Know Labs (KNWN) 10-Q 14 Feb 23 2023 Q1 Quarterly report Financial data

Cover

Cover - shares	3 Months Ended
	Dec. 31, 2022	Feb. 14, 2023
Cover [Abstract]
Entity Registrant Name	KNOW LABS, INC.
Entity Central Index Key	0001074828
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Document Period End Date	Dec. 31, 2022
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2023
Entity Common Stock Shares Outstanding		48,207,937
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	000-30262
Entity Incorporation State Country Code	NV
Entity Tax Identification Number	90-0273142
Entity Address Address Line 1	500 Union Street
Entity Address Address Line 2	Suite 810
Entity Address City Or Town	Seattle
Entity Address State Or Province	WA
Entity Address Postal Zip Code	98101
City Area Code	206
Local Phone Number	903-1351
Security 12b Title	Common Stock, par value $0.001 per share
Trading Symbol	KNW
Security Exchange Name	NYSE
Entity Interactive Data Current	Yes

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2022	Sep. 30, 2022
CURRENT ASSETS:
Cash and cash equivalents	$ 9,680,272	$ 12,593,692
Total current assets	9,680,272	12,593,692
PROPERTY AND EQUIPMENT, NET	770,663	862,977
OTHER ASSETS
Other assets	15,765	13,767
Operating lease right of use asset	243,526	287,930
TOTAL ASSETS	10,710,226	13,758,366
CURRENT LIABILITIES:
Accounts payable - trade	404,619	526,968
Accrued expenses	464,830	462,940
Accrued expenses - related parties	322,697	348,264
Convertible notes payable, net	2,255,066	2,255,066
Current portion of operating lease right of use liability	210,790	215,397
Total current liabilities	3,658,002	3,808,635
NON-CURRENT LIABILITIES:
Operating lease right of use liability, net of current portion	45,993	87,118
Total non-current liabilities	45,993	87,118
COMMITMENTS AND CONTINGENCIES (Note 12)	0	0
STOCKHOLDERS' EQUITY
Common stock - $0.001 par value, 200,000,000 shares authorized, 48,207,937 and 48,156,062 shares issued and outstanding at 12/31/2022 and 9/30/2022, respectively	48,209	48,158
Additional paid in capital	112,175,814	111,209,388
Accumulated deficit	(105,220,597)	(101,397,738)
Total stockholders' equity	7,006,231	9,862,613
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	10,710,226	13,758,366
Series C Preferred Stock [Member]
STOCKHOLDERS' EQUITY
Preferred stock, value	1,790	1,790
Series D Preferred Stock [Member]
STOCKHOLDERS' EQUITY
Preferred stock, value	$ 1,015	$ 1,015

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2022	Sep. 30, 2022
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock shares authorized	5,000,000	5,000,000
Common stock par value	$ 0.001	$ 0.001
Common stock shares authorized	200,000,000	200,000,000
Common stock shares issued	48,207,937	48,156,062
Common stock shares outstanding	48,207,937	48,156,062
Convertible Preferred Stock Series C [Member]
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
Convertible Preferred Stock Series D [Member]
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock shares authorized	1,016,014	1,016,014
Preferred stock shares issued	1,016,004	1,016,004
Preferred stock shares outstanding	1,016,004	1,016,004

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
REVENUE- DIGITAL ASSET SALES	$ 0	$ 4,351,400
OPERATING EXPENSES-
RESEARCH AND DEVELOPMENT EXPENSES	1,743,051	885,752
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	1,905,071	1,216,947
SELLING AND TRANSACTIONAL COSTS FOR DIGITAL ASSETS	0	3,118,360
Total operating expenses	3,648,122	5,221,059
OPERATING LOSS	(3,648,122)	(869,659)
OTHER INCOME (EXPENSE):
Interest expense	(227,170)	(4,486,960)
Other income	52,433	0
Total other (expense), net	(174,737)	(4,486,960)
LOSS BEFORE INCOME TAXES	(3,822,859)	(5,356,619)
Income tax expense	0	0
NET LOSS	$ (3,822,859)	$ (5,356,619)
Basic and diluted loss per share	$ (0.08)	$ (0.15)
Weighted average shares of common stock outstanding- basic and diluted	48,187,339	35,479,073

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) (Unaudited) - USD ($)	Total	Series C Convertibles Preferred Stock [Member]	Series D Convertible Preferred Stock [Member]	Common Stock [Member]	Additional Paid In Capital [Member]	Accumulated Deficit [Member]
Balance, shares at Sep. 30, 2021		1,785,715	1,016,004	35,166,551
Balance, amount at Sep. 30, 2021	$ 1,242,163	$ 1,790	$ 1,015	$ 35,168	$ 82,530,684	$ (81,326,494)
Stock compensation expense - employee options	204,170	0	0	$ 0	204,170	0
Issuance of common stock for exercise of warrants, shares				801,486
Issuance of common stock for exercise of warrants, amount	766,486	0	0	$ 801	765,685	0
Issuance of common stock for stock option exercises, shares				1,875
Issuance of common stock for stock option exercises, amount	2,344	0	0	$ 2	2,342	0
Net loss	(5,356,619)	$ 0	$ 0	$ 0	0	(5,356,619)
Balance, shares at Dec. 31, 2021		1,785,715	1,016,004	35,969,912
Balance, amount at Dec. 31, 2021	(3,141,456)	$ 1,790	$ 1,015	$ 35,971	83,502,881	(86,683,113)
Balance, shares at Sep. 30, 2022		1,785,715	1,016,004	48,156,062
Balance, amount at Sep. 30, 2022	9,862,613	$ 1,790	$ 1,015	$ 48,158	111,209,388	(101,397,738)
Stock compensation expense - employee options	744,640	0	0	$ 0	744,640	0
Issuance of common stock for exercise of warrants, shares				50,000
Issuance of common stock for exercise of warrants, amount	12,500	0	0	$ 50	12,450	0
Issuance of common stock for stock option exercises, shares				1,875
Issuance of common stock for stock option exercises, amount	2,343	0	0	$ 1	2,342	0
Net loss	(3,822,859)	0	0	0	0	(3,822,859)
Interest expense for extension of notes and warrants	206,994	$ 0	$ 0	$ 0	206,994	0
Balance, shares at Dec. 31, 2022		1,785,715	1,016,004	48,207,937
Balance, amount at Dec. 31, 2022	$ 7,006,231	$ 1,790	$ 1,015	$ 48,209	$ 112,175,814	$ (105,220,597)

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (3,822,859)	$ (5,356,619)
Adjustments to reconcile net loss to net cash (used in) operating activities
Depreciation and amortization	103,160	41,672
Stock based compensation- stock option grants	744,640	204,170
Right of use, net	(1,328)	(1,781)
Interest expense for extension of notes and warrants	206,994	0
Amortization of debt discount to interest expense	0	4,184,657
Changes in operating assets and liabilities:
Other long-term assets	(1,998)	0
Accounts receivable-related party	0	(3,124,581)
Accounts payable - trade and accrued expenses	(146,026)
NET CASH (USED IN) OPERATING ACTIVITIES	(2,917,417)	(1,907,817)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of research and development equipment	(10,846)	(385,488)
NET CASH (USED IN) INVESTING ACTIVITIES:	(10,846)	(385,488)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock for stock options exercise	2,343	2,344
Proceeds from issuance of common stock for warrant exercise	12,500	766,486
NET CASH PROVIDED BY FINANCING ACTIVITIES	14,843	768,830
NET (DECREASE) IN CASH AND CASH EQUIVALENTS	(2,913,420)	(1,524,475)
CASH AND CASH EQUIVALENTS, beginning of period	12,593,692	12,258,218
CASH AND CASH EQUIVALENTS, end of period	9,680,272	10,733,743
Supplemental disclosures of cash flow information:
Interest paid	0	0
Taxes paid	$ 0	$ 0

ORGANIZATION

ORGANIZATION	3 Months Ended
	Dec. 31, 2022
ORGANIZATION
ORGANISATION	1. ORGANIZATION Know Labs, Inc. (the “Company”) was incorporated under the laws of the State of Nevada in 1998. The Company currently has authorized 205,000,000 shares of capital stock, of which 200,000,000 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. At the annual shareholder meeting held on October 15, 2021, the Company’s authorized shares of common stock was increased to 200,000,000 shares of voting common stock, par value $0.001 per share. The Company is focused on the development and commercialization of proprietary biosensor technologies which are capable of uniquely identifying and measuring almost any material or analyte using electromagnetic energy to detect, record, identify and measure the unique “signature” of said materials or analytes. The Company call these its “Bio-RFID” technology platform when pertaining to radio and microwave spectroscopy and “ChromaID” technology platform when pertaining to optical spectroscopy. The data obtained with biosensor technology is analyzed with trade secret algorithms. There are a significant number of analytes in the human body that relate to health and wellness. The Company’s focus is upon those analytes relating to human health, the identification of which provide diagnostic information and require, by their nature, clearance by the United States Food and Drug Administration. On April 30, 2020, the Company incorporated Particle, Inc. (“Particle”) in the State of Nevada. Particle is focused on the development and commercialization of the Company’s extensive intellectual property relating to electromagnetic energy outside of the medical diagnostic arena which remains the parent company’s singular focus. Since incorporation, Particle has engaged in research and development activities on threaded light bulbs that have a warm white light and can inactivate germs, including bacteria and viruses. It is seeking partners to take the product to market. On September 17, 2021, the Company incorporated AI Mind, Inc. (“AI Mind”) in the State of Nevada. AI Mind was focused on monetizing the AI deep learning platform. Since incorporation, it initially focused on creating graphical images which were sold as Non Fungible Tokens (“NFTs”). The Company does not expect future activity or revenue from that source. During the year ended September 30, 2022,

LIQUIDITY AND GOING CONCERN

LIQUIDITY AND GOING CONCERN	3 Months Ended
	Dec. 31, 2022
LIQUIDITY AND GOING CONCERN
LIQUIDITY AND GOING CONCERN	2. LIQUIDITY AND GOING CONCERN The Company has cash and cash equivalents of $9,680,272 and net working capital of $8,277,336 (exclusive of convertible notes payable) as of December 31, 2022. The Company anticipates that it will record losses from operations for the foreseeable future. The Company believes that it has enough available cash to operate until at least February 15, 2024. As of December 31, 2022, the Company’s accumulated deficit was $105,220,597. The Company has had limited capital resources and intends to seek additional cash via equity and debt offerings. On September 20, 2022, the Company completed a public offering of the Company’s common stock pursuant to which the Company sold 4,140,000 shares of common stock, at a purchase price of $2.00 per share, for total gross proceeds of $8,280,000. After deducting underwriting commissions and other offering expenses, we received net proceeds of $7,424,679. The proceeds of warrants currently outstanding, which could be exercised on a cash basis, may generate potential proceeds of up to $15,681,788. The Company expects that portions of these warrants will be exercised.

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES ADOPTION OF ACCOUNTING STANDARDS	3 Months Ended
	Dec. 31, 2022
SIGNIFICANT ACCOUNTING POLICIES ADOPTION OF ACCOUNTING STANDARDS
SIGNIFICANT ACCOUNTING POLICIES: ADOPTION OF ACCOUNTING STANDARDS	3. SIGNIFICANT ACCOUNTING POLICIES: ADOPTION OF ACCOUNTING STANDARDS Basis of Presentation Principles of Consolidation Cash and Cash Equivalents Equipment Long-Lived Assets Revenue Recognition · identification of the contract, or contracts, with the customer; · identification of the performance obligations in the contract; · determination of the transaction price; · allocation of the transaction price to the performance obligations in the contract; and · recognition of the revenue when, or as, the Company satisfies a performance obligation. Revenue is recognized when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. During the three months ended December 31, 2021, the Company’s artificial AI deep learning platform generated revenue from digital asset sales of NFTs. The Company engineering team, using its research data, AI and proprietary algorithms, produced NFTs in the form of digital art. The NFTs produced had no recorded cost basis. The Company does not expect future activity or revenue from that source. Research and Development Expenses The Company’s current research and development efforts are primarily focused on improving its Bio-RFID technology, extending its capacity and developing new and unique applications for this technology. The Company believes that continued development of new and enhanced technologies is essential to its future success. The Company incurred expenses of 1,743,051 and $885,752 for the three months ended December 31, 2022 and 2021, respectively, on development activities. Advertising 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, accounts payable and accrued expenses approximate the fair value of the respective assets and liabilities as of December 31, 2022 and September 30, 2022 are based upon the short-term nature of the assets and liabilities. The Company has a money market account which is considered a Level 1 asset. The balance as of December 31, 2022 and September 30, 2022 was $9,024,335 and $11,821,931, respectively. Derivative Financial Instruments – The Company determined that the conversion features for purposes of bifurcation within its currently outstanding convertible notes payable were immaterial and there was no derivative liability to be recorded as of December 31, 2022 and September 30, 2022. Stock Based Compensation Convertible Securities Net Loss per Share As of December 31, 2022, the Company had 48,207,937 shares of common stock issued and outstanding. As of December 31, 2022, there were options outstanding for the purchase of 24,480,495 common shares (including unearned stock option grants totaling 9,704,620 shares related to performance targets), warrants for the purchase of 21,736,313 common shares, and 8,108,356 shares of our common stock issuable upon the conversion of Series C and Series D Convertible Preferred Stock. In addition, the Company currently has 9,020,264 common shares at the current price of $0.25 per share reserved and are issuable upon conversion of convertible debentures of $2,255,066. All of the foregoing shares could potentially dilute future earnings per share but are excluded from the December 31, 2022, calculation of net loss per share because their impact is antidilutive. As of December 31, 2021, there were options outstanding for the purchase of 18,423,245 common shares (including unearned stock option grants totaling 11,775,745 shares related to performance targets), warrants for the purchase of 21,654,013 common shares, and 8,108,356 shares of the Company’s common stock issuable upon the conversion of Series C and Series D Convertible Preferred Stock. In addition, the Company currently has 16,124,764 common shares (9,020,264 common shares at the current price of $0.25 per share and 7,104,500 common shares at the current price of $2.00 per share) reserved and are issuable upon conversion of convertible debentures of $16,464,066. All of which could potentially dilute future earnings per share but are excluded from the December 31, 2021, calculation of net loss per share because their impact is antidilutive. Comprehensive loss Dividend Policy Use of Estimates Recent Accounting Pronouncements Based on the Company’s review of accounting standard updates recently issued, those standards not yet required to be adopted and proposed standards for the future, the Company does believe such items are expected to have a significant impact on the Company’s consolidated financial statements.

ARTIFICIAL INTELLIGENCE (AI) DE

ARTIFICIAL INTELLIGENCE (AI) DEEP LEARNING PLATFORM	3 Months Ended
	Dec. 31, 2022
ARTIFICIAL INTELLIGENCE (AI) DEEP LEARNING PLATFORM
ARTIFICIAL INTELLIGENCE (AI) DEEP LEARNING PLATFORM	4. Artificial Intelligence (AI) Deep Learning Platform AI Revenue During the year ended September 30, 2022, the Company’s AI deep learning platform began generating revenue from digital asset sales of NFTs and had sales of $4,360,087. The Company’s sales of NFTs are generated using the NFT digital exchange, OpenSea. Customers purchasing the NFT’s must make payments in the crypto currency, Ethereum. The Ethereum is received into a digital wallet and then moved to an account at Coinbase where the Ethereum is converted to U.S. dollars. During the three months ended December 31, 2021, the Company was not able to establish a digital wallet and corporate account at Coinbase in order to receive the Ethereum. The Company used the digital wallet and Coinbase account of the Company’s CEO. The Company and the CEO executed an assignment of his account to the Company while the Company establishes its own Coinbase account. All proceeds received from the sale of NFT were deposited in the CEO’s personal digital accounts. After the sale of the NFT, the Ethereum was converted to US dollars as soon as practically possible. The Company recorded the total value of the gross NFT sale in revenue. Costs incurred in connection with the NFT transaction were recorded in the statement of operations as selling and transactional cost of digital assets and include costs to outside consultants, estimated employee and CEO special bonus compensation, digital asset conversion losses and estimated sales and use tax. The amount totaled $3,430,438 for the year ended September 30, 2022. As of December 31, 2022 and September 30, 2022, accrued expenses include $343,878 of expenses, primarily sales and use tax and other expenses.

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT	3 Months Ended
	Dec. 31, 2022
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT	5. PROPERTY AND EQUIPMENT Property and equipment as of December 31, 2022 and September 30, 2022 was comprised of the following: Estimated Useful Lives December 31, 2022 September 30, 2022 Machinery and equipment 2-3 years $ 1,521,110 $ 1,510,265 Furniture and fixtures 5 years 26,855 26,855 Leasehold improvements 5 years 3,612 3,612 Less: accumulated depreciation (780,914 ) (677,755 ) $ 770,663 $ 862,977 Total depreciation expense was $103,160 and $41,672 for the three months ended December 31, 2022 and 2021, respectively. All equipment is used primarily for research and development purposes and accordingly $98,002 in depreciation is classified in research and development expenses during the three months ended December 31, 2022.

LEASES

LEASES	3 Months Ended
	Dec. 31, 2022
LEASES
LEASES	6. LEASES The Company has entered into operating leases for office and development facilities which range from two to three years and include options to renew. The Company determines whether an arrangement is or contains a lease based upon the unique facts and circumstances at the inception of the lease. Operating lease liabilities and their corresponding right-of-use asses are recorded based upon the present value of the lease payments over the expected lease term. As of December 31, 2022 and September 30, 2022, total operating lease liabilities for remaining long term leases was approximately $257,000 and $302,000, respectively. Right of use assets totaled approximately $244,000 and $288,000 at December 31, 2022 and September 30, 2022, respectively. In the three months ended December 31, 2022 and 2021, the Company recognized $81,599 and $40,629, respectively in total lease costs for the leases. Because the rate implicit in each lease is not readily determinable, the Company uses its estimated incremental borrowing rate to determine the present value of the lease payments. The weighted average remaining lease term for the operating leases was 15 months at December 31, 2022 and the weighted average discount rate was 7%. The minimum future lease payments as of December 31, 2022 are as follows: Years Ended December 31, $ 2023 $ 143,828 2024 127,232 Total remaining payments 271,060 Less Imputed Interest 14,277 Total lease liability $ 256,783

CONVERTIBLE NOTES PAYABLE AND N

CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE	3 Months Ended
	Dec. 31, 2022
CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE
CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE	7. CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE Convertible notes payable as of December 31, 2022 and September 30, 2022 consisted of the following: Convertible Promissory Notes with Clayton A. Struve The Company owes Clayton A. Struve, a significant stockholder, $1,071,000 under convertible promissory or OID notes. We recorded accrued interest of $88,452 and $86,562 as of December 31, 2022 and September 30, 2022, respectively. On December 7, 2022, we signed Amendments to the convertible promissory or OID notes, extending the due dates to September 30, 2023. The Company expensed $12,975 during the three months ended December 31, 2022 related to the extension of the notes. Convertible Redeemable Promissory Notes with J3E2A2Z On March 16, 2018, 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. The Company recorded accrued interest of $305,197 and $287,290 as of December 31, 2022 and September 30, 2022, respectively. On December 7, 2022, the Company approved Amendments to the convertible redeemable promissory notes with Ronald P. Erickson and J3E2A2Z, extending the due dates to January 30, 2023. On January 25, 2023, the Company approved Amendments to the convertible redeemable promissory notes with Ronald P. Erickson and J3E2A2Z, extending the due dates to September 30, 2023. Mr. Erickson controls J3JE2A2Z. Convertible Debt Offering Beginning in 2019, the Company entered into series of debt offerings with similar and consistent terms. The Company issued Subordinated Convertible Notes and Warrants in a private placement to accredited investors, pursuant to a series of substantially identical Securities Purchase Agreements, Common Stock Warrants, and related documents. As of September 30, 2022, all convertible notes and accrued interest had been converted to common stock. During the year ended September 30, 2022, amortization related to the debt offerings of $7,272,911 was recognized as interest expense in the consolidated statements of operations. Convertible notes payable as of December 31, 2022 and September 30, 2022 are summarized below: December 31, 2022 September 30, 2022 Convertible note- Clayton A. Struve $ 1,071,000 $ 1,071,000 Convertible note- Ronald P. Erickson and affiliates 1,184,066 1,184,066 2021 Convertible notes - 14,209,000 Less conversions of notes - (14,209,000 ) $ 2,255,066 $ 2,255,066

EQUITY

EQUITY	3 Months Ended
	Dec. 31, 2022
EQUITY
EQUITY	8. EQUITY Authorized Capital Stock The Company’s authorized capital stock currently consists of 205,000,000 shares, consisting of 200,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share, of which 1,785,715 shares have been designated as series C convertible preferred stock, 1,016,014 shares have been designated as series D convertible preferred stock, and 500 shares have been designated as series F preferred stock. Securities Subject to Price Adjustments If in the future, the Company sells its common stock at a price below $0.25 per share, the conversion price of our outstanding shares of series C convertible preferred stock and series D convertible preferred stock would adjust below $0.25 per share pursuant to the documents governing such instruments. In addition, the conversion price of the convertible promissory notes referred to above and the exercise price of certain outstanding warrants to purchase 10,074,381 shares of common stock would adjust below $0.25 per share pursuant to the documents governing such instruments. Warrants totaling 4,439,707 would adjust below $1.20 per share and warrants totaling 4,424,425 would adjust below $2.40 per share, in each case pursuant to the documents governing such instruments. Common Stock Each share of common stock entitles its holder to one vote on each matter submitted to the stockholders for a vote, and no cumulative voting for directors is permitted. Stockholders do not have any preemptive rights to acquire additional securities issued by the Company. Three Months Ended December 31, 2022 The Company issued 50,000 shares of common stock related to the exercise of warrants and received $12,500. The Company issued 1,875 shares related to the exercise of stock option grants and received $2,343. Warrants to Purchase Common Stock Three Months Ended December 31, 2022 On December 7, 2022, the Company signed an extension of warrant agreement with Clayton Struve, extending the exercise dates as follows: Warrant No./Class Issue Date No. Warrant Shares Exercise Price Current Expiration Date Amended Expiration Date Clayton A. Struve Warrant 08-14-2017 1,440,000 $ 0.25 08-13-2024 08-13-2025 Clayton A. Struve Warrant 12-12-2017 1,200,000 $ 0.25 12-11-2024 12-11-2025 Clayton A. Struve Warrant 08-04-2016 1,785,715 $ 0.25 08-04-2024 08-04-2025 Clayton A. Struve Warrant 02-28-2018 1,344,000 $ 0.25 02-28-2024 02-28-2025 The Company recorded interest expense of $194,019 during the three months ended December 31, 2022 related to the extension of the warrants. A summary of the warrants outstanding as of December 31, 2022 were as follows: December 31, 2022 Weighted Average Exercise Shares Price Outstanding at beginning of period 21,786,313 $ 1.029 Issued - - Exercised (50,000 ) (0.250 ) Forfeited - - Expired - - Outstanding at end of period 21,736,313 $ 1.031 Exercisable at end of period 21,736,313 The following table summarizes information about warrants outstanding and exercisable as of December 31, 2022: December 31, 2022 Weighted Weighted Weighted Average Average Average Number of Remaining Exercise Shares Exercise Warrants Life ( In Years) Price Exercisable Price 10,519,381 1.74 $ 0.250 10,519,381 $ 0.250 6,512,207 2.13 1.20-1.85 6,512,207 1.20-1.85 4,694,725 3.36 2.00-3.00 4,694,725 2.00-3.00 10,000 0.50 4.080 10,000 4.080 21,736,313 2.70 $ 1.031 21,736,313 $ 1.031 The significant weighted average assumptions relating to the valuation of the Company’s warrants for the three months ended December 31, 2022 were as follows: Assumptions Dividend yield 0 % Expected life 3-5 years Expected volatility 104 % Risk free interest rate 2.96 % There were vested warrants of 21,736,313 with an aggregate intrinsic value of $16,806,047.

STOCK INCENTIVE PLANS

STOCK INCENTIVE PLANS	3 Months Ended
	Dec. 31, 2022
STOCK INCENTIVE PLANS
STOCK INCENTIVE PLANS	9. STOCK INCENTIVE PLANS On August 12, 2021, the Company established its 2021 Equity Incentive Plan (the “2021 Plan”), which was adopted by stockholders on October 15, 2021. The Company initially had 20,000,000 shares of its common stock authorized as the maximum number of shares of common stock that may be delivered to participants under the 2021 Plan, subject to adjustment for certain corporate changes affecting the shares, such as stock splits. This number was increased to 22,000,000 shares of common stock as of January 1, 2022 as a result of the automatic share reserve increase described below. Three Months Ended December 31, 2022 On December 14, 2022, the Company issued a stock option grant to Ronald P. Erickson for 1,000,000 shares at an exercise price of $1.41 per share. The stock option grant expires in five years. The stock option grant vests quarterly over four years. On December 14, 2022, the Company issued a stock option grant to Phillip A. Bosua for 1,250,000 shares at an exercise price of $1.41 per share. The stock option grant expires in five years. The stock option grant vests quarterly over four years. During the three months ended December 31, 2022, the Company issued stock option grants to four employees and consultants for 1,440,000 shares at an average exercise price of $1.420 per share. The stock option grants expire in five years. The stock option grants primarily vest quarterly over four years. Stock option activity for the three months ended December 31, 2022 and the years ended September 30, 2022 and 2021 was as follows: Options Exercise Price Proceed $ Outstanding as of September 30, 2020 4,805,000 $ 1.161 $ 5,580,550 Granted 10,650,745 1.766 18,807,990 Exercised (20,625 ) (1.359 ) (28,031 ) Forfeitures (120,000 ) (3.300 ) (396,000 ) Outstanding as of September 30, 2021 15,315,120 1.565 23,964,509 Granted 6,636,000 1.815 12,045,330 Exercised (26,293 ) (1.376 ) (36,170 ) Forfeitures (1,132,457 ) (2.057 ) (2,329,267 ) Outstanding as of September 30, 2022 20,792,370 1.618 33,644,402 Granted 3,690,000 1.414 5,217,300 Exercised (1,875 ) (1.250 ) (2,344 ) Forfeitures - - - Outstanding as of December 31, 2022 24,480,495 $ 1.587 38,859,358 The following table summarizes information about stock options outstanding and exercisable as of December 31, 2022: Weighted Weighted Weighted Average Average Average Range of Number Remaining Life Exercise Price Number Exercise Price Exercise Prices Outstanding In Years Outstanding Exercisable Exercisable $ 0.25 230,000 1.65 $ 0.250 230,000 $ 0.250 1.10-1.25 2,903,750 2.96 1.100 1,797,813 1.100 1.28-1.67 16,010,745 4.03 1.479 2,008,938 1.407 1.79-3.67 5,336,000 3.82 2.234 1,185,688 2.150 24,480,495 3.84 $ 1.587 5,222,439 $ 1.466 There are stock option grants of 24,480,495 shares as of December 31, 2022 with an aggregate intrinsic value of $3,693,865. There are 24,480,495 (including unearned stock option grants totaling 9,704,620 shares related to performance milestones) options to purchase common stock at an average exercise price of $1.587 per share outstanding as of December 31, 2022 under the 2021 Plan. The Company recorded $744,640 and $204,170 of compensation expense, net of related tax effects, relative to stock options for the three months ended December 31, 2022 and 2021, respectively, in accordance with ASC 718. As of December 31, 2022, there is $11,532,729 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 3.84 years.

OTHER SIGNIFICANT TRANSACTIONS

OTHER SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES	3 Months Ended
	Dec. 31, 2022
OTHER SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES
OTHER SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES	10. SIGNIFICANT AND OTHER TRANSACTIONS WITH RELATED PARTIES Transactions with Clayton Struve See Notes 7 and 9 for related party transactions with Clayton A. Struve, a significant stockholder. Related Party Transactions with Ronald P. Erickson See Notes 7, 9 and 11 for related party transactions with Ronald P. Erickson, the Company’s Chairman and Chief Executive Officer and affiliated entities. The Company paid $40,385 of salaries and vacation pay to Mr. Erickson during the three months ended December 31, 2022 that were previously accrued and reported but were deferred. On December 14, 2022, the Company issued a stock option grant to Ronald P. Erickson for 1,000,000 shares at an exercise price of $1.41 per share. The stock option grant expires in five years. The stock option grant vests quarterly over four years. Related Party Transaction with Phillip A. Bosua See Notes 9 and 11 for related party transactions with Phillip A. Bosua. On December 14, 2022, the Company issued a stock option grant to Phillip A. Bosua for 1,250,000 shares at an exercise price of $1.41 per share. The stock option grant expires in five years. The stock option grant vests quarterly over four years. Mr. Bosua was paid month to month rent totaling $21,000 in the three months ended December 31, 2022 for leased lab facilities and executive offices in Yucca Valley, CA.

COMMITMENTS, CONTINGENCIES AND

COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS	3 Months Ended
	Dec. 31, 2022
COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS
COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS	11. 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 business. The Company is currently not a party to any pending legal proceeding that is not ordinary routine litigation incidental to the Company’s business. Employment Agreements Employment Agreement with Phillip A. Bosua, Former Chief Executive Officer See the Employment Agreement for Phillip A. Bosua that was disclosed in Form 10-K filed with the SEC on December 20, 2022. Mr. Bosua resigned effective January 23, 2023. Employment Agreement with Ronald P. Erickson, Chairman of the Board and Chief Executive Officer See the Employment Agreement for Ronald P. Erickson that was disclosed in Form 10-K filed with the SEC on December 22, 2022. Mr. Erickson was appointed Chief Executive Officer on January 23, 2023. Employment Agreement with Peter J. Conley, Chief Financial Officer and Senior Vice President, Intellectual Property See the Employment Agreement for Peter J. Conley that was disclosed in Form 10-K filed with the SEC on December 22, 2022. Properties and Operating Leases The Company is obligated under the following leases for its various facilities. Corporate Offices On April 13, 2017, the Company leased its executive office located at 500 Union Street, Suite 810, Seattle, Washington, USA, 98101. The Company leases 943 square feet and the current net monthly payment is $3,334. The monthly payment increases approximately 3% each year and the lease expired on May 31, 2022. On October 31, 2021, the Company extended the lease from June 1, 2022 to May 31, 2023 at $2,986 per month. Lab Facilities and Executive Offices On May 18, 2021, the Company entered into a lease for its lab facilities located at 914 E Pine Street, Suite 212, Seattle, WA 98122 and leased 2,642 square feet. The net monthly lease payment was $8,697 and increases by 3% annually. The lease expires on June 30, 2024. The lease can be extended for one additional three year term. On October 11, 2021, the Company entered into the First Amendment of Lease and added 2,485 square feet for $5,000 per month. On September 20, 2022, the Company entered into the Second Amendment of Lease for additional space. The expanded space will be utilized for research and testing. The Amendment of Lease expires on December 31, 2023. On September 22, 2022, the Company leased lab facilities and executive offices in Yucca Valley, CA from Phillip Bosua, the Company’s CEO. The Company leased 1,700 square feet of the total 2,134 square feet of the premises and the current net monthly payment is $7,000. The lease expires September 30, 2023 and can be extended on a month to month basis. The Company paid $91,500 in rent on September 28, 2022 for the period September 1, 2021 to September 30, 2022. The Company paid $21,000 for the three months ended December 31, 2022. The lease was terminated on January 23, 2023. On November 22, 2022, the Company leased additional lab facilities at 123 Boylston Ave, Suite C, Seattle, WA 98102. The Company leased 1,800 square feet and the current net monthly payment is $2,250. The lease expires on August 31, 2023.

SEGMENT REPORTING

SEGMENT REPORTING	3 Months Ended
	Dec. 31, 2022
SEGMENT REPORTING
SEGMENT REPORTING	12. SEGMENT REPORTING The management of the Company considers the business to currently have two operating segments (i) the development of the Bio-RFID™” and “ChromaID™” technologies; (ii) Particle, Inc. technology; and (iii) AI sales of NFT products. Particle commenced operations in the year ended September 30, 2020. It is now looking for partners to take the product to market. AI commenced operations during the year ended September 30, 2021. The Company does not expect future activity or revenue from that source. The reporting for the three months ended December 31, 2022 and 2021 was as follows (in thousands): Segment Operating Segment Segment Revenue Profit (Loss) Assets Three Months Ended December 31, 2022 Development of the Bio-RFID™” and “ChromaID™” technologies $ - $ (3,648 ) $ 10,710 Particle, Inc. technology - - - Digital asset sales - - - Total segments $ - $ (3,648 ) $ 10,710 Three Months Ended December 31, 2021 Development of the Bio-RFID™” and “ChromaID™” technologies $ - $ (2,087 ) $ 11,755 Particle, Inc. technology - (15 ) 5 Digital asset sales 4,351 1,233 3,125 Total segments $ 4,351 $ (869 ) $ 14,885 During the three months ended December 31, 2022 and 2021, the Company incurred non-cash expenses related to operations of $846,472 and $244,061.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Dec. 31, 2022
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	13. SUBSEQUENT EVENTS The Company evaluated subsequent events, for the purpose of adjustment or disclosure, up through the date the financial statements were issued. Subsequent to December 31, 2022, there were the following material transactions that require disclosure:

SIGNIFICANT ACCOUNTING POLICI_2

SIGNIFICANT ACCOUNTING POLICIES ADOPTION OF ACCOUNTING STANDARDS (Policies)	3 Months Ended
	Dec. 31, 2022
SIGNIFICANT ACCOUNTING POLICIES ADOPTION OF ACCOUNTING STANDARDS
Basis of Presentation	Basis of Presentation
Principles of Consolidation	Principles of Consolidation
Cash and Cash Equivalents	Cash and Cash Equivalents
Equipment	Equipment
Long-Lived Assets	Long-Lived Assets
Revenue Recognition	Revenue Recognition · identification of the contract, or contracts, with the customer; · identification of the performance obligations in the contract; · determination of the transaction price; · allocation of the transaction price to the performance obligations in the contract; and · recognition of the revenue when, or as, the Company satisfies a performance obligation. Revenue is recognized when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. During the three months ended December 31, 2021, the Company’s artificial AI deep learning platform generated revenue from digital asset sales of NFTs. The Company engineering team, using its research data, AI and proprietary algorithms, produced NFTs in the form of digital art. The NFTs produced had no recorded cost basis. The Company does not expect future activity or revenue from that source.
Research and Development Expenses	Research and Development Expenses The Company’s current research and development efforts are primarily focused on improving its Bio-RFID technology, extending its capacity and developing new and unique applications for this technology. The Company believes that continued development of new and enhanced technologies is essential to its future success. The Company incurred expenses of 1,743,051 and $885,752 for the three months ended December 31, 2022 and 2021, respectively, on development activities.
Advertising	Advertising
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, accounts payable and accrued expenses approximate the fair value of the respective assets and liabilities as of December 31, 2022 and September 30, 2022 are based upon the short-term nature of the assets and liabilities. The Company has a money market account which is considered a Level 1 asset. The balance as of December 31, 2022 and September 30, 2022 was $9,024,335 and $11,821,931, respectively.
Derivative Financial Instruments	Derivative Financial Instruments – The Company determined that the conversion features for purposes of bifurcation within its currently outstanding convertible notes payable were immaterial and there was no derivative liability to be recorded as of December 31, 2022 and September 30, 2022.
Stock Based Compensation	Stock Based Compensation
Convertible Securities	Convertible Securities
Net Loss per Share	Net Loss per Share As of December 31, 2022, the Company had 48,207,937 shares of common stock issued and outstanding. As of December 31, 2022, there were options outstanding for the purchase of 24,480,495 common shares (including unearned stock option grants totaling 9,704,620 shares related to performance targets), warrants for the purchase of 21,736,313 common shares, and 8,108,356 shares of our common stock issuable upon the conversion of Series C and Series D Convertible Preferred Stock. In addition, the Company currently has 9,020,264 common shares at the current price of $0.25 per share reserved and are issuable upon conversion of convertible debentures of $2,255,066. All of the foregoing shares could potentially dilute future earnings per share but are excluded from the December 31, 2022, calculation of net loss per share because their impact is antidilutive. As of December 31, 2021, there were options outstanding for the purchase of 18,423,245 common shares (including unearned stock option grants totaling 11,775,745 shares related to performance targets), warrants for the purchase of 21,654,013 common shares, and 8,108,356 shares of the Company’s common stock issuable upon the conversion of Series C and Series D Convertible Preferred Stock. In addition, the Company currently has 16,124,764 common shares (9,020,264 common shares at the current price of $0.25 per share and 7,104,500 common shares at the current price of $2.00 per share) reserved and are issuable upon conversion of convertible debentures of $16,464,066. All of which could potentially dilute future earnings per share but are excluded from the December 31, 2021, calculation of net loss per share because their impact is antidilutive.
Comprehensive Loss	Comprehensive loss
Dividend Policy	Dividend Policy
Use of Estimates	Use of Estimates
Recent Accounting Pronouncements	Based on the Company’s review of accounting standard updates recently issued, those standards not yet required to be adopted and proposed standards for the future, the Company does believe such items are expected to have a significant impact on the Company’s consolidated financial statements.

PROPERTY AND EQUIPMENT (Tables)

PROPERTY AND EQUIPMENT (Tables)	3 Months Ended
	Dec. 31, 2022
PROPERTY AND EQUIPMENT
Schedule of Property and equipment	Estimated Useful Lives December 31, 2022 September 30, 2022 Machinery and equipment 2-3 years $ 1,521,110 $ 1,510,265 Furniture and fixtures 5 years 26,855 26,855 Leasehold improvements 5 years 3,612 3,612 Less: accumulated depreciation (780,914 ) (677,755 ) $ 770,663 $ 862,977

LEASES (Tables)

LEASES (Tables)	3 Months Ended
	Dec. 31, 2022
LEASES
Summary of minimum future lease payments	Years Ended December 31, $ 2023 $ 143,828 2024 127,232 Total remaining payments 271,060 Less Imputed Interest 14,277 Total lease liability $ 256,783

CONVERTIBLE NOTES PAYABLE AND_2

CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE (Tables)	3 Months Ended
	Dec. 31, 2022
CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE
Schedule of convertible notes payable	December 31, 2022 September 30, 2022 Convertible note- Clayton A. Struve $ 1,071,000 $ 1,071,000 Convertible note- Ronald P. Erickson and affiliates 1,184,066 1,184,066 2021 Convertible notes - 14,209,000 Less conversions of notes - (14,209,000 ) $ 2,255,066 $ 2,255,066

EQUITY (Tables)

EQUITY (Tables)	3 Months Ended
	Dec. 31, 2022
EQUITY
Schedule of Warrant activity	Warrant No./Class Issue Date No. Warrant Shares Exercise Price Current Expiration Date Amended Expiration Date Clayton A. Struve Warrant 08-14-2017 1,440,000 $ 0.25 08-13-2024 08-13-2025 Clayton A. Struve Warrant 12-12-2017 1,200,000 $ 0.25 12-11-2024 12-11-2025 Clayton A. Struve Warrant 08-04-2016 1,785,715 $ 0.25 08-04-2024 08-04-2025 Clayton A. Struve Warrant 02-28-2018 1,344,000 $ 0.25 02-28-2024 02-28-2025
Schedule of Warrants outstanding and exercisable	December 31, 2022 Weighted Average Exercise Shares Price Outstanding at beginning of period 21,786,313 $ 1.029 Issued - - Exercised (50,000 ) (0.250 ) Forfeited - - Expired - - Outstanding at end of period 21,736,313 $ 1.031 Exercisable at end of period 21,736,313 December 31, 2022 Weighted Weighted Weighted Average Average Average Number of Remaining Exercise Shares Exercise Warrants Life ( In Years) Price Exercisable Price 10,519,381 1.74 $ 0.250 10,519,381 $ 0.250 6,512,207 2.13 1.20-1.85 6,512,207 1.20-1.85 4,694,725 3.36 2.00-3.00 4,694,725 2.00-3.00 10,000 0.50 4.080 10,000 4.080 21,736,313 2.70 $ 1.031 21,736,313 $ 1.031
Schedule of weighted average assumptions	Assumptions Dividend yield 0 % Expected life 3-5 years Expected volatility 104 % Risk free interest rate 2.96 %

STOCK INCENTIVE PLANS (Tables)

STOCK INCENTIVE PLANS (Tables)	3 Months Ended
	Dec. 31, 2022
STOCK INCENTIVE PLANS
Schedule of Stock option activity	Options Exercise Price Proceed $ Outstanding as of September 30, 2020 4,805,000 $ 1.161 $ 5,580,550 Granted 10,650,745 1.766 18,807,990 Exercised (20,625 ) (1.359 ) (28,031 ) Forfeitures (120,000 ) (3.300 ) (396,000 ) Outstanding as of September 30, 2021 15,315,120 1.565 23,964,509 Granted 6,636,000 1.815 12,045,330 Exercised (26,293 ) (1.376 ) (36,170 ) Forfeitures (1,132,457 ) (2.057 ) (2,329,267 ) Outstanding as of September 30, 2022 20,792,370 1.618 33,644,402 Granted 3,690,000 1.414 5,217,300 Exercised (1,875 ) (1.250 ) (2,344 ) Forfeitures - - - Outstanding as of December 31, 2022 24,480,495 $ 1.587 38,859,358
Schedule of 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 Outstanding Exercisable Exercisable $ 0.25 230,000 1.65 $ 0.250 230,000 $ 0.250 1.10-1.25 2,903,750 2.96 1.100 1,797,813 1.100 1.28-1.67 16,010,745 4.03 1.479 2,008,938 1.407 1.79-3.67 5,336,000 3.82 2.234 1,185,688 2.150 24,480,495 3.84 $ 1.587 5,222,439 $ 1.466

SEGMENT REPORTING (Tables)

SEGMENT REPORTING (Tables)	3 Months Ended
	Dec. 31, 2022
SEGMENT REPORTING
Schedule of Segment reporting	Segment Operating Segment Segment Revenue Profit (Loss) Assets Three Months Ended December 31, 2022 Development of the Bio-RFID™” and “ChromaID™” technologies $ - $ (3,648 ) $ 10,710 Particle, Inc. technology - - - Digital asset sales - - - Total segments $ - $ (3,648 ) $ 10,710 Three Months Ended December 31, 2021 Development of the Bio-RFID™” and “ChromaID™” technologies $ - $ (2,087 ) $ 11,755 Particle, Inc. technology - (15 ) 5 Digital asset sales 4,351 1,233 3,125 Total segments $ 4,351 $ (869 ) $ 14,885

ORGANIZATION (Details Narrative

ORGANIZATION (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Sep. 30, 2022	Oct. 15, 2021	Sep. 30, 2021
ORGANIZATION
Authorized shares of capital stock	205,000,000
Authorized shares of capital common stock	200,000,000
Authorized shares of capital stock par value	$ 0.001	$ 0.001	$ 0.001	$ 0.001
Preferred stock shares authorized	5,000,000	5,000,000		5,000,000
Preferred stock share par value	$ 0.001	$ 0.001		$ 0.001
Sales	$ 4,360,087
Authorized common stock increased			200,000,000

LIQUIDITY AND GOING CONCERN (De

LIQUIDITY AND GOING CONCERN (Details Narrative) - USD ($) $ / shares in Units, shares in Millions		3 Months Ended
	Jul. 29, 2022	Dec. 31, 2022	Sep. 30, 2022
Cash and cash equivalents		$ 9,680,272
Net working capital		8,277,336
Accumulated deficit		(105,220,597)	$ (101,397,738)
Proceeds of warrants currently outstanding		$ 7,424,679
31 December,2023 [Member]
New offering of shares of its common stock		4,140,000
Offering price	$ 2
Gross proceed from public issue stock		$ 8,280,000
Net proceed from deducting issue stock		$ 15,681,788

SIGNIFICANT ACCOUNTING POLICI_3

SIGNIFICANT ACCOUNTING POLICIES ADOPTION OF ACCOUNTING STANDARDS (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2022
FDIC insurance	$ 250,000
Research and development expense	1,743,051	$ 885,752
Advertising and marketing costs	51,084	294,391
Money market accounts	$ 9,024,335	$ 11,821,931
Common stock shares issued	48,207,937	18,423,245	48,156,062
Common stock shares outstanding	24,480,495
Additional common shares reserved		16,124,764
Issuable upon conversion of convertible debentures	2,255,066	16,464,066
Common shares current price per share	$ 1.420
Leasehold Improvements
Estimated useful lives of assets	5 years
Minimum
Estimated useful lives of assets	2 years
Maximum
Estimated useful lives of assets	5 years
Transaction 1
Common stock shares	9,020,264	9,020,264
Common shares current price per share	$ 0.25	$ 0.25
Transaction 2
Common stock shares		7,104,500
Common shares current price per share		$ 2
Convertible Preferred Stock
Antidilutive securities	8,108,356	8,108,356
Warrants
Antidilutive securities	21,736,313	21,654,013
Stock Option 1
Unearned stock option grants	9,704,620	11,775,745

ARTIFICIAL INTELLIGENCE (AI) _2

ARTIFICIAL INTELLIGENCE (AI) DEEP LEARNING PLATFORM (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Sep. 30, 2022
Accrued expenses	$ 464,830	$ 462,940
Technology Equipment [Member]
Amount total	3,430,438
Revenue Digital Asset Sales	4,360,087
Accrued expenses	$ 343,878

PROPERTY AND EQUIPMENT (Details

PROPERTY AND EQUIPMENT (Details) - USD ($)	Dec. 31, 2022	Sep. 30, 2022
PROPERTY AND EQUIPMENT
Machinery and equipment (2-3 years)	$ 1,521,110	$ 1,510,265
Leasehold improvements (5 years)	3,612	3,612
Furniture and fixtures (5 years)	26,855	26,855
Less: accumulated depreciation	(780,914)	(677,755)
Property and equipment, net	$ 770,663	$ 862,977

PROPERTY AND EQUIPMENT (Detai_2

PROPERTY AND EQUIPMENT (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Depreciation expense	$ 103,160	$ 41,672
Research And Development And Sellings General And Administrative [Mmber]
Depreciation expense	$ 98,002

LEASES (Details)

LEASES (Details)	Dec. 31, 2022 USD ($)
LEASES
2023	$ 143,828
2024	127,232
Total Remaining Payments	271,060
Imputed interest	(14,277)
Total lease liability	$ 256,783

LEASES (Details Narrative)

LEASES (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2022
LEASES
Lease cost	$ 81,599	$ 40,629
Right-of-use assets	244,000		$ 288,000
Total lease liability	$ 257,000		$ 302,000
Weighted-average remaining lease term	15 years
Weighted-average discount rate			7%

CONVERTIBLE NOTES PAYABLE AND_3

CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE (Details) - USD ($)	Dec. 31, 2022	Sep. 30, 2022
less conversions of notes	$ 0	$ (14,209,000)
Convertible notes, net	2,255,066	2,255,066
Convertibles Note - Clayton A. Struve
Convertible notes, gross	1,071,000	1,071,000
Convertibles Note - Ronald P. Erickson and Affiliates
Convertible notes, gross	1,184,066	1,184,066
2021 Convertibles notes
Convertible notes, gross	$ 0	$ 14,209,000

CONVERTIBLE NOTES PAYABLE AND_4

CONVERTIBLE NOTES PAYABLE AND NOTE PAYABLE (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Sep. 30, 2022	Mar. 16, 2018
Expensed	$ 12,975
Accrued interest	88,452	$ 86,562
Convertible Note - Ronald P. Erickson and Affiliates
Warrant to purchase common stock shares			1,039,666
Exercise price of warrants			$ 0.50
Convertible Note - Clayton A. Struve
Accrued interest amount	305,197	$ 287,290
Convertible promissory or OID notes	$ 1,071,000
Convertible Note - J3E2A2Z Notes
Convertible redeemable promissory note amount			$ 664,233
Convertible redeemable promissory note principal amount			664,233
Convertible Note - J3E2A2Z Account Payable
Convertible redeemable promissory note amount			519,833
Convertible redeemable promissory note principal amount			$ 519,833

EQUITY (Details)

EQUITY (Details)	3 Months Ended
	Dec. 31, 2022 $ / shares shares
Warrant Three [Member]
Number of warrant shares | shares	1,785,715
Issue date	Aug. 04, 2016
Original Expiration Date	Aug. 04, 2024
Amended Expiration Date	Aug. 04, 2025
Exercise price | $ / shares	$ 0.25
Warrant Four [Member]
Number of warrant shares | shares	1,344,000
Issue date	Feb. 28, 2018
Original Expiration Date	Feb. 28, 2024
Amended Expiration Date	Feb. 28, 2025
Exercise price | $ / shares	$ 0.25
Warrant One [Member]
Number of warrant shares | shares	1,440,000
Issue date	Aug. 14, 2017
Original Expiration Date	Aug. 13, 2024
Amended Expiration Date	Aug. 13, 2025
Exercise price | $ / shares	$ 0.25
Warrant Two [Member]
Number of warrant shares | shares	1,200,000
Issue date	Dec. 12, 2017
Original Expiration Date	Dec. 11, 2024
Amended Expiration Date	Dec. 11, 2025
Exercise price | $ / shares	$ 0.25

EQUITY (Details 1)

EQUITY (Details 1) - $ / shares	3 Months Ended	12 Months Ended
	Dec. 31, 2022	Sep. 30, 2022	Sep. 30, 2021
Shares
Share Outstanding at beginning of period	21,736,313	22,564,255
Exercised	(50,000)
Expired	(122,018)
Outstanding at end of period	21,736,313
Exercisable at end of period	21,736,313
Weighted Average Exercise Price:
Outstanding at begin of period	$ 1.029	$ 0.998
Weighted Average Exercise Price Issued	1.414	1.815	$ 1.766
Weighted Average Exercise Price Exercised	(0.250)
Weighted Average Exercise Price Forfeited	0
Weighted Average Exercise PriceExpired	$ (1.031)
Outstanding at end of period		$ 1.029

EQUITY (Details 2)

EQUITY (Details 2)	3 Months Ended
	Dec. 31, 2022 $ / shares shares
Warrant Three [Member]
Number of warrants | shares	4,694,725
Weighted average remaining life (years)	3 years 4 months 9 days
Weighted average exercise price, outstanding	$ 3
Shares exercisable | shares	4,694,725
Weighted average exercise price, exercisable	$ 3
Warrant Three [Member] | Minimum
Weighted average exercise price, outstanding	2
Weighted average exercise price, exercisable	$ 2
Warrant Four [Member]
Number of warrants | shares	10,000
Weighted average remaining life (years)	6 months
Weighted average exercise price, outstanding	$ 4.080
Shares exercisable | shares	10,000
Weighted average exercise price, exercisable	$ 4.080
Warrant One [Member]
Number of warrants | shares	10,519,381
Weighted average remaining life (years)	1 year 8 months 26 days
Weighted average exercise price, outstanding	$ 0.250
Shares exercisable | shares	10,519,381
Weighted average exercise price, exercisable	$ 0.250
Warrant Two [Member]
Number of warrants | shares	6,512,207
Weighted average remaining life (years)	2 years 1 month 17 days
Weighted average exercise price, outstanding	$ 1.85
Shares exercisable | shares	6,512,207
Weighted average exercise price, exercisable	$ 1.85
Warrant Two [Member] | Minimum
Weighted average exercise price, outstanding	1.20
Weighted average exercise price, exercisable	1.20
Warrant Two [Member] | Maximum
Weighted average exercise price, outstanding	1.85
Weighted average exercise price, exercisable	$ 1.85
Warrent Five [Member]
Number of warrants | shares	21,736,313
Weighted average remaining life (years)	2 years 8 months 12 days
Weighted average exercise price, outstanding	$ 1.031
Shares exercisable | shares	21,736,313
Weighted average exercise price, exercisable	$ 1.031

EQUITY (Details 3)

EQUITY (Details 3)	3 Months Ended
	Dec. 31, 2022
EQUITY
Dividend yield	0%
Expected life minimum	3 years
Expected life Maximum	5 years
Expected volatility	104%
Risk free interest rate	2.96%

EQUITY (Details Narrative)

EQUITY (Details Narrative) - USD ($)		3 Months Ended
	Jan. 05, 2022	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2022	Oct. 15, 2021	Sep. 30, 2021
No of share convertibae common stock		$ 50,000
warrants and received		12,500
Intrinsic value		16,806,047
Money warrants		$ 21,736,313
Warrant issued to common stock		50,000
Warrants expiration period	Jan. 05, 2027
Shrare issued warrant to purchased		10,074,381
Interest expenses		$ 194,019
Authorized shares of capital stock par value		$ 0.001		$ 0.001	$ 0.001	$ 0.001
Preferred stock share par value		$ 0.001		$ 0.001		$ 0.001
Preferred stock shares authorized		5,000,000		5,000,000		5,000,000
Interest expenses		$ 227,170	$ 4,486,960
Common stock share issued		48,207,937	18,423,245	48,156,062
Common stock shares authorized		200,000,000		200,000,000
Director And Consultants Member
Share issued price		$ 2
Common Preferred Stock [Member]
Proceeds from issuance of common stock		$ 1,875
Exercise of stock option		2,343
Authorized Capital Stock [Member]
Authorized shares of capital stock par value		$ 0.001
Preferred stock share par value		$ 0.001
Preferred stock shares authorized		5,000,000
Common stock share issued		200,000,000
Common stock shares authorized		205,000,000
Common shares		1,785,715
Conversion of convertible debentures		$ 2,255,066
Convertible preferred stock		1,016,014
Series F preferred stock		500
Convertible Preferred Stock Series C [Member]
Share issued price		$ 0.25
Stock at 0.25
Share issued price		$ 0.25
Warrants totaling		$ 4,424,425
Stock at 2.00
Warrants totaling		$ 4,439,707
Three Director [Member]
Shrare issued warrant to purchased price		$ 2.40
Warrants to Purchase Common Stock [Member]
Interest expenses		$ 194,019
Common Stock Shares issued		104,634

STOCK INCENTIVE PLANS (Details)

STOCK INCENTIVE PLANS (Details) - USD ($)	3 Months Ended	12 Months Ended
	Dec. 31, 2022	Sep. 30, 2022	Sep. 30, 2021
Outstanding at begin of period	$ 1.618	$ 1.565	$ 1.161
Weighted Average Exercise Price Granted	1.414	1.815	1.766
Weighted Average Exercise Price Exercised	(1.250)	(1.376)	(1.359)
Weighted Average Exercise Price Forfeitures	0	(2.057)	(3.300)
Outstanding at end of period	$ 1.587	$ 1.618	$ 1.565
Aggregate Intrinsic Value
Aggregate Outstanding at beginning of period	$ 33,644,402	$ 23,964,509	$ 5,580,550
Granted	5,217,300	12,045,330	18,807,990
Exercised	(2,344)	(36,170)	(28,031)
Forfeitures	0	2,329,267	396,000
Aggregate Outstanding at end of period	$ 38,859,358	$ 33,644,402	$ 23,964,509
Exercised	(50,000)
Stock Option
Aggregate Intrinsic Value
Share Outstanding at beginning of period	20,792,370	15,315,120	4,805,000
Shares Granted	(3,690,000)	(6,636,000)	(10,650,745)
Exercised	(1,875)	(26,293)	(20,625)
Shares Forfeitures	0	(1,132,457)	(120,000)
Share Outstanding at ending of period	24,480,495	20,792,370	15,315,120

STOCK INCENTIVE PLANS (Details

STOCK INCENTIVE PLANS (Details 1)	3 Months Ended
	Dec. 31, 2022 $ / shares shares
Employee Stock Options One [Member]
Number of outstanding stock options | shares	24,480,495
Weighted average remaining life (years)	3 years 10 months 2 days
Weighted average exercise price outstanding	$ 1.587
Weighted average exercise price exerciseable	$ 1.466
Number exercisable | shares	5,222,439
Stock Option 3
Number of outstanding stock options | shares	16,010,745
Weighted average remaining life (years)	4 years 10 days
Weighted average exercise price outstanding	$ 1.479
Weighted average exercise price exerciseable	$ 1.407
Number exercisable | shares	2,008,938
Stock Option 4
Number of outstanding stock options | shares	5,336,000
Weighted average remaining life (years)	3 years 9 months 25 days
Weighted average exercise price outstanding	$ 2.234
Weighted average exercise price exerciseable	$ 2.150
Number exercisable | shares	1,185,688
Minimum | Stock Option 2
Range of exercise prices	$ 1.10
Minimum | Stock Option 3
Range of exercise prices	1.28
Minimum | Stock Option 4
Range of exercise prices	1.79
Maximum | Stock Option 2
Range of exercise prices	1.25
Maximum | Stock Option 3
Range of exercise prices	1.67
Maximum | Stock Option 4
Range of exercise prices	3.67
Stock Options 1
Range of exercise prices	$ 0.25
Number of outstanding stock options | shares	230,000
Weighted average remaining life (years)	1 year 7 months 24 days
Weighted average exercise price outstanding	$ 0.250
Weighted average exercise price exerciseable	$ 0.250
Number exercisable | shares	230,000
Stock Options 2
Number of outstanding stock options | shares	2,903,750
Weighted average remaining life (years)	2 years 11 months 15 days
Weighted average exercise price outstanding	$ 1.100
Weighted average exercise price exerciseable	$ 1.100
Number exercisable | shares	1,797,813

STOCK INCENTIVE PLANS (Detail_2

STOCK INCENTIVE PLANS (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Jan. 01, 2022	Oct. 15, 2021
Compensation expense	$ 744,640	$ 204,170
Unrecognized compensation costs	11,532,729
Intrinsic value	$ 3,693,865
Exercise stock option grants	24,480,495
Exercise price	$ 1.420
Unearned stock option grants	1,440,000
Warrant issued to common stock	50,000
2021 Equity Incentive Plan
Unearned stock option grants	9,704,620
Average exercise price	$ 1.587
Number of outstanding stock options				20,000,000
Number of common stock shares increase			22,000,000
Stock Option | Nineteen Employees And Consultants [Member]
Period for recognition	4 years
Stock Option | An Employee [Member]
Period for recognition	3 years 10 months 2 days
Ronald P. Erickson [Member]
Exercise price	$ 1.41
Period for recognition	5 years
Warrant issued to common stock	1,000,000
Phillip A. Bosua [Member]
Exercise price	$ 1.41
Period for recognition	4 years
Warrant issued to common stock	1,250,000
Peter Conley [Member]
Exercise price	$ 1.48
Period for recognition	4 years
Warrant issued to common stock	1,000,000

OTHER SIGNIFICANT TRANSACTION_2

OTHER SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES (Details Narrative) - USD ($)		3 Months Ended
	Dec. 14, 2022	Dec. 31, 2022
Executive Officers And Director Member
Common Stock Shares issued	30,000
Ronald P. Erickson [Member]
No of share granted for stock option	1,000,000
Share exercise price	$ 1.41
Salaries & Vacation Pay		$ 40,385
Phillip A. Bosua [Member]
Share exercise price		$ 1.41
Rent		$ 21,000
Purchase of common stock		1,250,000

COMMITMENTS, CONTINGENCIES AN_2

COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS (Details narrative) - USD ($)		1 Months Ended
	Apr. 13, 2017	Nov. 22, 2022	Sep. 28, 2022	Sep. 22, 2022	Oct. 11, 2021	May 18, 2021
COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS
Leases, net monthly payment	$ 3,334	$ 2,250		$ 7,000	$ 5,000	$ 8,697
Extended lease, amount					$ 2,986
Lease description	The monthly payment increases approximately 3% each year and the lease expired on May 31, 2022.			The lease expires September 30, 2023 and can be extended on a month to month basis		increases by 3% annually. The lease expires on June 30, 2024. The lease can be extended for one additional three year term.
Rent paid		$ 21,000	$ 91,500

SEGMENT REPORTING (Details)

SEGMENT REPORTING (Details) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Revenue	$ 0	$ 4,351,000
Segment Operating Profit (Loss)	(3,648,000)	(869,000)
Segment assets	10,710,000	14,885,000
Development of the Bio-RFID and ChromaID Technologies
Revenue	0	0
Segment Operating Profit (Loss)	(3,648,000)	(2,087,000)
Segment assets	10,710,000	11,755,000
Particle, Inc. Technology
Revenue	0	0
Segment Operating Profit (Loss)	0	(15,000)
Segment assets	0	5,000
Digital asset sales [Member]
Revenue	0	4,351,000
Segment Operating Profit (Loss)	0	1,233,000
Segment assets	$ 0	$ 3,125,000

SEGMENT REPORTING (Details Narr

SEGMENT REPORTING (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
SEGMENT REPORTING
Non-cash expenses	$ 846,472	$ 244,061

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	1 Months Ended
	Jan. 23, 2023	Nov. 22, 2022	Sep. 28, 2022
Monthly payment to party		$ 21,000	$ 91,500
Subsequent Event [Member]
Monthly payment to party	$ 10,000
Stock option grants	7,384,795
Subsequent Event [Member] | Philip A. Bosua[Member]
Payroll taxes	$ 400,000
Consulting fee	$ 10,000