DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - USD ($) | 12 Months Ended | ||
Mar. 31, 2017 | Apr. 12, 2018 | Sep. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Mar. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Sundance Strategies, Inc. | ||
Entity Central Index Key | 1,171,838 | ||
Current Fiscal Year End Date | --03-31 | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Common Stock, Shares Outstanding | 44,128,441 | ||
Entity Public Float | $ 45,305,189 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2017 | Mar. 31, 2016 |
Assets | ||
Cash and Cash Equivalents | $ 4,364 | $ 24,717 |
Prepaid Expenses and Other Assets | 4,705 | 1,875 |
Investment in Net Insurance Benefits | 34,156,005 | 29,822,186 |
Total Assets | 34,165,074 | 29,848,778 |
Liabilities | ||
Accounts Payable | 508,071 | 351,671 |
Mandatorily Redeemable Common Stock | 750,000 | |
Deferred Income Taxes | 758,972 | |
Notes Payable, Related Parties | 5,214,753 | 3,820,178 |
Convertible Debenture | 700,000 | 700,000 |
Accrued Expenses | 753,780 | 192,157 |
Total Liabilities | 7,935,576 | 5,814,006 |
Commitments and Contingencies (Note 14) | ||
Stockholders' Equity | ||
Preferred Stock, authorized 10,000,000 shares, par value $0.001; -0- shares issued and outstanding | ||
Common Stock, authorized 500,000,000 shares, par value $0.001; 44,128,441 shares issued and outstanding | 44,129 | 44,129 |
Additional Paid In Capital | 24,547,014 | 24,364,442 |
Retained Earnings (Accumulated Deficit) | 1,638,355 | (373,799) |
Total Stockholders' Equity | 26,229,498 | 24,034,772 |
Total Liabilities and Stockholders' Equity | $ 34,165,074 | $ 29,848,778 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2017 | Mar. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred Stock, par value per share | $ 0.001 | $ 0.001 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, shares authorized | 500,000,000 | 500,000,000 |
Common Stock, par value per share | $ 0.001 | $ 0.001 |
Common Stock, shares issued | 44,128,441 | 44,128,441 |
Common Stock, shares outstanding | 44,128,441 | 44,128,441 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Interest Income on Investment in Net Insurance Benefits | $ 5,751,689 | $ 3,909,171 |
General and Administrative Expenses | 2,489,938 | 3,597,439 |
Income from Operations | 3,261,751 | 311,732 |
Other Income (Expense) | ||
Interest Income | 5,241 | |
Interest Expense | (390,625) | (233,244) |
Financing Expense | (100,000) | |
Total Other Expense | (490,625) | (228,003) |
Income Before Income Taxes | 2,771,126 | 83,729 |
Income Tax Provision | 758,972 | |
Net Income | $ 2,012,154 | $ 83,729 |
Basic and Diluted: | ||
Basic Earnings Per Share | $ 0.05 | |
Fully Diluted Earnings Per Share | $ 0.04 | |
Basic Weighted Average Number of Shares Outstanding | 44,131,515 | 44,026,832 |
Fully Diluted Weighted Average Number of Shares Outstanding | 45,477,464 | 45,373,208 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Common Stock [Member] | Additional Paid In Capital [Member] | Common Stock to be Issued [Member] | Retained Earnings (Accumulated Deficit) [Member] | Total |
Balance at Mar. 31, 2015 | $ 43,186 | $ 16,316,882 | $ 7,540,000 | $ (457,528) | $ 23,442,540 |
Balance, shares at Mar. 31, 2015 | 43,185,941 | ||||
Issuance of stock | $ 943 | 7,539,058 | (7,540,000) | ||
Issuance of stock, shares | 942,500 | ||||
Stock-based compensation expense | 508,503 | 508,503 | |||
Net income | 83,729 | 83,729 | |||
Balance at Mar. 31, 2016 | $ 44,129 | 24,364,442 | (373,799) | $ 24,034,772 | |
Balance, shares at Mar. 31, 2016 | 44,128,441 | 44,128,441 | |||
Issuance of stock | |||||
Stock-based compensation expense | 182,572 | 182,572 | |||
Net income | 2,012,154 | 2,012,154 | |||
Balance at Mar. 31, 2017 | $ 44,129 | $ 24,547,014 | $ 1,638,355 | $ 26,229,498 | |
Balance, shares at Mar. 31, 2017 | 44,128,441 | 44,128,441 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating Activities | ||
Net Income | $ 2,012,154 | $ 83,729 |
Adjustments to reconcile to net cash from operating activities: | ||
Share Based Compensation - Options | 182,572 | 508,503 |
Deferred Income Taxes | 758,972 | |
Write-off of Financing Commitment | 100,000 | |
Accrued Interest on Net Insurance Benefits (NIBs) | (5,751,689) | (3,909,171) |
Cash Received on NIBs | 1,417,870 | |
Changes in Operating Assets and Liabilities | ||
Accrued Interest Income | 16,428 | |
Prepaid Expenses and Other Assets | (2,830) | |
Accounts Payable | 156,400 | 96,310 |
Accrued Expenses | 561,623 | 183,364 |
Net Cash from Operating Activities | (564,928) | (3,020,837) |
Investing Activities | ||
Advance for Investments in NIBs | (626,914) | |
Refund of Advance for Investments in NIBs | 854,920 | |
Proceeds from Notes Receivable | 211,000 | |
Net Cash from Investing Activities | 439,006 | |
Financing Activities | ||
Proceeds from Issuance of Notes Payable, Related Party | 1,544,575 | 2,320,178 |
Repayment of Notes Payable, Related Party | (150,000) | |
Proceeds from Issuance of Convertible Debenture | 700,000 | |
Redemption of Temporary Equity | (750,000) | |
Redemption of Mandatorily Redeemable Common Stock | (750,000) | |
Financing Commitment | (100,000) | |
Net Cash from Financing Activities | 544,575 | 2,270,178 |
Net Change in Cash and Cash Equivalents | (20,353) | (311,653) |
Cash and Cash Equivalents at Beginning of Period | 24,717 | 336,370 |
Cash and Cash Equivalents at End of Period | 4,364 | 24,717 |
Non Cash Financing & Investing Activities, and Other Disclosures | ||
Cash Paid for Interest | 145,669 | |
Cash Paid for Income Taxes | ||
Advanced funds paid converted to Net Insurance Benefits | 3,368,380 | |
Exchange Note Payable and Accrued Interest for Temporary Equity | $ 1,500,000 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 12 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BASIS OF PRESENTATION | (1) ORGANIZATION AND BASIS OF PRESENTATION Sundance Strategies, Inc. (formerly known as Java Express, Inc.) was organized under the laws of the State of Nevada on December 14, 2001, and engaged in the retail selling of beverage products to the general public until these endeavors ceased in 2006; it had no material business operations from 2006, until its acquisition of ANEW LIFE, INC. (“ANEW LIFE”), a subsidiary of Sundance Strategies, Inc. (“Sundance Strategies,” the “Company”, “we” or “our”). The Company is engaged in the business of purchasing or acquiring life insurance policies and residual interests in or financial products tied to life insurance policies, including notes, drafts, acceptances, open accounts receivable and other obligations representing part or all of the sales price of insurance, life settlements and related insurance contracts being traded in the secondary marketplace, often referred to as the “life settlements market.” Since the Company’s inception on January 31, 2013, its operations have been primarily financed through sales of equity, debt financing from related parties and the issuance of notes payable and convertible debentures. Currently, the Company is focused on the purchase of net insurance benefit contracts (“NIBs”) based on life settlements or life insurance policies. The Company does not take possession or control of the policies. The owners of the life settlements or life insurance policies acquire such policies at a discount to their face value. The owners have available credit to pay forecasted premiums and expenses on the underlying policies until April 15, 2018, the renewal date of the loans on the life insurance policies. On settlement, the Company receives the net insurance benefit after all borrowings, interest and expenses have been paid by the owners out of the settlement proceeds. The investment in NIBs is a residual economic beneficial interest in a portfolio of life insurance contracts that have been financed by an independent third party via a loan from a lender and insured via a mortality risk insurance product or mortality re-insurance (“MRI”). Future expected cash flow and positive profits are defined as the net insurance proceeds from death benefits after senior debt repayment, mortality risk repayment, and service provider or other third-party payments. NIBs are in the form of participating debt certificates (“PDC”), and although two terms are interchangeable, the Company typically refers to them as NIBs.. According to the terms of the PDCs, the PDCs provide both variable and fixed interest return to the Company from the owners of the policies (“Holders”) in the form of accrued yield. The variable interest varies by individual PDC, and is calculated as 99% to 100% (depending on the PDC) of the positive profits from the life insurance assets held by the owners of the policies. The fixed interest also varies by individual PDC, and is either 1% or 2% per annum of the par value of the PDCs held by the Company. The par value of the PDCs held by the Company is approximately $36.8 million. The NIBs agreements between the Company and the owners of the policies contain a provision that allows for the owners to redeem the NIBs at any point, conditional upon paying to the Company the par value of the NIBs, as well as any unpaid accrued yield relating to fixed and variable interest. In aggregate, the sum of the par value plus unpaid accrued interest is in excess of the Company’s initial investment. The Company holds between 72.2% and 100% in the NIBs relating to the underlying life insurance policies as of March 31, 2017 and 2016. The Company is not responsible for maintaining premiums or other expenses related to maintaining the underlying life insurance contracts. Therefore, the investment in NIBs balance on the Company’s balance sheet does not increase when premiums or other expenses are paid. The Company accounts for its investment in NIBs at the initial investment value increased for interest income and decreased for cash receipts received by the Company. At the time of transfer or purchase of an investment in NIBs, we estimate the future expected cash flows and determine the effective interest rate based on these estimated cash flows and our initial investment. Based on this effective interest rate, the Company calculates accretable income, which is recorded as interest income on investment in NIBs in the statement of operations. Our current projections are based off of various assumptions that are subject to uncertainties and contingencies including, but not limited to, the amount and timing of projected net cash receipts, expected maturity events, counter party performance risk, changes to applicable regulation of the investment, shortage of funds needed to maintain the asset until maturity, changes in discount rates, life expectancy estimates and their relation to premiums, interest, and other costs incurred, among other items. These uncertainties and contingencies are difficult to predict and are subject to future events that may impact our estimates and interest income. As a result, actual results could differ significantly from these projections. Therefore, subsequent to the purchase and on a regular basis, these future estimated cash flows are evaluated for changes. If the determination is made that the future estimated cash flows should be adjusted to the point of a material change in revenue, a revised effective yield is calculated prospectively based on the current amortized cost of the investment, including accrued accretion. Any positive or adverse change in cash flows would result in a prospective increase or decrease in the effective interest rate used to recognize interest income. Any significant adverse change in the cash flows may result in the recognition of an “other-than-temporary impairment” (“OTTI”), and would be evaluated by the Company accordingly. The Company’s investment in NIBs is treated as a debt security, which is classified as a hold-to-maturity asset. We evaluate the carrying value of our investment in NIBs for impairment on a regular basis and, if necessary, adjust our total basis in the NIBs using new or updated information that affects our assumptions. We recognize impairment on a NIB contract if the fair value of the beneficial interest are less than the carrying amount of the investment, plus anticipated undiscounted future premiums and direct external costs, if any, and if there are adverse changes in cash flow. We have not recognized any impairment on our investment in NIBs from January 31, 2013 (inception), through the year ended March 31, 2017. Correction of an Immaterial Error During the period ended December 31, 2016, the Company identified an error related to its Consolidated Statement of Cash Flows for both the cash used in Advance for Investment in NIBs, as well as proceeds from Refunds on Advance for Investment in NIBs. The Company determined that in the prior period reported, these amounts were improperly included in cash inflows and outflows as operating activities when they should have been classified as inflows and outflows from investing activities in the Consolidated Statement of Cash Flows. This error did not affect net income, assets, liabilities, stockholders’ equity, cash flows from financing activities or the net increase or decrease in cash and cash equivalents for the period. In accordance with the SEC Staff Accounting Bulletin (SAB) No. 99, “Materiality,” and SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” we evaluated the materiality of the error from qualitative and quantitative perspectives and concluded that the error was immaterial to the current and prior periods mentioned above. Consequently, the Consolidated Statement of Cash Flows contained in these financial statements have been restated for the year ended March 31, 2016. The change resulted in a net decrease of $228,006 from cash flows used in operating activities and a corresponding increase to cash inflows from investing activities for the year ended March 31, 2016. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Estimates, Cash and Cash Equivalents, Income Recognition, Basic and Diluted Net Income (Loss) Per Common Share, The reconciliation between the basic and diluted weighted-average number of common shares for the years ended March 31, 2017 and 2016, is summarized as follows: Year Ended March 31, 2017 2016 Basic weighted-average number of common shares outstanding during the period 44,131,515 44,026,832 Weighted-average number of dilutive common stock equivalents outstanding during the period 1,345,949 1,346,376 Diluted weighted-average number of common and common equivalent shares outstanding during the period 45,477,464 45,373,208 For the years ended March 31, 2017 and 2016, options to exercise 400,000 shares were excluded because they were anti-dilutive. In addition, 235,345 and 255,215 shares related to the potential conversion of the convertible debenture were excluded because they were anti-dilutive for the years ended March 31, 2017 and 2016, respectively. Stock Based Compensation Investment in Net Insurance Benefits, In estimating these cash flows for purposes of interest income and impairment calculations, there are a number of assumptions that are subject to uncertainties and contingencies. These include the amount and timing of projected net cash receipts, expected maturity events, counter party performance risk, changes to applicable regulation of the investment, shortage of funds needed to maintain the asset until maturity, changes in discount rates, life expectancy estimates and their relation to premiums, interest, and other costs incurred, among other items. These uncertainties and contingencies are difficult to predict and are subject to future events that may impact our estimates and interest income. As a result, actual results could differ significantly from those estimates. Income Taxes, The tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not of being sustained if the position were to be challenged by a taxing authority. The Company has examined the tax positions taken in its tax returns and determined that there are no uncertain tax positions. As a result, the Company has recorded no uncertain tax liabilities in its balance sheet. Interest and penalties for uncertain positions, when applicable, would be recognized as a component of income tax expense. The Company files United States Federal and State income tax returns. The income tax returns of the Company are subject to examination by taxing authorities for three to five years from the date they are filed. The Company has tax returns subject to examination for 2013-2017. Principles of Consolidation, Variable Interest Entities (“VIEs”), Fair Value, Those levels of input are summarized as follows: • Level 1: Quoted prices in active markets for identical assets and liabilities. • Level 2: Observable inputs other than Level 1 quoted prices, such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. • Level 3: Unobservable inputs that are supported by little or no market activity. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques as well as instruments for which the determination of fair value requires significant management judgment or estimation. The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety. In accordance with the disclosure requirements of ASC Topic 825, “Financial Instruments” (“ASC 825”), the table below summarizes fair value estimates for the Company’s Investment in NIBs, which are not required to be carried at fair value. The total of the fair value calculations presented does not represent, and should not be construed to represent, the underlying value of the Company. In estimating the fair value of the Company’s Investment in NIBs, the rate of return that a market participant would be willing to pay for each portfolio is used to recalculate the discounted estimated future cash flows. This present value is used to represent the fair value of the Investment in NIBs using level 3 inputs. The carrying amounts in the table are recorded in the consolidated balance sheets at March 31, 2017 and 2016: Fair Value Measurements at March 31, 2017 Description Level 1 Level 2 Level 3 Total Investment in Net $ - $ - $ 45,643,224 $ 45,643,224 Insurance Benefits Fair Value Measurements at March 31, 2016 Description Level 1 Level 2 Level 3 Total Investment in Net $ - $ - $ 29,432,917 $ 29,432,917 Insurance Benefits The fair value of our investment in NIBs is determined by evaluating the sum of present value of the future cash flows expected from the NIBs. The key unobservable inputs used to arrive at the fair value estimates of the Company’s Investment in NIBs at March 31, 2017 and 2016, included a market rate discount rate range of approximately 15% to 18%, with a weighted average rate approximating 16%. The interest rate range and weighted average rate was obtained from the Market Rate – Life Insurance Settlement Association Statistics (weighted 50%), Build-up Method (weighted 25%) and Historical Cost Method (weighted 25%). As explained in Note 1, our current projections for the future cash flows are based off of various assumptions that are subject to uncertainties and contingencies, which are difficult to predict and are subject to future events that may impact our estimates and interest income. Therefore, subsequent to the purchase and on a regular basis, these future estimated cash flows are evaluated for changes. If the determination is made that the future estimated cash flows should be adjusted to the point of a material change in revenue, a revised effective yield is calculated prospectively based on the current amortized cost of the investment, including accrued accretion. During the year ended March 31, 2017, certain maturities were realized sooner than originally projected. The aggregate face value of these maturities was $14,500,000. In addition, there was a reduction of ongoing fees required to support the underlying policies (See Note 14). These two factors contributed to an overall increase in the estimated cash flows expected from the NIBs, which increased the estimated fair value from $29,432,917 as of March 31, 2016 to $45,643,224 as of March 31, 2017. The Company did not have any transfers of assets and liabilities between Levels 1, 2 and 3 of the fair value measurement hierarchy during the years ended March 31, 2017 and 2016. The Company’s recorded values of cash and cash equivalents, accounts payable and accrued liabilities approximate their fair values based on their short-term nature. The recorded values of the Notes Payable, Related Parties and Convertible Debenture approximates the fair values as the interest rate approximates market interest rates. During the year ended March 31, 2017, the Company changed its Consolidated Balance Sheet presentation from “classified” (distinguishing between short-term and long-term accounts) to “unclassified” (no such distinction) due to a desire to conform the Company’s Consolidated Balance Sheet presentation to trends of other companies within the industry. Such a change is a presentation election made by management; the March 31, 2016 Consolidated Balance Sheet has also been presented in an unclassified format comparable to the March 31, 2017 presentation. |
NEW ACCOUNTING PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 12 Months Ended |
Mar. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
NEW ACCOUNTING PRONOUNCEMENTS | (3) NEW ACCOUNTING PRONOUNCEMENTS Adopted During the Year Ended March 31, 2017 In August 2014, the FASB issued ASU 2014-15 Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. The new standard provides guidance around management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The new standard was effective for the Company’s fiscal year beginning April 1, 2016, and interim periods within that fiscal year. The adoption of this standard did not have a material impact on the Company’s financial statements. Not Yet Adopted The Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2014-09, 2015-14, 2016-8, 10,11 and 12 and 2017-13 – Revenue from Contracts with Customers, which provides a single, comprehensive revenue recognition model for all contracts with customers. The core principal of the ASUs is that an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASUs also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In July 2015, the FASB deferred the effective date of this standard. As a result, the standard and related amendments will be effective for the Company for its fiscal year beginning April 1, 2018, including interim periods within that fiscal year. Early application is permitted, but not before the original effective date of April 1, 2017. Entities are allowed to transition to the new standard by either retrospective application or recognizing the cumulative effect. The ASUs are not applicable to securitized beneficial interests that derive accreted yields and, therefore the Company will continue to follow the guidance in ASC 325-40. The adoption of this standard will not have an impact on the consolidated financial statements. In December 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes. The new standard is designed to simplify the presentation of deferred income taxes, and requires all deferred tax liabilities and assets of the same tax jurisdiction or a tax filing group, as well as any related valuation allowance, be offset and presented as a single noncurrent amount in a classified balance sheet. The amendments are effective for the Company’s fiscal year beginning April 1, 2017, and for interim periods within that fiscal year. The Company does not believe the adoption of this guidance will have a material effect on the consolidated financial statements as the Company presents an unclassified balance sheet. In January 2016, the FASB issued ASU 2016-01 regarding Financial Instruments, which amended guidance on the classification and measurement of financial instruments. Under the new guidance, entities will be required to measure equity investments that are not consolidated or accounted for under the equity method at fair value with any changes in fair value recorded in net income, unless the entity has elected the new practicability exception. For financial liabilities measured using the fair value option, entities will be required to separately present in other comprehensive income the portion of the changes in fair value attributable to instrument-specific credit risk. Additionally, the guidance amends certain disclosure requirements associated with the fair value of financial instruments. The standard will be effective for the Company’s fiscal year beginning April 1, 2018, including interim reporting periods within that fiscal year. The Company is currently evaluating the effect of the adoption of this guidance on the consolidated financial statements. In February 2016, the FASB issued ASU 2016-02 related to the accounting for leases. This pronouncement requires lessees to record most leases on their balance sheet, while expense recognition on the income statement remains similar to current lease accounting guidance. The guidance also eliminates real estate-specific provisions and modifies certain aspects of lessor accounting. Under the new guidance, lease classification as either a finance lease or an operating lease will determine how lease-related revenue and expense are recognized. The pronouncement is effective for the Company’s fiscal year beginning April 1, 2019, and for interim periods within that fiscal year. The Company does not believe the adoption of this guidance will have a material effect on the consolidated financial statements because leases are month-to-month and not material to the Company’s financial statements. In March 2016, the FASB issued ASU 2016-06 related to the embedded derivative analysis for debt instruments with contingent call or put options. This pronouncement clarifies that an exercise contingency does not need to be evaluated to determine whether it relates only to interest rates or credit risk. Instead, the contingent put or call option should be evaluated for possible bifurcation as a derivative in accordance with the four-step decision sequence detailed in FASB ASC 815-15, without regard to the nature of the exercise contingency. The pronouncement is effective for the Company’s fiscal year beginning April 1, 2017, and for interim periods within that fiscal year., The Company does not believe the adoption of this guidance will have a material effect on the consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting. The new standard simplifies certain aspects of the accounting for share-based payment award transactions by allowing entities to continue to use current GAAP by estimating the number of awards that are expected to vest or, alternatively, entities can elect to account for forfeitures as they occur. Another aspect of the standard requires an entity to recognize all excess tax benefits and deficiencies associated with stock-based compensation as a reduction or increase to tax expense in the income statement. Previously, such amounts were recognized in additional paid-in capital. ASU 2016-09 is effective for the Company for its fiscal year beginning April 1, 2017. The Company does not believe the adoption of this guidance will have a material effect on the consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses. ASU 2016-13 requires entities to report “expected” credit losses on financial instruments and other commitments to extend credit rather than the current “incurred loss” model. These expected credit losses for financial assets held at the reporting date are to be based on historical experience, current conditions, and reasonable and supportable forecasts. This ASU will also require enhanced disclosures relating to significant estimates and judgments used in estimating credit losses, as well as the credit quality. The amendments are effective for the Company’s fiscal year beginning April 1, 2020, including interim periods within that fiscal year. The Company is currently evaluating the impact the adoption of ASU 2016-13 will have on its consolidated financial statements and results of operations. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments. Historically, there has been a diversity in practice in how certain cash receipts/payments are presented and classified in the statement of cash flows. To reduce the existing diversity in practice, this update addresses the eight cash flow issues as listed in the pronouncement. The amendments in this update are effective for fiscal years beginning April 1, 2018, and interim periods within that fiscal year. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial statements. In October 2016, the FASB issued ASU 2016-17, Consolidation - Interests held through Related Parties that are under Common Control, which alters how a decision maker needs to consider indirect interests in a variable interest entity (VIE) held through an entity under common control. Under the new ASU, if a decision maker is required to evaluate whether it is the primary beneficiary of a VIE, it will need to consider only its proportionate indirect interest in the VIE held through a common control party. The amendments in this Update are effective for fiscal years beginning April 1, 2017, including interim periods within that fiscal year. The Company does not believe the adoption of this guidance will have a material effect on the consolidated financial statements, as the Company has no related parties under common control that have the characteristics of a primary beneficiary of a variable interest entity. On May 10, 2017, the FASB issued ASU 2017-09, Scope of Modification Accounting, which amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. For all entities, the ASU is effective for the Company’s fiscal year beginning April 1, 2018, including interim periods within that annual reporting period. Early adoption is permitted, including adoption in any interim period. The adoption of this standard is not expected to have material impact on the Company’s financial statements as the Company does not expect to make future modifications to existing share based payment awards. The Company has reviewed all other recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that none of these pronouncements will have a significant effect on its financial statements. |
CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS | 12 Months Ended |
Mar. 31, 2017 | |
Cash and Cash Equivalents [Abstract] | |
CASH AND CASH EQUIVALENTS | (4) CASH AND CASH EQUIVALENTS Cash and cash equivalents consists principally of currency on hand and demand deposits at commercial banks. The Company had $4,364 and $24,717 in cash and cash equivalents as of March 31, 2017, and 2016, respectively. The Company maintains non-interest bearing accounts at one financial institution. The accounts at this institution are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. |
ADVANCE FOR INVESTMENT IN NET I
ADVANCE FOR INVESTMENT IN NET INSURANCE BENEFITS | 12 Months Ended |
Mar. 31, 2017 | |
ADVANCE FOR INVESTMENT IN NET INSURANCE BENEFITS [Abstract] | |
ADVANCE FOR INVESTMENT IN NET INSURANCE BENEFITS | (5) ADVANCE FOR INVESTMENT IN NET INSURANCE BENEFITS On June 7, 2013, the Company entered into an Asset Transfer Agreement (the “Del Mar ATA”) with Del Mar Financial, S.a.r.l. (“Del Mar”). As part of the Del Mar ATA, the Company entered into a Structuring and Consulting Agreement with Europa Settlement Advisors Ltd. (respectively, the “Europa Agreement” and “Europa”). The Del Mar ATA involved the purchase of certain life settlement assets consisting of the legal and net beneficial ownership interest in a portfolio of life insurance policies, or NIBs, among other assets that are consideration and collateral for certain cash advances and expense payments made by the Company. According to the Del Mar ATA, Del Mar, with the assistance of Europa, was obligated to convert the NIBs and other newly acquired NIBs into “Qualified NIBS.” As soon as Del Mar met its obligation to provide Qualified NIBs to the Company, any remaining NIBs and any other consideration and collateral would be returned or released to Del Mar. The original due date for the conversion was December 31, 2013, which date was subsequently extended several times. On April 30, 2015, the Company finalized an amendment to the Del Mar ATA and the related Europa Agreement to extend the deadline until August 31, 2015. The remaining consideration and collateral under the Del Mar ATA, as of September 1, 2015, primarily consisted of approximately 72.2% of the NIBs associated with a portfolio of life settlement policies having a face value that originally totaled $94,000,000. The remaining 27.8% interest in the NIBs were held by other parties. During June 2015, one of the life settlement policies matured for $10,000,000 (the “Matured Policy”), lowering the remaining face value of such life settlement policies to $84,000,000. The premiums and expenses related to the maintenance of these life insurance policies are financed by a loan from a lender. As Del Mar was unable to provide the required amount of Qualified NIBs by the extended due date of August 31, 2015, effective September 1, 2015, the agreements with Del Mar and Europa were cancelled and the Company obtained full ownership and control of the collateral, which included the above mentioned approximately 72.2% of the NIBs associated with the $84,000,000 face value of life settlement policies and certain rights to net proceeds relating to the Matured Policy. On September 30, 2015, the Company transferred to Investment in NIBs the remaining balance of advances and expense payments to Del Mar, totaling $3,368,380, which approximates fair value. This amount was residing in advance for investment in NIBs before being transferred to investment in NIBs (see Note 6). The bulk of the $10,000,000 proceeds paid in connection with the Matured Policy were used to repay loans secured by such Matured Policy. However, on September 10, 2015, the Company received $1,094,335 as a result of the rights associated with a matured policy within the portfolio serving as collateral under the Del Mar ATA. The maturity occurred prior to the Company taking possession of the NIBs portfolio. As such, the Company agreed that the proceeds were to be allocated $211,000 to pay off a note receivable, $16,428 to pay off accrued interest receivable from prior periods, $11,987 to pay off interest accrued within the current period and $854,920 as a refund of advance payments previously made to or on behalf of Del Mar as part of the Del Mar ATA. The $854,920 was applied to reduce Advance for Investment in NIBs. |
INVESTMENT IN NET INSURANCE BEN
INVESTMENT IN NET INSURANCE BENEFITS | 12 Months Ended |
Mar. 31, 2017 | |
Investments, All Other Investments [Abstract] | |
INVESTMENT IN NET INSURANCE BENEFITS | (6) INVESTMENT IN NET INSURANCE BENEFITS The balance in Investment in NIBs at March 31, 2017 and 2016, and related activity for the periods then ended were as follows: March 31, 2017 March 31, 2016 Beginning Balance $ 29,822,186 $ 22,544,635 Transfers from Advance for Investment in NIBs - 3,368,380 Accretion of interest income 5,751,689 3,909,171 Cash received (1,417,870 ) - Total $ 34,156,005 $ 29,822,186 As explained in Note 5, the Company transferred $3,368,380 from advance for investment in NIBs into investment in NIBs on September 30, 2015. The table below describes the underlying life insurance policies relating to our investment in NIBs at March 31, 2017, with an adjustment made to reduce the Life Expectancies by the number of months since the last Life Expectancy report: Life Number of Interests Face Value of 0-1 9 $ 34,586,111 1-2 6 31,611,111 2-3 7 37,444,444 3-4 11 49,444,444 4-5 6 35,444,444 Thereafter 30 184,813,147 Total of all policies 69 $ 373,343,701 * The Life Expectancy (“LE”) input is the 70%/30% weighted average of two LEs available at the time of the original creation of the NIB portfolio. The Adjusted Life Expectancy is an unofficial calculation that simply reduces the original LE by the number of months since the last LE report. It should be noted that the insured’s health, medical conditions and other considerations may have changed since the LE report, so that the Adjusted LE is simply an estimate. These LEs were produced by third-party life expectancy companies and represent the actuarial mean of how long an individual is expected to live. The number is a calculation done with the LE provider’s proprietary statistical model that is typically based on individualized mortality curves for each life factoring in the insured’s gender, age, health and family history, medical conditions, and other considerations. In purchasing, financing or insuring life insurance policies or NIBs, we may use alternate life expectancy companies or may use weighted averages of two or more life expectancy companies, depending on the facts and circumstances of the case and requirements of the various counterparties. The life expectancy report is just an estimate, as the life expectancy of any individual cannot be known with absolute certainty. The original face value of the underlying life insurance policies was $412,820,622. This value takes into account the approximately 72.2% of the NIBs associated with a portfolio of life settlement policies having a face value that originally totaled $94,000,000 (see Note 5). One policy matured during March 2014, totaling $8,000,000. A second policy with a face value of $10,000,000 matured during November 2016. Between February and March 2017, two additional maturities occurred within one portfolio of policies, totaling $14,500,000 million in face value, both of which were earlier than was forecasted based on the LE reports. The remaining $373,343,701 represents the total insurance settlement on the life insurance policies as of March 31, 2017, including the estimated future increase for certain policies that have return of premium provisions. The table below shows all maturities that have occurred from the Company’s inception through March 31, 2017: Fiscal Year Number of Maturities Original Face Value Company’s Portion of 2013 0 $ 0 $ 0 2014 1 8,000,000 8,000,000 2015 0 0 0 2016 1 10,000,000 7,222,222 2017 3 24,500,000 24,500,000 5 $ 42,500,000 $ 39,722,222 The Company utilizes senior lender loan to value ratios to estimate potential proceeds from future maturity distributions. As repayment priority belongs to the Holders’ lender and MRI providers upon proceeds being received from the life insurance policies serving as collateral for the loan, upon the realization of a maturity, the Company does not immediately know the amount of cash that it will receive, if any, from that maturity. At March 31, 2017, maturity proceeds were first to be used to repay interest and principal owed under the loan (as long as the outstanding loan amount exceeds 50% of the aggregate value of the life insurance policies securing the loan) including draws on the MRI, if applicable, next to pay the Holder’s servicing fees, then to repay any additional amounts owed to the Holders’ lender and MRI provider and finally to an account designated by the Holder. If it was determined that the outstanding loan amount is less than 50%, and all other obligations have been paid in full, the Company may be eligible to receive a distribution. From the realization of a maturity to the time a determination was made about the availability of cash for distribution to the Company typically took 2 to 3 months. The Company anticipates that the approximately $40 million in early maturities will have a positive effect on the future cash flows it expects to receive from these portfolios. In addition, the Company received updated information from the policy owners during the year ended March 31, 2017, regarding reduced management fees relating to maintaining the underlying policies, and favorable changes in the senior debt balances and related loan-to-value ratios. As a result of these factors, a recalculation was made to the financial models used to calculate accretable income to reflect the resulting increased and accelerated cash flows. The resulting increase on the Interest Income on Investment in NIBs for the year ended March 31, 2017 was $393,920 over the accretable income that would have been recognized under the prior models during the same period. This increase had no significant effect on the Company’s earnings per share. As of March 31, 2017, the policy Holders had paid $120,696,149 on policy premiums. The policy Holders are independent of the Company, and as separate entities there is a risk that such entities might not continue to pay the policy premiums and other expenses as has been done historically. The Company monitors the policy Holders’ ability to maintain the underlying policies, and in the event the policy Holders are unable to make the required payments, the Company would evaluate whether to directly maintain the underlying policies through the policy Holders or allow them to lapse. Senior loan agreements and MRI reinsurance are typically intended to cover these payments. As of March 31, 2017, none of the underlying policies have lapsed and the required payments remain current. The table below describes the future estimated premium payments, other expenses and interest paid by external parties expected to be paid on the policies for the five years subsequent to March 31, 2017, and thereafter. Significant estimates are made as part of the calculation of the premium payments, other expenses and interest amounts identified in the table below. The following table only includes the percentage of the future estimated premium payments, other expenses and interest relating to the portfolio of which the Company only has partially owned NIBs. The following table does not include all of the estimation factors used by the Company in estimating expected net cash receipts for interest income calculation purposes, and is intended to only provide the estimated premium payments, other expenses and interest amounts related to the policies underlying the Company’s NIBs (totals do not include premiums, expenses and interest paid for prior years): Year Premiums Expenses + Interest Total Year 1 $ 14,718,014 $ 9,850,077 $ 24,568,091 Year 2 15,066,981 8,071,797 23,138,778 Year 3 13,464,031 7,165,785 20,629,816 Year 4 13,597,127 7,651,955 21,249,082 Year 5 11,943,568 10,176,791 22,120,358 Thereafter 25,506,798 15,213,806 40,720,604 Total $ 94,296,519 $ 58,130,211 $ 152,426,730 The projected premiums, expenses and interest were created using the expected remaining life expectancies on the policies and other key assumptions. The expenses and interest calculations were based on the interest rates on the loans to the Holders of the policies, current reinsurance interest rates, origination fees, servicing fees and other custodial fees expected during the life of the investment. The lender for the Holders of the policies provides the loans at a high rate of interest and loan payments are guaranteed by the MRI or reinsurance coverage. The policy Holders receive ongoing fees and a percentage of death benefits when a policy matures which we included in the estimated expenses. The Company receives cash flows from its investments in NIBs after all other loan balances, costs and expenses are paid. Our Investment in NIBs are classified as held-to-maturity investments and are included on the Company’s balance sheet. The NIBs have a contractual maturity date of 25 years from inception, which ranged from December 2011 to January 2013. The amortized cost, aggregate fair value and gross unrecognized holding gains and losses at March 31, 2017 and 2016, were as follows: March 31, 2017 March 31, 2016 Amortized Cost Basis/Net Carrying Amount $ 34,156,005 $ 29,822,186 Aggregate Fair Value (See Note 2) 45,643,224 29,432,917 Gross Unrecognized Holding Gains/(Losses) $ 11,487,219 $ (389,269 ) During April 2016, the Company received $1,417,870 in cash proceeds associated with maturities and miscellaneous adjustments to other underlying policies. The cash proceeds reduced the carrying value of the Company’s Investment in NIBs. |
NOTES PAYABLE, RELATED PARTY
NOTES PAYABLE, RELATED PARTY | 12 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
NOTES PAYABLE, RELATED PARTY | (7) NOTES PAYABLE, RELATED PARTY As of March 31, 2017 and 2016, the Company had borrowed $5,214,753 and $3,820,178, respectively, excluding accrued interest, from related parties under notes payable agreements that allow for borrowings of up to $6,730,000, exclusive of accrued interest. There are no covenants associated with these agreements. Of the $5,214,753 of notes payable owed as of March 31, 2017, $3,714,753 was due August 31, 2018. The remaining $1,500,000 was due November 30, 2018 (see Note 16 for subsequent due date extensions). In the event the Company completes a successful equity raise, principal and interest on notes payable totaling $5,549,379 are due in full at that time. The notes payable incur interest at 7.5%, and are collateralized by Investment in NIBs. During the years ended March 31, 2017 and 2016 the Company borrowed under these agreements an additional $1,544,576 and $2,520,178 respectively, and repaid $150,000 and $200,000, respectively. As of March 31, 2017, the Company had availability to borrow up to $1,515,247. The interest associated with these notes of $334,626 and $145,669 is recorded on the balance sheet as an Accrued Expense obligation at March 31, 2017 and 2016, respectively. The related parties include a person who is the Chairman of the Board of Directors and a stockholder, and Radiant Life, LLC, an entity partially owned by the Chairman of the Board of Directors. On February 1, 2017, the note payable, related party agreement that allowed for borrowings of up to $2,130,000 was amended to extend the due date from November 30, 2017 to November 30, 2018. Also on February 1, 2017, the note payable, related party agreement that allowed for borrowings of up to $3,600,000 at December 31, 2016, was amended to increase the borrowings from $3,600,000 to $4,600,000. See Note 16 for a detail of activity on the Notes Payable, Related Party subsequent to March 31, 2017. |
NOTES PAYABLE TRANSFERRED TO RE
NOTES PAYABLE TRANSFERRED TO REDEEMED COMMON STOCK PAYABLE | 12 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE TRANSFERRED TO REDEEMED COMMON STOCK PAYABLE | (8) NOTES PAYABLE TRANSFERRED TO REDEEMED COMMON STOCK PAYABLE At March 31, 2014, the Company owed $1,455,904, including accrued interest, for notes payable. During the year ended March 31, 2015, the Company had accrued an additional $37,350 in interest. The note incurred interest at 4%, was collateralized by NIBs and was due in April 2015. During June 2015, the note payable and related accrued interest were converted to equity through the issuance of 187,500 shares of common stock and the holder was granted the right to require the Company to redeem the common stock for $8.00 per share. On June 9, 2015, the holder exercised a portion of the redemption right relating to 93,750 shares and, as a result, the Company paid the holder $750,000 to redeem the shares. On March 25, 2016, the holder exercised the redemption right in relation to the remaining shares and on April 12, 2016, the Company paid the holder an additional $750,000 to redeem the remaining shares. At March 31, 2016, the $750,000 associated with the redemption had been recorded on the balance sheet as Mandatorily Redeemable Common Stock. |
CONVERTIBLE DEBENTURE AGREEMENT
CONVERTIBLE DEBENTURE AGREEMENT | 12 Months Ended |
Mar. 31, 2017 | |
CONVERTIBLE DEBENTURE AGREEMENT [Abstract] | |
CONVERTIBLE DEBENTURE AGREEMENT | (9) CONVERTIBLE DEBENTURE AGREEMENT The Company has entered into an 8% convertible debenture agreement with Satco International, Ltd., that allows for borrowings of up to $3,000,000. The holder originally had the option to convert the outstanding principal and accrued interest to unregistered, restricted common stock of the Company on June 2, 2016. Per the agreement, the number of shares issuable at conversion shall be determined by the quotient obtained by dividing the outstanding principal and accrued and unpaid interest by 90% of the 90 day average closing price of the Company’s common stock from the date the notice of conversion is received; and the price at which the Debenture may be converted will be no lower than $1.00 per share. The original maturity date was June 2, 2016, but was later extended to August 31, 2017. On October 25, 2016, the Company agreed to amend the 8% Convertible Debenture Agreement that extended the due date and conversion rights to February 28, 2018, and then on March 15, 2017, the Company agreed again to amend the agreement to extend the due date and conversion rights to August 31, 2018. As of March 31, 2017 and 2016, the Company owed $700,000 under the agreement, excluding accrued interest. The associated interest of $102,487 and $46,488 at March 31, 2017 and 2016, respectively, is recorded on the balance sheet as an Accrued Expense obligation. |
STOCK OPTIONS
STOCK OPTIONS | 12 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK OPTIONS | (10) STOCK OPTIONS During the year ended March 31, 2014, the Company issued common stock options to certain directors, officers, consultants and employees. The Company has recorded stock-based compensation expense of $182,572 and $508,503 related to these options for year ended March 31, 2017 and 2016, respectively. At March 31, 2017, all stock options had vested and all expenses relating to the outstanding options had been recognized as stock-based compensation expense. On the date of grant, the contractual option terms were all 5 years, with all options have an expiration date between April and October of 2018. Below is a summary of the stock option activity for the years ended March 31, 2017 and 2016 (including the 80,000 stock options granted to non-employees): Date Issued Number of Weighted Weighted Remaining Intrinsic Outstanding as of March 31, 2015 2,185,000 $ 1.54 $ 0.91 3.50 $ - Granted - - - - - Exercised - - - - - Cancelled/Expired (78,125 ) - - - - Outstanding as of March 31, 2016 2,106,875 $ 1.57 $ 1.04 2.50 $ - Granted - - - - - Exercised - - - - - Cancelled/Expired - - - - - Outstanding as of March 31, 2017 2,106,875 $ 1.57 $ 1.04 1.50 $ - Vested and Expected to Vest as of March 31, 2017 2,106,875 $ 1.57 $ 1.04 1.50 $ - Exercisable as of March 31, 2016 1,865,205 $ 1.57 $ 1.04 2.50 $ 1,227,109 Exercisable as of March 31, 2017 2,106,875 $ 1.57 $ 1.04 1.50 $ 1,217,847 If all vested options as of March 31, 2017 were to be exercised, the Company could expect to receive $3,314,294. |
WARRANTS
WARRANTS | 12 Months Ended |
Mar. 31, 2017 | |
Warrants and Rights Note Disclosure [Abstract] | |
WARRANTS | (11) WARRANTS On April 8, 2013, the Company approved a private placement of its common stock that provided for the payment of introduction fees in the form of cash and warrants and later amended. As a result of investments totaling $7,000,000 in this private offering by persons introduced to the Company, the Company authorized the issuance of 70,000 warrants to purchase 70,000 shares of the Company’s common stock. The warrants have an exercise price of $5.00 per share and have a contractual life of two years from the effective date of the funds invested in the offering by the parties introduced to the Company, which was May 31, 2013. The Company recorded $139,251 in stock issuance costs related to the warrants as of March 31, 2014, which represented the entirety of the related issuance costs. As of March 31, 2016, all warrants had expired. Number of Weighted Average Weighted Average Remaining Intrinsic Value Outstanding as of April 1, 2015 70,000 $ 5.00 $ 1.92 0.17 - Granted - - - - - Cancelled/Expired (70,000 ) 5.00 1.92 - - Outstanding as of March 31, 2016 - $ - $ - - $ - Granted - - - - - Cancelled/Expired - - - - - Outstanding as of March 31, 2017 - $ - $ - - $ - Exercisable as of March 31, 2016 - $ - $ - - $ - Exercisable as of March 31, 2017 - $ - $ - - $ - |
STOCK TRANSACTIONS
STOCK TRANSACTIONS | 12 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
STOCK TRANSACTIONS | (12) STOCK TRANSACTIONS During March 2015, we agreed to pay $150,000 in cash, issue 1,130,000 shares of common stock and forgive a note receivable with an outstanding amount of $150,000 in exchange for relief of a $1,493,254 note payable and the receipt of NIBs. The net consideration given for the relief of the note payable and receipt of NIBs totaled $1,493,254 and $7,846,746, respectively, for a total of $9,340,000. (See Note 8). Of the 1,130,000 common shares to be issued, 187,500 shares were subject to a redemption right that requires the Company to buy back the shares for $8.00 per share at the option of the holder. The total common stock still subject to the redemption right at March 31, 2016, was recorded as Mandatorily Redeemable Common Stock on the consolidated balance sheet (see Note 8). On June 9, 2015 the remaining 942,500 common shares were issued. In addition, as explained in Note 8, the 187,500 of redeemable common shares were issued and subsequently redeemed. |
LIQUIDITY REQUIREMENTS
LIQUIDITY REQUIREMENTS | 12 Months Ended |
Mar. 31, 2017 | |
LIQUIDITY AND CAPITAL REQUIREMENTS [Abstract] | |
LIQUIDITY REQUIREMENTS | (13) LIQUIDITY REQUIREMENTS Since the Company’s inception on January 31, 2013, its operations have been primarily financed through sales of equity, debt financing from related parties and the issuance of notes payable and convertible debentures. As of March 31, 2017, the Company had $4,364 of cash assets, compared to $24,717 as of March 31, 2016. As of March 31, 2018, the Company had access to draw an additional $5,900,492 on the notes payable, related party (see Note 7) and $3,000,000 on the Convertible Debenture Agreement (See Note 9). The Company’s average monthly expenses are expected to be approximately $132,000, which includes salaries of our employees, consulting agreements and contract labor, general and administrative expenses and estimated legal and accounting expenses. Outstanding Accounts Payable as of March 31, 2017 totaled $508,071, and other accrued liabilities totaled $753,780. Management has concluded that its existing capital resources, and availability under its existing convertible debentures and debt agreements with related parties will be sufficient to fund its operating working capital requirements for at least the next 12 months, or through April 2019. Related parties have given assurance that their continued support, by way of either extensions of due dates, or increases in lines-of-credit, can be relied on. The Company also continues to evaluate other debt and equity financing opportunities. The accompanying financial statements have been prepared on a going concern basis under which the Company is expected to be able to realize its assets and satisfy its liabilities in the normal course of business. In order to continue to purchase additional NIBs, the Company will likely need to raise additional capital. |
COMMITMENTS, CONTINGENCIES AND
COMMITMENTS, CONTINGENCIES AND LEGAL MATTERS | 12 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS, CONTINGENCIES AND LEGAL MATTERS | (14) COMMITMENTS, CONTINGENCIES AND LEGAL MATTERS As explained in Note 1, the Company is focused on the purchase of NIB’s based on life settlements or life insurance policies. The Company does not take possession or control of the policies. The owners of the life settlements or life insurance policies acquired such policies at a discount to their face value. The life insurance portfolios underlying our NIBs typically involve loans originated with 4-5 year terms. The Company assumes that the Holders will be able to refinance their loans at the end of the respective loan terms. However, the Holders’ Lender’s ability to offer replacement loans is governed by factors that are beyond the Company’s control or the control of the Holders. If the Holders are unable to refinance their loans with the Holders’ Lender, the Holders may not be able to continue to pay the premiums on the life insurance policies they hold and such life insurance policies may need to be liquidated, thereby potentially reducing the return on our NIBs. At March 31, 2017, the entities that own the policies maintain a total of 13 separate loan agreements with the senior lending facility, all with separate expiration dates. As of March 31, 2017, 7 of these loans had expiration dates that had lapsed, with the remaining 6 loans having maturity dates ranging from June 2017 to January 2018. During October 2017, the entities completed a refinancing of the loans that had matured and were about to mature. The agreements are with a new senior lending facility who previously provided MRI for the underlying policies. During December 2017, these new loans were extended through April 15, 2018, and do not require MRI coverage. Under the new senior lending facility the Company has not projected distributions from its investment in NIBs until the facilities are paid in full. The Holders are engaged in negotiating revised loan expiration dates and refinancing agreements, as well as exploring relationships with additional potential senior lenders (under which MRI coverage may not be required). If they are not successful, we may lose our interest in the affected NIBs. On settlement, the Company receives the net insurance benefit after all borrowings, interest and expenses have been paid by the Holders out of the settlement proceeds. However, in the event of default of the owner, the Company may be required to expend funds on premiums, interest and servicing costs to protect its interest in NIBs, though the Company has no legal responsibility nor adequate funds for these payments. In the event that neither party fulfils the financial obligations pertaining to the premiums, interest and servicing costs, the Company would be required to evaluate its investment in NIBs for other-than-temporary impairment. In addition, see Note 6 relating to associated commitments and contingencies affiliated with life settlements or life insurance policies. During July 2015 a group of persons located in the United States (the “Purchasers”) acquired the entities that owned all of the portfolios of life insurance policies underlying the Company’s NIBs. In connection with this purchase, the Purchasers and the respective owners of these portfolios entered into a settlement agreement releasing such owners and their managers from liability related to their ownership and management of the entities that owned the respective portfolios of life insurance contracts. The Company and Purchasers agreed to indemnify the prior owners of such portfolios against future claims in connection with the issuance of the NIBs or their ownership or management of the entities sold, based on actions that occurred prior to this sale to the Purchasers. The Company and Purchasers further agreed to maintain certain liquidity requirements of the entities underlying the NIBs for a period of 15 months following the acquisition by the Purchasers, which 15 month period expired in October 2016. If such liquidity was not provided, the Company and Purchasers were obligated to indemnify the prior owners and managers of the entities against third party claims for unpaid expenses. Neither the purchase of these entities nor the Settlement Agreement resulted in any material change in the Company’s NIBs ownership interest. The Company was supportive of the Purchasers acquiring the entities that owned the portfolios of life insurance contracts underlying the Company’s NIBs and was willing to provide the indemnification because it believed this ownership change would result in a reduction of costs and expenses associated with ownership of the NIBs, which would increase their intrinsic value. The Company was made aware by the Purchasers that credit was presently no longer available to pay certain costs to maintain the structure of the underlying life insurance policies. The Company’s obligations to provide liquidity under the Settlement Agreement have now expired and the Company is not legally obligated for costs incurred by the entities underlying the NIBs. However, if credit does not become available to Purchasers from the underlying loans to pay the costs as explained above, whether it be by proceeds from a future maturity or other negotiations, the Company may provide such liquidity to protect its investment in the NIBs. The total historical unpaid costs incurred prior to the ownership transition and potential unpaid cost incurred after the ownership transition approximates $370,000 and $580,000, respectively, for an estimated total of $950,000. The Company believes the probable amount it will ultimately pay is approximately $316,667 which relates to unpaid costs incurred prior to the transition. Therefore, the Company accrued $316,667 during the year ended March 31, 2017 to account for this uncertainty, which is included within the annual General and Administrative Expenses on the Company’s Statement of Income. As of March 31, 2017, the Company anticipated that the accrued amount would be paid by August 31, 2017, and therefore this amount was recorded as accrued expense. See Note 16 for updates to the estimated costs subsequent to year end. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | (15) INCOME TAXES The Company provides for income taxes under ASC 740, Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. The provision for income taxes for the years ended March 31, 2017 and 2016 consists of the following: 2017 2016 Current Taxes Federal $ - $ - State - Deferred Taxes Federal 691,824 - State 67,148 - Total Provision $ 758,972 $ - The income tax provision differs from the amount of income tax determined by applying the U.S. federal tax rate of 34% to pretax income from continuing operations for the years ended March 31, 2017 and 2016 due to the following: 2017 2016 Income tax benefit at U. S. federal statutory rates: $ 942,184 $ 28,468 State tax, net of federal benefit 91,446 2,762 Permanent and other differences 153 52,076 Change in valuation allowance (274,811 ) (83,306 ) $ 758,972 $ - The tax effects of significant items comprising the Company’s net deferred taxes as of March 31, 2017 and 2016 were as follows: 2017 2016 Deferred tax assets: Net operating loss carry forwards $ 3,326,228 $ 2,811,596 Stock and warrant compensation 718,295 650,196 Valuation allowance - (274,811 ) Net deferred tax assets $ 4,044,523 $ 3,186,981 Deferred tax liabilities: Investment in net insurance benefits $ (4,803,495 ) $ (3,186,981 ) Net deferred tax liabilities $ (4,803,495 ) $ (3,186,981 ) Total net deferred tax assets/liabilities $ (758,972 ) $ - The Company assesses the need for a valuation allowance against its deferred income tax assets at March 31, 2017. Factors considered in this assessment include recent and expected future earnings and the Company’s liquidity and equity positions. At March 31, 2016 management had recorded a 100% valuation allowance, totaling approximately $275,000, on the amount the Company’s deferred tax assets exceeding the Company’s deferred tax liabilities. As a result, no income tax expense (benefit) or deferred tax asset or liability was recorded on the financial statement. As of the year ended March 31, 2017, our deferred tax liabilities began to exceed the Company’s deferred tax assets, which resulted in the recording of income tax expense and a deferred tax liability. As a result, during the year ended March 31, 2017, the $275,000 valuation allowance was released as the deferred tax liabilities exceeded the deferred tax liabilities and the expectation of cash inflows from the actual and anticipated maturities of the underlying life insurance policies, which will create taxable income to the Company. The deferred tax assets primarily relate to net operating loss carryforwards and the deferred tax liabilities primarily relate to revenue recognized for financial reporting purposes, but not for tax reporting purposes. As of March 31, 2017, the Company has U.S. federal net operating loss carryforwards of $8,917,501. These carry forwards are available to offset future taxable income, if any, and begin to expire in 2022. The utilization of the net operating loss carry forwards is dependent upon the tax laws in effect at the time the net operating loss carry forwards can be utilized and may be significantly limited based on ownership changes within the meaning of section 382 of the Internal Revenue Code. Under FASB ASC 740-10-05-6, tax benefits are recognized only for the tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in the company’s tax return that do not meet these recognition and measurement standards. The Company had no liabilities for unrecognized tax benefits and the Company has recorded no additional interest or penalties. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | (16) SUBSEQUENT EVENTS Subsequent to year end, the following events transpired: The Company received $9,269,568 in cash proceeds associated with maturities and miscellaneous adjustments to other underlying policies. The cash proceeds reduced the carrying value of the Company’s Investment in NIBs. With these proceeds, the Company subsequently paid down principal and accrued interest on the Notes Payable, Related Party and the Convertible Debenture. Subsequent to March 31, 2017, the Company drew an additional $600,000 on the Notes Payable, Related Party, and repaid $4,785,245 in principal on those notes. In addition, the Company paid $539,643 toward accrued interest related to Notes Payable, Related Party. During the same period, the Company drew an additional $200,000 on the Convertible Debenture, and also repaid $900,000 in principal. In addition, the Company paid $10,000 toward accrued interest related to the Convertible Debenture. As of April 11, 2018, the outstanding principal balances of the Notes Payable, Related Party totaled $829,508 and the outstanding principal balance of the Convertible Debenture is $0. On December 6, 2017, the note payable, related party agreement that allowed for borrowings of up to $3,600,000 at December 31, 2016, was amended to extend the due date from August 31, 2018 to August 31, 2019. On March 20, 2018, the note payable, related party agreement that allowed for borrowings of up to $2,130,000 was amended to extend the due date from November 30, 2018 to August 31, 2019. On December 7, 2017, the Company agreed to amend the agreement to extend the due date and conversion rights on the Convertible Debenture from February 28, 2018 to August 31, 2019. As further explained in Note 14, during October 2017, the Holders completed a refinancing of the loans that had matured and were about to mature. The agreements are with a new senior lending facility who previously provided MRI for the underlying policies. During December 2017, these new loans were extended through April 15, 2018. Under the new senior lending facility the Company has not projected distributions from its investment in NIBs until the facilities are paid in full. The Holders are engaged in negotiating revised loan expiration dates and refinancing agreements, as well as exploring relationships with additional potential senior lenders. Effective January 1, 2018, Matthew Pearson resigned his position as the Company’s Chief Operations Officer to pursue other opportunities. As of the date of this filing, no replacement has been designated to fill his position. During October 2017 the Company received notification from the Holders that the $316,667 in certain unpaid costs to maintain the structure of the life insurance policies, which the Company had accrued at March 31, 2017 (see Note 14), had been paid in full by the Holders. Subsequent to March 31, 2017, the Company has reversed the effects of the $316,667 accrued liability on its balance sheet. During February 2018, management engaged consultants to explore and analyze financing alternatives available to the Company. The approximately $362,000 paid to the consultants was capitalized as a Financing Advance on the Company’s consolidated balance sheet prepared subsequent to March 31, 2017. On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Reform Act”) was signed into law by the President of the United States. The Tax Reform Act significantly revised the U.S. corporate income tax regime by, among other things, lowering the U.S. federal corporate tax rate from 35% to 21% effective for the Company’s calendar year ending March 31, 2018. U.S. GAAP requires that the impact of tax legislation be recognized in the period in which the law was enacted. The Company will recognize the effects of the Tax Reform Act for the re-measurement of the net deferred tax liabilities during the year ended March 31, 2018. This will be done in accordance with Staff Accounting Bulletin No. 118 (“SAB 118”), which provides SEC staff guidance for the application of ASC Topic 740, Income Taxes, in the reporting period in which the 2017 Tax Reform Act was signed into law. The guidance addresses how a company recognizes provision amounts when a company does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the effect of the changes in the Tax Reform Act. As such, the financial results reflect the income tax effects of the Tax Reform Act for which the accounting under ASC Topic 740 is complete and provisional amounts for those specific income tax effects of the Tax Reform Act for which the accounting under ASC 740 is incomplete, but a reasonable estimate could be determined. Pursuant to the SAB 118, we are allowed a measurement period of up to one year after the enactment date of the Tax Reform Act to finalize the recording of the related tax impacts. |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Estimates | Estimates |
Cash and Cash Equivalents | Cash and Cash Equivalents, |
Income Recognition | Income Recognition, |
Basic and Diluted Net Income (Loss) Per Common Share | Basic and Diluted Net Income (Loss) Per Common Share, The reconciliation between the basic and diluted weighted-average number of common shares for the years ended March 31, 2017 and 2016, is summarized as follows: Year Ended March 31, 2017 2016 Basic weighted-average number of common shares outstanding during the period 44,131,515 44,026,832 Weighted-average number of dilutive common stock equivalents outstanding during the period 1,345,949 1,346,376 Diluted weighted-average number of common and common equivalent shares outstanding during the period 45,477,464 45,373,208 For the years ended March 31, 2017 and 2016, options to exercise 400,000 shares were excluded because they were anti-dilutive. In addition, 235,345 and 255,215 shares related to the potential conversion of the convertible debenture were excluded because they were anti-dilutive for the years ended March 31, 2017 and 2016, respectively. |
Stock Based Compensation | Stock Based Compensation |
Investment in Net Insurance Benefits | Investment in Net Insurance Benefits, In estimating these cash flows for purposes of interest income and impairment calculations, there are a number of assumptions that are subject to uncertainties and contingencies. These include the amount and timing of projected net cash receipts, expected maturity events, counter party performance risk, changes to applicable regulation of the investment, shortage of funds needed to maintain the asset until maturity, changes in discount rates, life expectancy estimates and their relation to premiums, interest, and other costs incurred, among other items. These uncertainties and contingencies are difficult to predict and are subject to future events that may impact our estimates and interest income. As a result, actual results could differ significantly from those estimates. |
Income Taxes | Income Taxes, The tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not of being sustained if the position were to be challenged by a taxing authority. The Company has examined the tax positions taken in its tax returns and determined that there are no uncertain tax positions. As a result, the Company has recorded no uncertain tax liabilities in its balance sheet. Interest and penalties for uncertain positions, when applicable, would be recognized as a component of income tax expense. The Company files United States Federal and State income tax returns. The income tax returns of the Company are subject to examination by taxing authorities for three to five years from the date they are filed. The Company has tax returns subject to examination for 2013-2017. |
Principles of Consolidation | Principles of Consolidation, |
Variable Interest Entities ("VIEs") | Variable Interest Entities (“VIEs”), |
Fair Value | Fair Value, Those levels of input are summarized as follows: • Level 1: Quoted prices in active markets for identical assets and liabilities. • Level 2: Observable inputs other than Level 1 quoted prices, such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. • Level 3: Unobservable inputs that are supported by little or no market activity. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques as well as instruments for which the determination of fair value requires significant management judgment or estimation. The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety. In accordance with the disclosure requirements of ASC Topic 825, “Financial Instruments” (“ASC 825”), the table below summarizes fair value estimates for the Company’s Investment in NIBs, which are not required to be carried at fair value. The total of the fair value calculations presented does not represent, and should not be construed to represent, the underlying value of the Company. In estimating the fair value of the Company’s Investment in NIBs, the rate of return that a market participant would be willing to pay for each portfolio is used to recalculate the discounted estimated future cash flows. This present value is used to represent the fair value of the Investment in NIBs using level 3 inputs. The carrying amounts in the table are recorded in the consolidated balance sheets at March 31, 2017 and 2016: Fair Value Measurements at March 31, 2017 Description Level 1 Level 2 Level 3 Total Investment in Net $ - $ - $ 45,643,224 $ 45,643,224 Insurance Benefits Fair Value Measurements at March 31, 2016 Description Level 1 Level 2 Level 3 Total Investment in Net $ - $ - $ 29,432,917 $ 29,432,917 Insurance Benefits The fair value of our investment in NIBs is determined by evaluating the sum of present value of the future cash flows expected from the NIBs. The key unobservable inputs used to arrive at the fair value estimates of the Company’s Investment in NIBs at March 31, 2017 and 2016, included a market rate discount rate range of approximately 15% to 18%, with a weighted average rate approximating 16%. The interest rate range and weighted average rate was obtained from the Market Rate – Life Insurance Settlement Association Statistics (weighted 50%), Build-up Method (weighted 25%) and Historical Cost Method (weighted 25%). As explained in Note 1, our current projections for the future cash flows are based off of various assumptions that are subject to uncertainties and contingencies, which are difficult to predict and are subject to future events that may impact our estimates and interest income. Therefore, subsequent to the purchase and on a regular basis, these future estimated cash flows are evaluated for changes. If the determination is made that the future estimated cash flows should be adjusted to the point of a material change in revenue, a revised effective yield is calculated prospectively based on the current amortized cost of the investment, including accrued accretion. During the year ended March 31, 2017, certain maturities were realized sooner than originally projected. The aggregate face value of these maturities was $14,500,000. In addition, there was a reduction of ongoing fees required to support the underlying policies (See Note 14). These two factors contributed to an overall increase in the estimated cash flows expected from the NIBs, which increased the estimated fair value from $29,432,917 as of March 31, 2016 to $45,643,224 as of March 31, 2017. The Company did not have any transfers of assets and liabilities between Levels 1, 2 and 3 of the fair value measurement hierarchy during the years ended March 31, 2017 and 2016. The Company’s recorded values of cash and cash equivalents, accounts payable and accrued liabilities approximate their fair values based on their short-term nature. The recorded values of the Notes Payable, Related Parties and Convertible Debenture approximates the fair values as the interest rate approximates market interest rates. During the year ended March 31, 2017, the Company changed its Consolidated Balance Sheet presentation from “classified” (distinguishing between short-term and long-term accounts) to “unclassified” (no such distinction) due to a desire to conform the Company’s Consolidated Balance Sheet presentation to trends of other companies within the industry. Such a change is a presentation election made by management; the March 31, 2016 Consolidated Balance Sheet has also been presented in an unclassified format comparable to the March 31, 2017 presentation. |
SUMMARY OF SIGNIFICANT ACCOUN24
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Reconciliation of Basic and Diluted Weighted-Average Common Shares | The reconciliation between the basic and diluted weighted-average number of common shares for the years ended March 31, 2017 and 2016, is summarized as follows: Year Ended March 31, 2017 2016 Basic weighted-average number of common shares outstanding during the period 44,131,515 44,026,832 Weighted-average number of dilutive common stock equivalents outstanding during the period 1,345,949 1,346,376 Diluted weighted-average number of common and common equivalent shares outstanding during the period 45,477,464 45,373,208 |
Schedule of Fair Value Measurements and Disclosures | In accordance with the disclosure requirements of ASC Topic 825, “Financial Instruments” (“ASC 825”), the table below summarizes fair value estimates for the Company’s financial instruments that are not required to be carried at fair value. The total of the fair value calculations presented does not represent, and should not be construed to represent, the underlying value of the Company. In estimating the fair value of the Company’s Investment in NIBs, the rate of return that a market participant would be willing to pay for each portfolio is used to recalculate the discounted estimated future cash flows. This present value is used to represent the fair value of the Investment in NIBs using level 3 inputs. The carrying amounts in the table are recorded in the consolidated balance sheets at March 31, 2017 and 2016: Fair Value Measurements at March 31, 2017 Description Level 1 Level 2 Level 3 Total Investment in Net $ - $ - $ 45,643,224 $ 45,643,224 Insurance Benefits Fair Value Measurements at March 31, 2016 Description Level 1 Level 2 Level 3 Total Investment in Net $ - $ - $ 29,432,917 $ 29,432,917 Insurance Benefits |
INVESTMENT IN NET INSURANCE B25
INVESTMENT IN NET INSURANCE BENEFITS (Tables) | 12 Months Ended |
Mar. 31, 2017 | |
Investments, All Other Investments [Abstract] | |
Summary of Investments in Net Insurance Benefits | The balance in Investment in NIBs at March 31, 2017 and 2016, and related activity for the periods then ended were as follows: March 31, 2017 March 31, 2016 Beginning Balance $ 29,822,186 $ 22,544,635 Transfers from Advance for Investment in NIBs - 3,368,380 Accretion of interest income 5,751,689 3,909,171 Cash received (1,417,870 ) - Total $ 34,156,005 $ 29,822,186 |
Schedule of Investments in Net Insurance Benefit Contracts | The table below describes the underlying life insurance policies relating to our investment in NIBs at March 31, 2017, with an adjustment made to reduce the Life Expectancies by the number of months since the last Life Expectancy report: Life Number of Interests Face Value of 0-1 9 $ 34,586,111 1-2 6 31,611,111 2-3 7 37,444,444 3-4 11 49,444,444 4-5 6 35,444,444 Thereafter 30 184,813,147 Total of all policies 69 $ 373,343,701 |
Schedule of Maturities | The table below shows all maturities that have occurred from the Company’s inception through March 31, 2017: Fiscal Year Number of Maturities Original Face Value Company’s Portion of 2013 0 $ 0 $ 0 2014 1 8,000,000 8,000,000 2015 0 0 0 2016 1 10,000,000 7,222,222 2017 3 24,500,000 24,500,000 5 $ 42,500,000 $ 39,722,222 |
Schedule of Future Estimated Premiums, Payments and Other Expenses Expected to be Paid on Insurance Benefit Contracts | The table below describes the future estimated premium payments, other expenses and interest paid by external parties expected to be paid on the policies for the five years subsequent to March 31, 2017. Significant estimates are made as part of the calculation of the premium payments, other expenses and interest amounts identified in the table below. The following table only includes the percentage of the future estimated premium payments, other expenses and interest relating to the portfolio of which the Company only has partially owned NIBs. The following table does not include all of the estimation factors used by the Company in estimating expected net cash receipts for interest income calculation purposes, and is intended to only provide the estimated premium payments, other expenses and interest amounts related to the policies underlying the Company’s NIBs (totals do not include premiums, expenses and interest paid for prior years): Year Premiums Expenses + Interest Total Year 1 $ 14,718,014 $ 9,850,077 $ 24,568,091 Year 2 15,066,981 8,071,797 23,138,778 Year 3 13,464,031 7,165,785 20,629,816 Year 4 13,597,127 7,651,955 21,249,082 Year 5 11,943,568 10,176,791 22,120,358 Thereafter 25,506,798 15,213,806 40,720,604 Total $ 94,296,519 $ 58,130,211 $ 152,426,730 |
Amortized Cost, Aggregate Fair Value and Gross Unrecognized Holding Gains and Losses | The NIBs have a contractual maturity date of 25 years from inception, which ranged from December 2011 to January 2013. The amortized cost, aggregate fair value and gross unrecognized holding gains and losses at March 31, 2017 and 2016, were as follows: March 31, 2017 March 31, 2016 Amortized Cost Basis/Net Carrying Amount $ 34,156,005 $ 29,822,186 Aggregate Fair Value (See Note 2) 45,643,224 29,432,917 Gross Unrecognized Holding Gains/(Losses) $ 11,487,219 $ (389,269 ) |
STOCK OPTIONS (Tables)
STOCK OPTIONS (Tables) | 12 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Option Activity | Below is a summary of the stock option activity for the years ended March 31, 2017 and 2016 (including the 80,000 stock options granted to non-employees): Date Issued Number of Weighted Weighted Remaining Intrinsic Outstanding as of March 31, 2015 2,185,000 $ 1.54 $ 0.91 3.50 $ - Granted - - - - - Exercised - - - - - Cancelled/Expired (78,125 ) - - - - Outstanding as of March 31, 2016 2,106,875 $ 1.57 $ 1.04 2.50 $ - Granted - - - - - Exercised - - - - - Cancelled/Expired - - - - - Outstanding as of March 31, 2017 2,106,875 $ 1.57 $ 1.04 1.50 $ - Vested and Expected to Vest as of March 31, 2017 2,106,875 $ 1.57 $ 1.04 1.50 $ - Exercisable as of March 31, 2016 1,865,205 $ 1.57 $ 1.04 2.50 $ 1,227,109 Exercisable as of March 31, 2017 2,106,875 $ 1.57 $ 1.04 1.50 $ 1,217,847 |
WARRANTS (Tables)
WARRANTS (Tables) | 12 Months Ended |
Mar. 31, 2017 | |
Warrants and Rights Note Disclosure [Abstract] | |
Schedule of Warrant Activity | As of March 31, 2016, all warrants had expired. Number of Weighted Average Weighted Average Remaining Intrinsic Value Outstanding as of April 1, 2015 70,000 $ 5.00 $ 1.92 0.17 - Granted - - - - - Cancelled/Expired (70,000 ) 5.00 1.92 - - Outstanding as of March 31, 2016 - $ - $ - - $ - Granted - - - - - Cancelled/Expired - - - - - Outstanding as of March 31, 2017 - $ - $ - - $ - Exercisable as of March 31, 2016 - $ - $ - - $ - Exercisable as of March 31, 2017 - $ - $ - - $ - |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision for Income Taxes | The provision for income taxes for the years ended March 31, 2017 and 2016 consists of the following: 2017 2016 Current Taxes Federal $ - $ - State - Deferred Taxes Federal 691,824 - State 67,148 - Total Provision $ 758,972 $ - |
Schedule of Net Deferred Taxes | The income tax provision differs from the amount of income tax determined by applying the U.S. federal tax rate of 34% to pretax income from continuing operations for the years ended March 31, 2017 and 2016 due to the following: 2017 2016 Income tax benefit at U. S. federal statutory rates: $ 942,184 $ 28,468 State tax, net of federal benefit 91,446 2,762 Permanent and other differences 153 52,076 Change in valuation allowance (274,811 ) (83,306 ) $ 758,972 $ - |
Schedule of Income Tax Rate Reconciliation | The tax effects of significant items comprising the Company’s net deferred taxes as of March 31, 2017 and 2016 were as follows: 2017 2016 Deferred tax assets: Net operating loss carry forwards $ 3,326,228 $ 2,811,596 Stock and warrant compensation 718,295 650,196 Valuation allowance - (274,811 ) Net deferred tax assets $ 4,044,523 $ 3,186,981 Deferred tax liabilities: Investment in net insurance benefits $ (4,803,495 ) $ (3,186,981 ) Net deferred tax liabilities $ (4,803,495 ) $ (3,186,981 ) Total net deferred tax assets/liabilities $ (758,972 ) $ - |
ORGANIZATION AND BASIS OF PRE29
ORGANIZATION AND BASIS OF PRESENTATION (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Derivative [Line Items] | ||
Par value of PDCs | $ 36,800,000 | |
Net Cash from Operating Activities | (564,928) | $ (3,020,837) |
Net Cash from Investing Activities | 439,006 | |
Restatement Adjustment [Member] | ||
Derivative [Line Items] | ||
Net Cash from Operating Activities | 228,006 | |
Net Cash from Investing Activities | $ 228,006 | |
Minimum [Member] | ||
Derivative [Line Items] | ||
Variable interest rate for PDCs | 99.00% | |
Fixed interest rate for PDCs | 1.00% | |
Percentage of NIBs held | 72.20% | 72.20% |
Maximum [Member] | ||
Derivative [Line Items] | ||
Variable interest rate for PDCs | 100.00% | |
Fixed interest rate for PDCs | 2.00% | |
Percentage of NIBs held | 100.00% | 100.00% |
SUMMARY OF SIGNIFICANT ACCOUN30
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Sep. 01, 2015 | |
Carrying value | $ 34,156,005 | ||
Accrued expense | 316,667 | ||
Face value | $ 14,500,000 | ||
Discount rate | 15.00% | 18.00% | |
Weighted average rate | 16.00% | 16.00% | |
Market Rate - Life Insurance Settlement Association Statistics [Member] | |||
Interest rate | 50.00% | ||
Build-up Method [Member] | |||
Interest rate | 25.00% | ||
Historical Cost Method [Member] | |||
Interest rate | 25.00% | ||
Minimum [Member] | |||
Percentage of net insurance benefits relating to underlying life insurance policies held by company | 72.20% | ||
Maximum [Member] | |||
Percentage of net insurance benefits relating to underlying life insurance policies held by company | 100.00% |
SUMMARY OF SIGNIFICANT ACCOUN31
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Reconciliation of Basic and Diluted Weighted-Average Common Shares) (Details) - shares | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Basic weighted-average number of common shares outstanding during the period | 44,131,515 | 44,026,832 |
Weighted-average number of dilutive common stock equivalents outstanding during the period | 1,345,949 | 1,346,376 |
Diluted weighted-average number of common and common equivalent shares outstanding during the period | 45,477,464 | 45,373,208 |
Outstanding common stock equivalents not included in the computation of diluted net loss per common | 400,000 | 400,000 |
Convertible debenture [Member] | ||
Outstanding common stock equivalents not included in the computation of diluted net loss per common | 235,345 | 255,215 |
SUMMARY OF SIGNIFICANT ACCOUN32
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Schedule of Fair Value of Investment in NIBs) (Details) - USD ($) | Mar. 31, 2017 | Mar. 31, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in Net Insurance Benefits | $ 45,643,224 | $ 29,432,917 |
Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in Net Insurance Benefits | ||
Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in Net Insurance Benefits | ||
Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in Net Insurance Benefits | $ 45,643,224 | $ 29,432,917 |
CASH AND CASH EQUIVALENTS (Deta
CASH AND CASH EQUIVALENTS (Details) - USD ($) | Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2015 |
Cash and Cash Equivalents [Abstract] | |||
Cash and Cash Equivalents | $ 4,364 | $ 24,717 | $ 336,370 |
FDIC insurance maximum | $ 250,000 |
ADVANCE FOR INVESTMENT IN NET34
ADVANCE FOR INVESTMENT IN NET INSURANCE BENEFITS (Details) - USD ($) | Sep. 10, 2015 | Nov. 30, 2016 | Sep. 30, 2015 | Mar. 31, 2014 | Mar. 31, 2017 | Aug. 31, 2015 | May 31, 2015 |
ADVANCE FOR INVESTMENT IN NET INSURANCE BENEFITS [Abstract] | |||||||
Face Value Of Collateral Against Cash Advances | $ 3,368,380 | $ 84,000,000 | $ 94,000,000 | ||||
Contracts that matured during the period | $ 10,000,000 | 10,000,000 | $ 8,000,000 | $ 14,500,000 | |||
Proceeds from matured policy | $ 1,094,335 | ||||||
Proceeds allocated to note receivable payoff | 211,000 | ||||||
Proceeds allocated to pay off accrued interest | 16,428 | ||||||
Proceeds allocated to pay off interest in current period | $ 11,987 | ||||||
Proceeds allocated to reduce advance for Investments in NIBs | $ 854,920 | ||||||
Percentage of net insurance benefits associated with a portfolio of life settlement policies having a face value that originally totaled $94,000,000 | 72.20% | 72.20% | |||||
Percentage of net insurance benefits associated with a portfolio of life settlement policies having a face value that originally totaled $94,000,000 held by other parties | 27.80% |
INVESTMENT IN NET INSURANCE B35
INVESTMENT IN NET INSURANCE BENEFITS (Narrative) (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 12 Months Ended | ||||
Nov. 30, 2016 | Sep. 30, 2015 | Mar. 31, 2014 | Mar. 31, 2017 | Mar. 31, 2017 | Aug. 31, 2015 | May 31, 2015 | |
Investments, All Other Investments [Abstract] | |||||||
Contracts that matured during the period | $ 10,000,000 | $ 10,000,000 | $ 8,000,000 | $ 14,500,000 | |||
Percentage of net insurance benefits associated with a portfolio of life settlement policies having a face value that originally totaled $94,000,000 | 72.20% | 72.20% | 72.20% | ||||
Original face value of Net Insurance Benefits | $ 412,820,622 | $ 412,820,622 | |||||
Face Value Of Collateral Against Cash Advances | $ 3,368,380 | $ 84,000,000 | $ 94,000,000 | ||||
Early maturities | 40,000,000 | ||||||
Policy premiums | $ 120,696,149 | $ 120,696,149 | |||||
Period of contractual maturity | 20 years | ||||||
Increase in Interest Income on Investment in NIBs as a result of adjustments to the cash flow models used to calculate accretable income | $ 393,920 |
INVESTMENT IN NET INSURANCE B36
INVESTMENT IN NET INSURANCE BENEFITS (Summary of Investments in Net Insurance Benefits) (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Investments, All Other Investments [Abstract] | ||
Beginning Balance | $ 29,822,186 | $ 22,544,635 |
Transfers from Advance for Investment in NIBs | 3,368,380 | |
Accretion of interest income | 5,751,689 | 3,909,171 |
Cash received | (1,417,870) | |
Total | $ 34,156,005 | $ 29,822,186 |
INVESTMENT IN NET INSURANCE B37
INVESTMENT IN NET INSURANCE BENEFITS (Schedule of Investment in Net Insurance Benefit Contracts) (Details) | Mar. 31, 2017USD ($)item | [1] |
Number of Interests in Life Settlement Contracts: | ||
Number of interests in life settlement contracts, next twelve months | item | 9 | |
Number of interests in life settlement contracts, year two | item | 6 | |
Number of interests in life settlement contracts, year three | item | 7 | |
Number of interests in life settlement contracts, year four | item | 11 | |
Number of interests in life settlement contracts, year five | item | 6 | |
Number of interests in life settlement contracts, thereafter | item | 30 | |
Number of interests in life settlement contracts, total | item | 69 | |
Face Value of Underlying Policies: | ||
Face value of underlying policies, next twelve months | $ | $ 34,586,111 | |
Face value of underlying policies, year two | $ | 31,611,111 | |
Face value of underlying policies, year three | $ | 37,444,444 | |
Face value of underlying policies, year four | $ | 49,444,444 | |
Face value of underlying policies, year five | $ | 35,444,444 | |
Face value of underlying policies, thereafter | $ | 184,813,147 | |
Face value of underlying policies, total | $ | $ 373,343,701 | |
[1] | The Life Expectancy ('LE') input is the 70%/30% weighted average of two LEs available at the time of the original creation of the NIB portfolio. The Adjusted Life Expectancy is an unofficial calculation that simply reduces the original LE by the number of months since the last LE report. It should be noted that the insured's health, medical conditions and other considerations may have changed since the LE report, so that the Adjusted LE is simply an estimate. These LEs were produced by third-party life expectancy companies and represent the actuarial mean of how long an individual is expected to live. The number is a calculation done with the LE provider's proprietary statistical model that is typically based on individualized mortality curves for each life factoring in the insured's gender, age, health and family history, medical conditions, and other considerations. In purchasing, financing or insuring life insurance policies or NIBs, we may use alternate life expectancy companies or may use weighted averages of two or more life expectancy companies, depending on the facts and circumstances of the case and requirements of the various counterparties. The life expectancy report is just an estimate, as the life expectancy of any individual cannot be known with absolute certainty. |
INVESTMENT IN NET INSURANCE B38
INVESTMENT IN NET INSURANCE BENEFITS (Schedule of Maturities) (Details) | Mar. 31, 2017USD ($)item |
Number of Maturities | |
Number of Maturities, year one | item | 0 |
Number of Maturities, year two | item | 1 |
Number of Maturities, year three | item | 0 |
Number of Maturities, year four | item | 1 |
Number of Maturities, year five | item | 3 |
Number of Maturities, total | item | 5 |
Original Face Value of Underlying Policies | |
Original Face Value of Underlying Policies, year one | $ 0 |
Original Face Value of Underlying Policies, year two | 8,000,000 |
Original Face Value of Underlying Policies, year three | 0 |
Original Face Value of Underlying Policies, year four | 10,000,000 |
Original Face Value of Underlying Policies, year five | 24,500,000 |
Original Face Value of Underlying Policies, total | 42,500,000 |
Company's Portion of Face Value | |
Company's Portion of Face Value, Year One | 0 |
Company's Portion of Face Value, Year two | 8,000,000 |
Company's Portion of Face Value, Year three | 0 |
Company's Portion of Face Value, Year four | 7,222,222 |
Company's Portion of Face Value, Year five | 24,500,000 |
Company's Portion of Face Value, total | $ 39,722,222 |
INVESTMENT IN NET INSURANCE B39
INVESTMENT IN NET INSURANCE BENEFITS (Schedule of Future Estimated Premiums Payments, Other Expenses and Interest Paid By External Parties) (Details) | Mar. 31, 2017USD ($) |
Premiums: | |
Premiums to be paid, year one | $ 14,718,014 |
Premiums to be paid, year two | 15,066,981 |
Premiums to be paid, year three | 13,464,031 |
Premiums to be paid, year four | 13,597,127 |
Premiums to be paid, year five | 11,943,568 |
Premiums to be paid, thereafter | 25,506,798 |
Premiums to be paid, total | 94,296,519 |
Expenses + Interest: | |
Expense + Interest to be paid, year one | 9,850,077 |
Expense + Interest to be paid, year two | 8,071,797 |
Expense + Interest to be paid, year three | 7,165,785 |
Expense + Interest to be paid, year four | 7,651,955 |
Expense + Interest to be paid, year five | 10,176,791 |
Expense + Interst to be paid, thereafter | 15,213,806 |
Expense + Interest, total | 58,130,211 |
Total Premiums, Interest and Expenses: | |
Total to be paid, year one | 24,568,091 |
Total to be paid, year two | 23,138,778 |
Total to be paid, year three | 20,629,816 |
Total to be paid, year four | 21,249,082 |
Total to be paid, year five | 22,120,358 |
Total to be paid, thereafter | 40,720,604 |
Premiums, interest and expenses, total | $ 152,426,730 |
INVESTMENT IN NET INSURANCE B40
INVESTMENT IN NET INSURANCE BENEFITS (Amortized Cost, Aggregate Fair Value, and Gross Unrecognized Holding Gains) (Details) - USD ($) | Mar. 31, 2017 | Mar. 31, 2016 |
Investment In Net Insurance Benefits Amortized Cost Aggregate Fair Value And Gross Unrecognized Holding Gains Details | ||
Amortized Cost Basis/Net Carrying Amount | $ 34,156,005 | $ 29,822,186 |
Aggregate Fair Value (See Note 2) | 45,643,224 | 29,432,917 |
Gross Unrecognized Holding Gains | $ 11,487,219 | |
Gross Unrecognized Holding Losses | $ (389,269) |
NOTES PAYABLE, RELATED PARTY (D
NOTES PAYABLE, RELATED PARTY (Details) - USD ($) | Feb. 01, 2017 | Mar. 31, 2017 | Mar. 31, 2016 |
Related Party Transaction [Line Items] | |||
Long-term Line of Credit | $ 5,214,753 | $ 3,820,178 | |
Long term Accrued Expense obligation | $ 753,780 | 192,157 | |
Interest rate | 7.50% | ||
Stockholder [Member] | |||
Related Party Transaction [Line Items] | |||
Long-term Line of Credit | $ 5,549,379 | ||
Line of Credit Facility, Maximum Borrowing Capacity | 6,730,000 | ||
Remaining borrowing capacity | 1,515,247 | ||
Amount due on August 31, 2018 | 3,714,753 | ||
Amount due on November 30, 2018 | $ 1,500,000 | ||
Related party note interest rate | 7.50% | ||
Proceeds from Lines of Credit | $ 2,130,000 | $ 1,544,576 | 2,520,178 |
Repayments of Lines of Credit | 150,000 | 200,000 | |
Long term Accrued Expense obligation | $ 334,626 | $ 145,669 | |
Stockholder [Member] | December 31, 2016 [Member] | |||
Related Party Transaction [Line Items] | |||
Proceeds from Lines of Credit | 3,600,000 | ||
Stockholder [Member] | Minimum [Member] | |||
Related Party Transaction [Line Items] | |||
Proceeds from Lines of Credit | 3,600,000 | ||
Stockholder [Member] | Maximum [Member] | |||
Related Party Transaction [Line Items] | |||
Proceeds from Lines of Credit | $ 4,600,000 |
NOTES PAYABLE TRANSFERRED TO 42
NOTES PAYABLE TRANSFERRED TO REDEEMED COMMON STOCK PAYABLE (Details) - USD ($) | Jun. 09, 2015 | Apr. 30, 2016 | Mar. 31, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2014 |
Debt Instrument [Line Items] | ||||||||
Interest rate | 7.50% | |||||||
Number of shares repurchased during the period | 93,750 | 187,500 | ||||||
Value of shares repurchased during the period | $ 750,000 | $ 750,000 | ||||||
Mandatorily Redeemable Common Stock liability | $ 750,000 | |||||||
Repurchase price per share | $ 8 | $ 8 | ||||||
NIB-Collateralized Note Payable [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes Payable, including accrued interest | $ 1,455,904 | |||||||
Interest Payable | $ 37,350 | $ 37,350 | ||||||
Interest rate | 4.00% | 4.00% | ||||||
Maturity date | Apr. 1, 2015 | |||||||
Number of shares issued on conversion | 187,500 | |||||||
Repurchase price per share | $ 8 |
CONVERTIBLE DEBENTURE AGREEME43
CONVERTIBLE DEBENTURE AGREEMENT (Details) - USD ($) | Mar. 15, 2017 | Oct. 25, 2016 | Jun. 02, 2016 | Mar. 31, 2017 | Mar. 31, 2016 |
Debt Instrument [Line Items] | |||||
Interest rate | 7.50% | ||||
Face amount of debt instrument | $ 14,500,000 | ||||
Convertible Debenture | $ 700,000 | $ 700,000 | |||
Satco International, Ltd, 8% Convertible Debenture [Member] | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 8.00% | ||||
Maturity date | Aug. 31, 2018 | Feb. 28, 2018 | Jun. 2, 2016 | Aug. 31, 2017 | |
Convertible Debenture | $ 700,000 | 700,000 | |||
Convertible debenture, terms of conversion | Per the agreement, the number of shares issuable at conversion shall be determined by the quotient obtained by dividing the outstanding principal and accrued and unpaid interest by 90% of the 90 day average closing price of the Companys common stock from the date the notice of conversion is received; and the price at which the Debenture may be converted will be no lower than $1.00 per share. | ||||
Accrued interest | $ 102,487 | $ 46,488 | |||
Satco International, Ltd, 8% Convertible Debenture [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Face amount of debt instrument | $ 3,000,000 |
STOCK OPTIONS (Narrative) (Deta
STOCK OPTIONS (Narrative) (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options granted | ||
Stock option term | 5 years | |
Stock option expiration period | April and October of 2018 | |
Stock-based compensation expense | $ 182,572 | $ 508,503 |
Vested options exercised value | $ 3,314,294 | |
Nonemployees [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options granted | 80,000 |
STOCK OPTIONS (Schedule of Stoc
STOCK OPTIONS (Schedule of Stock Option Activity) (Details) - $ / shares | 12 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2015 | |
Number of Options | |||
Outstanding at beginning of period | 2,106,875 | 2,185,000 | |
Granted | |||
Exercised | |||
Cancelled/Expired | (78,125) | ||
Outstanding at end of period | 2,106,875 | 2,106,875 | 2,185,000 |
Vested and expected to vest | 2,106,875 | ||
Exercisable | 2,106,875 | 1,865,205 | |
Weighted Average Exercise Price | |||
Outstanding at beginning of period | $ 1.57 | $ 1.54 | |
Granted | |||
Exercised | |||
Cancelled/Expired | |||
Outstanding at end of period | 1.57 | 1.57 | $ 1.54 |
Vested and expected to vest | 1.57 | ||
Exercisable | 1.57 | 1.57 | |
Weighted Average Grant Date Fair Value | |||
Outstanding at beginning of period | 1.04 | 0.91 | |
Granted | |||
Exercised | |||
Cancelled/Expired | |||
Outstanding at end of period | 1.04 | 1.04 | $ 0.91 |
Vested and expected to vest | 1.04 | ||
Exercisable | $ 1.04 | $ 1.04 | |
Remaining Contractual Term | |||
Outstanding | 1 year 6 months | 2 years 6 months | 3 years 6 months |
Vested and expected to vest | 1 year 6 months | ||
Exercisable | 1 year 6 months | 2 years 6 months | |
Intrinsic Value | |||
Outstanding | |||
Exercisable | $ 1,217,847 | $ 1,227,109 |
WARRANTS (Narrative) (Details)
WARRANTS (Narrative) (Details) - USD ($) | Apr. 08, 2013 | Mar. 31, 2014 |
Class of Warrant or Right [Line Items] | ||
Shares of common stock issuable under warrants | 70,000 | |
Offering price of shares offered through private placement | $ 5 | |
Fair Value of Warrants Issued as Stock Issuance Costs | $ 139,251 | |
Warrant [Member] | ||
Class of Warrant or Right [Line Items] | ||
Private placement investment amount | $ 7,000,000 | |
Number of warrants authorized for issuance | 70,000 | |
Offering price of shares offered through private placement | $ 5 | |
Expected Term | 2 years |
WARRANTS (Schedule of Warrant A
WARRANTS (Schedule of Warrant Activity) (Details) - USD ($) | 12 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2015 | |
Remaining Contractual Term | |||
Outstanding | 1 year 6 months | 2 years 6 months | 3 years 6 months |
Warrant [Member] | |||
Number of Options | |||
Outstanding at beginning of period | 70,000 | ||
Granted | |||
Cancelled/Expired | (70,000) | ||
Outstanding at end of period | 70,000 | ||
Exercisable | |||
Weighted Average Exercise Price | |||
Outstanding at beginning of period | $ 5 | ||
Granted | |||
Cancelled/Expired | 5 | ||
Outstanding at end of period | $ 5 | ||
Exercisable | |||
Weighted Average Grant Date Fair Value | |||
Outstanding at beginning of period | 1.92 | ||
Granted | |||
Cancelled/Expired | 1.92 | ||
Outstanding at end of period | $ 1.92 | ||
Exercisable | |||
Remaining Contractual Term | |||
Outstanding | 2 months 1 day | ||
Intrinsic Value | |||
Outstanding at beginning of period | |||
Granted | |||
Cancelled/Expired | |||
Outstanding at end of period | |||
Exercisable |
STOCK TRANSACTIONS (Details)
STOCK TRANSACTIONS (Details) - USD ($) | Jun. 09, 2015 | Mar. 31, 2015 | Apr. 08, 2013 |
Stockholders' Equity Note [Abstract] | |||
Total cash payment made as consideration for relief of note payable balance and receipt of net insurance benefits | $ 150,000 | ||
Shares issued through private stock offering | 942,500 | 1,130,000 | |
Notes receivable balance forgiven as consideration for relief of note payable balance and receipt of net insurance benefits | $ 150,000 | ||
Amount of notes payable balance extinguished | 1,493,254 | ||
Net consideration provided for receipt of net insurance benefits | 7,846,746 | ||
Value of shares issued through private stock offering | $ 9,340,000 | ||
Number of shares repurchased during the period | 93,750 | 187,500 | |
Repurchase price per share | $ 8 | ||
Offering price of shares offered through private placement | $ 5 | ||
Shares of common stock issuable under warrants | 70,000 |
LIQUIDITY AND CAPITAL REQUIREME
LIQUIDITY AND CAPITAL REQUIREMENTS (Details) - USD ($) | 12 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2016 | Mar. 31, 2015 | |
Cash and Cash Equivalents | $ 4,364 | $ 24,717 | $ 336,370 | |
Monthly expenses incurred by company | 132,000 | |||
Accounts Payable | 508,071 | $ 351,671 | ||
Accrued Expenses | $ 753,780 | |||
Subsequent Event [Member] | ||||
Additional borrowing capacity from related party notes payable | $ 5,900,492 | |||
Additional borrowing capacity from Convertible Debenture Agreement | $ 3,000,000 |
COMMITMENTS, CONTINGENCIES AN50
COMMITMENTS, CONTINGENCIES AND LEGAL MATTERS (Details) | 12 Months Ended |
Mar. 31, 2017USD ($) | |
Operating Leased Assets [Line Items] | |
Historical unpaid costs incurred prior to ownership transition | $ 370,000 |
Potential unpaid cost incurred after the ownership transition | 580,000 |
Total unpaid costs related to ownership transition | 950,000 |
Current accrued uncertainty | 316,667 |
Accrued expense | $ 316,667 |
Maximum [Member] | |
Operating Leased Assets [Line Items] | |
Loan originate term | 5 years |
Minimum [Member] | |
Operating Leased Assets [Line Items] | |
Loan originate term | 4 years |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 8,917,501 | |
NOL beginning expiration date | Mar. 31, 2020 | |
Statutory federal tax rate | 34.00% | |
Change in deferred tax assets valuation allowancet | 100.00% |
INCOME TAXES (Schedule of Incom
INCOME TAXES (Schedule of Income Taxes) (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Current Taxes | ||
Federal | ||
State | ||
Deferred Taxes | ||
Federal | 691,824 | |
State | 67,148 | |
Total Provisions | $ 758,972 |
INCOME TAXES (Schedule of Effec
INCOME TAXES (Schedule of Effective Income Tax Rate Reconciliation) (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Income tax benefit at U. S. federal statutory rates: | $ 942,184 | $ 28,468 |
State tax, net of federal benefit | 91,446 | 2,762 |
Permanent and other differences | 153 | 52,076 |
Change in valuation allowance | (274,811) | (83,306) |
Total Provisions | $ 758,972 |
INCOME TAXES (Schedule of Net D
INCOME TAXES (Schedule of Net Deferred Taxes) (Details) - USD ($) | Mar. 31, 2017 | Mar. 31, 2016 |
Deferred Tax assets: | ||
Net operating loss carry forwards | $ 3,326,228 | $ 2,811,596 |
Stock and warrant compensation | 718,295 | 650,196 |
Valuation allowance | (274,811) | |
Net deferred tax asset | 4,044,523 | 3,186,981 |
Deferred tax liability: | ||
Investment in net insurance benefits | (4,803,495) | (3,186,981) |
Net deferred tax liability | (4,803,495) | (3,186,981) |
Total net deferred tax assets/liabilities | $ (758,972) |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Dec. 07, 2017 | Dec. 06, 2017 | Mar. 20, 2018 | Apr. 09, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | Apr. 11, 2018 | Apr. 09, 2017 |
Subsequent Event [Line Items] | ||||||||
Repayments of related party debt | $ 150,000 | |||||||
Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Cash proceeds associated with maturities and miscellaneous adjustments | $ 9,269,568 | |||||||
Repayments of related party debt | 150,000 | |||||||
Amount paid to consultants as a financing advance | $ 362,000 | |||||||
Federal statutory tax rate beginning in 2018 | 21.00% | |||||||
Reversal of prior accrual for certain unpaid costs to maintain the structure of the life insurance policies | $ 316,667 | |||||||
Notes Payable [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Proceeds from related party debt | $ 3,600,000 | $ 2,130,000 | 600,000 | |||||
Repayments of related party debt | 4,785,245 | |||||||
Accrued interest | $ 539,643 | |||||||
Notes Payable, Related Party | $ 829,508 | |||||||
Maturity date | Aug. 31, 2019 | Aug. 31, 2019 | ||||||
Convertible Debenture [Member] | Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Proceeds from related party debt | 200,000 | |||||||
Repayments of related party debt | 900,000 | |||||||
Accrued interest | $ 10,000 | |||||||
Notes Payable, Related Party | $ 0 | |||||||
Maturity date | Aug. 31, 2019 |