Spectral Capital (FCCN) 10-Q 5 Nov 13 2013 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	9 Months Ended
	Sep. 30, 2013
Document and Entity Information:	'
Entity Registrant Name	'SPECTRAL CAPITAL CORPORATION
Document Type	'10-Q
Document Period End Date	30-Sep-13
Amendment Flag	'false
Entity Central Index Key	'0001131903
Current Fiscal Year End Date	'--12-31
Entity Common Stock, Shares Outstanding	112,857,623
Entity Filer Category	'Smaller Reporting Company
Entity Current Reporting Status	'Yes
Entity Voluntary Filers	'No
Entity Well-known Seasoned Issuer	'No
Document Fiscal Year Focus	'2013
Document Fiscal Period Focus	'Q3

CONSOLIDATED_BALANCE_SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)	Sep. 30, 2013	Dec. 31, 2012
Assets:	'	'
Cash and cash equivalents	$882,965	$84,091
Accounts receivable - related party	323,978	323,978
Current assets	1,206,943	408,069
Property and equipment, net	'	717
Investment in Kontexto, Inc.	537,000	'
Internet search technology	3,115,022	'
Total Assets	4,858,965	408,786
Liabilities and Stockholders' Equity:	'	'
Accrued liabilities	16,500	14,000
Due to related parties	270,143	97,696
Current liabilities	286,643	111,696
Total Liabilities	286,643	111,696
Commitments and contingencies	'	'
Stockholders' Equity:	'	'
Preferred stock, par value $0.0001, 5,000,000 shares authorized, no shares issued and outstanding	'	'
Common stock, par value $0.0001, 500,000,000 shares authorized, 112,857,623 and 101,207,623 shares issued and outstanding as of September 30, 2013 and December 31, 2012, respectively	11,286	10,121
Additional paid-in capital	22,853,136	12,683,132
Common stock warrants	1,831,500	'
Prepaid consulting	-189,376	-615,469
Deficit accumulated during the development/exploration stage	-19,934,224	-11,780,694
Total stockholders' equity	4,572,322	297,090
Total liabilities and stockholders' equity	$4,858,965	$408,786

CONSOLIDATED_BALANCE_SHEETS_PA

CONSOLIDATED BALANCE SHEETS PARENTHETICAL (USD $)	Sep. 30, 2013	Dec. 31, 2012
CONSOLIDATED BALANCE SHEETS PARENTHETICAL	'	'
Preferred stock par value	$0.00	$0.00
Preferred stock shares authorized	5,000,000	5,000,000
Preferred stock shares issued	'	'
Preferred stock shares outstanding	'	'
Common stock par value	$0.00	$0.00
Common stock shares authorized	500,000,000	500,000,000
Common stock shares issued	112,587,623	101,207,623
Common stock shares outstanding	112,587,623	101,207,623

CONSOLIDATED_STATEMENTS_OF_OPE

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended		9 Months Ended		104 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013
Revenues	'	'	'	'	'
Revenues	'	'	'	'	'
Operating expenses:	'	'	'	'	'
Selling, general and administrative	49,369	48,598	182,878	156,646	3,947,657
Wages and benefits	39,260	37,569	78,173	126,129	2,544,927
Legal fees	'	8,954	'	77,254	651,057
Research and development	'	'	'	'	1,965,424
Stock-based compensation	676,754	1,260,145	2,030,262	1,487,059	4,982,421
Beneficial conversion expense	'	'	'	'	230,900
Depreciation and amortization	239	239	717	718	24,019
Impairment of cost investment	0	'	5,861,500	'	5,861,500
Total operating expenses	765,622	1,355,505	8,153,530	1,847,806	20,207,905
Operating loss	-765,622	-1,355,505	-8,153,530	-1,847,806	-20,207,905
Other income and (expense)	'	'	'	'	'
Interest expense	'	-34,314	'	-79,445	-113,761
Other income (expense)	'	'	'	'	-10,651
Total other income (expensee)	'	-34,314	'	-79,445	-124,412
Loss from operations and before non-controlling interest and discontinued operations	-765,622	-1,389,819	-8,153,530	-1,927,251	-20,332,317
Less: Loss attributable to non-controlling interest	'	51,637	'	315,139	269,686
Loss before tax provision and discontinued operations	-765,622	-1,338,182	-8,153,530	-1,612,112	-20,062,631
Provision for income taxes	'	'	'	'	'
Net loss attributable to Spectral Capital Corporation before discontinued operations	-765,622	-1,338,182	-8,153,530	-1,612,112	-20,062,631
Gain (loss) from discontinued operations	'	-90,294	'	-677,618	128,407
Net loss attributable to Spectral Capital Corporation	($765,622)	($1,428,476)	($8,153,530)	($2,289,730)	($19,934,224)
Basic and diluted loss per common share	($0.01)	($0.01)	($0.07)	($0.02)	'
Weighted average shares - basic and diluted	112,857,823	101,207,623	110,077,770	101,267,623	'

CONSOLIDATED_STATEMENT_OF_STOC

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (USD $)	Common Stock	Additional Paid in Capital	Prepaid Consulting	Common Stock Warrants	Non-Controlling Interest	Deficit Accumulated During the Exploration Stage	Total
Balance at Feb. 09, 2005	'	'	'	'	'	'	'
Stock based compensation	$2,983	$2,914,209	'	'	'	'	$2,917,192
Stock based compensation - shares	19,883	'	'	'	'	'	'
Net loss for the period ended March 6, 2005	'	'	'	'	'	-11,605	-11,605
Restated recapitalization, March 7, 2005	2,744	-104,701	'	'	'	'	-101,957
Restated recapitalization, March 7, 2005 - shares	18,229	'	'	'	'	'	'
PPMs	93	305,907	'	'	'	'	306,000
PPMs-shares	620	'	'	'	'	'	'
Net Income (Loss)	'	'	'	'	'	-4,079,552	-4,079,552
Beneficial conversion feature	'	230,900	'	'	'	'	230,900
Net Income (Loss)	'	'	'	'	'	-4,079,552	-4,079,552
Balance at Dec. 31, 2005	5,820	3,346,315	'	'	'	-4,091,157	-739,022
Balance Shares at Dec. 31, 2005	38,802	'	'	'	'	'	'
PPMs	112	951,888	'	'	'	'	952,000
PPMs-shares	757	'	'	'	'	'	'
Shares issued for services	4	37,996	'	'	'	'	38,000
Shares issued for services-shares	23	'	'	'	'	'	'
Shares exchanged for debt	107	985,026	'	'	'	'	985,133
Shares exchanged for debt-shares	716	'	'	'	'	'	'
Cancellation of shares issued for compensation	-60	-731,940	'	'	'	'	-732,000
Cancellation of shares issued for compensation-shares	-400	'	'	'	'	'	'
Net Income (Loss)	'	'	'	'	'	-435,407	-435,407
Stock options	'	11,724	'	'	'	'	11,724
Net Income (Loss)	'	'	'	'	'	-435,407	-435,407
Balance at Dec. 31, 2006	5,983	4,601,009	'	'	'	-4,526,564	80,428
Balance Shares at Dec. 31, 2006	39,898	'	'	'	'	'	'
PPMs	260	649,740	'	'	'	'	650,000
PPMs-shares	1,733	'	'	'	'	'	'
Share par value adjustments	'	-6,239	6,239	'	'	'	'
Net Income (Loss)	'	'	'	'	'	-720,112	-720,112
Net Income (Loss)	'	'	'	'	'	-720,112	-720,112
Balance at Dec. 31, 2007	4	5,256,988	'	'	'	-5,246,676	10,316
Balance Shares at Dec. 31, 2007	41,631	'	'	'	'	'	'
Issuance of common stock for cash	1	299,999	'	'	'	'	300,000
Issuance of common stock for cash - Shares	5,000	'	'	'	'	'	'
Net Income (Loss)	'	'	'	'	'	-292,310	-292,310
Net Income (Loss)	'	'	'	'	'	-292,310	-292,310
Balance at Dec. 31, 2008	5	5,556,987	'	'	'	-5,538,986	18,006
Balance Shares at Dec. 31, 2008	46,631	'	'	'	'	'	'
Conversion of debt to common stock	'	1,000	'	'	'	'	1,000
Conversion of debt to common stock - Shares	133	'	'	'	'	'	'
Reverse stock split	859	'	'	'	'	'	'
Net Income (Loss)	'	'	'	'	'	-77,998	-77,998
Net Income (Loss)	'	'	'	'	'	-77,998	-77,998
Balance at Dec. 31, 2009	5	5,557,987	'	'	'	-5,616,984	-58,992
Balance Shares at Dec. 31, 2009	47,623	'	'	'	'	'	'
Conversion of debt to common stock	1	9,999	'	'	'	'	10,000
Conversion of debt to common stock - Shares	10,000	'	'	'	'	'	'
Issuance of common stock for cash	5,000	45,000	'	'	'	'	50,000
Issuance of common stock for cash - Shares	50,000,000	'	'	'	'	'	'
Conversion of debt to common stock (2nd time)	5,000	51,181	'	'	'	'	56,181
Conversion of debt to common stock (2nd time) - Shares	50,000,000	'	'	'	'	'	'
Exercise of warrants	15	170,985	'	-21,000	'	'	150,000
Exercise of warrants - Shares	150,000	'	'	'	'	'	'
Stock options issued as compensation	'	1,170,713	'	'	'	'	1,170,713
Stock warrants issued for mineral properties	'	'	'	1,311,508	'	'	1,311,508
Issuance of stock warrants	'	-2,821,069	'	2,821,069	'	'	'
Issuance of common stock for cash (2nd time)	100	199,900	'	'	'	'	2,000,000
Issuance of common stock for cash (2nd time) - Shares	1,000,000	'	'	'	'	'	'
Net Income (Loss)	'	'	'	'	'	-1,449,474	-1,449,474
Net Income (Loss)	'	'	'	'	'	-1,449,474	-1,449,474
Balance at Dec. 31, 2010	10,121	6,184,696	'	4,111,577	'	-7,066,458	3,239,936
Balance Shares at Dec. 31, 2010	101,207,623	'	'	'	'	'	'
Stock options issued as compensation	'	434,517	'	'	'	'	434,517
Stock warrants issued for mineral properties	'	'	'	15,547,500	'	'	15,547,500
Stock warrants rescinded and cancelled	'	'	'	-15,547,500	'	'	-15,547,500
Stock warrants rescinded and cancelled (2nd time)	'	'	'	-1,311,508	'	'	-1,311,508
Stock options issued for consultant	'	400,425	'	'	'	'	400,425
Net Income (Loss)	'	'	'	'	'	-2,057,865	-2,057,865
Net Income (Loss)	'	'	'	'	'	-2,057,865	-2,057,865
Balance at Dec. 31, 2011	10,121	7,019,638	'	2,800,069	'	-9,124,323	705,505
Balance Shares at Dec. 31, 2011	101,207,623	'	'	'	'	'	'
Stock options issued as compensation	'	3,133,111	-615,469	'	'	'	2,517,642
Net Income (Loss)	'	'	'	'	'	-2,656,371	-2,926,057
Stock warrants expired	'	2,800,069	'	-2,800,069	'	'	'
Termination of non-controlling interest	'	-269,686	'	'	269,686	'	'
Net Income (Loss)	'	'	'	'	'	-2,656,371	-2,926,057
Balance at Dec. 31, 2012	10,121	12,683,132	-615,469	'	-296,686	-11,780,694	297,090
Balance Shares at Dec. 31, 2012	101,207,623	'	'	'	'	'	'
Issuance of common stock for cash	165	716,835	'	283,000	'	'	1,000,000
Issuance of common stock for cash - Shares	1,650,000	'	'	'	'	'	'
Stock options issued as compensation	'	1,604,169	'	'	'	'	1,604,169
Stock options issued for consultant	'	'	426,093	'	'	'	426,093
Net Income (Loss)	'	'	'	'	'	-8,153,530	-8,153,530
Shares issued for a technology asset	500	2,999,500	'	'	'	'	3,000,000
Shares issued for a technology asset-shares	5,000,000	'	'	'	'	'	'
Shares issued to acquire investment	500	4,849,500	'	1,548,500	'	'	6,398,500
Shares issued to acquire investment-shares	5,000,000	'	'	'	'	'	'
Net Income (Loss)	'	'	'	'	'	-8,153,530	-8,153,530
Balance at Sep. 30, 2013	$11,286	$22,853,136	($189,376)	$1,831,500	'	($19,934,224)	$4,572,322
Balance Shares at Sep. 30, 2013	112,857,623	'	'	'	'	'	'

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	9 Months Ended		104 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES:	'	'	'
Net loss	($8,153,530)	($2,604,869)	($19,934,224)
Non-controlling interest	'	'	-269,686
Depreciation and amortization	717	718	24,020
Share-based services	2,030,262	1,487,059	8,785,478
Beneficial conversion feature on warrant issued	'	'	-230,900
Gain on sale of oil business	'	'	-845,680
Loss on disposal of property and equipment	'	'	5,879
Property and equipment traded for services	'	'	24,805
Impairment of cost investment	5,861,500	'	5,861,500
Change in legal trust account	'	'	-14,207
Change in prepaid expenses	'	-9,254	'
Change in accounts payable & accrued expenses	2,500	107,079	143,735
Change in due to related parties	'	'	36,579
Net cash used in operating activities	-258,551	-1,019,267	-5,950,901
CASH FLOWS FROM INVESTING ACTIVITIES:	'	'	'
Purchase of property and equipment	'	'	-54,197
Development of internet search technology	-115,022	'	-115,022
Increase in security deposits	'	'	-27,810
Proceeds from disposal of property and equipment	'	'	494
Purchase of oil and gas properties	'	-219,093	-219,093
Net cash used in investing activities	-115,022	-219,093	-415,628
CASH FLOWS FROM FINANCING ACTIVITIES:	'	'	'
Cash received in recapitalization of the Company	'	'	184
Proceeds from related party advances	172,447	639,451	1,791,310
Proceeds from sale of common stock	1,000,000	'	5,412,000
Proceeds from note payable	'	'	50,000
Offering costs from issuance of common stock	'	'	-4,000
Net cash provided by financing activities	1,172,447	639,451	7,249,494
Change in cash and cash equivalents	798,874	-598,909	882,965
Cash and cash equivalents, beginning of period	84,091	730,922	'
Cash and cash equivalents, end of period	882,965	132,013	882,965
Supplemental disclosures of cash flow information:	'	'	'
Cash paid for interest	'	'	59,574
Cash paid for income taxes	'	'	'
Value of shares issued for acquisition of asset management company	'	'	'
Non-monetary net liabilities assumed in recapitalization	'	'	101,956
Properties acquired through assumption of debt	'	2,134,949	2,134,949
Debt assumed by buyer in sale of oil and gas business	'	'	2,291,739
Common stock issued for debt	'	'	1,000
Stock warrants issued for acquisition of mineral properties	'	'	16,859,008
Stock warrants rescinded and cancelled	'	'	16,859,008
Issuance of common stock warrants	1,548,500	'	4,369,569
Issuance of stock for prepaid consulting	'	'	615,469
Issuance of stock for technology asset and cost investment	7,850,000	'	7,850,000
Expiration of warrants	'	'	$2,800,069

Note_1_Nature_of_Operations

Note 1 - Nature of Operations	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 1 - Nature of Operations	'
	NOTE 1 – NATURE OF OPERATIONS
	Spectral Capital Corporation (the "Company" or "Spectral") was incorporated on September 13, 2000 under the laws of the State of Nevada. The Company was formerly in the business of developing internet search engine technology. From August 2010 until December 2012, the Company evaluated and sought out opportunities in the natural resource sector.  Spectral acquired various interests in natural resource assets in Russia, Kazakhstan and Alberta, Canada.  In December, 2012, Spectral changed its corporate focus from the natural resource sector and back to information technology.  Spectral has divested of its principal natural resource asset in Alberta, Canada and intends to divest any remaining natural resources in the near future and focus solely on acquiring and developing information technology. See Notes 5 and 6 for disclosures regarding the acquisition of certain technology and a cost investment.

Note_2_Summary_of_Significant_

Note 2 - Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 2 - Summary of Significant Accounting Policies	'
	NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	Interim Financial Statements
	The accompanying unaudited interim financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission.  Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim financial statements should be read in conjunction with the audited financial statements of the Company for the year ended December 31, 2012. The results of operations for the three and nine months ended September 30, 2013 are not indicative of the results that may be expected for the full year.
	Development Stage Company
	The accompanying financial statements have been prepared in accordance with generally accepted accounting principles related to accounting and reporting by development-stage companies.  A development-stage company is one in which planned principal operations have not commenced, or if its operations have commenced, there has been no significant revenues there from.
	Principles of Consolidation
	The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its 60% owned subsidiary, Noot Holdings, Inc. from its date of incorporation of February 28, 2013. Previously, the Company included the operations of Extractive Resources Corporation and Shamrock Oil and Gas, Ltd. Shamrock is 60% owned by Extractive Resources Corporation which were disposed on December 31, 2012.  All material intercompany accounts and transactions have been eliminated in consolidation.
	Basis of Presentation
	The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.
	Fair Value of Financial Instruments
	The Company's financial instruments consist of cash and cash equivalents, accounts receivable – related party, accrued expenses, and due to related parties. The carrying amount of these financial instruments approximates fair value due to either length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.
	Stock-Based Compensation
	The Company accounts for employee stock-based compensation in accordance with the guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, Compensation – Stock Compensation which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.
	The Company follows ASC Topic 505-50, Equity: Equity-Based Payments to Non-Employees for stock options and warrants issued to consultants and other non-employees.  In accordance with ASC Topic 505-50, these stock options and warrants issued as compensation for services provided to the Company are accounted for based upon the fair value of the services provided or the estimated fair market value of the option or warrant, whichever can be more clearly determined.  The fair value of the equity instrument is charged directly to compensation expense and additional paid-in capital over the period during which services are rendered.
	Use of Estimates
	The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period.  Actual results could differ from those estimates.
	Revenue Recognition
	The Company recognizes revenues when delivery of goods or completion of services has occurred provided there is persuasive evidence of an agreement, acceptance has been approved by its customers, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is probable.
	Basic Income (Loss) Per Share
	Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Common share equivalents totalling 20,250,000 and 14,600,000 were outstanding at September 30, 2013 and 2012, respectively, representing outstanding warrants and options, and were not included in the computation of diluted earnings per share for the periods ended September 30, 2013 and 2012, as their effect would have been anti-dilutive.
	Investment in Securities
	The Company’s investments consisting of common shares of non-controlled entities are accounted for on  the cost basis.  Impairment losses will be recorded when indicators of impairment are present.  See Note 6 for additional information.
	Reclassifications
	Certain accounts in these financial statements have been reclassified to correct a typographical error in the prior period.

Note_3_Managements_Plans

Note 3- Managements Plans	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 3- Managements Plans	'
	NOTE 3– MANAGEMENTS' PLANS
	The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  The Company is in the development stage and has sustained substantial losses since inception. However, as of September 30, 2013, the Company has cash on hand of $882,965 and positive working capital of $920,340. The Company expects current cash on hand will be able to fund operations for a period in excess of 12 months. In view of this matter, the ability of the Company to continue as a going concern is dependent upon growth of revenues

Note_4_Discontinued_Operations

Note 4 - Discontinued Operations	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 4 - Discontinued Operations	'
	NOTE 4 – DISCONTINUED OPERATIONS
	In prior years, the Company had limited activity related to mineral, oil and gas properties.  All such activities and business in such properties has been discontinued, sold/transferred in 2012.  Management has presented discontinued operations in the statement of operations for the three and nine months ended September 30, 2012.  There were no material assets or liabilities associated with discontinued operations and interest expense incurred during the applicable periods were deemed to be incurred in connection with continuing operations.

Note_5_Technology_Assets

Note 5 - Technology Assets	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 5 - Technology Assets	'
	NOTE 5 – TECHNOLOGY ASSETS
	On February 26, 2013, the Company, through its subsidiary, Spectral Holdings, Inc. signed a definitive Technology Acquisition Agreement (“Agreement”) to acquire mobile search engine and mobile sharing technology from Fiveseas Securities Ltd (“Fiveseas").  Under the Agreement, the Company issued Fiveseas 5,000,000 shares of the Company's common stock.  The Agreement calls for the technology to reside within a newly formed entity called Noot Holdings, Inc.( “Noot”), a Delaware corporation, which the Company will be a 60% owner of and Fiveseas will be a 40% owner of. Fiveseas was granted a right of first refusal for any subsequent sale of the technology.  The common shares were valued at $3,000,000 based on the closing market price of the Company's common stock as of the date of the agreement. The Company has recorded the value as an investment in technology as the in process development did not constitute a business. The Company intends to record the future income/losses from Noot attributable to the percentage owned by Fiveseas as a non-controlling interest. The Company completed substantial development of the technology acquired during September 2013. Costs were capitalized in relation to the technology’s development through September 30, 2013.  Starting October 1, 2013, the Company will amortize the asset over three years and expects to record amortization expense of approximately $260,000, $1,038,000, $1,038,000 and $779,000 in 2013,2014, 2015, and 2016, respectively. During the nine months ended September 30, 2013 costs of approximately $115,000 were capitalized in connection with the continued development.

Note_6_Cost_Investment

Note 6- Cost Investment	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 6- Cost Investment	'
	NOTE 6– COST INVESTMENT
	On March 14, 2013, the Company entered into an agreement to purchase 8% of the issued and outstanding common shares of Kontexto, Inc., (“Kontexto”) a Canadian corporation.  The Company purchased the shares from a minority shareholder in exchange for 5,000,000 common shares of the Company's common stock and warrants to purchase 5,000,000 shares of the Company's common stock at $0.85 per share, expiring on March 13, 2015 (see Note 10).  The Company valued the common stock using the closing price of the Company's common stock on the date of the agreement and the warrants were valued using the Black-Scholes pricing model. The Company’s investment in 8% of the common shares, initially valued at $6,398,500, is accounted for on the cost basis.  During the  nine months ended September 30, 2013, a third party valuation specialist valued the investment in Kontexto using a hybrid between the market and income methods and determined that the fair value was $537,500 .  Accordingly, an impairment loss of $0 and $5,861,500 was recognized in the statements of operations for the three and nine months ended September 30, 2013, respectively.

Note_7_Related_Party_Transacti

Note 7- Related Party Transactions	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 7- Related Party Transactions	'
	NOTE 7– RELATED PARTY TRANSACTIONS
	At September 30, 2013 and December 31, 2012, $270,143 and $97,696, respectively, was owed to the CEO of Spectral and Akoranga AG, a Swiss Company owned by the CEO of Spectral. Akoranga was formed to facilitate Spectral’s business in Europe. Fees expensed for services provided by Akoranga totaled approximately $77,065 and $20,381 for the nine months ended September 30, 2013 and 2012, respectively.
	At December 31, 2012, the Company sold its oil and gas business to Akoranga for $950,000 plus the assumption of all debt related to the oil and gas business. As a result of that transaction, Akoranga owes $323,978 to the Company and is reflected on the accompanying balance sheet as accounts receivable - related party. The balance is due on December 31, 2013. Related party loans are unsecured, and non-interest bearing and have no specific terms of repayment unless otherwise noted.

Note_8_Capital_Stock

Note 8 - Capital Stock	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 8 - Capital Stock	'
	NOTE 8 – CAPITAL STOCK
	The Company has 5,000,000 shares of $0.0001 par value preferred stock, and 500,000,000 shares of $0.0001 par value common stock authorized.
	On February 26, 2013, the Company issued 5,000,000 shares of common stock with a deemed value of $3,000,000 for technology assets (see Note 5).
	On March 7, 2013, the Company sold 1,650,000 shares of common stock at $0.65 per share and 1,650,000 warrants, and received a total of $1,000,000 USD in financing proceeds.  The shares and warrants had a deemed value of $717,000 and $283,000, respectively (see Note 10)
	On March 14, 2013, the Company issued 5,000,000 shares of common stock and 5,000,000 warrants to purchase common shares at $0.85 per share.  The warrants expire on March 13, 2015.  The shares and warrants had a deemed value of $4,850,000 and $1,548,500 respectively (see Note 6).

Note_9_Stockbased_Compensation

Note 9 - Stock-based Compensation	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 9 - Stock-based Compensation	'
	NOTE 9- STOCK-BASED COMPENSATION
	The Company has adopted a stock option and award plan to attract, retain and motivate its directors, officers, employees, consultants and advisors. Options provide the opportunity to acquire a proprietary interest in the Company and to benefit from its growth. Vesting terms and conditions are determined by the Board of Directors at the time of the grant. The Plan provides for the issuance of up to 15,000,000 common shares for employees, consultants, directors, and advisors.
	On February 6, 2012, the Company granted 7,500,000 options to two employees. Stock-based compensation is being recognized over the two year vesting period. The options were valued at $4,541,096 using the Black-Scholes Option Pricing Model.
	Employee stock-based compensation expense relating to options granted in 2010 and 2012 and recognized in the nine months ended September 30, 2013 and 2012 totalled $1,604,169 and $434,517, respectively. At September 30, 2013, unrecognized expense of $1,461,266 remains to be recognized through 2015.
	There were 2,500,000 options initially valued at $1,136,250 using the Black-Scholes pricing model issued to an advisor on February 6, 2012. Based on the vesting term, $520,781 was charged to consulting expense and $615,469 was recorded as prepaid consulting. During the nine months ended September 30, 2013, $426,093 of the prepaid consulting expense was charged to stock-based compensation on the accompanying statement of operations.  Unamortized prepaid consulting expense of $189,376 remains as of September 30, 2013.
	Because the Company’s stock-based compensation options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the estimate, amounts estimated using the Black-Scholes option pricing model may differ materially from the actual fair value of the Company’s stock-based compensation options.

Note_10_Stock_Warrants

Note 10 - Stock Warrants	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 10 - Stock Warrants	'
	NOTE 10– STOCK WARRANTS
	On March 7, 2013, Spectral sold 1,650,000 common shares at $0.65 per share and received a total of $1,000,000 in financing proceeds.  Contemporaneously, Spectral issued warrants to purchase 1,650,000 common shares at an exercise price of $0.80 per share.  The warrants expire March 7, 2015.  The warrants were valued using the Black-Scholes pricing model and $283,000 of the proceeds were allocated to the warrants.
	See Note 6 for discussion of warrants issued in connection with a cost investment.
	As of September 30, 2013 and December 31, 2012, the Company has 6,650,000 and zero outstanding warrants, respectively.

Note_11_Commitments_and_Contin

Note 11 - Commitments and Contingencies	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 11 - Commitments and Contingencies	'
	NOTE 11– COMMITMENTS AND CONTINGENCIES
	Effective March 31, 2012, Spectral and International Asset Holdings Corp (“IAHC”) entered into a Property Acquisition Option Agreement and Definitive Financing Agreement Rescission restating Spectral’s position in the Bayankol property in light of the difficulties with local regulation and title transfer.  The agreement rescinded the original transaction of January 14, 2011.

Note_12_Subsequent_Events

Note 12- Subsequent Events	9 Months Ended
	Sep. 30, 2013
Notes	'
Note 12- Subsequent Events	'
	NOTE 12– SUBSEQUENT EVENTS
	In accordance with ASC 855-10, the Company has analyzed its operations subsequent to September 30, 2013 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.

Note_2_Summary_of_Significant_1

Note 2 - Summary of Significant Accounting Policies: Development Stage Company (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Development Stage Company	'
	Development Stage Company
	The accompanying financial statements have been prepared in accordance with generally accepted accounting principles related to accounting and reporting by development-stage companies.  A development-stage company is one in which planned principal operations have not commenced, or if its operations have commenced, there has been no significant revenues there from.

Note_2_Summary_of_Significant_2

Note 2 - Summary of Significant Accounting Policies: Principles of Consolidation (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Principles of Consolidation	'
	Principles of Consolidation
	The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its 60% owned subsidiary, Noot Holdings, Inc. from its date of incorporation of February 28, 2013. Previously, the Company included the operations of Extractive Resources Corporation and Shamrock Oil and Gas, Ltd. Shamrock is 60% owned by Extractive Resources Corporation which were disposed on December 31, 2012.  All material intercompany accounts and transactions have been eliminated in consolidation.

Note_2_Summary_of_Significant_3

Note 2 - Summary of Significant Accounting Policies: Accounting Basis (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Accounting Basis	'
	Basis of Presentation
	The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.

Note_2_Summary_of_Significant_4

Note 2 - Summary of Significant Accounting Policies: Fair Value of Financial Instruments (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Fair Value of Financial Instruments	'
	Fair Value of Financial Instruments
	The Company's financial instruments consist of cash and cash equivalents, accounts receivable – related party, accrued expenses, and due to related parties. The carrying amount of these financial instruments approximates fair value due to either length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

Note_2_Summary_of_Significant_5

Note 2 - Summary of Significant Accounting Policies: Stock-based Compensation (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Stock-based Compensation	'
	Stock-Based Compensation
	The Company accounts for employee stock-based compensation in accordance with the guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, Compensation – Stock Compensation which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.
	The Company follows ASC Topic 505-50, Equity: Equity-Based Payments to Non-Employees for stock options and warrants issued to consultants and other non-employees.  In accordance with ASC Topic 505-50, these stock options and warrants issued as compensation for services provided to the Company are accounted for based upon the fair value of the services provided or the estimated fair market value of the option or warrant, whichever can be more clearly determined.  The fair value of the equity instrument is charged directly to compensation expense and additional paid-in capital over the period during which services are rendered.

Note_2_Summary_of_Significant_6

Note 2 - Summary of Significant Accounting Policies: Use of Estimates (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Use of Estimates	'
	Use of Estimates
	The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Note_2_Summary_of_Significant_7

Note 2 - Summary of Significant Accounting Policies: Revenue Recognition (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Revenue Recognition	'
	Revenue Recognition
	The Company recognizes revenues when delivery of goods or completion of services has occurred provided there is persuasive evidence of an agreement, acceptance has been approved by its customers, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is probable.

Note_2_Summary_of_Significant_8

Note 2 - Summary of Significant Accounting Policies: Basic Income (loss) Per Share (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Basic Income (loss) Per Share	'
	Basic Income (Loss) Per Share
	Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Common share equivalents totalling 20,250,000 and 14,600,000 were outstanding at September 30, 2013 and 2012, respectively, representing outstanding warrants and options, and were not included in the computation of diluted earnings per share for the periods ended September 30, 2013 and 2012, as their effect would have been anti-dilutive.

Note_2_Summary_of_Significant_9

Note 2 - Summary of Significant Accounting Policies: Investment, Policy (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Investment, Policy	'
	Investment in Securities
	The Company’s investments consisting of common shares of non-controlled entities are accounted for on  the cost basis.  Impairment losses will be recorded when indicators of impairment are present.  See Note 6 for additional information.

Recovered_Sheet1

Note 2 - Summary of Significant Accounting Policies: Reclassifications (Policies)	9 Months Ended
	Sep. 30, 2013
Policies	'
Reclassifications	'
	Reclassifications
	Certain accounts in these financial statements have been reclassified to correct a typographical error in the prior period.

Note_3_Managements_Plans_Cash_

Note 3- Managements Plans: Cash and Working Capital (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2012	Dec. 31, 2011
Details	'	'	'	'
Cash and cash equivalents	$882,965	$84,091	$132,013	$730,922
Working Capital	$920,340	'	'	'

Note_5_Technology_Assets_Detai

Note 5 - Technology Assets (Details) (USD $)	9 Months Ended
	Sep. 30, 2013	Feb. 26, 2013
Details	'	'
Common shares value	'	$3,000,000
Finite-Lived Intangible Assets, Amortization Expense, Remainder of Fiscal Year	260,000	'
Finite-Lived Intangible Assets, Amortization Expense, Rolling Year Two	1,038,000	'
Finite-Lived Intangible Assets, Amortization Expense, Rolling Year Three	1,038,000	'
Finite-Lived Intangible Assets, Amortization Expense, Rolling Year Four	779,000	'
Amortization of Intangible Assets	$115,000	'

Note_6_Cost_Investment_Details

Note 6- Cost Investment (Details) (USD $)	3 Months Ended	9 Months Ended	104 Months Ended
	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Mar. 14, 2013	Mar. 07, 2013
Warrants Issued To Purchase Common Shares	'	'	'	5,000,000	1,650,000
Warrants Issued To Purchase Common Shares Exercise Price	'	'	'	$0.85	$0.80
Impairment of cost investment	$0	$5,861,500	$5,861,500	'	'
Kontexto	'	'	'	'	'
Common shares of Kontexto, Inc. purchased	'	'	'	5,000,000	'
Warrants Issued To Purchase Common Shares	'	'	'	5,000,000	'
Warrants Issued To Purchase Common Shares Exercise Price	'	'	'	$0.85	'
Total Investment Value	'	'	'	6,398,500	'
Fair value of investement	$537,500	$537,500	$537,500	'	'

Note_7_Related_Party_Transacti1

Note 7- Related Party Transactions (Details) (USD $)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Service Fees from Akoranga	$77,065	$20,381	'
Pledged Assets, Not Separately Reported, Nonsecuritized Investments	'	'	950,000
Balance Owing From Offset Of Liabilities	323,978	'	'
Akoranga Ag	'	'	'
Accounts Payable, Related Parties	$270,143	'	$97,696

Note_8_Capital_Stock_Details

Note 8 - Capital Stock (Details) (USD $)	1 Months Ended
	Mar. 31, 2013	Feb. 28, 2013	Mar. 14, 2013	Mar. 07, 2013
Details	'	'	'	'
Stock Issued During Period, Shares, Purchase of Assets	'	5,000,000	'	'
Fair Value of Assets Acquired	'	$3,000,000	'	'
Common shares sold	'	'	'	1,650,000
Stock Issued Share Price	'	'	'	0.65
Warrants sold	'	'	'	1,650,000
Proceeds From Sell Of Common Stock	'	'	'	1,000,000
Deemed value of shares	'	'	4,850,000	717,000
Deemed value of warrants	'	'	$1,548,500	$283,000
Development Stage Entities, Stock Issued, Shares, Issued for Cash	5,000,000	'	'	'
Warrants Issued To Purchase Common Shares	'	'	5,000,000	1,650,000
Warrants Issued To Purchase Common Shares Exercise Price	'	'	$0.85	$0.80

Note_9_Stockbased_Compensation1

Note 9 - Stock-based Compensation (Details) (USD $)	1 Months Ended	9 Months Ended
	Feb. 28, 2012	Sep. 30, 2013	Sep. 30, 2012
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures	2,500,000	'	'
Stock-based compensation expense	'	$1,604,169	$434,517
Stock-based compensation unrecognized expense	'	1,461,266	'
Issuance of Stock and Warrants for Services or Claims	1,136,250	'	'
Consulting expense	520,781	426,093	'
Consulting expense prepaid	615,469	'	'
Unamortized prepaid consulting expense	'	189,376	'
6-Feb-12	'	'	'
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures	7,500,000	'	'
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures	$4,541,096	'	'

Note_10_Stock_Warrants_Details

Note 10 - Stock Warrants (Details) (USD $)	Sep. 30, 2013	Mar. 14, 2013	Mar. 07, 2013	Dec. 31, 2012
Details	'	'	'	'
Excess Stock, Shares Issued	'	'	1,650,000	'
Stock Issued Share Price	'	'	0.65	'
Proceeds From Sell Of Common Stock	'	'	$1,000,000	'
Warrants Issued To Purchase Common Shares	'	5,000,000	1,650,000	'
Warrants Issued To Purchase Common Shares Exercise Price	'	$0.85	$0.80	'
Warrants Issued To Purchase Common Shares Value	'	'	$283,000	'
Outstanding Warrants	6,650,000	'	'	0