Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 05, 2020 | |
Details | ||
Registrant CIK | 0001342936 | |
Fiscal Year End | --12-31 | |
Registrant Name | Advanced Voice Recognition Systems, Inc. | |
SEC Form | 10-Q | |
Period End date | Mar. 31, 2020 | |
Trading Symbol | AVOI | |
Trading Exchange | NONE | |
Tax Identification Number (TIN) | 98-0511932 | |
Number of common stock shares outstanding | 279,720,268 | |
Filer Category | Non-accelerated Filer | |
Current with reporting | Yes | |
Interactive Data Current | Yes | |
Shell Company | true | |
Small Business | true | |
Emerging Growth Company | true | |
Ex Transition Period | false | |
Document Transition Report | false | |
Entity File Number | 000-52390 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 7659 E. Wood Drive, | |
Entity Address, City or Town | Scottsdale, | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85260 | |
Entity Address, Address Description | (Address of principal executive offices) | |
City Area Code | (480) | |
Local Phone Number | 704-4183 | |
Title of 12(b) Security | Common Stock par value $0.001 per share | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Document Quarterly Report | true |
Balance Sheets (March 31, 2020)
Balance Sheets (March 31, 2020) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Current Assets | ||
Cash and cash equivalents | $ 1,730 | $ 6,241 |
Total Current Assets | 1,730 | 6,241 |
Non-Current Assets | ||
Patent, net | 25,011 | 28,687 |
Total Non-Current Assets | 25,011 | 28,687 |
Total Assets | 26,741 | 34,928 |
Current Liabilities | ||
Accounts payable | 58,712 | 46,083 |
Payroll | 162,382 | 162,382 |
Note Payable AIP | 19,935 | 19,935 |
Accrued Interest | 10,466 | 10,222 |
Total Current Liabilities | 251,495 | 238,622 |
Stockholders' Deficit | ||
Common stock | 279,720 | 278,220 |
Additional paid-in capital | 7,950,100 | 7,936,600 |
Accumulated Deficit | (8,454,574) | (8,418,514) |
Total Stockholders' Deficit | (224,754) | (203,694) |
Total Liabilities and Stockholders' Deficit | 26,741 | 34,928 |
Total Liabilities | $ 251,495 | $ 238,622 |
Balance Sheets (March 31, 202_2
Balance Sheets (March 31, 2020) - Parenthetical - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Details | ||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 547,500,000 | 547,500,000 |
Common Stock, Shares, Issued | 279,720,268 | 279,720,268 |
Common Stock, Shares, Outstanding | 278,220,268 | 278,220,268 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
Details | |||
Sales | $ 0 | $ 0 | |
Cost of goods sold | 0 | 0 | |
Gross profit | 0 | 0 | |
Operating expenses: | |||
Compensation | 7,794 | 69 | |
Professional fees | 21,346 | 21,945 | |
Office | 6,065 | 5,733 | |
Travel | 0 | 101 | |
Other | 357 | 557 | |
Total operating expenses | 35,562 | 28,405 | |
Loss from operations | (35,562) | (28,405) | |
Other income and (expense): | |||
Interest expense | (498) | (950) | |
Gain (Loss) on Extinguishment of Debt | 0 | 0 | |
Net other expense | (498) | (950) | |
Loss before income taxes | (36,060) | (29,355) | |
Provision for income taxes | 0 | 0 | |
Net Loss | $ (36,060) | $ (29,355) | |
Basic and diluted loss per common share | [1] | $ 0 | $ 0 |
Weighted average number of common shares | 279,670,817 | 267,120,268 | |
[1] | *less than $0.01 per share |
Statement of Stockholders' Defi
Statement of Stockholders' Deficit - USD ($) | Common Stock | Additional Paid-in Capital | Retained Earnings | Total |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Dec. 31, 2018 | $ 267,020 | $ 7,878,798 | $ (8,350,212) | $ (204,394) |
Shares, Outstanding, Beginning Balance at Dec. 31, 2018 | 267,020,268 | |||
Stock Issued During Period, Value, Purchase of Assets | $ 1,800 | 7,200 | 9,000 | |
Stock Issued During Period, Shares, Purchase of Assets | 1,800,000 | |||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ 0 | 0 | (29,355) | (29,355) |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Mar. 31, 2019 | $ 268,820 | 7,885,998 | (8,379,567) | (224,749) |
Shares, Outstanding, Ending Balance at Mar. 31, 2019 | 268,820,268 | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Dec. 31, 2019 | $ 278,220 | 7,936,600 | (8,418,514) | (203,694) |
Shares, Outstanding, Beginning Balance at Dec. 31, 2019 | 278,220,268 | |||
Stock Issued During Period, Value, Purchase of Assets | $ 1,500 | 13,500 | 15,000 | |
Stock Issued During Period, Shares, Purchase of Assets | 1,500,000 | |||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ 0 | 0 | (36,060) | (36,060) |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Mar. 31, 2020 | $ 279,720 | $ 7,950,100 | $ (8,454,574) | $ (224,754) |
Shares, Outstanding, Ending Balance at Mar. 31, 2020 | 279,720,268 |
Statement of Stockholders Defic
Statement of Stockholders Deficit (Unaudited) - USD ($) | Common Stock | Additional Paid-in Capital | Retained Earnings | Total |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Dec. 31, 2018 | $ 267,020 | $ 7,878,798 | $ (8,350,212) | $ (204,394) |
Shares, Outstanding, Beginning Balance at Dec. 31, 2018 | 267,020,268 | |||
Stock Issued During Period, Value, Purchase of Assets | $ 1,800 | 7,200 | 9,000 | |
Stock Issued During Period, Shares, Purchase of Assets | 1,800,000 | |||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ 0 | 0 | (29,355) | (29,355) |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Mar. 31, 2019 | $ 268,820 | 7,885,998 | (8,379,567) | (224,749) |
Shares, Outstanding, Ending Balance at Mar. 31, 2019 | 268,820,268 | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Dec. 31, 2019 | $ 278,220 | 7,936,600 | (8,418,514) | (203,694) |
Shares, Outstanding, Beginning Balance at Dec. 31, 2019 | 278,220,268 | |||
Stock Issued During Period, Value, Purchase of Assets | $ 1,500 | 13,500 | 15,000 | |
Stock Issued During Period, Shares, Purchase of Assets | 1,500,000 | |||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ 0 | 0 | (36,060) | (36,060) |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Mar. 31, 2020 | $ 279,720 | $ 7,950,100 | $ (8,454,574) | $ (224,754) |
Shares, Outstanding, Ending Balance at Mar. 31, 2020 | 279,720,268 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (36,060) | $ (29,355) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization and depreciation | 3,676 | 3,676 |
Changes in operating liabilities: | ||
Accounts payable and accrued liabilities | 12,873 | 5,588 |
Net cash used in operating activities | (19,511) | (20,091) |
Cash Flows from Financing Activities: | ||
Proceeds from sale of common stock | 15,000 | 9,000 |
Advance from Related Party | 0 | 5,000 |
Payments on notes payable | 0 | (2,631) |
Net cash provided by financing activities | 15,000 | 11,369 |
Net change in cash | (4,511) | (8,722) |
Cash and Cash Equivalents, at Carrying Value, Beginning Balance | 6,241 | 17,583 |
Cash and Cash Equivalents, at Carrying Value, Ending Balance | 1,730 | 8,861 |
Supplemental Disclosure of Cash Flow Information: | ||
Interest | 498 | 429 |
Income taxes | $ 0 | $ 0 |
Note 1. Nature of Operations
Note 1. Nature of Operations | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 1. Nature of Operations | Note 1. Nature of Operations Company Overview The operations of Advanced Voice Recognition Systems, Inc. (“AVRS” or the “Company”), http://www.avrsys.com, commenced in 1994 with a predecessor entity called NCC, Inc. NCC, Inc. was incorporated on March 15, 1994 in the State of Ohio. NCC, Inc. operated as a software and hardware development company that marketed voice recognition and transcription products for commercial applications. In May 2000, WG Investments, LLC acquired the assets of NCC, Inc. and subsequently changed its name to NCC, LLC. NCC, LLC (also a predecessor to AVRS) continued the operations of NCC, Inc. until approximately December 31, 2001, when shifts in the industry’s markets caused NCC, LLC to suspend its operations. AVRS was incorporated in the State of Colorado on July 7, 2005. In September 2005, the members of NCC, LLC transferred all of their membership interests in NCC, LLC to AVRS in exchange for 93,333,333 shares (post-recapitalization) of AVRS common stock. In December 2005, the Board of Directors approved a 1.5-to-1 stock split issuing 46,666,667 common shares (post-recapitalization), which increased the number of common shares outstanding to 140 million shares (post-capitalization). Following the incorporation of AVRS, the Company initiated a new business plan and intends to continue its operations in the voice recognition and transcription industry. AVRS is a software development company specializing in speech recognition technologies. AVRS has successfully obtained patent protection of its proprietary technology (refer to Note 3, Intangible Assets). The Company has currently engaged a firm to investigate and assert claims relating to certain patents including negotiating licensing agreements and the filing and prosecution of lawsuits. Stock Purchase Agreements During the year ended December 31, 2019 the Company entered into Stock Purchase Agreements for the private sale to six persons or entities of an aggregate of 11,200,000 shares of the common stock for aggregate proceeds of $69,002, full payment of which was received in the period. During the three months ended March 31, 2020, the Company entered into Stock Purchase Agreements for the private sale of an aggregate of 1,500,000 shares of the common stock for aggregate proceeds of $15,000 full payment of which was received in the period. Commitments and Contingencies On April 20, 2015 Advanced Voice Recognition Systems, Inc. (“AVRS”) entered into a Material Letter Agreement with an unrelated third party (“AIP”) in which they promise to pay to patent legal counsel funds to continue prosecuting Patents on behalf of AVRS. AVRS promises to pay AIP, or to such other holder of this promissory note (Note) as designate, the principal, together with a premium of ten percent (10%) of Principle and two percent (2%) of proceeds received by Company from a Monetization Event initiated by AIP. Interest was accrued and reported at March 31, 2020. On August 20, 2015, Advanced Voice Recognition Systems, Inc. (“AVRS”) entered into a letter agreement with unrelated third party (Third Party) pursuant to which the Third Party will provide strategic advisory services to AVRS to support the common goal of the acquisition, sale, licensing, prosecution, enforcement, and settlement with respect to AVRS’s intellectual property, including patents held by AVRS. The Third Party has agreed to advance costs recommended by it, including court filing fees, discovery and other litigation costs, and patent prosecution costs, up to an aggregate of $10,000,000. AVRS will be responsible for costs not recommended by the Third Party, as well as travel and ordinary business expenses incurred by AVRS. Except for the advanced costs by the Third Party, AVRS will be responsible for any contingency payments to law firms. Any and all advanced costs will only become liabilities if successful. On June 28, 2017 AVRS and the Third Party agreed to terminate the August 20, 2015 Letter Agreement. AVRS did not incur any material early termination penalties in connection of the early termination of the agreement. On November 1, 2016, Advanced Voice Recognition Systems, Inc. (“ AVRS Agreement Patent Rights responsibility for the costs and expenses in the Terminated August 20, 2015 Letter Agreement and provides for the payment of twenty percent (20%) of all gross Licensing Agreement Proceeds and thirty percent (30%) of all Litigation Proceeds received by AVRS. In addition if the Litigation Proceeds agreed to or received by AVRS at any time are $100,000 or less then Legal Representative shall receive forty percent (40%) of the Litigation Proceeds. On November 21, 2018 AVRS and Meyers & Associates entered into a Second Agreement to Amend Promissory Note. AVRS shall pay $20,000 on or before November 21, 2018, shall pay $1,500 on the first day of each month beginning January 1, 2019 and continuing through June 1, 2019 and shall pay all remaining principle and interest on July 1, 2019. On June 7, 2019 the Company made the final payment of $11,046.74. The note is paid in full. A $1,500 gain from early extinguishment of Note Payable was reported as income on June 30, 2019. On June 21, 2018, Advanced Voice Recognition Systems, Inc. (“ AVRS Agreement the Firm On July 22, 2019 Apple, Inc. submitted a petition for Inter Partes Review (IPR) of the AVRS patent. It was ordered in the case of AVRS, Inc. v. Apple Inc (Case No. 2-18-cv-2083) that the parties’ stipulation was granted and the case is stayed pending the resolution of the IPR proceeding. Buether Joe and Carpenter, LLC (BJC), our representation in the AVRS v. Apple litigation will represent AVRS in the IPR. The IPR response to the Patent Trial and Appeal Board (PTAB) is due November 8, 2019. On September 24, 2018, Advanced Voice Recognition Systems, Inc., a Nevada corporation (“AVRS”, “we” or “us”), entered into Promissory Note with Walter Geldenhuys, who is our President, Chief Executive Officer and Chief Financial Officer, and who serves as a member of our Board of Directors. The Promissory Note is effective as of September 24, 2018 in the principal amount of $9,000 with a maturity date of the Promissory Note September 24, 2019. Interest at 4% per annum was charged and accrued at December 31, 2018. The Company repaid $2500 of the note on December 10, 2018. Interest at 4% per annum was charged and accrued at December 31, 2019. During 2019 the Company repaid $6,500, paying the note in full on December 27, 2019. |
Note 2. Significant Accounting
Note 2. Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 2. Significant Accounting Policies | Note 2. Significant Accounting Policies Unaudited Financial Information The accompanying financial information at March 31, 2020 and for the three months ended March 31, 2020 and 2019 is unaudited. In the opinion of management, all normal and recurring adjustments which are necessary to provide a fair presentation of the Company’s financial position at March 31, 2020 and its operating results for the three months ended March 31, 2020 and 2019 have been made. Certain information and footnote data necessary for a fair presentation of financial position and results of operations in conformity with accounting principles generally accepted in the United States of America have been condensed or omitted. It is therefore suggested that these financial statements be read in conjunction with the summary of significant accounting policies and notes to financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) for the year ended December 31, 2019. The results of operations for the three months ended March 31, 2020 are not necessarily an indication of operating results to be expected for the year ending December 31, 2020. Going Concern The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Liabilities exceed assets and there is a capital deficiency of $224,754 and no significant revenues. The Company may be unable to continue as a going concern for a reasonable period of time. The financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis and ultimately to attain profitability. During the twelve months ended December 31, 2019 the Company received an aggregate of $69,002 from the sale of shares in private offerings of its common stock. During the three months ended March 31, 2020 the Company received an aggregate of $15,000 from the sale of shares in private offerings of its common stock. The Company’s current operations are related to patent monetization and filing of additional patents. The Company has entered into a letter agreement with Dominion Harbor Group, LLC to provide strategic advisory services to AVRS. Dominion has agreed to advanced costs up to an aggregate of $10,000,000. On June 28, 2017 the Company and Dominion agreed to terminate the August 20, 2015 Letter Agreement. The Company did not incur any material early termination penalties. In addition the Company has revised the Contingent Fee Agreement with Buether Joe & Carpenter, LLC which will represent AVRS in connection with investigating and asserting claims to the AVRS patents including licensing and litigation activities. Any and all advanced costs will only become liabilities if successful. On June 6, 2017 AVRS and BJC revised the Contingent Fee Agreement as it related to the termination of the August 20, 2015 Dominion Harbor Letter Agreement. There is no guarantee that AVRS will be able to provide the capital required for the Company to continue as a going concern. Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid debt instruments with original maturities of three months or less when acquired to be cash equivalents. The Company had cash at March 31, 2020 of $1,730, $6,241 at December 31, 2019. No amounts resulted from cash equivalents. Financial Instruments The carrying amounts of cash, receivables and current liabilities approximate fair value due to the short-term maturity of the instruments. Fixed Assets Fixed assets are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets, ranging from three to five years. Expenditures for additions and improvements are capitalized, while repairs and maintenance costs are expensed as incurred. The cost and related accumulated depreciation of property and equipment sold or otherwise disposed of are removed from the accounts and any gain or loss is recorded in the year of disposal. Income Taxes Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the recorded book basis and the tax basis of assets and liabilities for financial and income tax reporting. Deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future taxable income and tax credits that are available to offset future federal income taxes. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on the Company’s financial condition, results of operations, or cash flow. Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740. Research and Development Costs Research and development costs are expensed in the period incurred . Patents, Deferred Costs and Amortization Patents consist of costs incurred to acquire issued patents. Amortization commences once a patent is granted. Costs incurred to acquire patents that have not been issued are reported as deferred costs. On April 3, 2018 U.S. Patent #9,934,786 entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols” was issued by the U.S patent and Trademark Office. Deferred costs of $4,575 were capitalized and amortization began in the period. The Company amortizes its patents over an estimated useful life of twenty years. Impairment and Disposal of Long-Lived Assets The Company evaluates the carrying value of its long-lived assets under the provisions of ASC 360-10 Property, Plant, and Equipment measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying value or fair value, less costs to sell. The Company’s last impairment analysis was completed effective December 31, 2019. Impairment recorded for each of the three months ended March 31, 2020 and 2019 was $-0-. Loss per Common Share The Company reports net loss per share using a dual presentation of basic and diluted loss per share. Basic net loss per share excludes the impact of common stock equivalents. Diluted net loss per share utilizes the average market price per share when applying the treasury stock method in determining common stock equivalents. At March 31, 2020 and 2019, there were no variances between the basic and diluted loss per share as there were no potentially dilutive securities outstanding. Fair Value of Financial Instruments The carrying amounts of cash and current liabilities approximate fair value because of the short-term maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment, and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. We do not hold or issue financial instruments for trading purposes, nor do we utilize derivative instruments. The FASB Accounting Standards Codification (ASC) clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. It also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability. Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement. |
Note 3. Intangible and Fixed As
Note 3. Intangible and Fixed Assets | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 3. Intangible and Fixed Assets | Note 3. Intangible and Fixed Assets Intangible Assets The Company monitors the anticipated outcome of legal actions, and if it determines that the success of the defense of a patent is probable, and so long as the Company believes that the future economic benefit of the patent will be increased, the Company capitalizes external legal costs incurred in the defense of the patent. Upon successful defense of litigation, the amounts previously capitalized are amortized over the remaining life of the patent. On July 7, 2009, U.S. Patent # 7,558,730, entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols,” was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning on July 7, 2009 and ending 20 years from the application date of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended September 30, 2009 and the Company began amortization. AVRS filed a Complaint in the United States District Court Northern District for Arizona (Case No. 2-18-cv-2083) on July 3, 2018, and alleges that Apple products infringe U.S. Patent No. 7,558,730 entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols” (the “‘730 Patent”). On May 24, 2011, U.S. Patent #7,949,534, entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols,” was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning May 24, 2011 and ending 20 years from the application date of the parent application (U.S. Patent #7,558,730) of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended June 30, 2011 and the Company began amortization. On March 6, 2012, U.S. Patent #8,131,557, entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols,” was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning March 6, 2012 and ending 20 years from the application date of the parent application (U.S. Patent #7,558,730) of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended March 31, 2012 and the Company began amortization. On July 30, 2013, U.S. Patent #8,498,871, entitled “Dynamic Speech Recognition and Transcription Among Users Having Heterogeneous Protocols,” was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning on July 30, 2013 and ending 20 years from the application date of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended September 30, 2013 and the Company began amortization. On September 22, 2015, U.S. Patent #9,142,217, entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols,” was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning September 22, 2015 and ending 20 years from the application date of the parent application (US Patent No. 7,558,730) of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended September 30, 2015 and the Company began amortization. On April 3, 2018, U.S. Patent #9,934,786, entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols,” was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning April 3, 2018 and ending 20 years from the application date of the parent application (U.S. Patent #7,558,730) of November 27, 2001 or November 27, 2021. The deferred costs were capitalized during the quarter ended June 30, 2018 and the Company began amortization. Amortization at December 31, 2019 is as follows: SCHEDULE OF INTANGIBLE ASSETS Ended December 31, 2019 U.S. Patent # Carrying Value Amortization Balance 7,558,730 $ 58,277 49,266 9,011 7,949,534 3,365 2,739 626 8,131,557 5,092 4,090 1,002 8,498,871 21,114 16,247 4,867 9,142,217 35,068 24,278 10,790 9,934,786 4,575 2,184 2391 $ 127,491 $ 98,804 $ 28,687 Amortization at March 31, 2020 is as follows: Ended March 31, 2020 U.S. Patent # Carrying Value Amortization Balance 7,558,730 $ 58,277 50,439 7,838 7,949,534 3,365 2,817 548 8,131,557 5,092 4,221 871 8,498,871 21,114 16,880 4,234 9,142,217 35,068 25,627 9,441 9,934,786 4,575 2,496 2,079 $ 127,491 $ 102,480 $ 25,011 Amortization expense totaled $3,676 for each of the three months ended March 31, 2020 and 2019. Estimated aggregate amortization expense for each of the next three years is as follows: SCHEDULE OF FUTURE AMORTIZATION Year ending March 31, 2020 11,026 2021 13,985 $ 25,011 |
Note 4. Related Party Transacti
Note 4. Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 4. Related Party Transactions | On September 24, 2018, Advanced Voice Recognition Systems, Inc., a Nevada corporation (“AVRS”, “we” or “us”), entered into Promissory Note with Walter Geldenhuys, who is our President, Chief Executive Officer and Chief Financial Officer, and who serves as a member of our Board of Directors. The Promissory Note in the principal amount of $9,000 was paid in full on December 27, 2019. On February 1, 2019, Walter Geldenhuys advanced the Company $5,000. On April 30, 2019 the Company repaid the $5,000 advance. On August 13, 2019, Walter Geldenhuys advanced the Company $4000. The Company repaid the advance on August 30, 2019. On January 31, 2020 the Company advanced Walter Geldenhuys $1,000. Mr. Geldenhuys repaid the advance on February 28, 2020. |
Note 5. Income Taxes
Note 5. Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 5. Income Taxes | Note 5. Income Taxes A reconciliation of the U.S. statutory federal income tax rate to the effective rate is as follows. INCOME TAXES March 31, 2020 December 31, 2019 U.S. federal statutory graduated rate * 21.00% 21.00% State income tax rate, net of federal benefit 0.00% 0.00% Contributed services 0.00% 0.00% Costs capitalized under Section 195 -21.00% -21.00% Effective rate 0.00% 0.00% The Company is considered a start-up company for income tax purposes. As of March 31, 2020, the Company had not commenced its trade operations, so all costs were capitalized under Section 195. Accordingly, the Company had no net operating loss carry forwards at March 31, 2020. |
Note 6. Concentration of Risk
Note 6. Concentration of Risk | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 6. Concentration of Risk | Note 6. Concentration of Risk Beginning March 31, 2010, through March 31, 2020, all noninterest-bearing transaction accounts are fully insured, regardless of the balance of $250,000, at all FDIC-insured institutions. March 31, 2020, the Company had cash balances at one FDIC insured financial institution of $1,730 in non-interest bearing accounts that were fully insured by the FDIC. |
Note 7. Note Payable & Accounts
Note 7. Note Payable & Accounts Payable | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 7. Note Payable & Accounts Payable | Note 7. Note Payable & Accounts Payable On April 20, 2015, Advanced Voice Recognition Systems, Inc. (AVRS), entered into a Material Letter Agreement with an unrelated third party AIP” in which they promise to pay to patent legal counsel funds to continue prosecuting Patents on behalf of AVRS. AVRS promises to pay AIP, or to such other holder of this promissory note (Note) as designate, the principal, together with a premium of ten percent (10%) of Principle and two percent (2%) of proceeds received by Company from a Monetization Event initiated by AIP. Interest was accrued and reported at March 31, 2020. On September 24, 2018, Advanced Voice Recognition Systems, Inc., a Nevada corporation (“AVRS”, “we” or “us”), entered into Promissory Note with Walter Geldenhuys, who is our President, Chief Executive Officer and Chief Financial Officer, and who serves as a member of our Board of Directors. The Promissory Note is effective as of September 24, 2018 in the principal amount of $9,000 with a maturity date of the Promissory Note September 24, 2019. Interest at 4% per annum was charged and accrued at December 31, 2018. The Company repaid $2,500 of the note on December 10, 2018. During 2019 the Company repaid $6,500, paying the note in full on December 27, 2019. Interest at 4% per annum was charged and accrued at December 31, 2019. Accrued interest of $254 was paid on February 28, 2020. On November 21, 2018 AVRS and Meyers & Associates entered into a Second Agreement to Amend Promissory Note. AVRS shall pay $20,000 on or before November 21, 2018, shall pay $1,500 on the first day of each month beginning January 1, 2019 and continuing through June 1, 2019 and shall pay all remaining principle and interest on July 1, 2019. On June 7, 2019 the final payment of $11,046.74 was made and the note was paid in full. A $1,500 gain from early extinguishment of Note Payable was reported as income on June 30, 2019. |
Note 8. Stockholder Equity _ (D
Note 8. Stockholder Equity / (Deficit) | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 8. Stockholder Equity / (Deficit) | Note 8. Stockholder Equity / (Deficit) The Company has issued shares of its common stock pursuant to certain agreements as described in Note 1. |
Note 9. Subsequent Events
Note 9. Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Notes | |
Note 9. Subsequent Events | Note 9. Subsequent Events The Company does not expect to be materially impacted by COVID-19. |
Note 2. Significant Accountin_2
Note 2. Significant Accounting Policies: Going Concern (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Going Concern | Going Concern The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Liabilities exceed assets and there is a capital deficiency of $224,754 and no significant revenues. The Company may be unable to continue as a going concern for a reasonable period of time. The financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis and ultimately to attain profitability. During the twelve months ended December 31, 2019 the Company received an aggregate of $69,002 from the sale of shares in private offerings of its common stock. During the three months ended March 31, 2020 the Company received an aggregate of $15,000 from the sale of shares in private offerings of its common stock. The Company’s current operations are related to patent monetization and filing of additional patents. The Company has entered into a letter agreement with Dominion Harbor Group, LLC to provide strategic advisory services to AVRS. Dominion has agreed to advanced costs up to an aggregate of $10,000,000. On June 28, 2017 the Company and Dominion agreed to terminate the August 20, 2015 Letter Agreement. The Company did not incur any material early termination penalties. In addition the Company has revised the Contingent Fee Agreement with Buether Joe & Carpenter, LLC which will represent AVRS in connection with investigating and asserting claims to the AVRS patents including licensing and litigation activities. Any and all advanced costs will only become liabilities if successful. On June 6, 2017 AVRS and BJC revised the Contingent Fee Agreement as it related to the termination of the August 20, 2015 Dominion Harbor Letter Agreement. There is no guarantee that AVRS will be able to provide the capital required for the Company to continue as a going concern. |
Note 2. Significant Accountin_3
Note 2. Significant Accounting Policies: Use of Estimates (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Note 2. Significant Accountin_4
Note 2. Significant Accounting Policies: Cash and Cash Equivalents (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid debt instruments with original maturities of three months or less when acquired to be cash equivalents. The Company had cash at March 31, 2020 of $1,730, $6,241 at December 31, 2019. No amounts resulted from cash equivalents. |
Note 2. Significant Accountin_5
Note 2. Significant Accounting Policies: Financial Instruments (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Financial Instruments | Financial Instruments The carrying amounts of cash, receivables and current liabilities approximate fair value due to the short-term maturity of the instruments. |
Note 2. Significant Accountin_6
Note 2. Significant Accounting Policies: Fixed Assets (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Fixed Assets | Fixed Assets Fixed assets are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets, ranging from three to five years. Expenditures for additions and improvements are capitalized, while repairs and maintenance costs are expensed as incurred. The cost and related accumulated depreciation of property and equipment sold or otherwise disposed of are removed from the accounts and any gain or loss is recorded in the year of disposal. |
Note 2. Significant Accountin_7
Note 2. Significant Accounting Policies: Income Taxes (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Income Taxes | Income Taxes Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the recorded book basis and the tax basis of assets and liabilities for financial and income tax reporting. Deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future taxable income and tax credits that are available to offset future federal income taxes. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on the Company’s financial condition, results of operations, or cash flow. Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740. |
Note 2. Significant Accountin_8
Note 2. Significant Accounting Policies: Research and Development Costs (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Research and Development Costs | Research and Development Costs Research and development costs are expensed in the period incurred |
Note 2. Significant Accountin_9
Note 2. Significant Accounting Policies: Patents, Deferred Costs and Amortization (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Patents, Deferred Costs and Amortization | Patents, Deferred Costs and Amortization Patents consist of costs incurred to acquire issued patents. Amortization commences once a patent is granted. Costs incurred to acquire patents that have not been issued are reported as deferred costs. On April 3, 2018 U.S. Patent #9,934,786 entitled “Speech Recognition and Transcription Among Users Having Heterogeneous Protocols” was issued by the U.S patent and Trademark Office. Deferred costs of $4,575 were capitalized and amortization began in the period. The Company amortizes its patents over an estimated useful life of twenty years. |
Note 2. Significant Accounti_10
Note 2. Significant Accounting Policies: Impairment and Disposal of Long-Lived Assets (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Impairment and Disposal of Long-Lived Assets | Impairment and Disposal of Long-Lived Assets The Company evaluates the carrying value of its long-lived assets under the provisions of ASC 360-10 Property, Plant, and Equipment measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying value or fair value, less costs to sell. The Company’s last impairment analysis was completed effective December 31, 2019. Impairment recorded for each of the three months ended March 31, 2020 and 2019 was $-0-. |
Note 2. Significant Accounti_11
Note 2. Significant Accounting Policies: Loss per Common Share (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Loss per Common Share | Loss per Common Share The Company reports net loss per share using a dual presentation of basic and diluted loss per share. Basic net loss per share excludes the impact of common stock equivalents. Diluted net loss per share utilizes the average market price per share when applying the treasury stock method in determining common stock equivalents. At March 31, 2020 and 2019, there were no variances between the basic and diluted loss per share as there were no potentially dilutive securities outstanding. |
Note 2. Significant Accounti_12
Note 2. Significant Accounting Policies: Fair Value of Financial Instruments (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Policies | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of cash and current liabilities approximate fair value because of the short-term maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment, and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. We do not hold or issue financial instruments for trading purposes, nor do we utilize derivative instruments. The FASB Accounting Standards Codification (ASC) clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. It also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability. Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement. |
Note 3. Intangible and Fixed _2
Note 3. Intangible and Fixed Assets: Schedule of Amortization of Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Tables/Schedules | |
Schedule of Amortization of Intangible Assets | SCHEDULE OF INTANGIBLE ASSETS Ended December 31, 2019 U.S. Patent # Carrying Value Amortization Balance 7,558,730 $ 58,277 49,266 9,011 7,949,534 3,365 2,739 626 8,131,557 5,092 4,090 1,002 8,498,871 21,114 16,247 4,867 9,142,217 35,068 24,278 10,790 9,934,786 4,575 2,184 2391 $ 127,491 $ 98,804 $ 28,687 Amortization at March 31, 2020 is as follows: Ended March 31, 2020 U.S. Patent # Carrying Value Amortization Balance 7,558,730 $ 58,277 50,439 7,838 7,949,534 3,365 2,817 548 8,131,557 5,092 4,221 871 8,498,871 21,114 16,880 4,234 9,142,217 35,068 25,627 9,441 9,934,786 4,575 2,496 2,079 $ 127,491 $ 102,480 $ 25,011 |
Note 3. Intangible and Fixed _3
Note 3. Intangible and Fixed Assets: Schedule of Future Amortization (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Tables/Schedules | |
Schedule of Future Amortization | SCHEDULE OF FUTURE AMORTIZATION Year ending March 31, 2020 11,026 2021 13,985 $ 25,011 |
Note 5. Income Taxes_ Income Ta
Note 5. Income Taxes: Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Tables/Schedules | |
Income Taxes | INCOME TAXES March 31, 2020 December 31, 2019 U.S. federal statutory graduated rate * 21.00% 21.00% State income tax rate, net of federal benefit 0.00% 0.00% Contributed services 0.00% 0.00% Costs capitalized under Section 195 -21.00% -21.00% Effective rate 0.00% 0.00% |
Note 3. Intangible and Fixed _4
Note 3. Intangible and Fixed Assets: Schedule of Amortization of Intangible Assets (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Carrying Value | $ 25,011 | $ 28,687 |
Balance | 25,011 | |
U.S. Patent # 7,558,730 | ||
Carrying Value | 58,277 | 58,277 |
Amortization | 50,439 | 49,266 |
Balance | 7,838 | 9,011 |
U.S. Patent # 7,949,534 | ||
Carrying Value | 3,365 | 3,365 |
Amortization | 2,817 | 2,739 |
Balance | 548 | 626 |
U.S. Patent # 8,131,557 | ||
Carrying Value | 5,092 | 5,092 |
Amortization | 4,221 | 4,090 |
Balance | 871 | 1,002 |
U.S. Patent # 8,498,871 | ||
Carrying Value | 21,114 | 21,114 |
Amortization | 16,880 | 16,247 |
Balance | 4,234 | 4,867 |
U.S. Patent # 9,142,217 | ||
Carrying Value | 35,068 | 35,068 |
Amortization | 25,627 | 24,278 |
Balance | 9,441 | 10,790 |
U.S. Patent # 9,934,786 | ||
Carrying Value | 4,575 | 4,575 |
Amortization | 2,496 | 2,184 |
Balance | $ 2,079 | $ 2,391 |
Note 3. Intangible and Fixed _5
Note 3. Intangible and Fixed Assets: Schedule of Future Amortization (Details) | Mar. 31, 2020USD ($) |
Details | |
2020 | $ 11,026 |
2021 | 13,985 |
Balance | $ 25,011 |
Note 4. Related Party Transac_2
Note 4. Related Party Transactions (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Details | ||
Compensation | $ 7,794 | $ 69 |
Note 6. Concentration of Risk (
Note 6. Concentration of Risk (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Details | ||||
Cash and cash equivalents | $ 1,730 | $ 6,241 | $ 8,861 | $ 17,583 |