DERIVATIVE LIABILITY

3 Months Ended

12 Months Ended

Mar. 31, 2017

Dec. 31, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE LIABILITY

10 DERIVATIVE LIABILITY

The short-term convertible notes disclosed in note 9 above, have variable priced conversion rights with no fixed floor price and will re-price dependent on the share price performance over varying periods of time. This gives rise to a derivative financial liability, which was initially valued at inception of the convertible note using a Black-Scholes valuation model. The value of this derivative financial liability was re-assessed at March 31, 2017 and March 31, 2016, and $247,770 and $0 was charged to the statement of operations and comprehensive loss, respectively. The value of the derivative liability will be re-assessed at each financial reporting period, with any movement thereon recorded in the statement of operations in the period in which it is incurred.

The following assumptions were used in the Black-Scholes valuation model:

	Three
	Months Ended			Year ended
	March 31,			December 31,
	2017			2016
Conversion price	$	0.11 to 0.22		$	0.22 to 0.23
Risk free interest rate		0.63 to 1.04	%		0.85	%
Expected life of derivative liability		4 to 11 months			9 months
expected volatility of underlying stock		132.56 to 138.19	%		133.0	%
Expected dividend rate		0	%		0	%

The movement in derivative liability is as follows:

	March 31, 2017		December 31, 2016
Opening balance	$	113,074	$	-
Derivative financial liability arising from convertible note		458,000		77,000
Fair value adjustment to derivative liability		247,770		36,074
	$	818,844	$	113,074

11 DERIVATIVE LIABILITY

The short-term convertible note disclosed in note 10 above, has variable priced conversion rights with no fixed floor price and will re-price dependent on the share price performance over varying periods of time. This gives rise to a derivative financial liability, which was initially valued at $77,000 at inception of the convertible note using a Black-Scholes valuation model. The value of this derivative financial liability was re-assessed at December 31, 2016 and an additional charge of $36,074 was charged to the statement of operations and comprehensive loss. The value of the derivative liability will be re-assessed at each financial reporting period, with any movement thereon recorded in the statement of operations in the period in which it is incurred.

The following assumptions were used in the Black-Scholes valuation model:

	Year ended
	December 31,
	2016
Conversion price	$	0.22 to 0.23
Risk free interest rate		0.85	%
Expected life of derivative liability		9 months
expected volatility of underlying stock		133.0	%
Expected dividend rate		0	%

The movement in derivative liability is as follows:

	December 31, 2016		December 31, 2015
Opening balance	$	-	$	-
Derivative financial liability arising from convertible note		77,000		-
Fair value adjustment to derivative liability		36,074		-
	$	113,074	$	-