1. Restatement of Previously Issued Financial Statements

3 Months Ended

Mar. 31, 2015

Equity [Abstract]

1. Restatement of Previously Issued Financial Statements

1. Restatement of Previously Issued Financial Statements

The Company has restated its consolidated financial statements as of and for the three months ended March 31, 2014

The restatements reflect adjustments to correct errors identified by management during the Company’s normal closing process, in the course of the Company’s regularly scheduled audit by its newly appointed Independent Accounting Firm, and during the course of an internal investigation initiated by the board of directors of the Company (in performance of its function as the audit committee). The Company’s board of directors has completed its investigation. The effect of the restatements on the Company’s Balance Sheets is not material and the restatements have no effect on reported cash flow from operations.

In addition, the Company has restated its consolidated financial statements, to retroactively reflect the Company’s Board of Directors decision to dispose of its Endoscopy Division, as of and for the three months ended March 31, 2014. 

Beneficial Conversion Feature

During the fourth quarter of fiscal 2014, the Company identified an error as a result of not recognizing the beneficial conversion feature inherent in seventy five (75) mandatorily convertible notes issued between 2010 and 2012 to accredited investors; the beneficial conversion feature inherent in two (2) convertible notes issued to Asher Enterprises, Inc. during the second and third quarter of 2013; and the beneficial conversion feature inherent in five (5) convertible notes issued to JMJ Financial Group during the five quarters beginning with the period ended June 30, 2013 and ending in the period ended September 30, 2014.

Employee Option Incentive Grants

During the fourth quarter of fiscal 2014, the Company identified an error as a result of not recognizing the costs of employee option incentive granted during the second quarter of 2012 and which terminated during the second quarter of 2014.

The restated Unaudited Consolidated Balance Sheet as of March 31, 2014 and the restated Unaudited Consolidated Statement of Operations and Cash Flows for the three months ended March 31, 2014 are presented below:

GREENESTONE HEALTHCARE CORP

Consolidated Balance Sheet

March 31, 2014

	As Previously Reported on Form 10-Q		Opening Deficit			BCF		Compensation		As Restated		Reclassify Discontinued Operations			As Restated and Reclassified
ASSETS
CURRENT ASSETS
Cash	$	—								$	—	$	—		$	—
Accounts receivable		279,711									279,711		(210,635	)		69,076
Prepaid expenses		97,352									97,352		(17,812	)		79,540
Inventory		34,920									34,920		(34,920	)		—
Current assets - held for sale		—									—		263,367			263,367
Total current assets		411,983		—			—		—		411,983		—			411,983
NON CURRENT ASSETS:
Fixed assets		551,637									551,637		(238,801	)		312,836
Cash - Restricted		90,470									90,470		—			90,470
Long term assets - held for resale													238,801			238,801
Total assets	$	1,054,090	$	—		$	—	$	—	$	1,054,090	$	—		$	1,054,090
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Bank overdraft	$	46,025								$	46,025	$	—		$	46,025
Accounts payable and accrued liabilities		657,262									657,262		(190,124	)		467,138
Harmonized sales tax payable		608,497									608,497					608,497
Withholding taxes payable		1,887,780									1,887,780		(19,013	)		1,868,767
Deferred revenue		55,032									55,032					55,032
Convertible notes payable		139,000		(34,357	)		11,121				115,764		(2,210	)		113,554
Short term loan		53,541									53,541					53,541
Current portion of loan payable		7,652									7,652					7,652
Related party notes		559,614									559,614		(262,177	)		297,437
Current liabilities - held for resale		—									—		473,524			473,524
Total current liabilities		4,014,403		(34,357	)		11,121		—		3,991,167		—			3,991,167
NON CURRENT LIABILITIES:
Loan payable (note 9)		25,110									25,110		—			25,110
Total Liabilities		4,039,513		(34,357	)		11,121		—		4,016,277		—			4,016,277

	As Previously Reported on Form 10-Q			Opening Deficit			BCF			Compensation			As Restated			Reclassify Discontinued Operations		As Restated and Reclassified
STOCKHOLDERS' DEFICIT
Preferred Stock - Series A; $0.01 par value, 3,000,000 shares authorized; -0- issued and outstanding		—															—
Preferred Stock - Series B; $0.01 par value, 10,000,000 shares authorized; -0- issued and outstanding
Common stock; $0.01 par value, 500,000,000 shares authorized; 47,088,864 shares issued and outstanding		470,889												470,889			—		470,889
Additional paid-in capital		8,643,401			4,150,113			333,727			312,298			13,439,539			—		13,439,539
Accumulated other comprehensive loss		458,309												458,309			—		458,309
Accumulated deficit		(12,558,022	)		(4,115,756	)		(344,848	)		(312,298	)		(17,330,924	)		—		(17,330,924	)
Total Stockholders' Deficit		(2,985,423	)		34,357			(11,121	)		—			(2,962,187	)		—		(2,962,187	)
Total Liabilities and Stockholders' Deficit	$	1,054,090		$	—		$	—		$	—		$	1,054,090		$	—	$	1,054,090

GREENESTONE HEALTHCARE CORP

INCOME STATEMENT

For the Three months Ended March 31, 2014

	As Previously Reported on Form 10-Q			BCF			Compensation			As Restated			Reclassify Discontinued Operations			As Restated and Reclassified
Revenues	$	1,139,787		$	—		$	—		$	1,139,787		$	(527,769	)	$	612,018
Cost of services provided		288,573			—			—			288,573			(288,573	)		—
Gross margin		851,214			—			—			851,214			(239,196	)		612,018
Operating expenses
Depreciation		35,449			—			—			35,449			(14,141	)		21,308
General and administrative		242,713			—			—			242,713			(26,364	)		216,349
Management fees		54,367			—			—			54,367			(9,047	)		45,320
Meals and entertainment		36			—			—			36			(36	)		0
Professional fees		62,363			—			—			62,363			(2,262	)		60,101
Rent		258,971			—			—			258,971			(81,590	)		177,381
Salaries and wages		708,235			—			312,298			1,020,533			(116,590	)		903,943
Supplies		77,269			—			—			77,269			(34,513	)		42,756
Travel		4,377			—			—			4,377			—			4,377
Total operating expenses		1,443,780			—			312,298			1,756,078			(284,543	)		1,471,535
Operating loss	$	(592,566	)	$	—		$	(312,298	)	$	(904,864	)	$	45,347		$	(859,517	)
Other income (loss)					—			—			—			—			—
Interest expense		(31,385	)		(32,550	)					(63,935	)					(63,935	)
Net loss from continuing operations	$	(623,951	)	$	(32,550	)	$	(312,298	)	$	(968,799	)	$	45,347		$	(923,452	)
Profit (Loss) from discontinued operations, net of tax		—			—			—			—			(45,347	)		(45,347	)
Net loss applicable to common shareholders	$	(623,951	)	$	(32,550	)	$	(312,298	)	$	(968,799	)	$	—		$	(968,799	)
Accumulated other comprehensive loss		—			—			—			—			—			—
Foreign currency translation adjustment		194,174									194,174						194,174
Total comprehensive loss	$	(429,777	)	$	(32,550	)	$	(312,298	)	$	(774,625	)	$	—		$	(774,625	)
Basic and diluted income (loss) per common share- continuing operations	$	(0.01	)	$	(0.00	)	$	(0.01	)	$	(0.02	)	$	0.00		$	(0.02	)
Basic and diluted loss per common share- discontinued operations		$ ( -)			$ ( -)			$ ( -)			$ ( -)		$	(0.00	)	$	(0.00	)
Basic and diluted loss per common share	$	(0.01	)	$	(0.00	)	$	(0.01	)	$	(0.02	)		$ ( -)		$	(0.02	)
Weighted average outstanding		45,938,346			45,938,346			45,938,346			45,938,346			45,938,346			45,938,346

GREENESTONE HEALTHCARE CORP

CONSOLIDATED STATEMENT OF CASH FLOWS

For the period Ended March 31, 2014

	As Previously Reported on Form 10-Q			BCF			Compensation			As Restated			Reclassify Discontinued Operations			Conform to 2015 Presentation			As Restated and Reclassified
Cash flows from operating activities:
Net loss	$	(623,064	)	$	(32,550	)	$	(312,298	)	$	(967,912	)		$              45,347			(887	)	$	(923,452	)
Net loss from discontinued operations, net of tax		—			—			—			—			(45,347	)		—			(45,347	)
Net loss from continuing operations		(623,064	)		(32,550	)		(312,298	)		(967,912	)		—			—			(968,799	)
Adjustments to reconcile net loss to net cash provided by operating activities:		—			—			—			—			—			—			—
Depreciation		34,559						—			34,559			—			887			35,446
Provision for bad debts		—			—			—			—			—			—			—
Stock compensation		—			—			312,298			312,298			—			—			312,298
Stock issued for services		—			—			—			—			—			—			—
Amortization of beneficial conversion feature		—			32,550			—			32,550			—			—			32,550
Changes in operating assets and liabilities
Inc/dec in accounts receivable		161,207			—			—			161,207			(30,640	)		—			130,567
Inc/dec in inventory		(22,372	)		—			—			(22,372	)		22,983			—			611
Inc/dec in prepaids		12,502			—			—			12,502			(47,634	)		—			(35,132	)
Inc/dec in due to related parties		—			—			—			—			—			—			—
Inc/dec in accounts payable and accrued liabilities		(46,656	)		—			—			(46,656	)		(6,249	)		—			(52,905	)
Inc/dec in taxes payable		105,502			—			—			105,502			(1,579	)		—			103,923
Inc/dec in deferred revenue		(52,445	)		—			—			(52,445	)		—			—			(52,445	)
Net cash provided by (used in) operating activities- continuing operations		(430,767	)		—			—			(430,767	)		(63,119	)		—			(493,886	)
Net cash provided by (used in) operating activities- discontinued operations		—			—			—			63,119			—			63,119			—
Net cash provided (used in) operating activities		(430,767	)		—			—			(430,767	)		—			—			(430,767	)
Cash flows from investing activities:		—			—			—			—			—			—			—
Cash paid for purchase of fixed assets		(50,072	)		—			—			(50,072	)		(3,161	)		—			(53,233	)
Net cash provided by (used in) investing activities- discontinued operations		—			—			—			—			3,161			—			3,161
Net cash used by investing activities		(50,072	)		—			—			(50,072	)		—			—			(50,072	)

GREENESTONE HEALTHCARE CORP

CONSOLIDATED STATEMENT OF CASH FLOWS

For the period Ended March 31, 2014

	As Previously Reported on Form 10-Q			BCF		Compensation		As Restated			Reclassify Discontinued Operations			Conform to 2015 Presentation		As Restated and Reclassified
Cash flows from financing activities:		—			—		—		—			—			—		—
Repayment of notes payable		(3,643	)		—		—		(3,643	)		—			—		(3,643	)
Changes in restricted cash		3,550			—		—		3,550			—			—		3,550
Proceeds from issuance of short term notes		—			—		—		—			(148,281	)		—		(148,281	)
Proceeds from bank indebtedness		(80,048	)		—		—		(80,048	)		—			—		(80,048	)
Repayment of short term notes		(11,000	)		—		—		(11,000	)		—			—		(11,000	)
Proceeds from issuance of- related party notes		103,817			—		—		103,817			—			—		103,817
Repayment of related party notes		(166,559	)		—		—		(166,559	)		(25,544	)		—		(192,103	)
Net proceeds from additional paid in capital		385,548			—		—		385,548			—					(385,548	)
Proceeds from issuance of common stock		55,000			—		—		55,000			—			385,548		440,548
Net cash provided by (Used in) financing activities- continuing operations		286,665			—		—		286,665			(173,825	)		—		112,840
Net cash provided by (Used in) financing activities- discontinued operations		—			—		—		—			173,825			—		173,825
Net cash provided by financing activities		286,665			—		—		286,665			—			—		286,665
Effect of exchange rate on cash		194,174			—		—		194,174			—			—		194,174
Net increase in cash	$	—		$	—	$	—	$	—		$	—		$	—	$	—
Supplemental cash flow information
Cash paid for interest	$	145,523			—		—		—			—			—	$	145,523
Cash paid for income taxes		—			—		—		—			—			—		—
Supplemental schedules of noncash investing and financing activities
Common stock issued as a result of conversion of convertible notes payable	$	397,298			—		—		—			—			—	$	397,298
Common stock issued as a result of conversion of short term notes payable		—			—		—		—			—			—		—