Know Labs (KNW) 10-Q 9 Aug 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Jun. 30, 2018	Aug. 09, 2018
Document And Entity Information
Entity Registrant Name	KNOW LABS, INC.
Entity Central Index Key	1,074,828
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
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		16,570,162
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2,018

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2018	Sep. 30, 2017
CURRENT ASSETS:
Cash and cash equivalents	$ 1,304,499	$ 103,181
Accounts receivable, net of allowance of $60,000 and $60,000, respectively	430,460	693,320
Prepaid expenses	9,899	27,687
Inventories, net	170,734	225,909
Total current assets	1,915,592	1,050,097
EQUIPMENT, NET	114,539	133,204
OTHER ASSETS
Intangible assets	520,000	0
Other assets	7,170	5,070
TOTAL ASSETS	2,557,301	1,188,371
CURRENT LIABILITIES:
Accounts payable - trade	1,442,684	2,156,646
Accounts payable - related parties	0	2,905
Accrued expenses	32,688	24,000
Accrued expenses - related parties	703,226	1,166,049
Deferred revenue	4,210	63,902
Convertible notes payable	2,390,065	570,000
Notes payable - current portion of long term debt	394,670	1,165,660
Total current liabilities	4,967,543	5,149,162
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIT
Preferred stock - $0.001 par value, 5,000,000 shares authorized, 0 shares issued and outstanding at 6/30/2018 and 9/30/2017, respectively	0	0
Common stock - $0.001 par value, 100,000,000 shares authorized, 15,538,726 and 4,655,486 shares issued and outstanding at 6/30/2018 and 9/30/2017, respectively	15,539	4,655
Additional paid in capital	31,438,791	27,565,453
Accumulated deficit	(33,867,400)	(31,533,727)
Total stockholders' deficit	(2,410,242)	(3,960,791)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	2,557,301	1,188,371
Series A Convertible Preferred stock [Member]
STOCKHOLDERS' DEFICIT
Preferred stock - $0.001 par value, 5,000,000 shares authorized, 0 shares issued and outstanding at 6/30/2018 and 9/30/2017, respectively	23	23
Series C Convertible Preferred stock [Member]
STOCKHOLDERS' DEFICIT
Preferred stock - $0.001 par value, 5,000,000 shares authorized, 0 shares issued and outstanding at 6/30/2018 and 9/30/2017, respectively	1,790	1,790
Series D Convertible Preferred stock [Member]
STOCKHOLDERS' DEFICIT
Preferred stock - $0.001 par value, 5,000,000 shares authorized, 0 shares issued and outstanding at 6/30/2018 and 9/30/2017, respectively	$ 1,015	$ 1,015

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Jun. 30, 2018	Sep. 30, 2017
CURRENT ASSETS:
Allowance for Accounts receivable	$ 60,000	$ 60,000
EQUITY (DEFICIT)
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock shares authorized	5,000,000	5,000,000
Preferred stock shares issued	0	0
Preferred stock shares outstanding	0	0
Common stock par value	$ 0.001	$ 0.001
Common stock shares authorized	100,000,000	100,000,000
Common stock shares issued	15,538,726	4,655,486
Common stock shares outstanding	15,538,726	4,655,486
Series A Convertible Preferred stock [Member]
EQUITY (DEFICIT)
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock shares authorized	23,334	23,334
Preferred stock shares issued	23,334	23,334
Preferred stock shares outstanding	23,334	23,334
Series C Convertible Preferred stock [Member]
EQUITY (DEFICIT)
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock shares authorized	1,785,715	1,785,715
Preferred stock shares issued	1,785,715	1,785,715
Preferred stock shares outstanding	1,785,715	1,785,715
Series D Convertible Preferred stock [Member]
EQUITY (DEFICIT)
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock shares authorized	1,016,014	1,016,014
Preferred stock shares issued	1,016,014	1,016,014
Preferred stock shares outstanding	1,016,014	1,016,014

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		9 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
REVENUE	$ 1,107,216	$ 1,019,434	$ 3,432,301	$ 3,665,253
COST OF SALES	909,957	844,739	2,760,551	2,995,655
GROSS PROFIT	197,259	174,695	671,750	669,598
RESEARCH AND DEVELOPMENT EXPENSES	125,789	(9,240)	366,809	38,243
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	803,857	651,113	1,796,319	2,469,239
IMPAIRMENT OF GOODWILL	0	0	0	983,645
OPERATING LOSS	(732,387)	(467,178)	(1,491,378)	(2,821,529)
OTHER INCOME (EXPENSE):
Interest expense	(8,696)	(11,237)	(1,095,880)	(79,567)
Other income	436	1,634	19,192	44,774
Gain (loss) on change - derivative liability	0	1,004,727	0	(217,828)
Gain on debt settlements	234,393	0	234,393	0
Total other (expense)	226,133	995,124	(842,295)	(252,621)
(LOSS) INCOME BEFORE INCOME TAXES	(506,254)	527,946	(2,333,673)	(3,074,150)
Income taxes - current provision	0	0	0	0
NET (LOSS) INCOME	$ (506,254)	$ 527,946	$ (2,333,673)	$ (3,074,150)
Basic (loss) income per common share attributable to Visualant, Inc. and subsidiaries common shareholders
Basic (loss) income per share	$ (0.06)	$ 0.14	$ (0.39)	$ (0.85)
Weighted average shares of common stock outstanding - basic	8,065,144	3,844,840	5,947,860	3,605,904
Diluted (loss) income per common share attributable to Visualant, Inc. and subsidiaries common shareholders
Diluted (loss) income per share	$ (0.06)	$ 0.13	$ (0.39)	$ (0.85)
Weighted average shares of common stock outstanding - diluted	8,065,144	3,970,322	5,947,860	3,605,904

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (2,333,673)	$ (3,074,150)
Adjustments to reconcile net loss to net cash (used in) operating activities
Depreciation and amortization	43,984	72,041
Issuance of capital stock for services and expenses	348,881	411,306
Conversion of interest	64,233	68,043
Stock based compensation	7,337	32,661
(Loss) on sale of assets	0	(1,234)
Loss on change - derivative liability	0	213,315
Amortization of debt discount	475,174	10,500
Conversion of accrued liabilites- related parties to convertible notes payable	491,802	0
Provision on loss on accounts receivable	0	135,774
Issuance of warrant for debt conversion	232,255	0
Issuance of common stock for conversion of liabilities	247,950	0
Non cash gain on accounts payable	(234,393)	0
Impairment of goodwill	0	983,645
Changes in operating assets and liabilities:
Accounts receivable	262,860	259,662
Prepaid expenses	17,788	(15,908)
Inventory	55,175	11,357
Other assets	(2,100)	0
Accounts payable - trade and accrued expenses	(459,954)	86,339
Deferred revenue	(59,692)	0
NET CASH (USED IN) OPERATING ACTIVITIES	(842,373)	(806,649)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in BioMedx, Inc., net	0	(260,000)
Proceeds from investment in BioMedx, Inc,	0	260,000
Investment in equipment	(25,319)	0
Proceeds from sale of equipment	0	1,234
NET CASH PROVIDED BY INVESTING ACTIVITIES:	(25,319)	1,234
CASH FLOWS FROM FINANCING ACTIVITIES:
(Repayments) from line of credit	(170,990)	(122,127)
Proceeds from convertible notes payable	530,000	330,000
Repayment of convertible notes	0	(125,000)
Proceeds from issuance of common/preferred stock, net of costs	1,710,000	557,089
NET CASH PROVIDED BY FINANCING ACTIVITIES	2,069,010	639,962
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	1,201,318	(165,453)
CASH AND CASH EQUIVALENTS, beginning of period	103,181	188,309
CASH AND CASH EQUIVALENTS, end of period	1,304,499	22,856
Supplemental disclosures of cash flow information:
Interest paid	8,841	53,000
Taxes paid	0	0
Non-cash investing and financing activities:
Benificial conversion feature	348,096	0
Conversion of convertible debt	0	695,000
Benificial conversion feaature	0	559,130
Conversion of conertible debt to preferred shares	0	220,000
Related party accounts converted to notes	1,184,066	0
Acquisition of patents	$ 520,000	$ 0

1. GOING CONCERN

1. GOING CONCERN	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
GOING CONCERN	The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company incurred net losses of $(2,333,673), $(3,901,232) and $(1,746,495) for the nine months ended June 30, 2018 and for the years ended September 30, 2017 and 2016, respectively. Net cash used in operating activities was $(842,373), $(1,264,324) and $(2,746,333) for the nine months ended June 30, 2018 and for the years ended September 30, 2017 and 2016, respectively. The Company anticipates that it will record losses from operations for the foreseeable future. As of June 30, 2018, the Company’s accumulated deficit was $33,867,400. The Company has limited capital resources, and operations to date have been funded with the proceeds from private equity and debt financings and loans from Ronald P. Erickson, the Company’s Chairman of the Board, or entities with which he is affiliated. These conditions raise substantial doubt about our ability to continue as a going concern. The audit report prepared by the Company’s independent registered public accounting firm relating to our financial statements for the year ended September 30, 2017 includes an explanatory paragraph expressing the substantial doubt about the Company’s ability to continue as a going concern. We believe that our cash on hand will be sufficient to fund our operations until September 30, 2018. We need additional financing to implement our business plan and to service our ongoing operations and pay our current debts. There can be no assurance that we will be able to secure any needed funding, or that if such funding is available, the terms or conditions would be acceptable to us. If we are unable to obtain additional financing when it is needed, we will need to restructure our operations, and divest all or a portion of our business. We may seek additional capital through a combination of private and public equity offerings, debt financings and strategic collaborations. Debt financing, if obtained, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, and could increase our expenses and require that our assets secure such debt. Equity financing, if obtained, could result in dilution to our then-existing stockholders and/or require such stockholders to waive certain rights and preferences. If such financing is not available on satisfactory terms, or is not available at all, we may be required to delay, scale back, eliminate the development of business opportunities or file for bankruptcy and our operations and financial condition may be materially adversely affected.

2. ORGANIZATION

2. ORGANIZATION	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
ORGANIZATION	Know Labs, Inc. (the “Company”) was incorporated under the laws of the State of Nevada in 1998. The Company has authorized 105,000,000 shares of capital stock, of which 100,000,000 are shares of voting common stock, par value $0.001 per share, and 5,000,000 are shares preferred stock, par value $0.001 per share. Since 2007, the Company has been focused primarily on the development of a proprietary technology, which is capable of uniquely identifying and authenticating almost any substance using electromagnetic energy to detect the unique digital “signature” of the substance. The Company calls its technology “ChromaID™” and “Bio-RFID.” In 2010, the Company acquired TransTech Systems, Inc. as an adjunct to its business. TransTech is a distributor of products for employee and personnel identification. TransTech currently provides substantially all of the Company’s revenues. The Company is in the process of commercializing its ChromaID™ and Bio-RFID™ technology. To date, the Company has entered into License Agreements with Sumitomo Precision Products Co., Ltd. In addition, it has a technology license agreement with Allied Inventors, formerly Xinova and Invention Development Management Company, a subsidiary of Intellectual Ventures. The Company believes that its commercialization success is dependent upon its ability to significantly increase the number of customers that are purchasing and using its products. To date the Company has generated minimal revenue from sales of its ChromaID and Bio-RFID products. The Company is currently not profitable. Even if the Company succeeds in introducing the ChromaID and Bio-RFID technology and related products to its target markets, the Company may not be able to generate sufficient revenue to achieve or sustain profitability. ChromaID was invented by scientists under contract with the Company. Bio-RFID was invented by individuals working for the Company. The Company actively pursues a robust intellectual property strategy and has been granted twelve patents. The Company also has 20 patents pending. The Company possesses all right, title and interest to the issued patents. Ten of the pending patents are licensed exclusively to the Company in perpetuity by the Company’s strategic partner, Allied Inventors. Merger with RAAI Lighting, Inc. On April 10, 2018, the Company entered into an Agreement and Plan of Merger with 500 Union Corporation, a Delaware corporation and a wholly owned subsidiary of the Company, and RAAI Lighting, Inc., a Delaware corporation. Pursuant to the Merger Agreement, we have acquired all the outstanding shares of RAAI’s capital stock through a merger of Merger Sub with and into RAAI (the “Merger”), with RAAI surviving the Merger as a wholly owned subsidiary of the Company. Under the terms of the Merger Agreement, each share of RAAI common stock issued and outstanding immediately before the Merger (1,000 shares) were cancelled and converted into the right to receive 2,000 shares of the Company’s common stock. As a result, the Company issued 2,000,000 shares of its common stock to Phillip A. Bosua, formerly the sole stockholder of RAAI. The consideration for the Merger was determined through arms-length bargaining by the Company and RAAI. The Merger was structured to qualify as a tax-free reorganization for U.S. federal income tax purposes. As a result of the Merger, the Company received certain intellectual property, related to RAAI. Appointment of Director On April 10, 2018, the Board increased the size of the Board from three to four members and Phillip A. Bosua was appointed as a member of the Board. Mr. Bosua’s term of office expire at the next annual meeting of our stockholders. On May 24, 2018, the Board of Directors increased the size of the Board from four to five members and appointed (Ret.) Admiral William Owens as a member of the Board. Admiral Owen’s term of office expires at the next annual meeting of our stockholders. Appointment of Officer On April 10, 2018, the Company appointed Mr. Bosua as Chief Executive Officer of the Company, replacing Ronald P. Erickson, who remains Chairman of the Company. Previously, Mr. Bosua served as the Company’s Chief Product Officer since August 2017. The Company entered into a Consulting Agreement with Mr. Bosua’s company, Blaze Clinical on July 7, 2017. On April 10, 2018, the Company entered into an Employment Agreement with Mr. Bosua reflecting Mr. Bosua’s appointment as Chief Executive Officer. The Employment Agreement is for an initial term of 12 months (subject to earlier termination) and will be automatically extended for additional 12-month terms unless either party notifies the other party of its intention to terminate the Employment Agreement. Mr. Bosua will be paid a base salary of $225,000 per year, received 500,000 shares of common stock valued at $0.33 per share and may be entitled to bonuses and equity awards at the discretion of the Board or a committee of the Board. The Employment Agreement provides for severance pay equal to 12 months of base salary if Mr. Bosua is terminated without “cause” or voluntarily terminates his employment for “good reason.” On April 10, 2018, the Company entered into an Amended Employment Agreement for Ronald P. Erickson which amends the Employment Agreement dated July 1, 2017. The Agreement expires March 21, 2019. Merger with Know Labs, Inc. On May 1, 2018, Know Labs, Inc., a Nevada corporation incorporated on April 3, 2018, and our wholly-owned subsidiary, merged with and into the Company pursuant to an Agreement and Plan of Merger dated May 1, 2018. In connection with the merger, our Articles of Incorporation were effectively amended to change our name to Know Labs, Inc. by and through the filing of Articles of Merger. This parent-subsidiary merger was approved by us, the parent, in accordance with Nevada Revised Statutes Section 92A.180. Stockholder approval was not required. This amendment was filed with the Nevada Secretary of State and became effective on May 1, 2018. Corporate Name Change and Symbol Change On May 24, 2018, the Financial Industry Regulatory Authority (“FINRA”) announced the effectiveness of a change in our name from Visualant Incorporated to Know Labs, Inc. and a change in our ticker symbol from VSUL to the new trading symbol KNWN which became effective on the opening of trading as of May 25, 2018. In addition, in connection with the name change and symbol change, we were assigned the CUSIP number of 499238103. Closing of Financing on June 25, 2018 On June 25, 2018, the Company closed a private placement and received gross proceeds of $1,750,000 in exchange for issuing 7,000,000 shares of common stock and warrants to purchase 3,500,000 shares of common stock in a private placement to accredited investors pursuant to a series of substantially identical subscription agreements. The initial exercise price of the warrants described above is $0.25 per share, subject to certain adjustments, and the warrants expire five years after their issuance. The shares and the warrants described above were issued in transactions that were not registered under the Securities Act of 1933, as amended (the “Act”) in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and/or Rule 506 of SEC Regulation D under the Act.

3. SIGNIFICANT ACCOUNTING POLIC

3. SIGNIFICANT ACCOUNTING POLICIES: ADOPTION OF ACCOUNTING STANDARDS	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
SIGNIFICANT ACCOUNTING POLICIES: ADOPTION OF ACCOUNTING STANDARDS	Basis of Presentation Principles of Consolidation Cash and Cash Equivalents Accounts Receivable and Allowance for Doubtful Accounts Inventories Equipment Long-Lived Assets Fair Value Measurements and Financial Instruments Fair Value Measurement and Disclosures Level 1 – Quoted prices in active markets for identical assets and liabilities; Level 2 – Inputs other than level one inputs that are either directly or indirectly observable; and. Level 3 - Inputs to the valuation methodology are unobservable and significant to the fair value measurement. The recorded value of other financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, other current assets, and accounts payable and accrued expenses approximate the fair value of the respective assets and liabilities as of June 30, 2018 and September 30, 2017 are based upon the short-term nature of the assets and liabilities. Derivative Financial Instruments - Revenue Recognition Stock Based Compensation Convertible Securities Net Loss per Share As of June 30, 2017, there were options outstanding for the purchase of 50,908 common shares, warrants for the purchase of 5,127,416 common shares, 2,825,053 shares of our common stock issuable upon the conversion of Series A, Series C and Series D Convertible Preferred Stock and up to 332,940 shares of our common stock issuable upon the exercise of placement agent warrants, all of which could potentially dilute future earnings per share. Total outstanding common stock equivalents at June 30, 2017 were 6,527,268. Dividend Policy Use of Estimates Recent Accounting Pronouncements A variety of proposed or otherwise potential accounting standards are currently under study by standard setting organizations and various regulatory agencies. Due to the tentative and preliminary nature of those proposed standards, management has not determined whether implementation of such proposed standards would be material to the Company’s consolidated financial statements.

4. ACCOUNTS RECEIVABLE_CUSTOMER

4. ACCOUNTS RECEIVABLE/CUSTOMER CONCENTRATION	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
ACCOUNTS RECEIVABLE/CUSTOMER CONCENTRATION	Accounts receivable were $430,460 and $693,320, net of allowance, as of June 30, 2018 and September 30, 2017, respectively. The Company had one customer in excess of 10% (30.2%) of the Company’s consolidated revenues for the nine months ended June 30, 2018. The Company had two customers (41.7% and 13.2%) with accounts receivable in excess of 10% as of June 30, 2018. The Company has a total allowance for bad debt in the amount of $60,000 as of June 30, 2018.

5. INVENTORIES

5. INVENTORIES	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
INVENTORIES	Inventories were $170,734 and $225,909 as of June 30, 2018 and September 30, 2017, respectively. Inventories consist primarily of printers and consumable supplies, including ribbons and cards, badge accessories, capture devices, and access control components held for resale. There was a $35,000 reserve for impaired inventory as of June 30, 2018 and September 30, 2017, respectively.

6. FIXED ASSETS

6. FIXED ASSETS	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
FIXED ASSETS	Fixed assets, net of accumulated depreciation, was $114,539 and $133,204 as of June 30, 2018 and September 30, 2017, respectively. Accumulated depreciation was $654,257 and $662,855 as of June 30, 2018 and September 30, 2017, respectively. Total depreciation expense was $43,982 and $28,788 for the nine months ended June 30, 2018 and 2017, respectively. All equipment is used for selling, general and administrative purposes and accordingly all depreciation is classified in selling, general and administrative expenses. Property and equipment as of June 30, 2018 was comprised of the following: Estimated June 30, 2018 Useful Lives Purchased Capital Leases Total Machinery and equipment 2-10 years $ 260,094 $ 42,681 $ 302,775 Leasehold improvements 2-3 years 276,112 - 276,112 Furniture and fixtures 2-3 years 59,059 95,020 154,079 Software and websites 3- 7 years 35,830 - 35,830 Less: accumulated depreciation (516,556 ) (137,701 ) (654,257 ) $ 114,539 $ - $ 114,539

7. INTANGIBLE ASSETS

7. INTANGIBLE ASSETS	9 Months Ended
	Jun. 30, 2018
Finite-Lived Intangible Assets, Net [Abstract]
INTANGIBLE ASSETS	Intangible assets as of June 30, 2018 and September 30, 2017 consisted of the following: Estimated June 30, September 30, Useful Lives 2018 2017 Technology 5 years $ 520,000 $ - Less: accumulated amortization - - Intangible assets, net $ 520,000 $ - Total amortization expense was $0 and for the period ended June 30, 2018 and the year ended September 30, 2017, respectively. Merger with RAAI Lighting, Inc. On April 10, 2018, the Company entered into an Agreement and Plan of Merger with 500 Union Corporation, a Delaware corporation and a wholly owned subsidiary of the Company, and RAAI Lighting, Inc., a Delaware corporation. Pursuant to the Merger Agreement, we have acquired all the outstanding shares of RAAI’s capital stock through a merger of Merger Sub with and into RAAI (the “Merger”), with RAAI surviving the Merger as a wholly owned subsidiary of the Company. Under the terms of the Merger Agreement, each share of RAAI common stock issued and outstanding immediately before the Merger (1,000 shares) were cancelled and converted into the right to receive 2,000 shares of the Company’s common stock. As a result, the Company issued 2,000,000 shares of its common stock to Phillip A. Bosua, formerly the sole stockholder of RAAI. The consideration for the Merger was determined through arms-length bargaining by the Company and RAAI. The Merger was structured to qualify as a tax-free reorganization for U.S. federal income tax purposes. As a result of the Merger, the Company received certain intellectual property, related to RAAI. Merger with Know Labs, Inc. On May 1, 2018, Know Labs, Inc., a Nevada corporation incorporated on April 3, 2018, and our wholly-owned subsidiary, merged with and into the Company pursuant to an Agreement and Plan of Merger dated May 1, 2018. In connection with the merger, our Articles of Incorporation were effectively amended to change our name to Know Labs, Inc. by and through the filing of Articles of Merger. This parent-subsidiary merger was approved by us, the parent, in accordance with Nevada Revised Statutes Section 92A.180. Stockholder approval was not required. This amendment was filed with the Nevada Secretary of State and became effective on May 1, 2018. RAAI had no outstanding indebtedness or assets at the closing of the Merger. The 2,000,000 shares of the Company’s common stock issued for RAAI’s shares were recorded at the fair value at the date of the merger at $520,000 and the value assigned to the patent acquired with RAAI. The fair value of the intellectual property associated with the assets acquired was $520,000 estimated by using a discounted cash flow approach based on future economic benefits. In summary, the estimate was based on a projected income approach and related discounted cash flows over five years, with applicable risk factors assigned to assumptions in the forecasted results.

8. DERIVATIVE INSTRUMENTS

8. DERIVATIVE INSTRUMENTS	9 Months Ended
	Jun. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]
DERIVATIVE INSTRUMENTS	In April 2008, the FASB issued a pronouncement that provides guidance on determining what types of instruments or embedded features in an instrument held by a reporting entity can be considered indexed to its own stock for the purpose of evaluating the first criteria of the scope exception in the pronouncement on accounting for derivatives. This pronouncement was effective for financial statements issued for fiscal years beginning after December 15, 2008. The adoption of these requirements can affect the accounting for warrants and many convertible instruments with provisions that protect holders from a decline in the stock price (or “down-round” provisions). For example, warrants or conversion features with such provisions are no longer recorded in equity. Down-round provisions reduce the exercise price of a warrant or convertible instrument if a company either issues equity shares for a price that is lower than the exercise price of those instruments or issues new warrants or convertible instruments that have a lower exercise price. There was no derivative liability as of June 30, 2018 and September 30, 2017. For the year ended September 30, 2017, the Company recorded non-cash loss of $217,828 related to the “change in fair value of derivative” expense related to its derivative instruments. The Company early adopted ASU 2017-11 and has reclassified its financial instrument with down round features to equity in the amount of $410,524 at September 30, 2017.

9. CONVERTIBLE NOTES PAYABLE

9. CONVERTIBLE NOTES PAYABLE	9 Months Ended
	Jun. 30, 2018
Convertible Notes Payable
CONVERTIBLE NOTES PAYABLE	Convertible notes payable as of June 30, 2018 and September 30, 2017 consisted of the following: Convertible Promissory Note dated September 30, 2016 On September 30, 2016, the Company entered into a $210,000 Convertible Promissory Note with Clayton A. Struve, an accredited investor of the Company, to fund short-term working capital. The Convertible Promissory Note accrues interest at a rate of 10% per annum and becomes due on March 30, 2017. The Note holder can convert to common stock at $0.70 per share. During the year ended September 30, 2017, the Company recorded interest of $21,000 related to the convertible note. This note was extended in the Securities Purchase Agreement, General Security Agreement and Subordination Agreement dated August 14, 2017 with a maturity date of August 13, 2018. The Company recorded accrued interest of $36,707 as of June 30, 2018. Securities Purchase Agreement dated August 14, 2017 On August 14, 2017, the Company issued a senior convertible exchangeable debenture with a principal amount of $360,000 and a common stock purchase warrant to purchase 1,440,000 shares of common stock in a private placement to Clayton Struve for gross proceeds of $300,000 pursuantto a Securities Purchase Agreement dated August 14, 2017. The debenture accrues interest at 20% per annum and matures August 13, 2018. The convertible debenture contains a beneficial conversion valued at $110,629. The warrants were valued at $111,429. Because the note is immediately convertible, the warrants and beneficial conversion were expensed as interest. On the same date, the Company entered into a General Security Agreement with the investor, pursuant to which the Company has agreed to grant a security interest to the investor in substantially all the Company’s assets, effective upon the filing of a UCC-3 termination statement to terminate the security interest held by Capital Source Business Finance Group in the assets of the Company. In addition, an entity affiliated with Ronald P. Erickson, the Company’s Chief Executive Officer, entered into a Subordination Agreement with the investor pursuant to which all debt owed by the Company to such entity is subordinated to amounts owed by the Company to the investor under the Debenture (including amounts that become owing under any Debentures issued to the investor in the future). The initial conversion price of the Debenture is $0.25 per share, subject to certain adjustments. The initial exercise price of the Warrant is $0.25 per share, also subject to certain adjustments. As part of the Purchase Agreement, the Company granted the investor “piggyback” registration rights to register the shares of common stock issuable upon the conversion of the Debenture and the exercise of the Warrant with the Securities and Exchange Commission for resale or other disposition. The Debenture and the Warrant were issued in a transaction that was not registered under the Securities Act of 1933, as amended in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and Rule 506 of SEC Regulation D under the Act. In connection with the private placement, the placement agent for the Debenture and the Warrant received a cash fee of $30,000 and the Company expects to issue warrants to purchase shares of the Company’s common stock to the placement agent based on 10% of proceeds. Under the terms of the Purchase Agreement, the investor may purchase up to an aggregate of $1,000,000 principal amount of Debentures (before a 20% original issue discount) (and Warrants to purchase up to an aggregate of 250,000 shares of common stock). These securities are being offered on a “best efforts” basis by the placement agent. During the year ended September 30, 2017, $156,941 was recorded as interest expense related to debt discounts, beneficial conversions and warrants associated with Convertible Promissory Notes. On December 12, 2017, the Company closed an additional $250,000 and issued a senior convertible exchangeable debenture with a principal amount of $300,000 and a common stock purchase warrant to purchase 1,200,000 shares of common stock in a private placement dated December 12, 2017 to an accredited investor pursuant to a Securities Purchase Agreement dated August 14, 2017. The convertible debenture contains a beneficial conversion valued at $93,174. The warrants were valued at $123,600. Because the note is immediately convertible, the warrants and beneficial conversion were expensed as interest. On March 2, 2018, the Company received gross proceeds of $280,000 in exchange for issuing a senior convertible redeemable debenture with a principal amount of $336,000 and a warrant to purchase 1,344,000 shares of common stock in a private placement dated February 28, 2018 to an accredited investor pursuant to a Securities Purchase Agreement dated August 14, 2017. The convertible debenture contains a beneficial conversion valued at $252,932. The warrants were valued at $348,096. Because the note is immediately convertible, the warrants and beneficial conversion were expensed as interest. In connection with the February 28, 2018 private placement, the placement agent for the debenture and the warrant received a cash fee of $28,000 and the Company issued warrants to purchase shares of the Company’s common stock to the placement agent or its affiliates based on 10% of proceeds. Convertible Redeemable Promissory Notes with Ronald P. Erickson and J3E2A2Z The Company entered into a Note and Account Payable Conversion Agreement pursuant to which (a) all $664,233 currently owing under the J3E2A2Z Notes was converted to a Convertible Redeemable Promissory Note in the principal amount of $664,233, and (b) all $519,833 of the J3E2A2Z Account Payable was converted into a Convertible Redeemable Promissory Note in the principal amount of $519,833 together with a warrant to purchase up to 1,039,666 shares of common stock of the Company for a period of five years. The initial exercise price of the warrants described above is $0.50 per share, also subject to certain adjustments. See Note 10 and 11 for additional details. The warrants were valued at $110,545. Because the note is immediately convertible, the warrants and beneficial conversion were expensed as interest. The Company recorded accrued interest of $14,988 as of June 30, 2018.

10. NOTES PAYABLE, CAPITALIZED

10. NOTES PAYABLE, CAPITALIZED LEASES AND LONG TERM DEBT	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
NOTES PAYABLE, CAPITALIZED LEASES AND LONG TERM DEBT	Notes payable, capitalized leases and long-term debt as of June 30, 2018 and September 30, 2017 consisted of the following: June 30, September 30, 2018 2017 Capital Source Business Finance Group $ 194,735 $ 365,725 Note payable to Umpqua Bank 199,935 199,935 Secured note payable to J3E2A2Z LP - related party - 600,000 Total debt 394,670 1,165,660 Less current portion of long term debt (394,670 ) (1,165,660 ) Long term debt $ - $ - Capital Source Business Finance Group Know Labs, Inc. (the “Company”) finances its TransTech operations from operations and a Secured Credit Facility with Capital Source Business Finance Group. On June 15, 2018, TransTech entered into a Fifth Modification to the Loan and Security Agreement related to the $500,000 secured credit facility with Capital Source to fund its operations. The Modification extended the maturity to December 12, 2018. The secured credit facility provides for a prime rate interest floor for prime interest of 4.5% plus 2.5%. The eligible borrowing is based on 80% of eligible trade accounts receivable, not to exceed $500,000. The secured credit facility is collateralized by the assets of TransTech, with a guarantee by Know Labs, including a security interest in all assets of Know Labs. The remaining balance on the accounts receivable must be repaid by the time the secured credit facility expires on December 12, 2018, unless the Company renews by automatic extension for the next successive term. The Company has $47,000 available as of June 30, 2018. Note Payable to Umpqua Bank On July 9, 2018, the Company repaid a $199,935 Business Loan Agreement with Umpqua Bank from funds previously provided by an entity affiliated with Ronald P. Erickson, our Chairman of the Board. The Company paid $27,041 and issued 800,000 shares of common stock in exchange for the conversion of this debt. Mr. Erickson is an accredited investor. These shares were issued in transactions that were not registered under the Act in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and/or Rule 506 of SEC Regulation D under the Act. Note Payables to Ronald P. Erickson or J3E2A2Z LP On January 25, 2018, the Company entered into amendments to two demand promissory notes, totaling $600,000 with Mr. Erickson, the Company’s Chief Executive Officer and/or entities in which Mr. Erickson has a beneficial interest. On March 16, 2018, the demand promissory notes and accrued interest were converted into convertible notes payable. See Note 9 for additional details.

11. EQUITY

11. EQUITY	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
EQUITY	Authorized Capital Stock The Company has authorized 105,000,000 shares of capital stock, of which 100,000,000 are shares of voting common stock, par value $0.001 per share, and 5,000,000 are shares preferred stock, par value $0.001 per share. Voting Preferred Stock Series D Preferred Stock and Warrants On May 1, 2018, the Company issued 357,143 shares of Series D Convertible Preferred Stock and a warrant to purchase 357,143 shares of common stock in a private placement to an accredited investor for gross proceeds of $250,000 pursuant to a Series D Preferred Stock and Warrant Purchase Agreement dated May 1, 2016. The initial conversion price of the Series D Shares is $0.70 per share, subject to certain adjustments. The initial exercise price of the warrant is $0.70 per share, also subject to certain adjustments. The Company also amended and restated the Certificate of Designations, resulting in an adjustment to the conversion price of all currently outstanding Series D Shares to $0.70 per share. Common Stock All of the offerings and sales described below were deemed to be exempt under Rule 506 of Regulation D and/or Section 4(a)(2) of the Securities Act. No advertising or general solicitation was employed in offering the securities, the offerings and sales were made to a limited number of persons, all of whom were accredited investors and transfer was restricted by the company in accordance with the requirements of Regulation D and the Securities Act. All issuances to accredited and non-accredited investors were structured to comply with the requirements of the safe harbor afforded by Rule 506 of Regulation D, including limiting the number of non-accredited investors to no more than 35 investors who have sufficient knowledge and experience in financial and business matters to make them capable of evaluating the merits and risks of an investment in our securities. The following equity issuances occurred during the nine months ended June 30, 2018: The Company issued 708,240 shares of common stock to Names Executive Officers, directors, employees and consultants and for services during 2018. The Company expensed $183,881. On April 10, 2018, the Company issued 2,000,000 shares of our common stock to Phillip A. Bosua under the terms of the Merger Agreement with RAAI common stock. The shares were valued at the fair market value of $520,000 or $0.26 per share. On June 25, 2018, the Company closed a private placement and received gross proceeds of $1,750,000 ($1,710,000 as of June 30, 2018) in exchange for issuing 7,000,000 (6,840,000 as of June 30, 2018) shares of common stock and warrants to purchase 3,500,000 (3,420,000 as of June 30, 2018) shares of common stock in a private placement to accredited investors pursuant to a series of substantially identical subscription agreements. The initial exercise price of the warrants described above is $0.25 per share, subject to certain adjustments, and they expired five years after their issuance. The shares and the warrants described above were issued in transactions that were not registered under the Securities Act of 1933, as amended (the “Act”) in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and/or Rule 506 of SEC Regulation D under the Act. On June 25, 2018, the Company issued 500,000 shares of our common stock to Phillip A. Bosua under the terms of an Employment agreement dated April 10, 2018. The shares were valued at the fair market value of $165,000 or $0.33 per share. The Company closed debt conversions and issued 835,000 shares of common stock in exchange for the conversion of $247,950 in preexisting debt owed by the Company to certain service providers, all of whom are accredited investors. These shares were issued in transactions that were not registered under the Act in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and/or Rule 506 of SEC Regulation D under the Act. Warrants to Purchase Common Stock The following warrants were issued during the nine months ended June 30, 2018: On December 15, 2017, the Company received $250,000 and issued a senior convertible exchangeable debenture with a principal amount of $300,000 and a five year common stock purchase warrant to purchase 1,200,000 shares of common stock in a private placement dated December 12, 2017 to an accredited investor pursuant to a Securities Purchase Agreement dated August 14, 2017. See Note 9 for additional details. The initial exercise price of the warrants described above is $0.25 per share, also subject to certain adjustments. On March 2, 2018, the Company received gross proceeds of $280,000 in exchange for issuing a senior convertible redeemable debenture with a principal amount of $336,000 and a five year warrant to purchase 1,344,000 shares of common stock in a private placement dated February 28, 2018 to an accredited investor pursuant to a Securities Purchase Agreement dated August 14, 2017 See Note 9 for additional details. The initial exercise price of the warrants described above is $0.25 per share, also subject to certain adjustments. The Company entered into a Note and Account Payable Conversion Agreement pursuant to which (a) all $664,233 currently owing under the J3E2A2Z Notes was converted to a Convertible Redeemable Promissory Note in the principal amount of $664,233, and (b) all $519,833 of the J3E2A2Z Account Payable was converted into a Convertible Redeemable Promissory Note in the principal amount of $519,833 together with a warrant to purchase up to 1,039,666 shares of common stock of the Company for a period of five years. The initial exercise price of the warrants described above is $0.50 per share, also subject to certain adjustments. See Note 9 for additional details. In addition, effective as of January 31, 2018, Erickson was issued a warrant to purchase up to 855,000 shares of common stock of the Company for a period of five years. The initial exercise price of the warrants described above is $0.50 per share, also subject to certain adjustments. See Note 9 for additional details. During the nine months ended June 30, 2018, The Company issued placement agent warrants related to the issuance of senior convertible redeemable debentures and Series D Preferred Stock to purchase up to 498,400 shares of common stock for a period of five years. The initial exercise price of the warrants described above is $0.25 per share, also subject to certain adjustments. The estimated fair value was $?? On June 25, 2018, the Company closed a private placement and received gross proceeds of $1,750,000 ($1,710,000 as of June 30, 2018) in exchange for issuing 7,000,000 (6,840,000 as of June 30, 2018) shares of common stock and warrants to purchase 3,500,000 (3,420,000 as of June 30, 2018) shares of common stock in a private placement to accredited investors pursuant to a series of substantially identical subscription agreements. The initial exercise price of the warrants described above is $0.25 per share, subject to certain adjustments, and they expired five years after their issuance. The shares and the warrants described above were issued in transactions that were not registered under the Securities Act of 1933, as amended (the “Act”) in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and/or Rule 506 of SEC Regulation D under the Act. The Company issued warrants to purchase 874,000 shares of common stock to Named Executive Officers, directors, employees and consultants and for services during 2018. The Company expensed $232,255. A summary of the warrants outstanding as of June 30, 2018 were as follows: June 30, 2018 Weighted Average Exercise Shares Price Outstanding at beginning of period 6,900,356 $ 0.428 Issued 9,231,066 0.250 Exercised - - Forfeited - - Expired (544,998 ) (0.250 ) Outstanding at end of period 15,586,424 $ 0.328 Exercisable at end of period 15,586,424 A summary of the status of the warrants outstanding as of June 30, 2018 is presented below: June 30, 2018 Weighted Weighted Weighted Average Average Average Number of Remaining Exercise Shares Exercise Warrants Life (In Years) Price Exercisable Price 13,929,123 4.27 $ 0.250 13,929,123 $ 0.250 714,286 3.08 0.700 714,286 0.700 936,348 3.37 1.000 936,348 1.000 6,667 0.50 30.000 6,667 30.000 15,586,424 3.84 $ 0.328 15,586,424 $ 0.328 The significant weighted average assumptions relating to the valuation of the Company’s warrants for the nine months ended June 30, 2018 were as follows: Dividend yield 0% Expected life 1-2 years Expected volatility 125%-145% Risk free interest rate 2.0%-2.14% There were vested warrants of 14,643,409 as of June 30, 2018 with an aggregate intrinsic value of $9,489,655.

12. STOCK OPTIONS

12. STOCK OPTIONS	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
STOCK OPTIONS	Description of Stock Option Plan On March 21, 2013, an amendment to the Stock Option Plan was approved by the stockholders of the Company, increasing the number of shares reserved for issuance under the Plan to 93,333 shares. Determining Fair Value under ASC 505 The Company records compensation expense associated with stock options and other equity-based compensation using the Black-Scholes-Merton option valuation model for estimating fair value of stock options granted under our plan. The Company amortizes the fair value of stock options on a ratable basis over the requisite service periods, which are generally the vesting periods. The expected life of awards granted represents the period of time that they are expected to be outstanding. The Company estimates the volatility of our common stock based on the historical volatility of its own common stock over the most recent period corresponding with the estimated expected life of the award. The Company bases the risk-free interest rate used in the Black Scholes-Merton option valuation model on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent remaining term equal to the expected life of the award. The Company has not paid any cash dividends on our common stock and does not anticipate paying any cash dividends in the foreseeable future. Consequently, the Company uses an expected dividend yield of zero in the Black-Scholes-Merton option valuation model and adjusts share-based compensation for changes to the estimate of expected equity award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate is recognized in the period the forfeiture estimate is changed. Stock Option Activity The Company had the following stock option transactions during the nine months ended June 30, 2018. A former employee forfeited stock option grants for 10,668 shares of common stock at $14.719 per share. On April 10, 2018, an employee was granted an option to purchase 300,000 shares of common stock at an exercise price of $0.250 per share. The stock option grant vests quarterly over four years (none during the first six months) and is exercisable for 5 years. The stock option grant was valued at $27,000. On June 15, 2018, an employee was granted an option to purchase 230,000 shares of common stock at an exercise price of $0.250 per share. The stock option grant vests quarterly over four years (none during the first six months) and is exercisable for 5 years. The stock option grant was valued at $37,950 There are currently 534,736 options to purchase common stock at an average exercise price of $0.377 per share outstanding as of June 30, 2018 under the 2011 Stock Incentive Plan. The Company recorded $7,334 and $32,661 of compensation expense, net of related tax effects, relative to stock options for the nine months ended June 30, 2018 and in accordance with ASC 505. Net loss per share (basic and diluted) associated with this expense was approximately ($0.00) and ($0.01) per share, respectively. As of June 30, 2018, there is approximately $64,949 of total unrecognized costs related to employee granted stock options that are not vested. These costs are expected to be recognized over a period of approximately 4.83 years. Stock option activity for the nine months ended June 30, 2018 and for the years ended September 30, 2017 and 2016 was as follows: Weighted Average Options Exercise Price $ Outstanding as of September 30, 2015 57,407 $ 18.425 $ 1,057,725 Granted - - - Exercised - - - Forfeitures (6,499 ) (21.403 ) (139,098 ) Outstanding as of September 30, 2016 50,908 18.045 918,627 Granted - - - Exercised - - - Forfeitures (35,504 ) (19.507 ) (692,568 ) Outstanding as of September 30, 2017 15,404 14.675 226,059 Granted 530,000 0.250 132,500 Exercised - - - Forfeitures (10,668 ) 14.719 (157,020 ) Outstanding as of June 30, 2018 534,736 $ 0.377 $ 201,539 The following table summarizes information about stock options outstanding and exercisable as of June 30, 2018: Weighted Weighted Weighted Average Average Average Range of Number Remaining Life Exercise Price Number Exercise Price Exercise Prices Outstanding In Years Exercisable Exercisable Exercisable 0.25 530,000 4.86 $ 0.250 - $ - 13.500 1,334 0.50 13.50 1,334 13.50 15.000 3,402 0.79 15.00 2,068 15.00 534,736 4.83 $ 0.377 3,402 $ 14.41 There were stock option grants of 530,000 shares as of June 30, 2018 with an aggregate intrinsic value of $355,100.

13. OTHER SIGNIFICANT TRANSACTI

13. OTHER SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
OTHER SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES	Transactions with Clayton Struve See Note 9 and 11 for Convertible Notes Payable and Series C and D Preferred Stock and Warrants with Clayton Struve: Related Party Transactions with Ronald P. Erickson See Note 9 and 10 for Convertible Notes Payable and Notes Payable with Ronald P. Erickson, our Chairman and/or entities in which Mr. Erickson has a beneficial interest. Mr. Erickson and/or entities with which he is affiliated also have accrued compensation and interest of approximately $567,785. The Company owes Mr. Erickson, or entities with which he is affiliated, $1,792,766 as of June 30, 2018. On July 9, 2018, the Company repaid a $199,935 Business Loan Agreement with Umpqua Bank from funds previously provided by an entity affiliated with Ronald P. Erickson, our Chairman of the Board. The Company paid $27,041 and issued 800,000 shares of common stock in exchange for the conversion of this debt. Mr. Erickson is an accredited investor. These shares were issued in transactions that were not registered under the Act in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and/or Rule 506 of SEC Regulation D under the Act. Stock Issuances to Named Executive Officers and Directors During January to May 2018, the Company issued 300,000 shares of restricted common stock to two Named Executive Officers employees and two directors for services during 2018. The shares were issued in accordance with the 2011 Stock Incentive Plan and were valued at $0.233 per share, the market price of our common stock. Related Party Transaction with Phillip A. Bosua On February 7, 2018, the Company issued 50,000 shares of our common stock to Phillip A. Bosua under the terms of a consulting agreement dated July 6, 2017. On April 10, 2018, the Company issued 2,000,000 shares of our common stock to Phillip A. Bosua under the terms of the Merger Agreement with RAAI common stock. On June 25, 2018, the Company issued 500,000 shares of our common stock to Phillip A. Bosua under the terms of an Employment agreement dated April 10, 2018. On June 25, 2018, the Company closed a debt conversion with an entity controlled by Phillip A. Bosua and issued 255,000 shares of common stock in exchange for the conversion of $63,750 in preexisting debt owed by the Company to this entity.

14. COMMITMENTS, CONTINGENCIES

14. COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
14. COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS	Legal Proceedings The Company may from time to time become a party to various legal proceedings arising in the ordinary course of our business. The Company is currently not a party to any pending legal proceeding that is not ordinary routine litigation incidental to our business. Properties and Operating Leases The Company is obligated under the following non-cancelable operating leases for its various facilities and certain equipment. Years Ended June 30, Total 2019 $ 86,190 2020 90,379 2021 32,456 2022 - 2023 - Beyond - Total $ 209,025 Corporate Offices On April 13, 2017, the Company leased our executive office located at 500 Union Street, Suite 810, Seattle, Washington, USA, 98101. The Company leases 943 square feet and the net monthly payment is $2,672. The monthly payment increases approximately 3% each year and the lease expires on May 31, 2022. Lab Facilities and Executive Offices On May 1, 2018, the Company leased its lab facilities and executive offices located at 304 Alaskan Way South, Suite 102, Seattle, Washington, USA, 98101. The Company leases 2,800 square feet and the net monthly payment is $4,000. The lease expires on April 30, 2019. TransTech Facilities TransTech is located at 12142 NE Sky Lane, Suite 130, Aurora, OR 97002. TransTech leases a total of approximately 6,340 square feet of office and warehouse space for its administrative offices, product inventory and shipping operations. Effective December 1, 2017, TransTech leases this office from December 1, 2017 at $4,465 per month. The monthly payment increases approximately 3% each year and the lease expires on January 31, 2020. Until December 1, 2017, TransTech leased this office on a month to month basis at $6,942 per month. Consulting Agreement with Phillip A. Bosua On July 7, 2017, the Company entered into a Consulting Agreement with Phillip A. Bosua whereby Mr. Bosua can earn up to 200,000 shares of the Company’s company stock based on achieving certain product development and funding milestones. On March 1, 2018, the Company entered into a Consulting and Services Agreement with Blaze, Inc. and Mr. Bosua. The Consulting Agreement supersedes the Consulting Relationship Letter dated July 6, 2017 between the Company and Mr. Bosua. Under the terms of the Consulting Agreement, Blaze and Mr. Bosua are performing certain development work on behalf of the Company related to potential products for the consumer marketplace. The Consulting Agreement is deemed to be effective as of the date of the July 7, 2017 Consulting Relationship Letter and is effective until the completion of services or earlier termination in accordance with the terms of the Agreement. On April 10, 2018, the Company terminated the Entry into Employment Agreement with Phillip A. Bosua, Chief Executive Officer Phillip A. Bosua was appointed the Company’s CEO on April 10, 2018. On April 10, 2018, the Company entered into an Employment Agreement with Mr. Bosua reflecting his appointment as Chief Executive Officer. The Employment Agreement is for an initial term of 12 months (subject to earlier termination) and will be automatically extended for additional 12-month terms unless either party notifies the other party of its intention to terminate the Employment Agreement. Mr. Bosua will be paid a base salary of $225,000 per year and may be entitled to bonuses and equity awards at the discretion of the Board or a committee of the Board. The Employment Agreement provides for severance pay equal to 12 months of base salary if Mr. Bosua is terminated without “cause” or voluntarily terminates his employment for “good reason.” Entry into Employment and Amended Employment Agreements with Ronald P. Erickson On August 4, 2017, the Board of Directors approved an Employment Agreement with Ronald P. Erickson pursuant to which the Company engaged Mr. Erickson as the Company’s Chief Executive Officer through December 31, 2018. Mr. Erickson’s annual compensation is $180,000. Mr. Erickson is also entitled to receive an annual bonus and equity awards compensation as approved by the Board. The bonus should be paid no later than 30 days following earning of the bonus. Mr. Erickson will be entitled to participate in all group employment benefits that are offered by the Company to the Company’s senior executives and management employees from time to time, subject to the terms and conditions of such benefit plans, including any eligibility requirements. If the Company terminates Mr. Erickson’s employment at any time prior to the expiration of the Term without Cause, as defined in the Employment Agreement, or if Mr. Erickson terminates his employment at any time for “Good Reason” or due to a “Disability”, Mr. Erickson will be entitled to receive (i) his Base Salary amount for one year; and (ii) medical benefits for eighteen months. On April 10, 2018, the Company appointed Mr. Bosua as Chief Executive Officer of the Company, replacing Ronald P. Erickson, who remains Chairman of the Company. On April 10, 2018, the Company entered into an Amended Employment Agreement for Ronald P. Erickson which amends the Employment Agreement dated July 1, 2017. The Agreement expires March 21, 2019.

15. SUBSEQUENT EVENTS

15. SUBSEQUENT EVENTS	9 Months Ended
	Jun. 30, 2018
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	The Company evaluates subsequent events, for the purpose of adjustment or disclosure, up through the date the financial statements are available. Subsequent to June 30, 2018, there were the following material transactions that require disclosure: On July 9, 2018, the Company repaid a $199,935 Business Loan Agreement with Umpqua Bank from funds previously provided by an entity affiliated with Ronald P. Erickson, our Chairman of the Board. The Company paid $27,041 and issued 800,000 shares of common stock in exchange for the conversion of this debt. Mr. Erickson is an accredited investor. These shares were issued in transactions that were not registered under the Act in reliance upon applicable exemptions from registration under Section 4(a)(2) of the Act and/or Rule 506 of SEC Regulation D under the Act. On July 17, 2018, the Company filed with the State of Nevada a second Amended and Restated Certificate of Designation of Preferences, Powers, and Rights of the Series D Convertible Preferred Stock. The Amended Certificate restates the prior Certificate of Designation filed on May 8, 2017 to decrease the number of authorized Series D shares from 3,906,250 shares to 1,016,014 shares. No other amendments were made to the preferences and rights of the Series D Convertible Preferred Stock. The filing of the Amended Certificate was unanimously approved by the Board of Directors and the shareholders of Series D Convertible Preferred Stock. On July 30, 2018, two employees were granted an option to purchase 1,150,000 shares of common stock at an exercise price of $1.28 per share. The stock option grant vests quarterly over four years and are exercisable for 5 years. On August 1, 2018, the Company filed with the State of Nevada a Certificate of Designation establishing the Designations, Preferences, Limitations and Relative Rights of Series F Preferred Stock (the “Designation”). The Designation authorized 500 shares of Series F Preferred Stock. The Series F Preferred Stock shall only be issued to the current Board of Directors on the date of the Designation’s filing and is not convertible into common stock. As set forth in the Designation, the Series F Preferred Stock has no rights to dividends or liquidation preference and carries rights to vote 100,000 shares of common stock per share of Series F upon a Trigger Event, as defined in the Designation. A Trigger Event includes certain unsolicited bids, tender offers, proxy contests, and significant share purchases, all as described in the Designation. Unless and until a Trigger Event, the Series F shall have no right to vote. The Series F Preferred Stock shall remain issued and outstanding until the date which is 731 days after the issuance of Series F Preferred Stock (“Explosion Date”), unless a Trigger Event occurs, in which case the Explosion Date shall be extended by 183 days. On August 1, 2018, the Board approved an amendment to its 2011 Stock Incentive Plan increasing the number of shares of common stock reserved under the Incentive Plan 1,200,000 to 2,000,000.

3. SIGNIFICANT ACCOUNTING POL21

3. SIGNIFICANT ACCOUNTING POLICIES: ADOPTION OF ACCOUNTING STANDARDS (Policies)	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
Basis of Presentation	Basis of Presentation
Principles of Consolidation	Principles of Consolidation
Cash and Cash Equivalents	Cash and Cash Equivalents
Accounts Receivable and Allowance for Doubtful Accounts	Accounts Receivable and Allowance for Doubtful Accounts
Inventories	Inventories
Equipment	Equipment
Long-Lived Assets	Long-Lived Assets
Fair Value Measurements and Financial Instruments	Fair Value Measurements and Financial Instruments Fair Value Measurement and Disclosures Level 1 – Quoted prices in active markets for identical assets and liabilities; Level 2 – Inputs other than level one inputs that are either directly or indirectly observable; and. Level 3 - Inputs to the valuation methodology are unobservable and significant to the fair value measurement. The recorded value of other financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, other current assets, and accounts payable and accrued expenses approximate the fair value of the respective assets and liabilities as of June 30, 2018 and September 30, 2017 are based upon the short-term nature of the assets and liabilities.
Derivative Financial Instruments	Derivative Financial Instruments -
Revenue Recognition	Revenue Recognition
Stock Based Compensation	Stock Based Compensation
Convertible Securities	Convertible Securities
Net Loss per Share	Net Loss per Share As of June 30, 2017, there were options outstanding for the purchase of 50,908 common shares, warrants for the purchase of 5,127,416 common shares, 2,825,053 shares of our common stock issuable upon the conversion of Series A, Series C and Series D Convertible Preferred Stock and up to 332,940 shares of our common stock issuable upon the exercise of placement agent warrants, all of which could potentially dilute future earnings per share. Total outstanding common stock equivalents at June 30, 2017 were 6,527,268.
Dividend Policy	Dividend Policy
Use of Estimates	Use of Estimates
Recent Accounting Pronouncements	Recent Accounting Pronouncements A variety of proposed or otherwise potential accounting standards are currently under study by standard setting organizations and various regulatory agencies. Due to the tentative and preliminary nature of those proposed standards, management has not determined whether implementation of such proposed standards would be material to the Company’s consolidated financial statements.

6. FIXED ASSETS (Tables)

6. FIXED ASSETS (Tables)	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
Schedule of property and equipment	Estimated June 30, 2018 Useful Lives Purchased Capital Leases Total Machinery and equipment 2-10 years $ 260,094 $ 42,681 $ 302,775 Leasehold improvements 2-3 years 276,112 - 276,112 Furniture and fixtures 2-3 years 59,059 95,020 154,079 Software and websites 3- 7 years 35,830 - 35,830 Less: accumulated depreciation (516,556 ) (137,701 ) (654,257 ) $ 114,539 $ - $ 114,539

7. INTANGIBLE ASSETS (Tables)

7. INTANGIBLE ASSETS (Tables)	9 Months Ended
	Jun. 30, 2018
Finite-Lived Intangible Assets, Net [Abstract]
Schedule of intangible assets	Estimated June 30, September 30, Useful Lives 2018 2017 Technology 5 years $ 520,000 $ - Less: accumulated amortization - - Intangible assets, net $ 520,000 $ -

10. NOTES PAYABLE, CAPITALIZE24

10. NOTES PAYABLE, CAPITALIZED LEASES AND LONG TERM DEBT (Tables)	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
Notes payable, capitalized leases and long term debt	June 30, September 30, 2018 2017 Capital Source Business Finance Group $ 194,735 $ 365,725 Note payable to Umpqua Bank 199,935 199,935 Secured note payable to J3E2A2Z LP - related party - 600,000 Total debt 394,670 1,165,660 Less current portion of long term debt (394,670 ) (1,165,660 ) Long term debt $ - $ -

11. EQUITY (Tables)

11. EQUITY (Tables)	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
Summary of the warrants issued	June 30, 2018 Weighted Average Exercise Shares Price Outstanding at beginning of period 6,900,356 $ 0.428 Issued 9,231,066 0.250 Exercised - - Forfeited - - Expired (544,998 ) (0.250 ) Outstanding at end of period 15,586,424 $ 0.328 Exercisable at end of period 15,586,424
Summary of the status of the warrants outstanding	June 30, 2018 Weighted Weighted Weighted Average Average Average Number of Remaining Exercise Shares Exercise Warrants Life (In Years) Price Exercisable Price 13,929,123 4.27 $ 0.250 13,929,123 $ 0.250 714,286 3.08 0.700 714,286 0.700 936,348 3.37 1.000 936,348 1.000 6,667 0.50 30.000 6,667 30.000 15,586,424 3.84 $ 0.328 15,586,424 $ 0.328
Weighted average assumptions relating to the valuation of the Companys warrants	Dividend yield 0% Expected life 1-2 years Expected volatility 125%-145% Risk free interest rate 2.0%-2.14%

12. STOCK OPTIONS (Tables)

12. STOCK OPTIONS (Tables)	9 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
Stock option activity	Weighted Average Options Exercise Price $ Outstanding as of September 30, 2015 57,407 $ 18.425 $ 1,057,725 Granted - - - Exercised - - - Forfeitures (6,499 ) (21.403 ) (139,098 ) Outstanding as of September 30, 2016 50,908 18.045 918,627 Granted - - - Exercised - - - Forfeitures (35,504 ) (19.507 ) (692,568 ) Outstanding as of September 30, 2017 15,404 14.675 226,059 Granted 530,000 0.250 132,500 Exercised - - - Forfeitures (10,668 ) 14.719 (157,020 ) Outstanding as of June 30, 2018 534,736 $ 0.377 $ 201,539
Stock options outstanding and exercisable	Weighted Weighted Weighted Average Average Average Range of Number Remaining Life Exercise Price Number Exercise Price Exercise Prices Outstanding In Years Exercisable Exercisable Exercisable 0.25 530,000 4.86 $ 0.250 - $ - 13.500 1,334 0.50 13.50 1,334 13.50 15.000 3,402 0.79 15.00 2,068 15.00 534,736 4.83 $ 0.377 3,402 $ 14.41

14. COMMITMENTS, CONTINGENCIE27

14. COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS (Tables)	9 Months Ended
	Jun. 30, 2018
Commitments Contingencies And Legal Proceedings
Properties and operating leases	Years Ended June 30, Total 2019 $ 86,190 2020 90,379 2021 32,456 2022 - 2023 - Beyond - Total $ 209,025

1. GOING CONCERN (Details Narra

1. GOING CONCERN (Details Narrative) - USD ($)	9 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2017	Sep. 30, 2016
Notes to Financial Statements
Net loss	$ (2,333,673)		$ (3,901,232)	$ (1,746,495)
Net cash used in operating activities	(842,373)	$ (806,649)	(2,746,333)
Accumulated Deficit	$ 33,867,400		$ 31,533,727

3. SIGNIFICANT ACCOUNTING POL29

3. SIGNIFICANT ACCOUNTING POLICIES: ADOPTION OF ACCOUNTING STANDARDS (Details Narrative) - USD ($)	9 Months Ended
	Jun. 30, 2018	Sep. 30, 2017
Reserve for impaired inventory	$ 35,000	$ 35,000
Minimum [Member]
Estimated useful lives of assets	2 years
Maximum [Member]
Estimated useful lives of assets	10 years
Leasehold Improvements [Member] | Minimum [Member]
Estimated useful lives of assets	5 years
Leasehold Improvements [Member] | Maximum [Member]
Estimated useful lives of assets	20 years

4. ACCOUNTS RECEIVABLE_CUSTOM30

4. ACCOUNTS RECEIVABLE/CUSTOMER CONCENTRATION (Details Narrative) - USD ($)	Jun. 30, 2018	Sep. 30, 2017
Notes to Financial Statements
Accounts receivable, net of allowance	$ 430,460	$ 693,320
Allowance for bad debt	$ 60,000

5. INVENTORIES (Details Narrati

5. INVENTORIES (Details Narrative) - USD ($)	Jun. 30, 2018	Sep. 30, 2017
Notes to Financial Statements
Inventories	$ 170,734	$ 225,909
Reserve for impaired inventory	$ 35,000	$ 35,000

6. FIXED ASSETS (Details)

6. FIXED ASSETS (Details) - USD ($)	Jun. 30, 2018	Sep. 30, 2017
Machinery and equipment (2-10 years)	$ 302,775
Leasehold improvements (5-20 years)	276,112
Furniture and fixtures (3-10 years)	154,079
Software and websites (3- 7 years)	35,830
Less: accumulated depreciation	(654,257)	$ (662,855)
Property and equipment, net	114,539	$ 133,204
Purchased [Member]
Machinery and equipment (2-10 years)	260,094
Leasehold improvements (5-20 years)	276,112
Furniture and fixtures (3-10 years)	59,059
Software and websites (3- 7 years)	35,830
Less: accumulated depreciation	(516,556)
Property and equipment, net	114,539
Capital Leases [Member]
Machinery and equipment (2-10 years)	42,681
Leasehold improvements (5-20 years)	0
Furniture and fixtures (3-10 years)	95,020
Software and websites (3- 7 years)	0
Less: accumulated depreciation	(137,701)
Property and equipment, net	$ 0

6. FIXED ASSETS (Details Narrat

6. FIXED ASSETS (Details Narrative) - USD ($)	9 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2017
Notes to Financial Statements
Property and equipment, net	$ 114,539		$ 133,204
Property and equipment, accumulated depreciation	654,257		$ 662,855
Depreciation expense	$ 43,982	$ 28,788

7. INTANGIBLE ASSETS (Details)

7. INTANGIBLE ASSETS (Details) - Technology - USD ($)	Jun. 30, 2018	Sep. 30, 2017
Intangible assets, gross	$ 520,000	$ 0
Less: accumulated amortization	0	0
Intangible assets, net	$ 520,000	$ 0

8. DERIVATIVE INSTRUMENTS (Deta

8. DERIVATIVE INSTRUMENTS (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Jun. 30, 2018	Sep. 30, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Change in the fair value of the liability	$ 0	$ 217,828

9. CONVERTIBLE NOTES PAYABLE (D

9. CONVERTIBLE NOTES PAYABLE (Details Narrative)	Jun. 30, 2018USD ($)
Vis Vires Group, Inc [Member]
Accrued interest	$ 31,741

10. NOTES PAYABLE, CAPITALIZE37

10. NOTES PAYABLE, CAPITALIZED LEASES AND LONG TERM DEBT (Details) - USD ($)	Jun. 30, 2018	Sep. 30, 2017
Notes Payable Capitalized Leases And Long Term Debt Details
Capital Source Business Finance Group	$ 194,735	$ 365,725
Note payable to Umpqua Bank	199,935	199,935
Secured note payable to J3E2A2Z LP - related party	0	600,000
Total debt	394,670	1,165,660
Less current portion of long term debt	(394,670)	(1,165,660)
Long term debt	$ 0	$ 0

11. EQUITY (Details)

11. EQUITY (Details)	9 Months Ended
	Jun. 30, 2018$ / sharesshares
Shares
Outstanding at beginning of period	6,900,356
Issued	9,231,066
Exercised	0
Forfeited	0
Expired	(544,998)
Outstanding at end of period	15,586,424
Exercisable at end of period	15,586,424
Weighted Average Exercise Price:
Outstanding at beginning of period | $ / shares	$ .428
Issued | $ / shares	.250
Exercised | $ / shares	(.000)
Forfeited | $ / shares	.000
Expired | $ / shares	0.250
Outstanding at end of period | $ / shares	$ .328

11. EQUITY (Details 1)

11. EQUITY (Details 1)	9 Months Ended
	Jun. 30, 2018$ / sharesshares
Number of Warrants | shares	15,586,424
Weighted Average Remaining Life (years)	3 years 10 months 2 days
Weighted Average Exercise Price, outstanding | $ / shares	$ 0.328
Shares Exercisable | shares	15,586,424
Weighted Average Exercise Price, exerciseable | $ / shares	$ 0.328
Warrant One [Member]
Number of Warrants | shares	13,929,123
Weighted Average Remaining Life (years)	4 years 3 months 7 days
Weighted Average Exercise Price, outstanding | $ / shares	$ 0.25
Shares Exercisable | shares	13,929,123
Weighted Average Exercise Price, exerciseable | $ / shares	$ 0.25
Warrant Two [Member]
Number of Warrants | shares	714,286
Weighted Average Remaining Life (years)	3 years 29 days
Weighted Average Exercise Price, outstanding | $ / shares	$ .70
Shares Exercisable | shares	714,286
Weighted Average Exercise Price, exerciseable | $ / shares	$ 0.70
Warrant Three [Member]
Number of Warrants | shares	936,348
Weighted Average Remaining Life (years)	3 years 4 months 13 days
Weighted Average Exercise Price, outstanding | $ / shares	$ 1
Shares Exercisable | shares	936,348
Weighted Average Exercise Price, exerciseable | $ / shares	$ 1
Warrant Four [Member]
Number of Warrants | shares	6,667
Weighted Average Remaining Life (years)	6 months
Weighted Average Exercise Price, outstanding | $ / shares	$ 30
Shares Exercisable | shares	6,667
Weighted Average Exercise Price, exerciseable | $ / shares	$ 30

11. EQUITY (Details 2)

11. EQUITY (Details 2)	9 Months Ended
	Jun. 30, 2018
Dividend yield	0.00%
Minimum [Member]
Expected life	1 year
Expected volatility	125.00%
Risk free interest rate	2.00%
Maximum [Member]
Expected life	2 years
Expected volatility	145.00%
Risk free interest rate	2.14%

11. EQUITY (Details Narrative)

11. EQUITY (Details Narrative)	Jun. 30, 2018USD ($)shares
Notes to Financial Statements
Warrants Vested | shares	14,643,409
Intrinsic value | $	$ 9,489,655

12. STOCK OPTIONS (Details)

12. STOCK OPTIONS (Details) - USD ($)	9 Months Ended	12 Months Ended
	Jun. 30, 2018	Sep. 30, 2017	Sep. 30, 2016
Shares:
Outstanding at beginning of period	6,900,356
Shares granted	9,231,066
Shares exercised	0
Shares forfeitures	0
Outstanding at end of period	15,586,424	6,900,356
Weighted Average Exercise Price:
Outstanding at beginning of period	$ .428
Shares granted	.250
Shares exercised	.000
Shares forfeitures	(.000)
Outstanding at end of period	$ .328	$ .428
Aggregate Intrinsic Value
Aggregate Intrinsic Value Outstanding, End	$ 9,489,655
Stock Options
Shares:
Outstanding at beginning of period	15,404	50,908	57,407
Shares granted	530,000	0	0
Shares exercised	0	0	0
Shares forfeitures	(10,668)	(35,504)	(6,499)
Outstanding at end of period	534,736	15,404	50,908
Weighted Average Exercise Price:
Outstanding at beginning of period	$ 14.675	$ 18.045	$ 18.425
Shares granted	.250	0	0
Shares exercised	.000	0	0
Shares forfeitures	14.719	(19.507)	(21.403)
Outstanding at end of period	$ .377	$ 14.675	$ 18.045
Aggregate Intrinsic Value
Aggregate Intrinsic Value Outstanding, Beginning	$ 226,059	$ 918,267	$ 1,057,725
Aggregate Intrinsic Value Outstanding, Granted	$ 132,500	$ 0	$ 0
Aggregate Intrinsic Value Outstanding, Exercised	$ 0	$ 0	$ 0
Aggregate Intrinsic Value Outstanding, Forefeitures	$ (157,020)	$ (692,568)	$ (139,098)
Aggregate Intrinsic Value Outstanding, End	$ 201,539	$ 226,059	$ 918,267

12. STOCK OPTIONS (Details 1)

12. STOCK OPTIONS (Details 1)	9 Months Ended
	Jun. 30, 2018$ / sharesshares
Number of Outstanding Stock Options | shares	15,586,424
Weighted Average Remaining Life (years)	3 years 10 months 2 days
Weighted Average Exercise Price Exerciseable	$ 0.328
Number Exercisable | shares	15,586,424
Exercise Price 0.25
Range of Exercise Prices	$ .25
Number of Outstanding Stock Options | shares	530,000
Weighted Average Remaining Life (years)	4 years 10 months 10 days
Weighted Average Exercise Price Exerciseable	$ .250
Number Exercisable | shares	0
Weighted Average Exercise Price Exerciseable	$ .00
Exercise Price 13.500
Range of Exercise Prices	$ 13.500
Number of Outstanding Stock Options | shares	1,334
Weighted Average Remaining Life (years)	6 months
Weighted Average Exercise Price Exerciseable	$ 13.50
Number Exercisable | shares	1,334
Weighted Average Exercise Price Exerciseable	$ 13.50
Exercise Price 15.000
Range of Exercise Prices	$ 15
Number of Outstanding Stock Options | shares	3,402
Weighted Average Remaining Life (years)	9 months 15 days
Weighted Average Exercise Price Exerciseable	$ 15
Number Exercisable | shares	2,068
Weighted Average Exercise Price Exerciseable	$ 15
Exercise Price Total
Number of Outstanding Stock Options | shares	534,736
Weighted Average Remaining Life (years)	4 years 9 months 29 days
Weighted Average Exercise Price Exerciseable	$ .377
Number Exercisable | shares	3,402
Weighted Average Exercise Price Exerciseable	$ 14.41

12. STOCK OPTIONS (Details Narr

12. STOCK OPTIONS (Details Narrative) - USD ($)	9 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2017	Sep. 30, 2016
Compensation expense	$ 7,334	$ 32,661
Unrecognized compensation costs	$ 64,949
Period for recognition	4 years 9 months 29 days
Options to purchase common stock under 2011 Stock Incentive Plan	15,586,424
Average exercise price under 2011 Stock Incentive Plan	$ 0.328
Exercisable at end of period	15,586,424
Stock options granted	9,231,066
Aggregate intrinsic value	$ 355,100
2011 Stock Incentive Plan
Options to purchase common stock under 2011 Stock Incentive Plan	534,736
Average exercise price under 2011 Stock Incentive Plan	$ .377
Stock Options
Stock options granted	530,000		0	0

13. OTHER SIGNIFICANT TRANSAC45

13. OTHER SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES (Details narrative) - Chief Executive Officer	9 Months Ended
	Jun. 30, 2018USD ($)
Accrued liabilities related parties from advances	$ 567,785
Due to related party	$ 1,792,766

14. COMMITMENTS, CONTINGENCIE46

14. COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS (Details)	Jun. 30, 2018USD ($)
Commitments Contingencies And Legal Proceedings Details Abstract
2,019	$ 86,190
2,020	90,379
2,021	32,456
2,022	0
2,023	0
Beyond	0
Total	$ 209,025