Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2016 | Jun. 03, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | CIPHERLOC CORPORATION | |
Entity Central Index Key | 1,022,505 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 4,813,541 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,016 |
Balance Sheets
Balance Sheets - USD ($) | Mar. 31, 2016 | Sep. 30, 2015 |
CURRENT ASSETS: | ||
Cash | $ 750,767 | $ 1,993,406 |
Assets attributable to discontinued operations | 3,232 | 3,232 |
Total current assets | 753,999 | $ 1,996,638 |
LONG TERM ASSETS: | ||
Lease deposit | 7,217 | |
Total long term assets | 7,217 | |
TOTAL ASSETS | 761,216 | $ 1,996,638 |
CURRENT LIABILITIES: | ||
Accounts payable and accrued liabilities | 29,569 | 69,194 |
Accrued compensation | 345,408 | $ 1,031,751 |
Deferred revenue-curent | 450,000 | |
Liabilities attributable to discontinued operations | 18 | $ 18 |
Total current liabilities | 824,995 | 1,100,963 |
LONG TERM LIABILITIES | ||
Deferred revenue | 558,686 | 1,125,000 |
Total long-term liabilities | 558,686 | 2,225,963 |
TOTAL LIABILITIES | 1,383,681 | 2,225,963 |
STOCKHOLDERS' DEFICIT: | ||
Preferred stock, $0.01 par value, 10,000,000 shares authorized; 10,000,000 issued and outstanding as of March 31, 2016 and September 30, 2015 | 100,000 | 100,000 |
Common stock, $0.01 par value, 650,000,000 shares authorized; 4,469,241 and 4,356,741 issued and outstanding as of March 31, 2016 and September 30, 2015, respectively | $ 44,692 | 43,567 |
Stock subscription receivable | (50,000) | |
Additional paid-in capital | $ 43,057,310 | 42,815,934 |
Accumulated deficit | (43,824,467) | (43,138,826) |
Total stockholders' deficit | (622,465) | (229,325) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ 761,216 | $ 1,996,638 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2016 | Sep. 30, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, Par Value | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Issued | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Outstandng | 10,000,000 | 10,000,000 |
Common Stock, Par Value | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 650,000,000 | 650,000,000 |
Common Stock, Shares Issued | 4,469,421 | 4,356,741 |
Common Stock, Shares Outstanding | 4,469,421 | 4,356,741 |
Statements of Operations
Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement [Abstract] | ||||
REVENUE | $ 112,500 | $ 116,314 | $ 431 | |
COST OF REVENUES | 30,300 | $ 64,650 | 30,300 | 127,970 |
GROSS PROFIT (LOSS) | 82,200 | (64,650) | 86,014 | (127,539) |
OPERATING EXPENSES: | ||||
General and administrative | $ 251,550 | 10,107,671 | $ 577,817 | 10,283,996 |
Impairment | 238,531 | 238,531 | ||
Research and development | $ 110,493 | 19,469 | $ 237,643 | 41,650 |
Total operating expenses | 362,043 | 10,365,671 | 815,460 | 10,564,177 |
OPERATING LOSS | (279,843) | $ (10,430,321) | (729,446) | $ (10,691,716) |
OTHER INCOME (EXPENSE) | ||||
Gain on extinguishment of debt | $ 43,911 | 43,911 | ||
Interest expense | $ (817) | (106) | $ (1,841) | |
Total other income (expenses) | $ 43,911 | (817) | 43,805 | (1,841) |
LOSS FROM CONTINUING OPERATIONS | $ (235,932) | (10,431,138) | $ (685,641) | (10,693,557) |
LOSS FROM DISCONTINUED OPERATIONS | (155) | (869) | ||
NET LOSS | $ (235,932) | $ (10,431,293) | $ (685,641) | $ (10,694,426) |
NET LOSS PER COMMON SHARE - Basic and diluted: | ||||
Continuing operations | $ (0.05) | $ (3.68) | $ (0.15) | $ (3.77) |
Discontinued operations | 0 | 0 | 0 | 0 |
Total | $ (0.05) | $ (3.68) | $ (0.15) | $ (3.77) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING Basic and diluted | 4,494,241 | 2,832,587 | 4,480,662 | 2,833,320 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 6 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (685,641) | $ (10,694,426) |
Loss from discontinued operations | 869 | |
Net from continuing operations | $ (685,641) | $ (10,693,557) |
Adjustments to reconcile net loss from continuing operations to net cash (used in) provided by operating activities: | ||
Gain on extinguishment of debt | $ (43,911) | |
Impairment of software | $ 238,531 | |
Depreciation and amortization | 127,240 | |
Gain on cancellation of stock issued for services | (4,752) | |
Stock based compensation | $ 27,500 | $ 9,900,000 |
Changes in operating assets and liabilities: | ||
Deferred revenue | $ (116,314) | |
Accounts receivable | $ 7,006 | |
Accounts payable and accrued liabilities | $ (680,853) | (18,732) |
Net cash (used in) operating activities | (1,499,219) | $ (444,264) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Deposits with others | (7,216) | |
Net cash from investing activities | (7,216) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayment of advances from officer | $ (1,205) | |
Subscribed stock | $ (7,000) | |
Repayment of line of credit | $ (7,514) | |
Common stock issued for cash | $ 265,001 | |
Net cash (used in) provided by financing activities | 263,796 | $ (14,514) |
DECREASE IN CASH | (1,242,639) | (458,778) |
CASH, BEGINNING OF YEAR | 1,993,406 | 545,650 |
CASH, END OF YEAR | 750,767 | 86,872 |
CASH PAID FOR: | ||
Interest paid | $ 106 | $ 1,222 |
Taxes paid | ||
SUPPLEMENTAL DISCLOSURE OF NONCASH OPERATING AND FINANCING ACTIVITIES: | ||
Cancellation of stock for rescinded subscription | $ 50,000 | |
Cancellation of stock rescinded for purchase of software | $ 6,000 | |
Cancellation of common stock | $ 150 |
1. DESCRIPTION OF BUSINESS
1. DESCRIPTION OF BUSINESS | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
1. DESCRIPTION OF BUSINESS | NOTE 1 - DESCRIPTION OF BUSINESS Cipherloc Corporation (the Company) was incorporated in Texas on June 22, 1953 as American Mortgage Company. On March 15, 2015, the Company changed its name to Cipherloc Corporation. The name change became effective by the Amended Certificate as of March 23, 2015 . CipherLoc is a data security solutions company. Our highly innovative products - based on our patented polymorphic encryption technology - are designed to enable an iron-clad layer of protection to be added to existing solutions. CipherLoc has developed technology that: Dramatically enhances data security Can be easily added to existing products Is scalable and future-proof Our solutions are not a replacement of existing encryption technologies but rather an enhancement to them. Our mobile, desktop, and server software solutions are specifically designed to be added to any third-party application, service, or product. With a highly flexible and modular technology that can be easily added other software solutions, CipherLoc can support a wide range of use cases including any-to-any security (mobile-to-mobile, mobile-to-desktop, desktop-to-cloud, etc.), dynamically-created VPNs (where no provisioning is necessary), and many others. |
2. BASIS OF PRESENTATION OF INT
2. BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS | 6 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
2. BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS | NOTE 2 BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America. The accompanying interim unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the six months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the year ending September 30, 2016. Notes to the unaudited interim financial statements that would substantially duplicate the disclosures contained in the audited financial statements for the year ended September 30, 2015 have been omitted; this report should be read in conjunction with the audited financial statements and the footnotes thereto for the fiscal year ended September 30, 2015 included within the Companys Form 10-K as filed with the Securities and Exchange Commission. |
3. GOING CONCERN
3. GOING CONCERN | 6 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
3. GOING CONCERN | NOTE 3 - GOING CONCERN The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. However, the Company has incurred losses from operations, has an accumulated deficit at March 31, 2016 of $43,824,467 and needs additional cash to maintain its operations . We intend to continue raising money through a private placement memorandum and also by the release of products during the 2016 calendar year to fund our operations. These factors raise doubt about the Companys ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Companys continued existence is dependent upon managements ability to develop profitable operations, continued contributions from the Companys executive officers to finance its operations and the ability to obtain additional funding sources to explore potential strategic relationships and to provide capital and other resources for the further development and marketing of the Companys products and business. |
4. SUMMARY OF SIGNIFICANT ACCOU
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America. Significant accounting policies are as follows: Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At March 31, 2016 and 2015, cash and cash equivalents include cash on hand and cash in the bank. The Company maintains its cash in accounts held by large, globally recognized banks which, at times, may exceed federally insured limits as guaranteed by the Federal Deposit Insurance Corporation (FDIC). The FDIC insures these deposits up to $250,000. At March 31, 2016, $490,672 of the Companys cash balance was uninsured. The Company has not experienced any losses in such accounts. Basic and Diluted Net Loss per Common Share Basic income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. The weighted average number of shares is calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Diluted earnings per share reflects the potential dilution that could occur if stock options, warrants, and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. As of March 31, 2016 and September 30, 2015, the Company had 10,000,000 shares of preferred stock outstanding which are convertible into 15,000,000 shares of common stock. Diluted loss per share is the same as basic loss per share during periods where net losses are incurred since the inclusion of the potential common stock equivalents would be anti-dilutive as a result of the net loss. Concentration of Credit Risk and Customer Concentrations All of the Companys cash and cash equivalents are maintained in regional and national financial institutions. The Company has exposure to credit risk to the extent that its cash and cash equivalents exceed amounts covered by the U.S. federal deposit insurance; however, the Company has not experienced any losses in such accounts. In managements opinion, the capitalization and operating history of the financial institutions are such that the likelihood of material loss is remote. During the three and six months ended March 31, 2016, one customer made up 100% of revenues. Management believes the loss of this customer would have a material impact on the Companys financial position, results of operations, and cash flows. Revenue Recognition Software license revenue is generally recognized when a signed contract or other persuasive evidence of an arrangement exists, the software has been electronically delivered, the license fee is fixed or is measured on a paid user basis; and collection of the resulting receivable is probable. When contracts contain multiple elements wherein Vendor-Specific Objective Evidence (VSOE) exists for all undelivered elements, we account for the delivered elements in accordance with the Residual Method. VSOE of fair value for maintenance and support is established by a stated renewal rate, if substantive, included in the license arrangement or rates charged in stand-alone sales of maintenance and support. Revenue from subscription license agreements, which include software, rights to unspecified future products and maintenance, is recognized ratably over the term of the subscription period. When the fair value of VSOE of post contract customer support cannot be determined, the revenue is recognized ratably over the contract period. In June 2014, the Company entered into an agreement to provide software and support to a third party for which no VSOE for any elements is known. Delivery of the use of the license was not achieved until December 2015; the only remaining undelivered element was post contract support services, and accordingly, the revenues will be recognized on a pro rata basis prospectively over the remaining 30 months of the related contracts. Deferred revenue results from fees billed to or collected from customers for which revenue has not yet been recognized. The Company has deferred revenue from one customer of $1,008,686 as of March 31, 2016 and $1,125,000 as of September 30, 2015. Research and Development and Software Development Costs Capitalization of certain software development costs are recorded after the determination of technological feasibility. Based on our product development process, technological feasibility is determined upon the completion of a working model. To date, costs incurred by us from the completion of the working model to the point at which the product is ready for general release have been insignificant. Accordingly, we have charged all such costs to research and development expense in the period incurred. Our research and development costs incurred in our continuing operations for the three and six months ended March 31, 2016 and 2015 were $110,493, $19,469, $237,643 and $41,650, respectively. Recent Accounting Announcements The FASB issues ASUs to amend the authoritative literature in ASC. There have been a number of ASUs to date that amend the original text of ASC. The Company believes those issued to date either (1) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 840), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, for a public entity. Early adoption of the amendments in this standard is permitted for all entities and the Company must recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently in the process of evaluating the effect this guidance will have on its financial statements and related disclosures. |
5. RELATED PARTY TRANSACTIONS
5. RELATED PARTY TRANSACTIONS | 6 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
5. RELATED PARTY TRANSACTIONS | NOTE 5 RELATED PARTY TRANSACTIONS The advances from the CEO are due on demand and do not accrue interest. These advances are included in accounts payable and accrued liabilities on the balance sheet. The Company had advances from the CEO of $0 and $1,205 as of March 31, 2016 and September 30, 2015, respectively. |
6. DISCONTINUED OPERATIONS
6. DISCONTINUED OPERATIONS | 6 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
6. DISCONTINUED OPERATIONS | NOTE 6 DISCONTINUED OPERATIONS Cloud MD Sale The Companys Board of Directors believed that it was in the best interest of the Company to discontinue the former business operation Cloud MD. During September 2015, the Cloud MD business segment was discontinued and a plan of sale of the segment was approved. The Cloud MD sale occurred in October 2015 as a $250,000 note payable from a former employee of Cloud MD. The note receivable has five annual payments of $50,000 and carries interest of 3% a year. We reviewed the need for an allowance for loan loss and estimation of impairment of the note receivable based on professional relationship and experience with the buyer and the specifics of the agreements. As it was determined that collectability of the cash was not reasonably assured, the Company has fully reserved the receivable, and the Company will record the gain from the sale of assets of discontinued operations in the future when and if cash is received. |
7. EQUITY
7. EQUITY | 6 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
7. EQUITY | NOTE 7 - EQUITY As of March 31, 2016, the Company was authorized to issue 650,000,000 common shares and 10,000,000 preferred shares at a par value of $0.01. Common Stock On April 11, 2011, the Company amended its articles of incorporation to increase the authorized shares to 650,000,000 shares, at $0.01 par value. There were 4,469,241 shares issued and outstanding as of March 31, 2016. The holders of our common stock are entitled to receive such dividends, if any, as may be declared by our board of directors from time to time out of legally available funds. The dividend rights of our common stock are junior to any preferential dividend rights of any outstanding shares of preferred stock. The holders of our common stock also are entitled to receive distributions upon our liquidation, dissolution or winding up of our assets that are legally available for distribution, after payment of all debt and other liabilities and distribution in full of preferential amounts, if any, to be distributed to holders of our preferred stock. The holders of our common stock are not entitled to preemptive, subscription, redemption or conversion rights. The rights, preferences and privileges of holders of our common stock are subject to, and may be adversely affected by, the rights of any series of preferred stock that we may designate and issue in the future. During the three months ended March 31, 2016, there were no shares of common stock sold for cash. During the six months ended March 31, 2016, 132,500 shares of common stock were sold for cash proceeds of $265,001. On October 22, 2015, the Company issued 5,000 shares of common stock to an individual per an asset purchase agreement. The shares had a value of $27,500 on the date of issue, which was treated as a research and development expense rather than an asset, as the purchased technology has not reached technological feasibility. Preferred Stock As of March 31, 2016, the Series A Preferred Stock is convertible into the Companys common stock at a rate of 1 to 1.5 common shares. As of March 31, 2016, there are a total of 10,000,000 shares of the Series A Preferred Stock authorized and outstanding which are convertible into a total of 15,000,000 shares of common stock. Each share of the Preferred Stock has 150 votes on all matters presented to be voted by the holders of common stock. The holders of the Preferred A shares can only convert the shares if agreed upon by 50.1% vote of all preferred shareholders. |
8. COMMITMENTS AND CONTINGENCIE
8. COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
8. COMMITMENTS AND CONTINGENCIES | NOTE 8 - COMMITMENTS AND CONTINGENCIES Litigation The Company is involved in various collections matters; the defendants have asserted certain counterclaims. While the outcome and impact of currently pending legal proceedings cannot be predicted with certainty, based on the current status of the matters, we believe that the resolution of these proceedings through settlement or judgment will not have a material adverse effect on our operating results, financial position or cash flow. |
9. SUBSEQUENT EVENTS
9. SUBSEQUENT EVENTS | 6 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
9. SUBSEQUENT EVENTS | NOTE 9 - SUBSEQUENT EVENTS The Company hired Mike Salas as Vice President of Sales and Marketing on April 25, The employment contract grants an annual salary of $175,000 and restricted common stock with an annual value of $125,000. One quarter of the stock shall be granted at the end of the first quarter anniversary of employment and a like amount each quarter as long as the contract is in effect. The Company also executed a three-year lease agreement effective April 1, 2016 for a free standing building with annual rent of $86,596 for the first year increasing annual to $90,502 for the third year. The lease is automatically renewable for two one year periods at the Companys option. The building is located in Buda, Texas. Since March 31, 2016, the Company has issued 315,500 restricted common shares through a Private Placement Memorandum for cash proceeds totaling $631,000 . The Company also issued 28,800 shares for services in lieu of cash. |
4. SUMMARY OF SIGNIFICANT ACC15
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At March 31, 2016 and 2015, cash and cash equivalents include cash on hand and cash in the bank. The Company maintains its cash in accounts held by large, globally recognized banks which, at times, may exceed federally insured limits as guaranteed by the Federal Deposit Insurance Corporation (FDIC). The FDIC insures these deposits up to $250,000. At March 31, 2016, $490,672 of the Companys cash balance was uninsured. The Company has not experienced any losses in such accounts. |
Basic and Diluted Net Loss per Common Share | Basic and Diluted Net Loss per Common Share Basic income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. The weighted average number of shares is calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Diluted earnings per share reflects the potential dilution that could occur if stock options, warrants, and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. As of March 31, 2016 and September 30, 2015, the Company had 10,000,000 shares of preferred stock outstanding which are convertible into 15,000,000 shares of common stock. Diluted loss per share is the same as basic loss per share during periods where net losses are incurred since the inclusion of the potential common stock equivalents would be anti-dilutive as a result of the net loss. |
Concentration of Credit Risk | Concentration of Credit Risk and Customer Concentrations All of the Companys cash and cash equivalents are maintained in regional and national financial institutions. The Company has exposure to credit risk to the extent that its cash and cash equivalents exceed amounts covered by the U.S. federal deposit insurance; however, the Company has not experienced any losses in such accounts. In managements opinion, the capitalization and operating history of the financial institutions are such that the likelihood of material loss is remote. During the three and six months ended March 31, 2016, one customer made up 100% of revenues. Management believes the loss of this customer would have a material impact on the Companys financial position, results of operations, and cash flows. |
Revenue Recognition | Revenue Recognition Software license revenue is generally recognized when a signed contract or other persuasive evidence of an arrangement exists, the software has been electronically delivered, the license fee is fixed or is measured on a paid user basis; and collection of the resulting receivable is probable. When contracts contain multiple elements wherein Vendor-Specific Objective Evidence (VSOE) exists for all undelivered elements, we account for the delivered elements in accordance with the Residual Method. VSOE of fair value for maintenance and support is established by a stated renewal rate, if substantive, included in the license arrangement or rates charged in stand-alone sales of maintenance and support. Revenue from subscription license agreements, which include software, rights to unspecified future products and maintenance, is recognized ratably over the term of the subscription period. When the fair value of VSOE of post contract customer support cannot be determined, the revenue is recognized ratably over the contract period. In June 2014, the Company entered into an agreement to provide software and support to a third party for which no VSOE for any elements is known. Delivery of the use of the license was not achieved until December 2015; the only remaining undelivered element was post contract support services, and accordingly, the revenues will be recognized on a pro rata basis prospectively over the remaining 30 months of the related contracts. Deferred revenue results from fees billed to or collected from customers for which revenue has not yet been recognized. The Company has deferred revenue from one customer of $1,008,686 as of March 31, 2016 and $1,125,000 as of September 30, 2015. |
Research and Development and Software Development Costs | Research and Development and Software Development Costs Capitalization of certain software development costs are recorded after the determination of technological feasibility. Based on our product development process, technological feasibility is determined upon the completion of a working model. To date, costs incurred by us from the completion of the working model to the point at which the product is ready for general release have been insignificant. Accordingly, we have charged all such costs to research and development expense in the period incurred. Our research and development costs incurred in our continuing operations for the three and six months ended March 31, 2016 and 2015 were $110,493, $19,469, $237,643 and $41,650, respectively. |
Recent Accounting Announcements | Recent Accounting Announcements The FASB issues ASUs to amend the authoritative literature in ASC. There have been a number of ASUs to date that amend the original text of ASC. The Company believes those issued to date either (1) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 840), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, for a public entity. Early adoption of the amendments in this standard is permitted for all entities and the Company must recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently in the process of evaluating the effect this guidance will have on its financial statements and related disclosures. |
3. GOING CONCERN (Details Narra
3. GOING CONCERN (Details Narrative) - USD ($) | Mar. 31, 2016 | Sep. 30, 2015 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated Deficit | $ (43,824,467) | $ (43,138,826) |
4. SUMMARY OF SIGNIFICANT ACC17
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Sep. 30, 2015 | |
Accounting Policies [Abstract] | |||||
Deferred Revenue | $ 558,686 | $ 558,686 | $ 1,125,000 | ||
Research and Development Costs | $ 110,493 | $ 19,469 | $ 237,643 | $ 41,650 | |
Preferred Stock, Shares Outstanding | 10,000,000 | 10,000,000 | 10,000,000 |