Corporation, based in Japan, for $110,000 in cash plus 50,000 share of common stock. The Company determined in accordance with ASC 805-10-25-6 that the 50,000 shares of common stock was valued at the closing price on the date of purchase at $1.49 for a total value of $74,500. In accordance with purchase acquisition accounting, the company initially allocated the consideration to the net tangible and identifiable intangible assets, based on their estimated fair values as of the date of acquisition. Customer Lists represents the excess of the purchase price over the fair value of the underlying net tangible and identifiable intangible assets.

The Company estimates the useful life to the customer list to be three years and thus it was being amortized over a three year period. Upon review of the customer list the Company elected to impair the asset. The allocation result in an impairment cost of $30,987 and the balance $31,298 being amortized. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date. The company has finalized its purchase price allocation as follows:

Cash and cash equivalents	$	108,882
Accounts receivable		37,089
Inventory		7,175
Prepaid		4,726
Intangible asset		62,285
Other assets		6,185
Total Assets		226,342
Accounts payable		31,874
Deposits		3,813
Taxes payable		6,155
Total Liabilities		41,842
Total Purchase Price	$	184,500

The following unaudited consolidated pro forma information gives effect to the NiC Corporation acquisition as if this transaction had occurred at the beginning of the period presented. The following unaudited pro forma information is presented for illustration purposes only and is not necessarily indicative of the results that would have been attained had the acquisition of this business been completed at the beginning of each period presented, nor are they indicative of results that may occur in any future periods.

As of October 31, 2104	Twelve Months Period
Revenue	$	1,389,752
Operating expense	$	2,390,455
Other income(expense)	$	7,512
Net income	$	(993,191	)

As of October 31, 2015 the Company amortized and impaired the customer list, allocating $37,297 to amortization and $30,987 to impairment of the asset reducing the value of the customer list to zero.