| Note 2. Significant Accounting Policies | Basis of Presentation and Principles of
Accounting The interim consolidated financial statements
included herein have been prepared by the Company, without audit, in accordance with the rules and regulations of the Securities
and Exchange Commission ("SEC") pursuant to Part 210 of Regulation S-X. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States
of America ("GAAP") have been condensed or omitted pursuant to such SEC rules and regulations, although the Company believes
that the disclosures included are adequate to make the information presented not misleading. In management's opinion, the unaudited consolidated
financial statements contained herein reflect all adjustments, consisting solely of normal recurring items, which are necessary
for the fair presentation of the Company's financial position, results of operations, and cash flows on a basis consistent with
that of the Company's prior audited consolidated financial statements. The Company has evaluated information about subsequent events
that became available to us through the date the financial statements were issued. This information relates to events, transactions
or changes in circumstances that would require us to adjust the amounts reported in the financial statements or to disclose information
about those events, transactions or changes in circumstances. The results of operations for interim periods may not be indicative
of results to be expected for the full fiscal year. Therefore, these financial statements should be read in conjunction with the
Company's audited financial statements, including the notes thereto for the year ended December 31, 2015, which may be found under
the Company's profile on EDGAR. Principles of Consolidation These consolidated financial statements have
been prepared in accordance with US GAAP and include the accounts of the Company and its wholly owned subsidiary, RenovaCare Sciences.
All significant intercompany transactions and balances have been eliminated. RenovaCare Sciences was incorporated under the laws
of the State of Nevada on June 12, 2013. Applicable Accounting Guidance Any reference in these notes to applicable
accounting guidance is meant to refer to the authoritative non-governmental US GAAP as found in the Financial Accounting Standards
Board's Accounting Standards Codification. In May 2014, the Financial Accounting Standards
Board ("FASB") issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition
requirements in Accounting Standards Codification ("ASC") 605, Revenue Recognition. The new revenue recognition standard
requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount
that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09
is effective for interim and annual reporting periods beginning after December 15, 2017 and is to be applied retrospectively. The
Company does not currently have any revenue. As such, ASU 2014-09 will not have any effect on the Company's results of operations
and financial position. If the Company begins generating revenue prior to the effective date of ASU 2014-09, it will evaluate the
effect that ASU 2014-09 will have on its results of operations and financial position. In February 2016, the FASB issued ASU 2016-02,
Leases, which supersedes ASC Topic 840, Leases, and creates a new topic, ASC Topic 842, Leases. ASU 2016-02 requires lessees to
recognize a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months on
its balance sheet. ASU 2016-02 also expands the required quantitative and qualitative disclosures surrounding leases. ASU 2016-02
is effective for the Company beginning January 1, 2019. Early adoption is permitted. The Company has determined that the adoption
of ASU 2016-02 will currently have no impact on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-19,
Stock Compensation, which is intended to simplify several aspects of the accounting for share-based payment award transactions.
The guidance will be effective for the fiscal year beginning after December 15, 2016, including interim periods within that year.
The Company is in the process of evaluating the impacts of the adoption of this ASU. Accounting Estimates The preparation of consolidated financial statements
in conformity with accounting principles generally accepted in the United States of America requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses during
the reporting period. Actual results, as determined by future events, may differ from these estimates. Cash and Cash Equivalents The Company considers all highly liquid instruments
purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents may at times exceed
federally insured limits. Fair Value of Financial Instruments The carrying amounts for cash and cash equivalents,
contract and contribution payable and accounts payable and accrued expenses approximate fair value based on observable quoted prices
for active markets Level 1 inputs. Research and Development Costs The Company intends to outsource its research
and development efforts and expense related costs as incurred, including the cost of manufacturing product for testing, licensing
fees and costs associated with planning and conducting clinical trials. The value ascribed to patents and other intellectual property
acquired will be capitalized as it relates to particular research and development projects that may have alternative future uses.
Intangible Assets The intangible asset consists primarily of
the CellMist TM The Company assessed the following qualitative
factors that could affect any change in the fair value of the intangible asset: analysis of the technology's current phase, additional
testing necessary to bring the technology to market, development of competing products, changes in projections caused by delays,
changes in regulations, changes in the market for the technology and changes in cost projections to bring the technology to market.
Based on a qualitative assessment, management concluded that a positive assertion can be made from the qualitative assessment
that it is more likely than not that the intangible asset related to the SkinGun TM Stock Options The Company measures all stock-based compensation
awards using a fair value method on the date of grant and recognizes such expense in its consolidated financial statements over
the requisite service period. The Company uses the Black-Scholes pricing model to determine the fair value of stock-based compensation
awards on the date of grant. The Black-Scholes pricing model requires management to make assumptions regarding option lives, expected
volatility, and risk free interest rates. Income Taxes The Company recognizes income taxes on an accrual
basis based on tax positions taken, or expected to be taken, in tax returns. A tax position is defined as a position in a previously
filed tax return or a position expected to be taken in future tax filing that is reflected in measuring current or deferred income
tax assets and liabilities. Tax positions are recognized only when it is more likely than not (i.e., likelihood of greater than
50%), based on technical merits, that the position would be sustained upon examination by taxing authorities. Tax positions that
meet the more likely than not threshold are measured using a probability-weighted approach as the largest amount of tax benefit
that is greater than 50% likely of being realized upon settlement. Income taxes are accounted for using an asset and liability
approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events
that have been recognized in the Company's financial statements or tax returns. A valuation allowance is established to reduce
deferred tax assets if all, or some portion, of such assets will more than likely not be realized. Should they occur, the Company's
policy is to classify interest and penalties related to tax positions as interest expense. Since the Company's inception, no such
interest or penalties have been incurred. The Company did not record an income tax provision during the periods presented due to
net taxable losses. Earnings (Loss) Per Share The Company presents both basic and diluted
earnings per share ("EPS") amounts. Basic EPS is calculated by dividing net income (loss) by the weighted average number
of common shares outstanding during the period presented. Diluted EPS amounts are based upon the weighted average number of common
and common equivalent shares outstanding during the period presented. Potentially dilutive shares of common stock consisted of
warrants to purchase shares of common stock (6,796,087 shares as of March 31, 2016 and 8,970,000 at December 31, 2015) and options
to purchase shares of common stock (437,500 shares as of March 31, 2016 and 257,500 as of December 31, 2015). During the periods
presented, potentially dilutive shares of common stock were not included in the computation of dilutive loss per share as to do
so would be anti-dilutive. Related Party Transactions A related party is generally defined as (i)
any person who holds 10% or more of the Company's securities and their immediate families; (ii) the Company's management; (iii)
someone who directly or indirectly controls, is controlled by or is under common control with the Company; or (iv) anyone who can
significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party
transaction when there is a transfer of resources or obligations between related parties. See "Note 6. Related Party Transactions,"
for further discussion. |
