Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Mar. 31, 2015 | |
Document And Entity Information | ||
Entity Registrant Name | SITESTAR CORP | |
Entity Central Index Key | 1096934 | |
Document Type | 10-K | |
Document Period End Date | 31-Dec-14 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
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 Public Float | $1,933,637 | |
Entity Common Stock, Shares Outstanding | 74,085,705 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2014 |
Balance_Sheets
Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
ASSETS | ||
Real estate - held for resale | $2,293,061 | $2,712,441 |
Real estate - held for investment, net | 1,107,402 | 531,165 |
Cash and cash equivalents | 369,694 | 118,469 |
Accounts receivable, net | 21,811 | 35,129 |
Prepaid expenses | 1,340 | 1,394 |
Property and equipment, net | 146,314 | 146,314 |
Goodwill, net | 1,166,494 | 1,166,494 |
Deferred tax assets, net | 74,276 | |
Other assets | 200,056 | 217,563 |
TOTAL ASSETS | 5,306,172 | 5,003,245 |
LIABILITIES | ||
Accounts payable | 14,963 | 12,121 |
Accrued expenses | 34,315 | 19,129 |
Deferred revenue | 273,440 | 312,898 |
Notes payable | 900,615 | 900,615 |
Notes payable - stockholder | 59,826 | |
TOTAL LIABILITIES | 1,223,333 | 1,304,589 |
STOCKHOLDERS' EQUITY | ||
Preferred Stock, $0.001 par value, 10,000,000 shares authorized, 0 shares issued and outstanding | ||
Common Stock, $0.001 par value, 300,000,000 shares authorized and 91,326,463 shares issued in 2014 and 2013, and 74,085,705 shares outstanding in 2014 and 2013. | 91,326 | 91,326 |
Additional paid-in capital | 13,880,947 | 13,880,947 |
Treasury Stock, at cost, 17,240,758 common shares | -789,518 | -789,518 |
Accumulated deficit | -9,099,916 | -9,484,099 |
Total stockholders' equity | 4,082,839 | 3,698,656 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $5,306,172 | $5,003,245 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ||
Preferred Stock Par Value | $0.00 | $0.00 |
Preferred Stock Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock Shares Issued | 0 | 0 |
Preferred Stock Shares Outstanding | 0 | 0 |
Common Stock Par Value | $0.00 | $0.00 |
Common Stock Shares Authorized | 300,000,000 | 300,000,000 |
Common Stock Shares Issued | 91,326,463 | 91,326,463 |
Common Stock Shares Outstanding | 74,085,705 | 74,085,705 |
Common Shares Treasury Stock | 17,240,758 | 17,240,758 |
Statements_of_Operations
Statements of Operations (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
REVENUE | ||
Internet | $1,922,445 | $2,397,557 |
Real estate | 461,251 | 156,192 |
Revenue | 2,383,696 | 2,553,749 |
COST OF REVENUE | ||
Internet | 679,361 | 1,146,535 |
Real estate | 426,722 | 193,795 |
Cost of Revenue | 1,106,083 | 1,340,330 |
GROSS PROFIT | 1,277,613 | 1,213,419 |
OPERATING EXPENSES | ||
Selling, general and administrative expenses | 817,403 | 829,046 |
Goodwill impairment | 122,065 | |
TOTAL OPERATING EXPENSES | 817,403 | 951,111 |
INCOME (LOSS) FROM OPERATIONS | 460,210 | 262,308 |
OTHER INCOME (EXPENSES) | ||
Other income | 653 | 2,055 |
Interest expense | -2,405 | -4,848 |
TOTAL OTHER INCOME (EXPENSES) | -1,752 | -2,793 |
INCOME (LOSS) BEFORE INCOME TAXES | 458,458 | 259,515 |
INCOME TAX EXPENSE | 74,275 | 163,272 |
NET INCOME (LOSS) | $384,183 | $96,243 |
BASIC AND DILUTED INCOME PER SHARE | $0.01 | $0 |
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC AND DILUTED | 74,085,705 | 74,085,705 |
Shareholders_Equity
Shareholders Equity (USD $) | Common Stock | Additional Paid-In Capital | Treasury Stock | Accumulated Deficit | Total |
Beginning Balance, Value at Dec. 31, 2012 | $91,326 | $13,880,947 | ($789,518) | ($9,580,342) | $3,602,413 |
Beginning Balance, Shares at Dec. 31, 2012 | 74,085,705 | ||||
Repurchase of shares | 0 | 0 | 0 | ||
Net income | 96,243 | 96,243 | |||
Ending Balance, Value at Dec. 31, 2013 | 91,326 | 13,880,947 | -789,518 | -9,484,099 | 3,698,656 |
Ending Balance, Shares at Dec. 31, 2013 | 74,085,705 | ||||
Repurchase of shares | 0 | 0 | 0 | ||
Net income | 384,183 | 384,183 | |||
Ending Balance, Value at Dec. 31, 2014 | $91,326 | $13,880,947 | ($789,518) | ($9,099,916) | $4,082,839 |
Ending Balance, Shares at Dec. 31, 2014 | 74,085,705 |
Statements_of_Cash_Flows
Statements of Cash Flows (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $384,183 | $96,243 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation, amortization and impairment | 19,405 | 153,620 |
Allowance for doubtful accounts | -2,624 | 2,133 |
Inventory Obsolescence | 17,509 | |
(Increase) decrease in accounts receivable | 15,942 | -6,774 |
(Increase) decrease in prepaid expenses | 54 | 49,017 |
(Increase) decrease in real estate held for resale | -271,787 | -136,075 |
(Increase) decrease in real estate held for investment | -151,973 | |
Fair value adjustment to real estate held-for-resale | 43,452 | |
(Increase) decrease in deferred income taxes | 74,275 | 135,423 |
(Increase) decrease in deferred taxes valuation allowance | 61,619 | |
Increase (decrease) in accounts payable | 2,842 | -20,758 |
Increase (decrease) in accrued expenses | 5,639 | -25,945 |
Increase (decrease) in deferred revenue | -39,458 | -74,359 |
Net cash provided by (used in) operating activities | 311,051 | -40,204 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Sale of assets held for resale | 5 | |
Purchase of customer list | 534 | |
Net cash provided by investing activities | 539 | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from notes payable - stockholders | ||
Purchase of treasury stock | ||
Repayment of notes payable - stockholders | -50,280 | 9,544 |
Net cash (used in) financing activities | -50,280 | 9,544 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 251,225 | -30,121 |
CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR | 118,469 | 148,590 |
CASH AND CASH EQUIVALENTS - END OF YEAR | 369,694 | 118,469 |
Supplemental Disclosures of Cash Flow Information | ||
Income Taxes Paid | 0 | 0 |
Interest Expense Paid | $2,405 | $4,849 |
1_ORGANIZATION_AND_SIGNIFICANT
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES | ||||||||
Organization and Lines of Business | |||||||||
Sitestar Corporation (formerly White Dove Systems, Inc., Interfoods Consolidated, Inc., was known as Holland American International Specialties (HAIS)), (the Company), began operations on June 1, 1997, under a partnership agreement and was incorporated in Nevada on November 4, 1997. On July 26, 1999 the Company restated its Articles of Incorporation to change the name of the Company to “Sitestar Corporation.” The Company was in the International specialty foods distribution business. In 1999, through the acquisition of two Internet Service Providers, the Company changed from a food distribution company to an Internet holding company. The Company services customers throughout the U.S. and Canada with multiple sites of operation. Effective October 15, 2008 pursuant to the approval of the board of directors, the Company’s management implemented a program to purchase real estate with the Company’s surplus cash flows. Sitestar is headquartered in Lynchburg, Virginia. | |||||||||
Principles of Consolidation | |||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries including: Sitestar.net, Inc. (formerly know as Neocom Microspecialists, Inc.), FRE Enterprises, Inc., Advanced Internet Services, Inc. and NetRover Inc. All intercompany accounts and transactions have been eliminated. | |||||||||
Reclassifications | |||||||||
Certain reclassifications have been made to amounts in prior period financial statements to conform to current period presentation. These reclassifications have not changed the results of operations or stockholders’ equity. | |||||||||
Use of Estimates | |||||||||
In accordance with Generally Accepted Accounting Principles (GAAP), the preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions and conditions. The most significant accounting estimates inherent in the preparation of the Company’s financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. These accounting policies are described at relevant sections in the notes to the consolidated financial statements. | |||||||||
Fair Value of Financial Instruments | |||||||||
For certain of the Company's assets and liabilities, including cash, accounts receivable, accounts payable, accrued expenses and deferred revenue, the carrying amounts approximate fair value due to their short maturities. The amounts shown for notes payable also approximate fair value because current interest rates and terms offered to the Company for similar debt are substantially the same. | |||||||||
Real Estate | |||||||||
The acquired properties are initially evaluated for their condition of repair, location and refurbish costs for resale and or rental. If, at acquisition, a property needs to be renovated before it is ready for its intended use, we commence the necessary development activities. During this development period, we capitalize all direct and indirect costs incurred in renovating the property. Real estate under development in the accompanying consolidated balance sheets represents aggregate carrying amount of properties that are being prepared for their intended use. When the intended use has been determined: | |||||||||
Real Estate – Held-for-Resale | |||||||||
Real estate is carried at cost. All costs directly related to the improvement and carrying of real estate are capitalized, including renovations and property taxes, to the extent the capitalized costs of the property do not exceed the estimated fair value of the property. If the cost of the real estate exceeds the estimated fair value, the excess is charged to expense. Fair value is estimated based on comparable sales in the geographic area the real estate is located, and is evaluated annually, or when events or changes in circumstances indicate the carrying value of the real estate may not be recoverable. | |||||||||
Real Estate – Held-for-Investment | |||||||||
Real estate is carried at cost, net of accumulated depreciation of $42,334. Once a property is ready for rental use, expenditures for ordinary maintenance and repairs thereafter are expensed to operations as incurred, and we capitalize expenditures that improve or extend the life of a home. Building depreciation is computed on the straight-line basis over the estimated useful lives of the assets. The Company generally uses a 27.5-year estimated life with no salvage value. | |||||||||
Building depreciation was $19,405 and $22,929 in 2014 and 2013. | |||||||||
Cash and Cash Equivalents | |||||||||
For purposes of the statements of cash flows, the Company defines cash equivalents as all highly liquid instruments purchased with a maturity of three months or less. | |||||||||
Concentration of Credit Risk | |||||||||
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash and accounts receivable. The Company places its cash with high quality financial institutions and, at times, may exceed the FDIC insurance limit. The Company extends credit based on an evaluation of the customers’ financial condition, generally without collateral. Exposure to losses on receivables is principally dependent on each customer's financial condition. The Company monitors its exposure for credit losses and maintains allowances for anticipated losses. | |||||||||
Accounts Receivable | |||||||||
The Company grants credit in the form of unsecured accounts receivable to its customers. The estimate of the allowance for doubtful accounts, which is charged off to bad debt expense, is based on management’s assessment of current economic conditions and historical collection experience with each customer. Specific customer receivables are considered past due when they are outstanding beyond their contractual terms and are charged off to the allowance for doubtful accounts when determined uncollectible. | |||||||||
For 2014 and 2013, bad debt expense was $20,213 and $58,596. As of December 31, 2014 and 2013, accounts receivable consists of the following: | |||||||||
2014 | 2013 | ||||||||
Gross accounts receivable | $ | 22,934 | $ | 38,876 | |||||
Less allowance for doubtful accounts | (1,123 | ) | (3,747 | ) | |||||
$ | 21,811 | $ | 35,129 | ||||||
Sales of Internet services, which are not automatically processed via credit card or bank account drafts, have been the Company’s highest exposure to collection risk. To help offset this exposure, the Company has added a late payment fee to encourage timely payments by customers. Another effort to improve customer collections was the implementation of a uniform manual invoice processing fee, which has also helped to accelerate the collections process. Accounts over ninety days past due are no longer included in accounts receivable and are turned over to a collection agency. | |||||||||
Property and Equipment | |||||||||
Property and equipment are stated at cost. Depreciation is computed using the declining balance method based on estimated useful lives from three to seven years for equipment and thirty nine years for buildings. Expenditures for maintenance and repairs are charged to operations as incurred while renewals and betterments are capitalized. Gains and losses on disposals are included in the results of operations. | |||||||||
Impairment of Long-Lived Assets | |||||||||
In accordance with GAAP, long-lived assets to be held and used are analyzed for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. | |||||||||
The Company evaluates at each balance sheet date whether events and circumstances have occurred that indicate possible impairment. If there are indications of impairment, the Company uses future undiscounted cash flows of the related asset or asset grouping over the remaining life in measuring whether the assets are recoverable. In the event such cash flows are not expected to be sufficient to recover the recorded asset values, the assets are written down to their estimated fair value. Long-lived assets to be disposed are reported at the lower of carrying amount or fair value of the asset less cost to sell. | |||||||||
Intangible Assets | |||||||||
The Company continually monitors its intangible assets to determine whether any impairment has occurred. In making such determination with respect to these assets, the Company evaluates the performance, on a discounted cash flow basis, of the intangible assets or group of assets. Should impairment be identified, a loss would be reported to the extent that the carrying value of the related intangible asset exceeds its fair value using the discounted cash flow method. | |||||||||
The Company's customer lists are being amortized over three years. Amortization expense for the customer lists was $0 and $5,983 for 2014 and 2013. Customer lists are now fully-amortized. Non-competition agreements are amortized over the contract period, usually one-to-three years. Amortization expense for non-competition agreements was $0 and $528 for 2014 and 2013. Non-competition agreements are now fully-amortized. | |||||||||
Goodwill | |||||||||
Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is not amortized, but is tested for impairment on an annual basis and more frequently if impairment indicators are present. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. An impairment charge is recognized for the excess of the carrying value of goodwill over its implied fair value. The Company conducted its annual goodwill impairment test as of December 31, 2014 and 2013 and determined no impairment charge was necessary in 2014, however, at December 31, 2013, the Company determined that the carrying value of Goodwill exceeded its fair value and recorded a goodwill impairment charge of $122,065 in 2013. | |||||||||
Deferred Revenue | |||||||||
Deferred revenue represents collections from customers in advance for services not yet performed and are recognized as revenue in the period service is provided. | |||||||||
Revenue Recognition | |||||||||
In all cases, revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed, and collectability of the related fee is reasonably assured. The Company’s arrangements generally do not include a provision for cancellation, termination, or refunds that would significantly impact revenue recognition. | |||||||||
Internet | |||||||||
The Company sells Internet services under annual and monthly contracts. Under the annual contracts, the subscriber pays a one-time annual fee, which is recognized as revenue ratably over the life of the contract. Under the monthly contracts, the subscriber is billed monthly and revenue is recognized for the period to which the service relates. Sales of computer hardware are recognized as revenue upon delivery and acceptance of the product by the customer. Sales are adjusted for any returns or allowances. | |||||||||
Real estate – held-for-resale | |||||||||
Revenue from real estate – held for resale is recognized upon closing of the sale, as all conditions for full revenue recognition have been met at that time. All costs associated with the property sold are removed from the consolidated balance sheets and charged to cost of revenue at that time. | |||||||||
Revenue from real estate sales was $311,563 and $93,000 in 2014 and 2013. | |||||||||
Real estate – held-for-investment | |||||||||
Rental revenue from real estate – held-for-investment attributable to residential leases is recorded when due from residents, which approximates the amount that would result from straight-lining rents over the lease term. The initial term of our residential leases is generally one year, with renewals upon consent of both parties on an annual or monthly basis. | |||||||||
Rental revenue was $119,588 and $63,192 in 2014 and 2013. | |||||||||
Advertising and Marketing Costs | |||||||||
The Company expenses costs of advertising and marketing as they are incurred. These expenses for the years ended December 31, 2014 and 2013 were approximately $9,000 and $15,000, respectively. | |||||||||
Income Taxes | |||||||||
Deferred taxes are provided on the liability method, whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | |||||||||
Income Per Share | |||||||||
The basic income per common share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding. Diluted income per common share is computed similar to basic income per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company has no potentially dilutive securities. The following table represents the calculations of basic and diluted income per share: | |||||||||
2014 | 2013 | ||||||||
Net income available to common shareholders | $ | 384,183 | $ | 96,243 | |||||
Weighted average number of common shares | 74,085,705 | 74,085,705 | |||||||
Basic and diluted income per share | $ | 0 | $ | 0 | |||||
Comprehensive Income | |||||||||
As of and for the years ended December 31, 2014 and 2013, the Company had no items that represent other comprehensive income and therefore, has not included a schedule of comprehensive income in the consolidated financial statements. | |||||||||
Recently Issued Accounting Pronouncements | |||||||||
No new accounting pronouncement issued or effective during the fiscal year has had or is expected to have a material impact on the consolidated financial statements. |
2_PROPERTY_AND_EQUIPMENT
2. PROPERTY AND EQUIPMENT | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
2. PROPERTY AND EQUIPMENT | NOTE 2 - PROPERTY AND EQUIPMENT | ||||||||
The cost of property and equipment at December 31, 2014 and December 31, 2013 consisted of the following: | |||||||||
2014 | 2013 | ||||||||
Land | $ | 10,000 | $ | 10,000 | |||||
Building | 213,366 | 213,366 | |||||||
Automobile | 11,500 | 11,500 | |||||||
Computer equipment | 1,164,061 | 1,164,061 | |||||||
Furniture and fixtures | 59,862 | 59,862 | |||||||
1,458,789 | 1,458,789 | ||||||||
Less accumulated depreciation | (1,312,475 | ) | (1,312,475 | ) | |||||
$ | 146,314 | $ | 146,314 | ||||||
Depreciation expense was $0 and $2,643 for 2014 and 2013. |
3_NOTES_PAYABLE
3. NOTES PAYABLE | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | |||||||||
3. NOTES PAYABLE | NOTE 3 NOTES PAYABLE | ||||||||
This USA Telephone note payable is due and is currently in litigation. At December 31, 2013 and 2012, the balance consist of the following: | |||||||||
2013 | 2012 | ||||||||
Non-interest bearing amount due on acquisition of USA Telephone payable in thirty six monthly installments starting January 2008. | $ | 900,615 | $ | 900,615 | |||||
Litigation | |||||||||
United Systems Access, Inc., et al. v. SiteStar Corporation, Civil Action, Docket No. CV-13-161, (York County Superior Court). This is a breach of contract claim, whereby Plaintiff has alleged that SiteStar has failed to pay the amounts owed on a Promissory Note. SiteStar has filed a counterclaim for damages associated with Plaintiff’s failure to turnover certain customer lists. Plaintiff seeks monetary damages in the amount of $900,615. Litigation is currently in the discovery phase of litigation. The parties have exchanged documents but have not yet taken depositions. SiteStar is currently contesting the Litigation. A mediation hearing in the matter took place on April 25, 2014, as required by the Maine Rules of Civil Procedure, however, no ruling has yet been issued. The estimate of the upper limit of a potential loss is $900,615 which has been accrued. Management is vigorously defending this claim. |
4_NOTES_PAYABLE_STOCKHOLDERS
4 NOTES PAYABLE - STOCKHOLDERS | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Payables and Accruals [Abstract] | |||||||||
4. NOTES PAYABLE - STOCKHOLDERS | NOTE 4 NOTES PAYABLE - STOCKHOLDERS | ||||||||
Notes payable - stockholders at December 31, 2014 and 2013 consist of the following: | |||||||||
2014 | 2013 | ||||||||
Note payable to stockholder. The note is payable on January 1, 2020 and bears interest at an annual rate of 10.0%. | $ | — | $ | 59,826 | |||||
— | 59,826 | ||||||||
Less current portion | — | — | |||||||
Long-term portion | $ | — | $ | 59,826 | |||||
This note was paid during 2014. |
5_COMMITMENTS_AND_CONTINGENCIE
5. COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||
5. COMMITMENTS AND CONTINGENCIES | NOTE 5 COMMITMENTS AND CONTINGENCIES | ||||||
Leases | |||||||
The Company leases certain facilities for its corporate offices and retail stores under non-cancelable operating leases. Total rent expense for the years ended December 31, 2014 and 2013 was $109,653 and $71,690, respectively. Related party rent expense for each year is $54,000. Future minimum lease payments under operating leases with initial or remaining terms of one year or more are as follows: | |||||||
Year ended December 31, | |||||||
2015 | $ | 55,200 | |||||
2016 | 0 | ||||||
2017 | 0 | ||||||
Total | $ | 55,200 | |||||
6_STOCKHOLDERS_EQUITY
6. STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2014 | |
Equity [Abstract] | |
6. STOCKHOLDERS' EQUITY | NOTE 6 STOCKHOLDERS' EQUITY |
Classes of Shares | |
The Company's Articles of Incorporation authorize 310,000,000 shares, consisting of 10,000,000 shares of preferred stock, which have a par value of $0.001 per share and 300,000,000 shares of common stock, which have a par value of $0.001. | |
Preferred Stock | |
Preferred stock, any series, shall have the powers, preferences, rights, qualifications, limitations and restrictions as fixed by the Company's Board of Directors in its sole discretion. As of December 31, 2014, the Company's Board of Directors has not issued any Preferred Stock. | |
Common Stock | |
None |
7_INCOME_TAXES
7. INCOME TAXES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Tax Disclosure [Abstract] | |||||||||
7. INCOME TAXES | NOTE 7 INCOME TAXES | ||||||||
The provision for federal and state income taxes for the years ended December 31, 2014 and 2013 included the following: | |||||||||
2014 | 2013 | ||||||||
Current provision: | |||||||||
Federal | $ | — | $ | — | |||||
State | — | — | |||||||
Deferred provision: | |||||||||
Federal | 62,536 | 137,465 | |||||||
State | 11,740 | 25,807 | |||||||
Valuation allowance | — | — | |||||||
Total income tax provision | $ | 74,276 | $ | 163,272 | |||||
Deferred tax assets and liabilities reflect the net effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities at December 31, 2014 and 2013 are as follows: | |||||||||
2014 | 2013 | ||||||||
Accounts receivable | $ | 1,123 | $ | 2,256 | |||||
Amortization of Intangible assets | 2,359,505 | 2,494,267 | |||||||
Less valuation allowance | (2,360,628 | ) | (2,422,247 | ) | |||||
Deferred tax asset | $ | — | $ | 74,276 | |||||
8_RELATED_PARTY_TRANSACTIONS
8. RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |
8. RELATED PARTY TRANSACTIONS | NOTE 8 RELATED PARTY TRANSACTIONS |
The Company leases its office building in Lynchburg, Virginia from its Director and CEO on a five-year lease expiring April 30, 2017. For the years ended December 31, 2014 and 2013, the Company paid $48,000 and $48,000 for rent on this office building. In addition, the Company rents a house used for storage of appliances and supplies which is located in Salem VA. This property is also leased from the same Company director and CEO at an annual rent of $6,000. |
9_SEGMENT_INFORMATION
9. SEGMENT INFORMATION | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||
9. SEGMENT INFORMATION | NOTE 9 - SEGMENT INFORMATION | ||||||||||||||||
The Company has three business units with separate management and reporting infrastructures that offer different products and services. The business units have been aggregated into three reportable segments: Corporate, Real estate and Internet. The Corporate group is the holding company which oversees the operating of the Internet group and arranges financing. The real estate group invests in, refurbishes and markets real estate for resale. The Internet group provides Internet access to customers throughout the U.S. and Canada. The Company evaluates the performance of its operating segments based on income from operations, before income taxes, accounting changes, non-recurring items, and interest income and expense. | |||||||||||||||||
Summarized financial information concerning the Company's reportable segments is shown in the following table for the years ended December 31, 2014 and 2013: | |||||||||||||||||
31-Dec-14 | |||||||||||||||||
Corporate | Real Estate | Internet | Consolidated | ||||||||||||||
Revenue | $ | — | $ | 461,251 | $ | 1,922,445 | $ | 2,383,696 | |||||||||
Operating income (loss) | $ | (135,922 | ) | $ | 34,529 | $ | 561,603 | $ | 460,210 | ||||||||
Depreciation and amortization | $ | — | $ | 19,405 | $ | — | $ | 19,405 | |||||||||
Interest expense | $ | — | $ | (2,405 | ) | $ | (2,405 | ) | |||||||||
Goodwill | $ | — | $ | 1,166,494 | $ | 1,166,494 | |||||||||||
Identifiable assets | $ | — | $ | 3,400,463 | $ | 1,905,709 | $ | 5,306,172 | |||||||||
31-Dec-13 | |||||||||||||||||
Corporate | Real Estate | Internet | Consolidated | ||||||||||||||
Revenue | $ | — | $ | 156,192 | $ | 2,397,557 | $ | 2,553,749 | |||||||||
Operating income (loss) | $ | (115,490 | ) | $ | (37,603 | ) | $ | 415,401 | $ | 262,308 | |||||||
Depreciation and amortization | $ | — | $ | 22,929 | $ | 130,691 | $ | 153,620 | |||||||||
Interest expense | $ | — | $ | (4,848 | ) | $ | (4,848 | ) | |||||||||
Goodwill | $ | — | $ | 1,166,494 | $ | 1,166,494 | |||||||||||
Identifiable assets | $ | — | $ | 3,243,606 | $ | 1,759,639 | $ | 5,003,245 |
1_ORGANIZATION_AND_SIGNIFICANT1
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
Organization and Lines of Business | Organization and Lines of Business | ||||||||
Sitestar Corporation (formerly White Dove Systems, Inc., Interfoods Consolidated, Inc., was known as Holland American International Specialties (HAIS)), (the Company), began operations on June 1, 1997, under a partnership agreement and was incorporated in Nevada on November 4, 1997. On July 26, 1999 the Company restated its Articles of Incorporation to change the name of the Company to “Sitestar Corporation.” The Company was in the International specialty foods distribution business. In 1999, through the acquisition of two Internet Service Providers, the Company changed from a food distribution company to an Internet holding company. The Company services customers throughout the U.S. and Canada with multiple sites of operation. Effective October 15, 2008 pursuant to the approval of the board of directors, the Company’s management implemented a program to purchase real estate with the Company’s surplus cash flows. Sitestar is headquartered in Lynchburg, Virginia. | |||||||||
Principles of Consolidation | Principles of Consolidation | ||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries including: Sitestar.net, Inc. (formerly know as Neocom Microspecialists, Inc.), FRE Enterprises, Inc., Advanced Internet Services, Inc. and NetRover Inc. All intercompany accounts and transactions have been eliminated. | |||||||||
Reclassifications | Reclassifications | ||||||||
Certain reclassifications have been made to amounts in prior period financial statements to conform to current period presentation. These reclassifications have not changed the results of operations or stockholders’ equity. | |||||||||
Use of Estimates | Use of Estimates | ||||||||
In accordance with Generally Accepted Accounting Principles (GAAP), the preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions and conditions. The most significant accounting estimates inherent in the preparation of the Company’s financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. These accounting policies are described at relevant sections in the notes to the consolidated financial statements. | |||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments | ||||||||
For certain of the Company's assets and liabilities, including cash, accounts receivable, accounts payable, accrued expenses and deferred revenue, the carrying amounts approximate fair value due to their short maturities. The amounts shown for notes payable also approximate fair value because current interest rates and terms offered to the Company for similar debt are substantially the same. | |||||||||
Real Estate | Real Estate | ||||||||
The acquired properties are initially evaluated for their condition of repair, location and refurbish costs for resale and or rental. If, at acquisition, a property needs to be renovated before it is ready for its intended use, we commence the necessary development activities. During this development period, we capitalize all direct and indirect costs incurred in renovating the property. Real estate under development in the accompanying consolidated balance sheets represents aggregate carrying amount of properties that are being prepared for their intended use. When the intended use has been determined: | |||||||||
Real Estate – Held-for-Resale | |||||||||
Real estate is carried at cost. All costs directly related to the improvement and carrying of real estate are capitalized, including renovations and property taxes, to the extent the capitalized costs of the property do not exceed the estimated fair value of the property. If the cost of the real estate exceeds the estimated fair value, the excess is charged to expense. Fair value is estimated based on comparable sales in the geographic area the real estate is located, and is evaluated annually, or when events or changes in circumstances indicate the carrying value of the real estate may not be recoverable. | |||||||||
Real Estate – Held-for-Investment | |||||||||
Real estate is carried at cost, net of accumulated depreciation of $42,334. Once a property is ready for rental use, expenditures for ordinary maintenance and repairs thereafter are expensed to operations as incurred, and we capitalize expenditures that improve or extend the life of a home. Building depreciation is computed on the straight-line basis over the estimated useful lives of the assets. The Company generally uses a 27.5-year estimated life with no salvage value. | |||||||||
Building depreciation was $19,405 and $22,929 in 2014 and 2013. | |||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents | ||||||||
For purposes of the statements of cash flows, the Company defines cash equivalents as all highly liquid instruments purchased with a maturity of three months or less. | |||||||||
Concentration of Credit Risk | Concentration of Credit Risk | ||||||||
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash and accounts receivable. The Company places its cash with high quality financial institutions and, at times, may exceed the FDIC insurance limit. The Company extends credit based on an evaluation of the customers’ financial condition, generally without collateral. Exposure to losses on receivables is principally dependent on each customer's financial condition. The Company monitors its exposure for credit losses and maintains allowances for anticipated losses. | |||||||||
Accounts Receivable | Accounts Receivable | ||||||||
The Company grants credit in the form of unsecured accounts receivable to its customers. The estimate of the allowance for doubtful accounts, which is charged off to bad debt expense, is based on management’s assessment of current economic conditions and historical collection experience with each customer. Specific customer receivables are considered past due when they are outstanding beyond their contractual terms and are charged off to the allowance for doubtful accounts when determined uncollectible. | |||||||||
For 2014 and 2013, bad debt expense was $20,213 and $58,596. As of December 31, 2014 and 2013, accounts receivable consists of the following: | |||||||||
2014 | 2013 | ||||||||
Gross accounts receivable | $ | 22,934 | $ | 38,876 | |||||
Less allowance for doubtful accounts | (1,123 | ) | (3,747 | ) | |||||
$ | 21,811 | $ | 35,129 | ||||||
Sales of Internet services, which are not automatically processed via credit card or bank account drafts, have been the Company’s highest exposure to collection risk. To help offset this exposure, the Company has added a late payment fee to encourage timely payments by customers. Another effort to improve customer collections was the implementation of a uniform manual invoice processing fee, which has also helped to accelerate the collections process. Accounts over ninety days past due are no longer included in accounts receivable and are turned over to a collection agency. | |||||||||
Property and Equipment | Property and Equipment | ||||||||
Property and equipment are stated at cost. Depreciation is computed using the declining balance method based on estimated useful lives from three to seven years for equipment and thirty nine years for buildings. Expenditures for maintenance and repairs are charged to operations as incurred while renewals and betterments are capitalized. Gains and losses on disposals are included in the results of operations. | |||||||||
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets | ||||||||
In accordance with GAAP, long-lived assets to be held and used are analyzed for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. | |||||||||
The Company evaluates at each balance sheet date whether events and circumstances have occurred that indicate possible impairment. If there are indications of impairment, the Company uses future undiscounted cash flows of the related asset or asset grouping over the remaining life in measuring whether the assets are recoverable. In the event such cash flows are not expected to be sufficient to recover the recorded asset values, the assets are written down to their estimated fair value. Long-lived assets to be disposed are reported at the lower of carrying amount or fair value of the asset less cost to sell. | |||||||||
Intangible Assets | Intangible Assets | ||||||||
The Company continually monitors its intangible assets to determine whether any impairment has occurred. In making such determination with respect to these assets, the Company evaluates the performance, on a discounted cash flow basis, of the intangible assets or group of assets. Should impairment be identified, a loss would be reported to the extent that the carrying value of the related intangible asset exceeds its fair value using the discounted cash flow method. | |||||||||
The Company's customer lists are being amortized over three years. Amortization expense for the customer lists was $0 and $5,983 for 2014 and 2013. Customer lists are now fully-amortized. Non-competition agreements are amortized over the contract period, usually one-to-three years. Amortization expense for non-competition agreements was $0 and $528 for 2014 and 2013. Non-competition agreements are now fully-amortized. | |||||||||
Goodwill | Goodwill | ||||||||
Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is not amortized, but is tested for impairment on an annual basis and more frequently if impairment indicators are present. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. An impairment charge is recognized for the excess of the carrying value of goodwill over its implied fair value. The Company conducted its annual goodwill impairment test as of December 31, 2014 and 2013 and determined no impairment charge was necessary in 2014, however, at December 31, 2013, the Company determined that the carrying value of Goodwill exceeded its fair value and recorded a goodwill impairment charge of $122,065 in 2013. | |||||||||
Deferred Revenue | Deferred Revenue | ||||||||
Deferred revenue represents collections from customers in advance for services not yet performed and are recognized as revenue in the period service is provided. | |||||||||
Revenue Recognition | Revenue Recognition | ||||||||
In all cases, revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed, and collectability of the related fee is reasonably assured. The Company’s arrangements generally do not include a provision for cancellation, termination, or refunds that would significantly impact revenue recognition. | |||||||||
Internet | |||||||||
The Company sells Internet services under annual and monthly contracts. Under the annual contracts, the subscriber pays a one-time annual fee, which is recognized as revenue ratably over the life of the contract. Under the monthly contracts, the subscriber is billed monthly and revenue is recognized for the period to which the service relates. Sales of computer hardware are recognized as revenue upon delivery and acceptance of the product by the customer. Sales are adjusted for any returns or allowances. | |||||||||
Real estate – held-for-resale | |||||||||
Revenue from real estate – held for resale is recognized upon closing of the sale, as all conditions for full revenue recognition have been met at that time. All costs associated with the property sold are removed from the consolidated balance sheets and charged to cost of revenue at that time. | |||||||||
Revenue from real estate sales was $311,563 and $93,000 in 2014 and 2013. | |||||||||
Real estate – held-for-investment | |||||||||
Rental revenue from real estate – held-for-investment attributable to residential leases is recorded when due from residents, which approximates the amount that would result from straight-lining rents over the lease term. The initial term of our residential leases is generally one year, with renewals upon consent of both parties on an annual or monthly basis. | |||||||||
Rental revenue was $119,588 and $63,192 in 2014 and 2013. | |||||||||
Advertising and Marketing Costs | Advertising and Marketing Costs | ||||||||
The Company expenses costs of advertising and marketing as they are incurred. These expenses for the years ended December 31, 2014 and 2013 were approximately $9,000 and $15,000, respectively. | |||||||||
Income Taxes | Income Taxes | ||||||||
Deferred taxes are provided on the liability method, whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | |||||||||
Income Per Share | Income Per Share | ||||||||
The basic income per common share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding. Diluted income per common share is computed similar to basic income per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company has no potentially dilutive securities. The following table represents the calculations of basic and diluted income per share: | |||||||||
2014 | 2013 | ||||||||
Net income available to common shareholders | $ | 384,183 | $ | 96,243 | |||||
Weighted average number of common shares | 74,085,705 | 74,085,705 | |||||||
Basic and diluted income per share | $ | 0 | $ | 0 | |||||
Comprehensive Income | Comprehensive Income | ||||||||
As of and for the years ended December 31, 2014 and 2013, the Company had no items that represent other comprehensive income and therefore, has not included a schedule of comprehensive income in the consolidated financial statements. | |||||||||
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements | ||||||||
No new accounting pronouncement issued or effective during the fiscal year has had or is expected to have a material impact on the consolidated financial statements. |
1_ORGANIZATION_AND_SIGNIFICANT2
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accounting Policies [Abstract] | |||||||||
Accounts Receivable | 2014 | 2013 | |||||||
Gross accounts receivable | $ | 22,934 | $ | 38,876 | |||||
Less allowance for doubtful accounts | (1,123 | ) | (3,747 | ) | |||||
$ | 21,811 | $ | 35,129 | ||||||
Income Per Share | 2014 | 2013 | |||||||
Net income available to common shareholders | $ | 384,183 | $ | 96,243 | |||||
Weighted average number of common shares | 74,085,705 | 74,085,705 | |||||||
Basic and diluted income per share | $ | 0 | $ | 0 |
2_PROPERTY_AND_EQUIPMENT_Table
2. PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
Property and Equipment | 2014 | 2013 | |||||||
Land | $ | 10,000 | $ | 10,000 | |||||
Building | 213,366 | 213,366 | |||||||
Automobile | 11,500 | 11,500 | |||||||
Computer equipment | 1,164,061 | 1,164,061 | |||||||
Furniture and fixtures | 59,862 | 59,862 | |||||||
1,458,789 | 1,458,789 | ||||||||
Less accumulated depreciation | (1,312,475 | ) | (1,312,475 | ) | |||||
$ | 146,314 | $ | 146,314 |
3_NOTES_PAYABLE_Tables
3. NOTES PAYABLE (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | |||||||||
Notes Payable | 2013 | 2012 | |||||||
Non-interest bearing amount due on acquisition of USA Telephone payable in thirty six monthly installments starting January 2008. | $ | 900,615 | $ | 900,615 | |||||
4_NOTES_PAYABLE_STOCKHOLDERS_T
4 NOTES PAYABLE - STOCKHOLDERS (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Payables and Accruals [Abstract] | |||||||||
Notes Payable - Stockholders | 2014 | 2013 | |||||||
Note payable to stockholder. The note is payable on January 1, 2020 and bears interest at an annual rate of 10.0%. | $ | — | $ | 59,826 | |||||
— | 59,826 | ||||||||
Less current portion | — | — | |||||||
Long-term portion | $ | — | $ | 59,826 |
5_COMMITMENTS_AND_CONTINGENCIE1
5. COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||
Commitments and Contingencies | Year ended December 31, | ||||||
2015 | $ | 55,200 | |||||
2016 | 0 | ||||||
2017 | 0 | ||||||
Total | $ | 55,200 |
7_INCOME_TAXES_Tables
7. INCOME TAXES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Tax Disclosure [Abstract] | |||||||||
Provision for Income Taxes | 2014 | 2013 | |||||||
Current provision: | |||||||||
Federal | $ | — | $ | — | |||||
State | — | — | |||||||
Deferred provision: | |||||||||
Federal | 62,536 | 137,465 | |||||||
State | 11,740 | 25,807 | |||||||
Valuation allowance | — | — | |||||||
Total income tax provision | $ | 74,276 | $ | 163,272 | |||||
Significant Components of Deferred Tax Assets | 2014 | 2013 | |||||||
Accounts receivable | $ | 1,123 | $ | 2,256 | |||||
Amortization of Intangible assets | 2,359,505 | 2,494,267 | |||||||
Less valuation allowance | (2,360,628 | ) | (2,422,247 | ) | |||||
Deferred tax asset | $ | — | $ | 74,276 |
9_SEGMENT_INFORMATION_Tables
9. SEGMENT INFORMATION (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||
Segment Information | 31-Dec-14 | ||||||||||||||||
Corporate | Real Estate | Internet | Consolidated | ||||||||||||||
Revenue | $ | — | $ | 461,251 | $ | 1,922,445 | $ | 2,383,696 | |||||||||
Operating income (loss) | $ | (135,922 | ) | $ | 34,529 | $ | 561,603 | $ | 460,210 | ||||||||
Depreciation and amortization | $ | — | $ | 19,405 | $ | — | $ | 19,405 | |||||||||
Interest expense | $ | — | $ | (2,405 | ) | $ | (2,405 | ) | |||||||||
Goodwill | $ | — | $ | 1,166,494 | $ | 1,166,494 | |||||||||||
Identifiable assets | $ | — | $ | 3,400,463 | $ | 1,905,709 | $ | 5,306,172 | |||||||||
31-Dec-13 | |||||||||||||||||
Corporate | Real Estate | Internet | Consolidated | ||||||||||||||
Revenue | $ | — | $ | 156,192 | $ | 2,397,557 | $ | 2,553,749 | |||||||||
Operating income (loss) | $ | (115,490 | ) | $ | (37,603 | ) | $ | 415,401 | $ | 262,308 | |||||||
Depreciation and amortization | $ | — | $ | 22,929 | $ | 130,691 | $ | 153,620 | |||||||||
Interest expense | $ | — | $ | (4,848 | ) | $ | (4,848 | ) | |||||||||
Goodwill | $ | — | $ | 1,166,494 | $ | 1,166,494 | |||||||||||
Identifiable assets | $ | — | $ | 3,243,606 | $ | 1,759,639 | $ | 5,003,245 |
1_ORGANIZATION_AND_SIGNIFICANT3
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Accounting Policies [Abstract] | ||
Gross accounts receivable | $22,934 | $38,876 |
Less allowance for doubtful accounts | -1,123 | -3,747 |
Net accounts receivable | $21,811 | $35,129 |
1_ORGANIZATION_AND_SIGNIFICANT4
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES - Income Per Share (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Accounting Policies [Abstract] | ||
Net income available to common shareholders | $384,183 | $96,243 |
Weighted average number of common shares | 74,085,705 | 74,085,705 |
Basic and diluted income per share | $0.01 | $0 |
1_ORGANIZATION_AND_SIGNIFICANT5
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Accumulated Depreciation | $42,334 | |
Building Depreciation | 19,405 | 22,929 |
Bad Debt Expense | 20,213 | 58,596 |
Goodwill Impairment Charge | 122,065 | |
Revenue from Real Estate Sales | 311,563 | 93,000 |
Rental Revenue | 119,588 | 63,192 |
Advertising and Marketing Costs | 9,000 | 15,000 |
Customer Lists | ||
Amortization Expense for Intangible Assets | 0 | 5,983 |
Non Competition Agreements | ||
Amortization Expense for Intangible Assets | $0 | $528 |
2_PROPERTY_AND_EQUIPMENT_Prope
2. PROPERTY AND EQUIPMENT - Property and Equipment (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Property and Equipment, Gross | $1,458,789 | $1,458,789 |
Less accumulated depreciation | -1,312,475 | -1,312,475 |
Property and Equipment, Net | 146,314 | 146,314 |
Land | ||
Property and Equipment, Gross | 10,000 | 10,000 |
Building | ||
Property and Equipment, Gross | 213,366 | 213,366 |
Automobile | ||
Property and Equipment, Gross | 11,500 | 11,500 |
Computer Equipment | ||
Property and Equipment, Gross | 1,164,061 | 1,164,061 |
Furniture and Fixtures | ||
Property and Equipment, Gross | $59,862 | $59,862 |
2_PROPERTY_AND_EQUIPMENT_Detai
2. PROPERTY AND EQUIPMENT (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation Expense | $0 | $2,643 |
3_NOTES_PAYABLE_Notes_Payable_
3. NOTES PAYABLE - Notes Payable (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Debt Disclosure [Abstract] | ||
Non-interest bearing amount due on acquisition of USA Telephone payable in thirty six monthly installments starting January 2008. | $900,615 | $900,615 |
3_NOTES_PAYABLE_Details_Narrat
3. NOTES PAYABLE (Details Narrative) (USD $) | Dec. 31, 2014 |
Debt Disclosure [Abstract] | |
Potential Litigation Loss | $900,615 |
4_NOTES_PAYABLE_STOCKHOLDERS_N
4 NOTES PAYABLE - STOCKHOLDERS - Notes Payable - Stockholders (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Payables and Accruals [Abstract] | ||
Note payable to stockholder. The note is payable on January 1, 2020 and bears interest at an annual rate of 10.0%. | $59,826 | |
Less current portion | ||
Long-term portion | $59,826 |
5_COMMITMENTS_AND_CONTINGENCIE2
5. COMMITMENTS AND CONTINGENCIES - Commitments and Contingencies (Details) (USD $) | Dec. 31, 2014 |
Commitments and Contingencies Disclosure [Abstract] | |
2015 | $55,200 |
2016 | 0 |
2017 | 0 |
Total | $55,200 |
5_COMMITMENTS_AND_CONTINGENCIE3
5. COMMITMENTS AND CONTINGENCIES (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Rent Expense | $109,653 | $71,690 |
Related Party Rent Expense | $54,000 |
6_STOCKHOLDERS_EQUITY_Details_
6. STOCKHOLDERS' EQUITY (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Equity [Abstract] | ||
Preferred Stock Par Value | $0.00 | $0.00 |
Preferred Stock Shares Authorized | 10,000,000 | 10,000,000 |
Common Stock Par Value | $0.00 | $0.00 |
Common Stock Shares Authorized | 300,000,000 | 300,000,000 |
7_INCOME_TAXES_Provision_for_I
7. INCOME TAXES - Provision for Income Taxes (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | ||
Federal | ||
State | ||
Federal | 62,536 | 137,465 |
State | 11,740 | 25,807 |
Valuation allowance | ||
Total income tax provision | $74,275 | $163,272 |
7_INCOME_TAXES_Significant_Com
7. INCOME TAXES - Significant Components of Deferred Tax Assets (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Accounts receivable | $21,811 | $35,129 |
Deferred Income Tax Charge [Member] | ||
Accounts receivable | 1,123 | 2,256 |
Amortization of Intangible assets | 2,359,505 | 2,494,267 |
Less valuation allowance | -2,360,628 | -2,422,247 |
Deferred tax asset | $74,276 |
8_RELATED_PARTY_TRANSACTIONS_D
8. RELATED PARTY TRANSACTIONS (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Office Rental | $109,653 | $71,690 |
Related Party [Member] | ||
Office Rental | 48,000 | 48,000 |
Related Party Rent | $6,000 |
9_SEGMENT_INFORMATION_Segment_
9. SEGMENT INFORMATION - Segment Information (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Interest expense | $2,405 | $4,848 |
Corporate [Member] | ||
Revenue | ||
Operating income (loss) | -135,922 | -115,490 |
Depreciation and amortization | ||
Interest expense | ||
Goodwill | ||
Identifiable assets | ||
Real Estate [Member] | ||
Revenue | 461,251 | 156,192 |
Operating income (loss) | 34,529 | -37,603 |
Depreciation and amortization | 19,405 | 22,929 |
Identifiable assets | 3,400,463 | 3,243,606 |
Internet [Member] | ||
Revenue | 1,922,445 | 2,397,557 |
Operating income (loss) | 561,603 | 415,401 |
Depreciation and amortization | 130,691 | |
Interest expense | -2,405 | -4,848 |
Goodwill | 1,166,494 | 1,166,494 |
Identifiable assets | 1,905,709 | 1,759,639 |
Consolidated [Member] | ||
Revenue | 2,383,696 | 2,553,749 |
Operating income (loss) | 460,210 | 262,308 |
Depreciation and amortization | 19,405 | 153,620 |
Interest expense | -2,405 | -4,848 |
Goodwill | 1,166,494 | 1,166,494 |
Identifiable assets | $5,306,172 | $5,003,245 |