DERIVATIVE LIABILITY

6 Months Ended

Jun. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE LIABILITY

10 DERIVATIVE LIABILITY

Certain of 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 notes using a Black-Scholes valuation model. The value of this derivative financial liability was re-assessed at June 30, 2017 and 2016, and $118,472 and $0 was credited 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:

	Six Months Ended			Year ended
	June 30,			December 31,
	2017			2016
Conversion price	$	0.11 to 0.29		$	0.22 to 0.23
Risk free interest rate		1.05 to 1.21	%		0.85	%
Expected life of derivative liability		9 to 12 months			9 months
expected volatility of underlying stock		134.1 to 152.2	%		133.0	%
Expected dividend rate		0	%		0	%

The movement in derivative liability is as follows:

	June 30, 2017			December 31, 2016
Opening balance	$	113,074		$	—
Derivative financial liability arising from convertible note		904,412			77,000
Fair value adjustment to derivative liability		(118,472	)		36,074
	$	899,014		$	113,074