| ORGANIZATION AND ACCOUNTING POLICIES | NOTE 2 ORGANIZATION AND ACCOUNTING POLICIES (a) Organization Mindesta, Inc. was incorporated on November 6, 1996, as Winchester Mining Corporation in the State of Delaware. Effective July 26, 2011, the Company changed its name to Mindesta Inc. Effective July 20, 2015 the Company changed its name to CTT Pharmaceutical Holdings, Inc.. The Company trades on the OTC under the symbol MDST. (b) Reverse Acquisition and Recapitalization On September 9, 2015, Mindesta entered into a Share Exchange Agreement (the Exchange Agreement) with CTT Pharmaceuticals, Inc., f/k/a Fenwafe Inc., an entity organized under the Canadian Corporations Business Act in March 2007 and the shareholders of CTT Pharma whereby Mindesta acquired all of the issued and outstanding shares of common stock of CTT Pharma in consideration for the issuance of 14,918,329 shares of Mindesta common stock. The 14,073,895 restricted shares of Mindesta common stock issued to former CTT Pharma stockholders and the 844,434 shares of Mindesta restricted shares issued at closing represent approximately 80% of the then issued and outstanding common stock of Mindesta. As a result of the transactions effected by the Exchange Agreement, at closing CTT Pharma became a wholly owned subsidiary of Mindesta and Mindesta has abandoned all of its previous business operations with the business of CTT Pharma now being Mindestas sole business. CTT Pharma is a development stage company with limited operations to date focused on developing an oral delivery system of medication contained on a disposable film. The Exchange Agreement was accounted for as a reverse acquisition and recapitalization of the Company and as a result, the consolidated financial statements of the Company (the legal acquirer) are, in substance, those of CTT Pharma (the accounting acquirer), with the assets and liabilities, and expenses of the Company being included effective from the date of the Exchange Agreement. As the Exchange Agreement was accounted for as a reverse acquisition and recapitalization, there was no gain or loss recognized on the transaction. The transaction is in substance a capital transaction, rather than a business combination, thus no goodwill or other intangible assets have been recorded. The significant components of the transaction are as follows: Assets acquired $ 1,867 Liabilities assumed (31,767 ) Net $ (29,900 ) The historical financial statements for periods prior to the Exchange Agreement are those of CTT Pharma, except that the equity section and earnings per share have been retroactively restated to reflect the Exchange Agreement. As a result of the Exchange Agreement, the Company has ceased mineral exploration and focuses on oral drug delivery systems (note 1). (c) Significant Accounting Policies i) Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original or remaining maturity of less than three months at the date of purchase to be cash equivalents. Cash and cash equivalents include balances with banks and operating line of credit. ii) Revenue Recognition Revenue is recognized when persuasive evidence of an arrangement exists, title passes to the customer, typically upon delivery, and when collection of the fixed or determinable selling price is reasonably assured. iii) Functional and Presentation Currency The functional currency of CTT Pharma is the Canadian Dollar and the functional currency of Mindesta is the United States Dollar. The reporting currency is the United States Dollar. The financial statements of the CTT Pharma are translated to United States dollars in accordance with ASC 830 using period-end rates of exchange for assets and liabilities, and average rates of exchange for the period for revenues and expenses. Translation gains (losses) are recorded in accumulated other comprehensive income (loss) as a component of stockholders equity. iv) Comprehensive Income Other comprehensive income refers to revenues, expenses, gains and losses that under generally accepted accounting principles are included in comprehensive income, but are excluded from net income as these amounts are recorded directly as an adjustment to stockholders equity. Comprehensive income relates to the effects of translation from CTT Pharmas functional currency of the Canadian Dollar to the presentation currency of the United States Dollar. v) Share Capital Proceeds from share issuance net of share issuance costs are recorded at the amount paid. Share capital issued for non-monetary consideration is recorded at the fair market value of the shares on the date the shares are issued. vi) Earnings Per Share Basic earnings per share is computed using the weighted average number of common shares outstanding during the period, and diluted earnings per share is computed using the weighted average number of common shares outstanding during the period adjusted for all potentially dilutive common stock equivalents, except in cases where the effect of the common stock equivalents would be antidilutive. There were no potentially dilutive common stock equivalents outstanding at June 30, 2015 or 2014. vii) Financial Instruments The fair market value of the Companys financial instruments comprising cash, accounts payable and accrued liabilities and due to shareholder were estimated to approximate their carrying values due to immediate or short-term maturity of these financial instruments. The Company maintains cash balances at financial institutions which do not exceed federally insured amounts. The Company has not experienced any material losses in such accounts. The Company is not exposed to any foreign exchange or interest rate risk. viii) Fair Value of Financial Instruments We measure and disclose certain financial assets and liabilities at fair value. ASC Topic 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC Topic 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. We utilize the active market approach to measure fair value for our financial assets and liabilities. We report separately each class of assets and liabilities measured at fair value on a recurring basis and include assets and liabilities that are disclosed but not recorded at fair value in the fair value hierarchy. The fair values of cash, accounts payable and accrued liabilities, and due to shareholder for all periods presented approximate their respective carrying amounts due to the short term nature of these financial instruments. The fair value of the liability to issue common shares is calculated based on the published closing stock price of Mindesta at June 30, 2015. ix) Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance so that the assets are recognized only to the extent that when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will be realized. Per FASB ASC 740 Income taxes under the liability method, it is the Companys policy to provide for uncertain tax positions and the related interest and penalties based upon managements assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. At June 30, 2015, the Company believes it has appropriately accounted for any unrecognized tax benefits. To the extent the Company prevails in matters for which a liability for an unrecognized benefit is established or is required to pay amounts in excess of the liability, the Companys effective tax rate in a given financial statement period may be affected. Interest and penalties associated with the Companys tax positions are recorded as Interest Expense. x) Research Costs Research costs are expensed in the period incurred. The Company expenses development costs in the period incurred, except when it is determined that the costs meet United States GAAP criteria for deferral and amortization. Deferred development costs, if any, will be amortized on straight-line basis over the expected useful life of the underlying product. xi) Use of Estimates The preparation of consolidated financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made by management in the accompanying financial statements include the valuation of deferred tax assets, and estimation of market rates of interest imputed on non-interest bearing shareholder loans. (d) Recently Adopted and Future Accounting Pronouncements i) ASU 2014-05 In March 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-05, Foreign Currency Matters (Topic 830); Parents Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This guidance applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business (other than a sale of substance real estate or conveyance of oil and gas, mineral rights) within a foreign entity. ASU No. 2014-05 is effective prospectively for fiscal periods (and interim reporting periods with those periods) beginning after December 15, 2014. The adoption of ASU 2014-05 did not have a material impact on our financial position or results of operations. ii) ASU 2014-11 In July 2014, FASB issued ASU 2014-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or Tax Credit Carryforward Exits. The FASBs objective in issuing this ASU is to eliminate diversity in practice resulting from a lack of guidance on this topic in current U.S. GAAP. This ASU applies to all entities with unrecognized tax benefits that also have tax loss or tax credit carryforwards in the same tax jurisdiction as of the reporting date. ASU No. 2014-11 is effective for public entities for fiscal periods beginning after December 15, 2014, and interim periods within those periods. Early adoption is permitted. The amendments should be applied to all unrecognized tax benefits that exist as of the effective date. Entities may choose to apply the amendments retrospectively to each prior reporting period presented. The adoption of ASU 2014-05 did not have a material impact on our financial position or results of operations. iii) ASU 2015-08 In April 2015, FASB issued ASU 2015-08, Discontinued Operations. ASC guidance was issued related to discontinued operations which changed the criteria for determining which disposals can be presented as discontinued operations and modified related disclosure requirements. The updated guidance requires an entity to only classify discontinued operations due to a major strategic shift or a major effect on an entitys operations in the financial statements. The updated guidance will also require additional disclosures relating to discontinued operations. The update is effective prospectively for the Companys fiscal period beginning January 1, 2015. Early application is permitted. Adoption of ASU 2015-08 did not have an impact on our financial position or results of operations. iv) ASU 2015-12 In June 2015, FASB issued ASU 2015-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. ASC guidance was issued to update the guidance on performance stock awards. The guidance requires that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. This standard is effective for the Companys fiscal period beginning January 1, 2016. Early application is permitted. The Company does not expect the updated guidance to have a material impact on the consolidated financial position, results of operations or cash flows. iv) ASU 2015-15 In August 2015, FASB issued ASU 2015-15, Presentation of Financial Statements Going Concern. ASC guidance was issued that explicitly requires management to assess an entitys ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. This standard is effective for the Companys fiscal period ending December 31, 2017, and for annual periods and interim periods thereafter. Early application is permitted. The Company does not expect the updated guidance to have a material impact on the consolidated financial position, results of operations or cash flows. |
