Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2017shares | |
Details | |
Registrant Name | Vanc Pharmaceuticals Inc. |
Registrant CIK | 1,355,736 |
SEC Form | 20-F |
Period End date | Dec. 31, 2017 |
Fiscal Year End | --12-31 |
Trading Symbol | vanc |
Number of common stock shares outstanding | 27,860,623 |
Filer Category | Non-accelerated Filer |
Current with reporting | Yes |
Voluntary filer | No |
Well-known Seasoned Issuer | No |
Amendment Flag | false |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | FY |
Contained File Information, File Number | 000-51848 |
Entity Home Country ISO Code | CA |
Entity Address, Address Line One | Suite 810 - 789 West Pender Street |
Entity Address, City or Town | Vancouver |
Entity Address, State or Province | British Columbia |
Entity Address, Postal Zip Code | V6C 1H2 |
Entity Address, Country | CANADA |
Contact Personnel Name | Bob Rai |
City Area Code | 604 |
Local Phone Number | 687-2038 |
Contact Personnel Email Address | brai@vancpharm.com |
Entity Address, Address Description | Address of principal executive offices |
Entity Reporting Currency ISO Code | CAD |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 | |
Current Assets | |||
Cash and cash equivalents | $ 559,733 | $ 427,482 | |
Accounts receivable | [1] | 450,437 | 719,405 |
Prepaid expenses and deposits | [2] | 452,953 | 41,144 |
Inventories | [3] | 211,225 | 1,056,287 |
Current assets | 1,674,348 | 2,244,318 | |
Equipment | [4] | 89,721 | 31,017 |
Intangible assets | [5] | 1,136,117 | 0 |
Total Assets | 2,900,186 | 2,275,335 | |
Current Liabilities | |||
Accounts payable and accrued liabilities | [6] | 302,089 | 357,342 |
Asset acquisition liability | [7] | 100,000 | 0 |
Liabilities | 402,089 | 357,342 | |
SHAREHOLDERS' EQUITY | |||
Share capital | [8] | 18,340,491 | 16,320,006 |
Shares to be issued | [7] | 973,333 | 0 |
Reserves | [8] | 4,275,882 | 3,952,879 |
Deficit | (21,091,609) | (18,354,892) | |
Equity | 2,498,097 | 1,917,993 | |
Total Liabilities and Shareholders' Equity | $ 2,900,186 | $ 2,275,335 | |
[1] | Note 5 | ||
[2] | Note 6 | ||
[3] | Note 7 | ||
[4] | Note 8 | ||
[5] | Note 9 | ||
[6] | Note 10 | ||
[7] | Note 4 | ||
[8] | Note 11 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss | 6 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2015$ / shares | Dec. 31, 2015CAD ($)shares | Dec. 31, 2017$ / shares | Dec. 31, 2017CAD ($)shares | Dec. 31, 2016$ / shares | Dec. 31, 2016CAD ($)shares | Jun. 30, 2015$ / shares | Jun. 30, 2015CAD ($)shares | ||
Revenue | |||||||||
Sales | $ 561,344 | $ 1,617,083 | $ 2,461,933 | $ 5,713 | |||||
Marketing, promotional incentives | (410,590) | (1,079,369) | (1,448,243) | 0 | |||||
Net sales | 150,754 | 537,714 | 1,013,690 | 5,713 | |||||
Cost of Sales | 64,290 | 290,871 | 710,912 | 2,491 | |||||
Gross Profit | 86,464 | 246,843 | 302,778 | 3,222 | |||||
Expenses | |||||||||
Product registration and development | [1] | 930 | 242,303 | 208,784 | 56,143 | ||||
Selling and marketing | [2] | 103,123 | 696,161 | 663,822 | 9,858 | ||||
General and administrative | [3] | 551,723 | 1,022,563 | 840,792 | 751,774 | ||||
Share-based compensation | [4] | 630,401 | 311,389 | 922,922 | 915,211 | ||||
Expenses, by nature | 1,286,177 | 2,272,416 | 2,636,320 | 1,732,986 | |||||
Other income (expense) | |||||||||
Finance costs | 0 | (262) | 0 | 0 | |||||
Interest income | 175 | 0 | 8,480 | 126 | |||||
Other income | 9,124 | 35,095 | 2,952 | 4,990 | |||||
Write-down of inventories | [5] | 0 | (745,977) | (291,794) | 0 | ||||
Impairment of intellectual property | 0 | 0 | 0 | (476,000) | |||||
Net loss and comprehensive loss for the period | $ (1,190,414) | $ (2,736,717) | $ (2,613,904) | $ (2,200,648) | |||||
Basic and Diluted Loss Per Share | $ / shares | $ (0.09) | $ (0.15) | $ (0.18) | $ (0.19) | |||||
Weighted Average Number of Common Shares Outstanding | shares | 13,961,051 | 18,393,169 | 14,907,103 | 11,818,217 | |||||
[1] | Note 12 | ||||||||
[2] | Note 13 | ||||||||
[3] | Note 14 | ||||||||
[4] | Note 11 | ||||||||
[5] | Note 7 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - CAD ($) | Issued capital | Shares to be Issued | Warrant Reserve | Option Reserve | Deficit | Total |
Equity at beginning of period at Jun. 30, 2014 | $ 10,995,282 | $ 0 | $ 85,772 | $ 1,931,969 | $ (12,349,926) | $ 663,097 |
Number of shares outstanding at beginning of period at Jun. 30, 2014 | 9,191,759 | |||||
Issue of equity | $ 1,141,100 | 0 | 0 | 0 | 0 | 1,141,100 |
Shares issued for Cash | 1,901,833 | |||||
For exercise of options | $ 531,060 | 0 | 0 | (274,560) | 0 | 256,500 |
Shares issued for Exercise of Options | 406,250 | |||||
For exercise of warrants | $ 2,957,245 | 0 | (84,267) | 0 | 0 | 2,872,978 |
Shares issued for Exercise of Warrants | 2,304,928 | |||||
Share issuance costs | $ (362,330) | 0 | 67,553 | 0 | 0 | (294,777) |
Increase (decrease) through share-based payment transactions, equity | 0 | 0 | 0 | 915,211 | 0 | 915,211 |
Net loss and comprehensive loss for the period | $ 0 | 0 | 0 | 0 | (2,200,648) | (2,200,648) |
Number of shares outstanding at end of period at Jun. 30, 2015 | 13,804,770 | |||||
Equity at end of period at Jun. 30, 2015 | $ 15,262,357 | 0 | 69,058 | 2,572,620 | (14,550,574) | 3,353,461 |
For exercise of options | $ 48,975 | 0 | 0 | (29,475) | 0 | 19,500 |
Shares issued for Exercise of Options | 37,500 | |||||
For exercise of warrants | $ 463,813 | 0 | (29,786) | 0 | 0 | 434,027 |
Shares issued for Exercise of Warrants | 434,027 | |||||
Increase (decrease) through share-based payment transactions, equity | $ 0 | 0 | 0 | 630,401 | 0 | 630,401 |
Net loss and comprehensive loss for the period | $ 0 | 0 | 0 | 0 | (1,190,414) | (1,190,414) |
Number of shares outstanding at end of period at Dec. 31, 2015 | 14,276,297 | |||||
Equity at end of period at Dec. 31, 2015 | $ 15,775,145 | 0 | 39,272 | 3,173,546 | (15,740,988) | 3,246,975 |
For exercise of options | $ 359,863 | 0 | 0 | (166,863) | 0 | 193,000 |
Shares issued for Exercise of Options | 400,000 | |||||
For exercise of warrants | $ 184,998 | 0 | (15,998) | 0 | 0 | 169,000 |
Shares issued for Exercise of Warrants | 325,000 | |||||
Change of warrants term | $ 0 | 0 | 186,500 | 0 | 0 | 186,500 |
Increase (decrease) through share-based payment transactions, equity | 0 | 0 | 0 | 736,422 | 0 | 736,422 |
Net loss and comprehensive loss for the period | $ 0 | 0 | 0 | 0 | (2,613,904) | (2,613,904) |
Number of shares outstanding at end of period at Dec. 31, 2016 | 15,001,297 | |||||
Equity at end of period at Dec. 31, 2016 | $ 16,320,006 | 0 | 209,774 | 3,743,105 | (18,354,892) | 1,917,993 |
Issue of equity | $ 1,587,799 | 0 | 0 | 0 | 0 | 1,587,799 |
Shares issued for Cash | 10,585,326 | |||||
For exercise of warrants | $ 454,800 | 0 | 0 | 0 | 0 | 454,800 |
Shares issued for Exercise of Warrants | 2,274,000 | |||||
Share issuance costs | $ (22,114) | 0 | 11,614 | 0 | 0 | (10,500) |
Acquisition of HealthTab Inc. | 0 | 973,333 | 0 | 0 | 0 | 973,333 |
Increase (decrease) through share-based payment transactions, equity | 0 | 0 | 0 | 311,389 | 0 | 311,389 |
Net loss and comprehensive loss for the period | $ 0 | 0 | 0 | 0 | (2,736,717) | (2,736,717) |
Number of shares outstanding at end of period at Dec. 31, 2017 | 27,860,623 | |||||
Equity at end of period at Dec. 31, 2017 | $ 18,340,491 | $ 973,333 | $ 221,388 | $ 4,054,494 | $ (21,091,609) | $ 2,498,097 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - CAD ($) | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | ||
Operating Activities | |||||
Net loss and comprehensive loss for the period | $ (1,190,414) | $ (2,736,717) | $ (2,613,904) | $ (2,200,648) | |
Adjustments to reconcile profit (loss) | |||||
Adjustments for amortisation expense | 8,513 | 13,854 | 14,668 | 13,900 | |
Adjustments for share-based payments | 630,401 | 311,389 | 922,922 | 915,211 | |
Write-downs (reversals of write-downs) of inventories | [1] | 0 | 745,977 | 291,794 | 0 |
Impairment of intellectual property | 0 | 0 | 0 | 476,000 | |
Changes in Non-Cash Working Capital Items | |||||
Adjustments for decrease (increase) in trade and other receivables | (86,656) | 268,968 | (606,207) | (10,913) | |
Adjustment for change in Prepaid expenses and deposits | 323,222 | (411,809) | 22,753 | (384,619) | |
Adjustments for decrease (increase) in inventories | (784,564) | 99,085 | (207,228) | (356,289) | |
Adjustment for change in Accounts payable and Accrued liabilities | 59,106 | (58,043) | 111,112 | 62,781 | |
Net cash used in operating activities | (1,040,392) | (1,767,296) | (2,064,090) | (1,484,577) | |
Investing Activities | |||||
Purchase of equipment | 0 | (3,784) | (6,340) | (30,846) | |
Acquisition, net of cash received | 0 | (128,768) | 0 | 0 | |
Net cash used in investing activities | 0 | (132,552) | (6,340) | (30,846) | |
Financing Activities | |||||
Proceeds from issuance of shares, net | 0 | 1,577,299 | 0 | 846,323 | |
Proceeds from exercise of options | 19,502 | 0 | 193,000 | 256,500 | |
Proceeds from exercise of warrants | 434,025 | 454,800 | 169,000 | 2,872,978 | |
Repayment of promissory notes | 0 | 0 | 0 | (32,978) | |
Net cash provided by financing activities | 453,527 | 2,032,099 | 362,000 | 3,942,823 | |
Increase (Decrease) in Cash | (586,865) | 132,251 | (1,708,430) | 2,427,400 | |
Cash and cash equivalents at beginning of period | 2,722,777 | 427,482 | 2,135,912 | 295,377 | |
Cash and cash equivalents at end of period | $ 2,135,912 | $ 559,733 | $ 427,482 | $ 2,722,777 | |
[1] | Note 7 |
Components of Cash and Cash Equ
Components of Cash and Cash Equivalents - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2015 |
Cash and Cash Equivalents Consist of: | ||||
Cash | $ 549,678 | $ 97,372 | $ 385,912 | $ 711,277 |
Guaranteed Investment Certificates | 10,055 | 330,110 | 1,750,000 | 2,011,500 |
Cash and cash equivalents | $ 559,733 | $ 427,482 | $ 2,135,912 | $ 2,722,777 |
1. NATURE OF OPERATIONS AND GOI
1. NATURE OF OPERATIONS AND GOING CONCERN | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
1. NATURE OF OPERATIONS AND GOING CONCERN | 1. NATURE OF OPERATIONS AND GOING CONCERN VANC Pharmaceuticals Inc. (the “Company”) was incorporated under the Company Act British Columbia on May 30, 2000 . The Company’s common shares trade on the TSX Venture Exchange (the “Exchange”) under symbol “ NPH ” and are quoted on the OTCIQ Market as “ NUVPF ”. The Company’s registered office is at 810 - 789 West Pender Street , Vancouver , British Columbia , V6C 1H2 . The Company’s operations consist of the marketing and distribution of generic and over-the-counter (“OTC”) pharmaceuticals. The consolidated financial statements have been prepared on the basis of accounting principles applicable to a going concern, which assumes that the Company will continue in operations for the foreseeable future and be able to realize assets and satisfy liabilities in the normal course of business. The Company has always experienced net losses (2017 - $2,736,717 ) and negative operating cash flows. Operations have been funded by the issuance of share capital. This material uncertainty casts substantial doubt on the Company’s ability to continue as a going concern. The continuation of the Company as a going concern is dependent upon its ability to generate profitable operations or raise additional financing to cover ongoing cash requirements. The consolidated financial statements do not reflect any adjustments, which could be material, to the carrying values of assets and liabilities, which may be required should the Company be unable to continue as a going concern. Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 $ $ $ $ Comprehensive loss (2,736,717) (2,613,904) (1,190,414) (2,200,648) Deficit (21,091,609) (18,354,892) (15,740,988) (14,550,574) Working capital 1,272,259 1,886,976 3,207,630 3,305,603 Economic dependence The Company currently has licensing arrangements with three manufacturers to purchase, distribute and commercialize their drug molecules in Canada. The Company derives over 85% of its gross sales from four distributors for the year ended December 31, 2017 (2016 - 70%, six months ended December 31, 2015 – 95%). The ability of the Company to sustain operations is partially dependent on the continued operation of these distributors. The launch of new OTC products diversifies the Company’s portfolio and reduces the risk of the economic dependence. |
2. BASIS OF PRESENTATION
2. BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
2. BASIS OF PRESENTATION | 2. BASIS OF PRESENTATION a) Statement of Compliance and basis of presentation The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”). The consolidated financial statements were approved by the Board of Directors on May 15, 2018. b) Basis of presentation The consolidated financial statements of the Company have been prepared on an accrual basis and are based on historical costs, modified where applicable. The significant accounting policies are presented in Note 3 and have been consistently applied in each of the period presented. The consolidated financial statements are presented in Canadian dollars, which is also the Company’s functional currency, unless other indicated. The preparation of consolidated financial statements in accordance with IFRS requires the Company’s management to make estimates, judgments and assumptions that affect amounts reported in the consolidated financial statements and accompanying notes to the consolidated financial statements. The areas involving a higher degree of judgment and complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 3(k). Actual results might differ from these estimates. The Company’s management reviews these estimates and underlying judgments on an ongoing basis, based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for prospectively in the year in which the estimates are revised. c) Basis of consolidation Consolidated financial statements include the assets, liabilities and results of operations of all entities controlled by the Company. Inter-company balances and transactions, including unrealized income and expenses arising from inter-company transactions, are eliminated in preparing the Company’s the consolidated financial statements. Where control of an entity is obtained during a financial year, its results are included in the consolidated statements of comprehensive loss from the date on which control commences. Where control of an entity ceases during a financial year, its results are included for that part of the year during which control exists. These consolidated financial statements include the accounts of the Company and its controlled wholly owned subsidiaries, Vanc Marine Pharmaceuticals Inc. and HealthTab Inc. d) Accounting standards issued, but not yet in effective The following is an overview of accounting standard changes that the Company will be required to adopt in future years. IFRS 9 Financial instruments On July 24, 2014, the IASB issued the complete IFRS 9, Financial Instruments (“IFRS 9”). IFRS 9 introduces new requirements for the classification and measurements of financial assets. Under IFRS 9, financial assets are classified and measured based on the business model in which they are held and the characteristics of their contractual cash flows. The standard introduces additional changes relating to financial liabilities and amends the impairment model by introducing a new “expected credit loss” model for calculating impairment. It also includes a new general hedge accounting standard which aligns hedge accounting ore closely with risk management. IFRS 9 is effective for reporting periods beginning on or after January 1, 2018 and must be applied retrospectively with some exemptions. Management anticipates that this standard will be adopted in the Company’s consolidated financial statements for the period beginning January 1, 2018 and will have an insignificant effect on its consolidated financial statements other than increased note disclosure. IFRS 15 Revenue from contracts with customers On May 28, 2014 the IASB issued IFRS 15, Revenue from Contracts with Customers (“IFRS 15”). IFRS 15 deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. Revenue is recognized when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the goods or services. The standard replaces IAS 18 Revenue and IAS 11 Construction contracts and related interpretations. IFRS 15 is effective for reporting periods beginning on or after January 1, 2018. Management anticipates that this standard will be adopted in the Company’s consolidated financial statements for the period beginning January 1, 2018 and will have an insignificant effect on its consolidated financial statements. IFRS 16 Leases On January 13, 2016, the International Accounting Standards Board published a new standard, IFRS 16, Leases, eliminating the current dual accounting model for lessees, which distinguishes between on-balance sheet finance leases and off-balance sheet operating leases. Under the new standard, a lease becomes an on-balance sheet liability that attracts interest, together with a new right-of-use asset. In addition, lessees will recognize a front-loaded pattern of expense for most leases, even when cash rentals are constant. IFRS 16 is effective for reporting periods beginning on or after January 1, 2019. The Company is in the process of assessing the impact of this pronouncement. The extent of the impact has not yet been determined. Other new standards or amendments are either not applicable or not expected to have a significant impact on the Company’s consolidated financial statements. |
3. SUMMARY OF SIGNIFICANT ACCOU
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a) Revenue recognition Revenues are recognized when the risks and rewards of ownership have passed to the customer based on the terms of the sale, collection of the relevant receivable is probable, evidence of an arrangement exists and the sales price is fixed or determinable. Risks and rewards of ownership pass to the customer upon successful completion of shipment of pharmaceuticals. Provisions for sales discounts and returns are made on a per sale basis based on contractual and historical information. b) Foreign currency These consolidated financial statements are presented in Canadian dollars, which is also the functional currency of the Company and its subsidiaries. Foreign currency transactions are translated into the functional currency of the respective entity, using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the remeasurement of monetary items at year-end exchange rates are recognized in profit or loss. Non-monetary items measured at historical cost are translated using the exchange rates at the date of the transaction and are not retranslated. Non-monetary items measured at fair value are translated using the exchange rates at the date when fair value was determined. c) Cash equivalents Cash equivalents d) Inventory Inventories consist of raw materials comprising the ingredients used to manufacture OTC pharmaceuticals, as well as the packaging for these products, and finished goods comprising Canadian generic pharmaceuticals. All inventories are recorded at the lower of cost on a weighted average basis and net realizable value. The stated value of all inventories includes purchase, shipping and freight, and quality control testing. A regular review is undertaken to determine the extent of any provision for obsolescence. e) Equipment Equipment is stated at historical cost less accumulated amortization and accumulated impairment losses. Amortization is calculated on a declining balance method over their estimated useful lives. The CompanyÂ’s equipment, which consists of computer, furniture, equipment and computer systems are amortized at 30%, and the straight-line method for leasehold improvements over the term of the lease. f) Intangible assets All intangible assets acquired separately by the Company are recorded at cost on the date of acquisition. Intangible assets that have indefinite lives are measured at cost less accumulated impairment losses. Intangible assets that have finite useful lives are measured at cost less accumulated amortization and accumulated impairment losses. Intangible assets comprise of intellectual property, trademarks and web domains, which are amortized on a straight-line basis over 3 years. Amortization rates are reviewed annually to ensure they are aligned with estimates of remaining economic useful lives of the associated intangible assets. g) Share-based payments The Company operates an incentive share purchase option plan. Share-based payments to employees are h) Share capital Proceeds from the exercise of stock options and warrants are recorded as share capital in the amount for which the option or warrant enabled the holder to purchase a share in the Company. Any previously recorded share-based payment included in the reserves account is transferred to share capital on exercise of options. Share capital issued for non-monetary consideration is valued at the closing market price at the date of issuance. The proceeds from issuance of units are allocated between common shares and warrants based on the residual method. Under this method, the proceeds are allocated first to share capital based on the fair value of the common shares at the time the units are priced and any residual value is allocated to the warrants reserve. Consideration received for the exercise of warrants is recorded in share capital, and any related amount recorded in warrants reserve is transferred to share capital. i) Loss per share Basic loss per share is calculated by dividing the net loss available to common shareholders by the weighted average number of shares outstanding during the year. Diluted earnings per share reflect the potential dilution of securities that could share in earnings of an entity. In a loss year, potentially dilutive common shares are excluded from the loss per share calculation as the effect would be anti-dilutive. Basic and diluted loss per share are the same for the periods presented. j) Income taxes Income tax expense, consisting of current and deferred tax expense, is recognized in the statements of operations. Current tax expense is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at period-end, adjusted for amendments to tax payable with regard to previous years. Deferred tax assets and liabilities and the related deferred income tax expense or recovery are recognized for deferred tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income (loss) in the period that substantive enactment occurs. A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. To the extent that the Company does not consider it probable that a deferred tax asset will be recovered, the deferred tax asset is reduced. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis. k) Financial Instruments The Company classifies its financial instruments in the following categories: at fair value through profit or loss, loans and receivables, held-to-maturity investments, available-for-sale and other financial liabilities. The classification depends on the purpose for which the financial instruments were acquired. Management determines the classification of its financial instruments at initial recognition. All financial assets and liabilities are recorded at fair value at initial recognition. The Company classifies its financial instruments as follows: Cash and equivalents Fair value through profit or loss Accounts receivable Loans and receivables Accounts payable and accrued liabilities Other financial liability Asset acquisition liability Other financial liability Financial assets are classified at fair value through profit or loss when they are either held for trading for the purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being included in profit or loss. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortized cost. They are included in current assets, except for maturities greater than twelve months after the end of the reporting period. These are classified as non-current assets. Other financial liabilities (excluding financial guarantees) are subsequently measured at amortized cost. At each reporting date, the Company assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a significant and prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen. l) Impairment of equipment and intangible assets At the end of each reporting period, the Company reviews the carrying amounts of its equipment and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. Individual assets are grouped together as a cash generating unit for impairment assessment purposes at the lowest level at which there are identifiable cash flows that are independent from other group assets If any such indication of impairment exists, the Company makes an estimate of its recoverable amount. The recoverable amount is the higher of fair value less costs to sell and value in use. Where the carrying amount of a cash generating unit exceeds its recoverable amount, the cash generating unit is considered impaired and is written down to its recoverable amount. In assessing the value in use, the estimated future cash flows are adjusted for the risks specific to the cash generating unit and are discounted to their present value with a discount rate that reflects the current market indicators. Where an impairment loss subsequently reverses, the carrying amount of the cash generating unit is increased to the revised estimate of its recoverable amount, to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the cash generating unit in prior years. A reversal of an impairment loss is recognized as income immediately. m) Significant accounting estimates and judgments Significant estimates used in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements are as follows: Inventory valuation The Company estimates the net realizable values of inventories, taking into account the most reliable evidence available at each reporting date. The future realization of these inventories may be affected by regulatory changes or other market-driven changes that may reduce future selling prices. In determining net realizable value, the Company considers such factors as turnover, historical experience, expiry dates and shelf life of the products. A change to these assumptions could impact the CompanyÂ’s inventory valuation and gross margin. The Company attempts to sell products with short shelf life with significant rebates. Any unsold products with short shelf life and expired products are written-off. Revenue recognition Revenues are recognized when the risks and rewards of ownership have passed to the customer based on the terms of the sale, collection of the relevant receivable is probable, evidence of an arrangement exists and the sales price is fixed or determinable. Risks and rewards of ownership pass to the customer upon successful completion of shipment of pharmaceuticals. Provisions for sales discounts, incentives, and rebates and returns are made based upon historical experiences. Useful lives of depreciable assets The Company reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected utilization of the assets. Uncertainties in these estimates relate to technical obsolescence that may change the utilization of certain equipment. Intellectual property The recoverability of the carrying value of the intellectual property is dependent on successful development and commercial stage to the point where revenue is possible. The carrying value of these assets is reviewed by management when events or circumstances indicate that its carrying value may not be recovered. If impairment is determined to exist, an impairment loss is recognized to the extent that the carrying amount exceeds the recoverable amount. Share-based payments The Company grants share-based awards to certain directors, officers, employees, consultants and other eligible persons. For equity-settled awards, the fair value is charged to the statement of operations and comprehensive loss and credited to the reserves over the vesting period using the graded vesting method, after adjusting for the estimated number of awards that are expected to vest. The fair value of equity-settled awards is determined at the date of the grant using the Black-Scholes option pricing model. For equity-settled awards to non-employees, the fair value is measured at each vesting date. The estimate of warrant and option valuation also requires determining the most appropriate inputs to the valuation model, including the volatility, expected life of warrants and options, risk free interest rate and dividend yield. Changes in these assumptions can materially affect the fair value estimate, and therefore the existing models do not necessarily provide a reliable measure of the fair value of the CompanyÂ’s options and warrants issued. Management must also make significant judgments or assessments as to how financial assets and liabilities are categorized. Significant judgements Significant judgments used in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements are as follows: Tax interpretations, regulations and legislation in the various jurisdictions in which the Company operates are subject to change. The determination of income tax expense and deferred tax involves judgment and estimates as to the future taxable earnings, expected timing of reversals of deferred tax assets and liabilities, and interpretations of laws in the countries in which the Company operates. The Company is subject to assessments by tax authorities who may interpret the tax law differently. Changes in these estimates may materially affect the final amount of deferred taxes or the timing of tax payments. |
4. ACQUISITION
4. ACQUISITION | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
4. ACQUISITION | 4. ACQUISITION On December 28, 2017, the Company completed the acquisition of all the common shares of HealthTab Inc. (“HealthTab”). HealthTab’s primary asset is intellectual property and certain trademarks and web domains related to the design of the HealthTab system, being a lab-accurate, point of care testing platform. Under the share purchase agreement, the consideration paid by the Company is as follows: · · · · · · · This acquisition has been accounted for as an acquisition of assets and liabilities as HealthTab did not meet the definition of a business under IFRS 3, Business Combinations. The shares to be issued have been valued based on the Company’s share price on the acquisition. Due to the uncertainty associated with future revenue derived from HealthTab, the Company has estimated the 2019 and 2020 share issuances to be $100,000 each. The aggregate fair values of assets acquired and liabilities assumed were as follows on the acquisition date, December 28, 2017: $ Purchase consideration: Cash 100,000 Asset acquisition liability 100,000 Shares to be issued 973,333 Acquisition costs 28,806 1,202,139 Net assets acquired: Cash 38 Equipment 64,608 Intangible assets 1,140,283 Accounts payable and accrued liabilities (2,790) Total net assets acquired 1,202,139 |
5. ACCOUNTS RECEIVABLE
5. ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
5. ACCOUNTS RECEIVABLE | 5. ACCOUNTS RECEIVABLE The CompanyÂ’s accounts receivable consists of the following: December 31, 2017 December 31, 2016 $ $ Trade receivables 425,284 668,917 GST receivable 24,995 48,242 Employee advances 158 2,246 450,437 719,405 |
6. PREPAID EXPENSES AND DEPOSIT
6. PREPAID EXPENSES AND DEPOSITS | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
6. PREPAID EXPENSES AND DEPOSITS | 6. PREPAID EXPENSES AND DEPOSITS The closing balance consists of the deposits for inventory purchases and prepaid expense to vendors of $437,137 (2016 – 26,198), office rent of $8,420 (2016 - $8,420) and prepaid business insurance of $7,396 (2016 - $6,526). |
7. INVENTORIES
7. INVENTORIES | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
7. INVENTORIES | 7. INVENTORIES At December 31, 2017, the CompanyÂ’s inventory consists of the following: December 31, 2017 December 31, 2016 $ $ Work in process 39,845 5,987 Finished goods 171,380 1,050,300 211,225 1,056,287 Inventories expensed to cost of sales during the year ended December 31, 2017 are $255,253 (2016 - $688,624). During the year ended December 31, 2017, the Company recorded a write-down of inventory of $745,977 (2016 - $291,794). |
8. EQUIPMENT
8. EQUIPMENT | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
8. EQUIPMENT | 8. EQUIPMENT Office Furniture and Equipment Computer equipment and Systems Laboratory Equipment Leasehold Improvements Total Cost $ $ $ $ $ Balance, December 31, 2015 1,702 - 36,822 24,182 62,706 Additions 369 3,898 2,074 - 6,341 Balance, December 31, 2016 2,071 3,898 38,896 24,182 69,047 Acquired assets 1,636 62,972 - - 64,608 Additions 3,784 - - - 3,784 Balance, December 31, 2017 7,491 66,870 38,896 24,182 137,439 Accumulated Amortization Balance, December 31, 2015 759 - 12,449 10,153 23,361 Amortization 330 1,151 7,085 6,103 14,669 Balance, December 31, 2016 1,089 1,151 19,534 16,256 38,030 Amortization 523 979 5,808 2,378 9,688 Balance, December 31, 2017 1,612 2,130 25,342 18,634 47,718 Carrying value As at December 31, 2016 982 2,747 19,362 7,926 31,017 As at December 31, 2017 5,879 64,740 13,554 5,548 89,721 |
9. INTANGIBLE ASSETS
9. INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
9. INTANGIBLE ASSETS | 9. INTANGIBLE ASSETS Cost $ Balance, December 31, 2016 - Acquired assets 1,140,283 Balance, December 31, 2017 1,140,283 Accumulated Amortization Balance, December 31, 2016 - Amortization 4,166 Balance, December 31, 2017 4,166 Carrying value As at December 31, 2016 - As at December 31, 2017 1,136,117 |
10. ACCOUNTS PAYABLE AND ACCRUE
10. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
10. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | 10. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES The CompanyÂ’s December 31, 2017 December 31, 2016 $ $ Trade accounts payable 160,249 100,342 Accrued liabilities 141,840 257,000 302,089 357,342 |
11. SHAREHOLDERS' EQUITY
11. SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
11. SHAREHOLDERS' EQUITY | 11. S H A R E H O L D E R S ’ EQ U I T A u t r z e r t A h i z d n li m i n u m be o c m m s a r w i o v l e Is s r a p a On June 26, 2017, the Company closed a private placement and issued 4,408,659 units at a price of $0.15 per unit for gross proceeds of $661,299. Each unit consisted of one common share and one share purchase warrant entitling the holder thereof to acquire additional common share of the Company at a price of $0.20 per share until June 26, 2022. The Company paid finder’s fees of $7,200 in cash and issued 48,000 finder’s warrants valued at $8,210. The finder’s warrants are exercisable to purchase one common share of the Company at $0.20 per share until June 26, 2022. On August 3, 2017, the Company closed a private placement and issued 1,326,667 units at a price of $0.15 per unit for gross proceeds of $199,000. Each unit consisted of one common share and one share purchase warrant entitling the holder thereof to acquire additional common share of the Company at a price of $0.20 per share until August 3, 2022. On November 27, 2017, the Company closed a private placement and issued 4,850,000 units at a price of $0.15 per unit for gross proceeds of $727,500. Each unit consisted of one common share and one share purchase warrant entitling the holder thereof to acquire additional common share of the Company at a price of $0.20 per share until November 27, 2022. The Company paid finder’s fees of $3,300 in cash and issued 22,000 finder’s warrants valued at $3,404. The finder’s warrants are exercisable to purchase one common share of the Company at $0.20 per share until November 27, 2022. On December 8, 2017, the Company issued 2,274,000 common shares related to 2,274,000 warrants with an exercise price of $0.20 being exercised for gross proceeds of $454,800. During the year ended December 31, 2016, the Company issued 400,000 common shares related to the exercise of options for gross proceeds of $193,000 and 325,000 common shares were issued related to the exercise of warrants for gross proceeds of $169,000. During the six months ended December 31, 2015, 37,500 shares were issued for the exercise of options, and 434,027 shares were issued for the exercise of warrants. On December 10, 2014, the Company closed a non-brokered private placement of 1,901,833 units at price of $0.60 per unit for gross proceeds of $1,141,100. Each unit consists of one common share and one-half of one transferrable share purchase warrant. Each warrant entitles the holder thereof to purchase one additional common share on or before December 10, 2015 at a price of $1.00. Finder’s fees of $91,287 cash were paid in addition to the issuance of 152,147 warrants. The fair value of the warrants issued to agents was estimated using the Black-Scholes option pricing model and amounted to $67,533. Additional share issue costs totaling $203,490 were incurred relating to options and warrants exercised for the year ended June 30, 2015. S t ock p t i The Company has adopted an incentive share purchase option plan under the rules of the Exchange pursuant to which it is authorized to grant options to executive officers, directors, employees and consultants, enabling them to acquire up to 10% of the issued and outstanding common shares of the Company. The options can be granted for a maximum term of ten years and generally vest either immediately or in specified increments of up to 25% in any three month period. The c a g e i s a r p i n i n c l di t o s a e i r c r s o f i c e r n c n s l n t u r i 2017 and 2016 s u m a r i z oll w s Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Beginning balance 1,460,938 $1.38 1,303,750 $1.52 1,220,000 $1.08 562,500 $0.44 Options granted 2,420,000 $0.24 672,500 $1.38 201,250 $1.64 1,063,750 $1.24 Expired/Cancelled (1,460,938) $1.38 (115,312) $1.51 (80,000) $1.80 - - Exercised - - (400,000) $0.48 (37,500) $0.60 (406,250) $0.64 Ending balance 2,420,000 $0.24 1,460,938 $1.38 1,303,750 $1.52 1,220,000 $1.08 Exercisable 1,188,750 $0.22 1,184,324 $1.38 1,035,625 $1.52 774,375 $0.76 The following table summarizes information about share options outstanding and exercisable as at December 31, 2017: Exercise Price Expiry date Options Outstanding Exercisable $0.22 January 27, 2022 300,000 300,000 $0.15 July 20, 2022 150,000 150,000 $0.15 August 3, 2019 125,000 41,250 $0.15 August 15, 2022 150,000 150,000 $0.15 August 24, 2019 150,000 48,750 $0.28 November 20, 2022 150,000 150,000 $0.28 December 8, 2022 1,395,000 348,750 2,420,000 1,188,750 Share-based compensation S a r - b s $311,389 w r c o ni z u r i n n e 0 17 ( f s c p i n vested during the current period O i n i ss e i r c n ff i c m a n v s t i m m di e l y w h i l o s i ss e c n s u l a v s S a r - b s a y m n f p i n a e w m a s si th B l c k - S c ol p t i o i n m d w i t f l l o i Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Expected life 2.0 – 5.0 years 2.0 – 5.0 years 4.1 years 4.1 years Volatility 148% - 164% 100% - 155% 172% 169% Dividend yield 0% 0% 0% 1% Risk-free interest rate 1.23% - 1.69% 0.47% - 0.58% 0.44% 1.03% O i o i n m d l r q i r s i h l s bj c iv s t i m e n ss m i n s i c l u i x e c s v l il i t y C a g i u d r l y i ss m i n c m e r i l l ff c f i v l s i m e s W a rr n t T m a n a i ss e r n n i t l i t h l er c ui r c m m s a r m a n y T s u m m r c a n e i w r r n i s e n e l o Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Beginning balance - - 1,301,250 $1.24 1,748,135 $1.24 2,950,000 $1.32 Warrants issued 10,655,326 $0.20 - - - - 1,103,063 $1.00 Expired/Cancelled - - (976,250) $0.50 (12,858) $1.00 - - Exercised (2,274,000) $0.20 (325,000) $0.52 (434,027) $1.00 (2,304,928) $1.24 Outstanding 8,381,326 $0.20 - - 1,301,250 $1.64 1,748,135 $1.24 The following table summarizes information about warrants outstanding and exercisable as at December 31, 2017: Exercise Price Expiry date Warrants Outstanding $0.20 June 26, 2022 2,182,659 $0.20 August 3, 2022 1,326,667 $0.20 November 27, 2022 4,872,000 8,381,326 The fair value of the 70,000 finder’s warrants was calculated using the Black-Scholes Option Pricing Model using the following assumptions: Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Expected life 5.0 years - - 1.0 years Volatility 154% - 159% - - 179% Dividend yield 0% - - 0% Risk-free interest rate 1.15% - 1.62% - - 1.07% On May 31, 2016, the Company received approval to extend the term of 976,250 common share purchase warrants. The warrants had an expiry date of June 12, 2016. The Company extended the expiry date to December 20, 2016, and amended the exercise price of the warrants from $2.00 per share to $1.60 per share. The incremental fair value of warrant extension was estimated at $186,500. The fair value of each warrant was estimated as at the date of grant using the Black-Scholes pricing model with the following weighted-average assumptions: Year ended December 31, 2016 Expected life 0.03 – 0.56 years Volatility 75% - 110% Dividend yield 0% Risk-free interest rate 0.61% |
12. PRODUCT REGISTRATION AND DE
12. PRODUCT REGISTRATION AND DEVELOPMENT | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
12. PRODUCT REGISTRATION AND DEVELOPMENT | 12. PRODUCT REGISTRATION AND DEVELOPMENT Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Payroll 126,859 168,964 - - Product registration and licensing fees 115,444 39,820 930 56,143 242,303 208,784 930 56,143 |
13. SELLING AND MARKETING EXPEN
13. SELLING AND MARKETING EXPENSES | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
13. SELLING AND MARKETING EXPENSES | 13. SELLING AND MARKETING EXPENSES Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Payroll (sales personnel) 335,920 329,091 - - Marketing and advertising 178,058 105,658 103,123 9,858 Distribution 102,948 161,304 - - Travel 79,235 67,769 - - 696,161 663,822 103,123 9,858 |
14. GENERAL AND ADMINISTRATIVE
14. GENERAL AND ADMINISTRATIVE EXPENSES | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
14. GENERAL AND ADMINISTRATIVE EXPENSES | 14. GENERAL AND ADMINISTRATIVE EXPENSES Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Management and consulting fees (Note 15) 192,621 242,667 155,084 362,727 Payroll 79,847 122,330 149,034 54,665 Bad debt 62,930 99,000 - - Investor relations 7,174 70,332 58,024 54,334 Office maintenance 180,984 55,168 33,881 51,357 Legal, audit and accounting 279,097 61,409 37,587 37,806 Travel 41,246 34,020 33,961 30,441 Insurance 34,573 34,453 25,250 18,366 Seminars and conferences - 445 14,582 23,084 Rent 49,229 46,050 20,429 48,982 Filing and registration fees 74,898 62,130 13,688 53,714 Amortization 13,854 14,668 8,513 13,900 Bank service charges 2,480 1,330 1,690 1,061 Foreign exchange 3,630 (3,210) - 1,337 1,022,563 840,792 551,723 751,774 |
15. RELATED PARTY TRANSACTIONS
15. RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
15. RELATED PARTY TRANSACTIONS | 15. RELATED PARTY TRANSACTIONS Related party transactions not otherwise described in the consolidated financial statements are shown below. The remuneration of the CompanyÂ’s directors and other members of key management, who have the authority and responsibility for planning, directing and controlling the activities of the Company, consist of the following: Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 $ $ $ $ Management and consulting fees 60,010 242,667 154,356 149,667 Rent - - - 4,500 Salaries and benefits 132,613 - - - Share-based compensation 280,864 - - - 473,487 242,667 154,356 154,167 As at December 31, 2017, there was $13,152 (2016 - $3,275) due to related parties included in accounts payable and accrued liabilities. |
16. CAPITAL DISCLOSURES
16. CAPITAL DISCLOSURES | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
16. CAPITAL DISCLOSURES | 16. CAPITAL DISCLOSURES The Company includes shareholdersÂ’ equity in the definition of capital. The CompanyÂ’s objective when managing capital is to maintain sufficient cash resources to support its day-to-day operations. The availability of capital is solely through the issuance of the CompanyÂ’s common shares. The Company will not issue additional equity until such time when funds are needed and the market conditions become favorable to the Company. There are no assurances that funds will be made available to the Company when required. The Company makes every effort to safeguard its capital and minimize its dilution to its shareholders. The Company is not subject to any externally imposed capital requirements. There were no changes in the CompanyÂ’s approach to capital management during the year ended December 31, 2017. |
17. COMMITMENTS
17. COMMITMENTS | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
17. COMMITMENTS | 17. COMMITMENTS Leased premises The Company has entered December 31, 2017 $ Within 1 year 38,447 2 years 83,560 122,007 |
18. FINANCIAL INSTRUMENTS AND F
18. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
18. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | 18. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities and asset acquisition liability. The Company’s risk management policies are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to market conditions and the Company’s activities. The Company has exposure to credit risk, liquidity risk and market risk as a result of its use of financial instruments. This note presents information about the Company’s exposure to each of the above risks and the Company’s objectives, policies and processes for measuring and managing these risks. Further quantitative disclosures are included throughout the consolidated financial statements. The Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. The Board has implemented and monitors compliance with risk management policies. a) Credit risk Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises primarily from the Company’s cash and cash equivalents and accounts receivable. The Company’s cash and cash equivalents are held through a large Canadian financial institution. The cash equivalent is composed of a guaranteed investment certificate and is issued by a Canadian bank with high investment-grade ratings. The Company does not have financial assets that are invested in asset-backed commercial paper. The Company performs ongoing credit evaluations of its accounts receivable, but does not require collateral. The Company establishes an allowance for doubtful accounts based on the credit risk applicable to particular customers and historical data. Approximately 35% of trade receivables are due from one customer at December 31, 2017 (2016 – 35% from one customer). Pursuant to their collective terms, accounts receivable were aged as follows: December 31, 2017 December 31, 2016 $ $ Current 251,693 245,071 0 – 30 days past due 23,062 242,250 31 – 60 days past due 7,055 25,119 61 – 90 days past due 15,387 31,837 Over 90 days past due 128,087 124,640 425,284 668,917 As at December 31, 2017, the allowance for doubtful accounts receivable was $59,045 (2016 – $99,000). b) Liquidity risk Liquidity risk is the risk that the Company will incur difficulties meeting its financial obligations as they are due. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet The Company monitors its spending plans, repayment obligations and cash resources, and takes actions with the objective of ensuring that there is sufficient capital in order to meet short-term business requirements. To facilitate its expenditure program, the Company raises funds primarily through public equity financing. The Company anticipates it will have adequate liquidity to fund its financial liabilities through future equity contributions. As at December 31, 2017, the Company’s financial liabilities were comprised of accounts payable and accrued liabilities of $302,089 (2016 - $357,342) and asset acquisition liability of $100,000 (2016 - $Nil). c) Market risk Market risk for the Company consists of currency risk and interest rate risk. The objective of market risk management is to manage and control market risk exposure within acceptable limits, while maximizing returns. Currency risk Foreign currency risk is the risk that the fair value or future cash flows will fluctuate as a result of changes in foreign exchange rates. As all of the Company’s purchases and sales are denominated in Canadian dollars, and it has no significant cash balances denominated in foreign currencies, the Company is not exposed to foreign currency risk at this time. Interest rate risk Interest rate risk is the risk that fair values or future cash flows will fluctuate as a result of changes in market interest rates. In respect of financial assets, the Company’s policy is to invest cash at floating interest rates and cash reserves are to be maintained in cash equivalents in order to maintain liquidity, while achieving a satisfactory return for shareholders. The Company is not exposed to significant interest rate risk. d) Fair value of financials instruments The fair values of financial assets and financial liabilities are determined as follows: Cash and cash equivalents are measured at fair value. For accounts receivable, accounts payable, accrued liabilities and asset acquisition liability carrying amounts approximate fair value due to their short-term maturity; The fair value hierarchy establishes three levels to classify the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy are described below: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities and amounts resulting from direct arm’s length transactions. Cash and cash equivalents are valued using quoted market prices or from amounts resulting from direct arm’s length transactions. As a result, these financial assets have been included in Level 1 of the fair value hierarchy. Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full contractual term. Derivatives are included in Level 2 of the fair value hierarchy as they are valued using price models. These models require a variety of inputs, including, but not limited to, contractual terms, market prices, forward price curves, yield curves and credit spreads. The Company has no financial instruments at this level. Level 3: Inputs for the asset or liability are not based on observable market data. Currently, the Company has no financial instruments at this level. |
19. SUPPLEMENTAL CASH FLOW INFO
19. SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
19. SUPPLEMENTAL CASH FLOW INFORMATION | 19. SUPPLEMENTAL CASH FLOW INFORMATION Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Cash paid for interest - - - - Cash paid for income taxes - - - - - - - - On April 26, 2017, the Company issued a total of 70,000 finderÂ’s warrants with a fair value of $11,614 (Note 11). On December 28, 2017, the Company completed the acquisition of all the common shares of HealthTab through shares to be issued of $973,333 and an asset acquisition liability of $100,000 (Note 4). During the year ended December 31, 2017, the Company wrote-off inventory in the amount of $745,977 (2016 - $291,794, six months ended December 31, 2015 - $Nil, year ended June 30, 2015 - $Nil). On December 10, 2014, the Company issued a total of 152,147 finderÂ’s warrants with a fair value of $67,533 (Note 11). During the year ended June 30, 2015, the Company recognized an impairment of intellectual property in the amount of $476,000. |
20. INCOME TAXES
20. INCOME TAXES | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
20. INCOME TAXES | 20. INCOME TAXES The following table reconciles the expected income tax expense (recovery) at the Canadian statutory income tax rates to the amounts recognized in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2017 and 2016, six months ended December 31, 2015 and year ended June 30, 2015: Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Net loss before taxes (2,736,717) (2,613,904) (1,190,414) (2,200,648) Statutory tax rate 26.0% 26.0% 26.0% 26.0% Expected income tax (recovery) (711,546) (679,615) (309,508) (572,169) Non-deductible items 84,637 241,475 166,482 237,955 Change in estimates (768) (11,699) - - Share issue costs (2,730) - (19,205) (2,771) Loss expired - - 166,689 84,778 Change in statutory rates and other (155,379) - - - Change in deferred tax asset not recognized 785,786 449,839 (4,458) 252,207 - - - - Deferred taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their corresponding values for tax purposes. Unrecognized deductible temporary differences as at December 31, 2017 and 2016 are comprised of the following: Year ended December 31, 2017 2016 $ $ Non-capital loss carry-forwards 3,959,367 3,170,690 Property and equipment 147,189 139,259 Intangible asset 94,126 90,639 Financing costs 26,469 40,777 4,227,151 3,441,365 Deferred tax asset not recognized 4,227,151 3,441,365 Net deferred tax asset (liability) - - |
21. SUBSEQUENT EVENTS
21. SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2017 | |
Notes | |
21. SUBSEQUENT EVENTS | 21. SUBSEQUENT EVENTS In January and April 2018, the Company issued 2,591,500 common shares related to 2,591,500 warrants with an exercise price of $0.20 being exercised for gross proceeds of $518,300. In February 2018, a total of 150,000 stock options were granted to an officer of the Company. Each option can be exercised to purchase one common share of the Company at $0.35 per share for a period of 5 years. In April 2018, a total of 200,000 stock options were granted to a director of the Company. Each option can be exercised to purchase one common share of the Company at $0.24 per share for a period of 5 years. On April 15, 2018, the Company issued 3,030,303 share purchase warrants entitling the holder to acquire an additional common share of the Company at a price of $0.33 per share until April 15, 2020. On April 27, 2018, the Company issued 880,000 common shares related to the acquisition of HealthTab (Note 4). In April 2018, the Company entered into an agreement with Corozon Consulting Corporation to acquire the Corozon Platform. The purchase price consists of $50,000 and issuance of 909,090 common shares. This acquisition is subject to approval from the Exchange. |
2. BASIS OF PRESENTATION_ State
2. BASIS OF PRESENTATION: Statement of Compliance and basis of presentation (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Statement of Compliance and basis of presentation | a) Statement of Compliance and basis of presentation The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”). The consolidated financial statements were approved by the Board of Directors on May 15, 2018. |
2. BASIS OF PRESENTATION_ Basis
2. BASIS OF PRESENTATION: Basis of presentation (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Basis of presentation | b) Basis of presentation The consolidated financial statements of the Company have been prepared on an accrual basis and are based on historical costs, modified where applicable. The significant accounting policies are presented in Note 3 and have been consistently applied in each of the period presented. The consolidated financial statements are presented in Canadian dollars, which is also the CompanyÂ’s functional currency, unless other indicated. The preparation of consolidated financial statements in accordance with IFRS requires the CompanyÂ’s management to make estimates, judgments and assumptions that affect amounts reported in the consolidated financial statements and accompanying notes to the consolidated financial statements. The areas involving a higher degree of judgment and complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 3(k). Actual results might differ from these estimates. The CompanyÂ’s management reviews these estimates and underlying judgments on an ongoing basis, based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for prospectively in the year in which the estimates are revised. |
2. BASIS OF PRESENTATION_ Bas30
2. BASIS OF PRESENTATION: Basis of consolidation (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Basis of consolidation | c) Basis of consolidation Consolidated financial statements include the assets, liabilities and results of operations of all entities controlled by the Company. Inter-company balances and transactions, including unrealized income and expenses arising from inter-company transactions, are eliminated in preparing the CompanyÂ’s the consolidated financial statements. Where control of an entity is obtained during a financial year, its results are included in the consolidated statements of comprehensive loss from the date on which control commences. Where control of an entity ceases during a financial year, its results are included for that part of the year during which control exists. These consolidated financial statements include the accounts of the Company and its controlled wholly owned subsidiaries, Vanc Marine Pharmaceuticals Inc. and HealthTab Inc. |
2. BASIS OF PRESENTATION_ Accou
2. BASIS OF PRESENTATION: Accounting standards issued, but not yet in effective (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Accounting standards issued, but not yet in effective | d) Accounting standards issued, but not yet in effective The following is an overview of accounting standard changes that the Company will be required to adopt in future years. IFRS 9 Financial instruments On July 24, 2014, the IASB issued the complete IFRS 9, Financial Instruments (“IFRS 9”). IFRS 9 introduces new requirements for the classification and measurements of financial assets. Under IFRS 9, financial assets are classified and measured based on the business model in which they are held and the characteristics of their contractual cash flows. The standard introduces additional changes relating to financial liabilities and amends the impairment model by introducing a new “expected credit loss” model for calculating impairment. It also includes a new general hedge accounting standard which aligns hedge accounting ore closely with risk management. IFRS 9 is effective for reporting periods beginning on or after January 1, 2018 and must be applied retrospectively with some exemptions. Management anticipates that this standard will be adopted in the Company’s consolidated financial statements for the period beginning January 1, 2018 and will have an insignificant effect on its consolidated financial statements other than increased note disclosure. IFRS 15 Revenue from contracts with customers On May 28, 2014 the IASB issued IFRS 15, Revenue from Contracts with Customers (“IFRS 15”). IFRS 15 deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. Revenue is recognized when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the goods or services. The standard replaces IAS 18 Revenue and IAS 11 Construction contracts and related interpretations. IFRS 15 is effective for reporting periods beginning on or after January 1, 2018. Management anticipates that this standard will be adopted in the Company’s consolidated financial statements for the period beginning January 1, 2018 and will have an insignificant effect on its consolidated financial statements. IFRS 16 Leases On January 13, 2016, the International Accounting Standards Board published a new standard, IFRS 16, Leases, eliminating the current dual accounting model for lessees, which distinguishes between on-balance sheet finance leases and off-balance sheet operating leases. Under the new standard, a lease becomes an on-balance sheet liability that attracts interest, together with a new right-of-use asset. In addition, lessees will recognize a front-loaded pattern of expense for most leases, even when cash rentals are constant. IFRS 16 is effective for reporting periods beginning on or after January 1, 2019. The Company is in the process of assessing the impact of this pronouncement. The extent of the impact has not yet been determined. Other new standards or amendments are either not applicable or not expected to have a significant impact on the Company’s consolidated financial statements. |
3. SUMMARY OF SIGNIFICANT ACC32
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Revenue recognition (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Revenue recognition | a) Revenue recognition Revenues are recognized when the risks and rewards of ownership have passed to the customer based on the terms of the sale, collection of the relevant receivable is probable, evidence of an arrangement exists and the sales price is fixed or determinable. Risks and rewards of ownership pass to the customer upon successful completion of shipment of pharmaceuticals. Provisions for sales discounts and returns are made on a per sale basis based on contractual and historical information. |
3. SUMMARY OF SIGNIFICANT ACC33
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Foreign currency (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Foreign currency | b) Foreign currency These consolidated financial statements are presented in Canadian dollars, which is also the functional currency of the Company and its subsidiaries. Foreign currency transactions are translated into the functional currency of the respective entity, using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the remeasurement of monetary items at year-end exchange rates are recognized in profit or loss. Non-monetary items measured at historical cost are translated using the exchange rates at the date of the transaction and are not retranslated. Non-monetary items measured at fair value are translated using the exchange rates at the date when fair value was determined. |
3. SUMMARY OF SIGNIFICANT ACC34
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Cash equivalents (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Cash equivalents | c) Cash equivalents Cash equivalents |
3. SUMMARY OF SIGNIFICANT ACC35
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Inventory (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Inventory | d) Inventory Inventories consist of raw materials comprising the ingredients used to manufacture OTC pharmaceuticals, as well as the packaging for these products, and finished goods comprising Canadian generic pharmaceuticals. All inventories are recorded at the lower of cost on a weighted average basis and net realizable value. The stated value of all inventories includes purchase, shipping and freight, and quality control testing. A regular review is undertaken to determine the extent of any provision for obsolescence. |
3. SUMMARY OF SIGNIFICANT ACC36
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Equipment (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Equipment | e) Equipment Equipment is stated at historical cost less accumulated amortization and accumulated impairment losses. Amortization is calculated on a declining balance method over their estimated useful lives. The CompanyÂ’s equipment, which consists of computer, furniture, equipment and computer systems are amortized at 30%, and the straight-line method for leasehold improvements over the term of the lease. |
3. SUMMARY OF SIGNIFICANT ACC37
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Intangible assets (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Intangible assets | f) Intangible assets All intangible assets acquired separately by the Company are recorded at cost on the date of acquisition. Intangible assets that have indefinite lives are measured at cost less accumulated impairment losses. Intangible assets that have finite useful lives are measured at cost less accumulated amortization and accumulated impairment losses. Intangible assets comprise of intellectual property, trademarks and web domains, which are amortized on a straight-line basis over 3 years. Amortization rates are reviewed annually to ensure they are aligned with estimates of remaining economic useful lives of the associated intangible assets. |
3. SUMMARY OF SIGNIFICANT ACC38
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Share-based payments (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Share-based payments | g) Share-based payments The Company operates an incentive share purchase option plan. Share-based payments to employees are |
3. SUMMARY OF SIGNIFICANT ACC39
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Share capital (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Share capital | h) Share capital Proceeds from the exercise of stock options and warrants are recorded as share capital in the amount for which the option or warrant enabled the holder to purchase a share in the Company. Any previously recorded share-based payment included in the reserves account is transferred to share capital on exercise of options. Share capital issued for non-monetary consideration is valued at the closing market price at the date of issuance. The proceeds from issuance of units are allocated between common shares and warrants based on the residual method. Under this method, the proceeds are allocated first to share capital based on the fair value of the common shares at the time the units are priced and any residual value is allocated to the warrants reserve. Consideration received for the exercise of warrants is recorded in share capital, and any related amount recorded in warrants reserve is transferred to share capital. |
3. SUMMARY OF SIGNIFICANT ACC40
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Loss per share (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Loss per share | i) Loss per share Basic loss per share is calculated by dividing the net loss available to common shareholders by the weighted average number of shares outstanding during the year. Diluted earnings per share reflect the potential dilution of securities that could share in earnings of an entity. In a loss year, potentially dilutive common shares are excluded from the loss per share calculation as the effect would be anti-dilutive. Basic and diluted loss per share are the same for the periods presented. |
3. SUMMARY OF SIGNIFICANT ACC41
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Income taxes (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Income taxes | j) Income taxes Income tax expense, consisting of current and deferred tax expense, is recognized in the statements of operations. Current tax expense is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at period-end, adjusted for amendments to tax payable with regard to previous years. Deferred tax assets and liabilities and the related deferred income tax expense or recovery are recognized for deferred tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income (loss) in the period that substantive enactment occurs. A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. To the extent that the Company does not consider it probable that a deferred tax asset will be recovered, the deferred tax asset is reduced. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis. |
3. SUMMARY OF SIGNIFICANT ACC42
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Financial Instruments (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Financial Instruments | k) Financial Instruments The Company classifies its financial instruments in the following categories: at fair value through profit or loss, loans and receivables, held-to-maturity investments, available-for-sale and other financial liabilities. The classification depends on the purpose for which the financial instruments were acquired. Management determines the classification of its financial instruments at initial recognition. All financial assets and liabilities are recorded at fair value at initial recognition. The Company classifies its financial instruments as follows: Cash and equivalents Fair value through profit or loss Accounts receivable Loans and receivables Accounts payable and accrued liabilities Other financial liability Asset acquisition liability Other financial liability Financial assets are classified at fair value through profit or loss when they are either held for trading for the purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being included in profit or loss. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortized cost. They are included in current assets, except for maturities greater than twelve months after the end of the reporting period. These are classified as non-current assets. Other financial liabilities (excluding financial guarantees) are subsequently measured at amortized cost. At each reporting date, the Company assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a significant and prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen. |
3. SUMMARY OF SIGNIFICANT ACC43
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Impairment of equipment and intangible assets (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Impairment of equipment and intangible assets | l) Impairment of equipment and intangible assets At the end of each reporting period, the Company reviews the carrying amounts of its equipment and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. Individual assets are grouped together as a cash generating unit for impairment assessment purposes at the lowest level at which there are identifiable cash flows that are independent from other group assets If any such indication of impairment exists, the Company makes an estimate of its recoverable amount. The recoverable amount is the higher of fair value less costs to sell and value in use. Where the carrying amount of a cash generating unit exceeds its recoverable amount, the cash generating unit is considered impaired and is written down to its recoverable amount. In assessing the value in use, the estimated future cash flows are adjusted for the risks specific to the cash generating unit and are discounted to their present value with a discount rate that reflects the current market indicators. Where an impairment loss subsequently reverses, the carrying amount of the cash generating unit is increased to the revised estimate of its recoverable amount, to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the cash generating unit in prior years. A reversal of an impairment loss is recognized as income immediately. |
3. SUMMARY OF SIGNIFICANT ACC44
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Significant accounting estimates and judgments (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Policies | |
Significant accounting estimates and judgments | m) Significant accounting estimates and judgments Significant estimates used in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements are as follows: Inventory valuation The Company estimates the net realizable values of inventories, taking into account the most reliable evidence available at each reporting date. The future realization of these inventories may be affected by regulatory changes or other market-driven changes that may reduce future selling prices. In determining net realizable value, the Company considers such factors as turnover, historical experience, expiry dates and shelf life of the products. A change to these assumptions could impact the CompanyÂ’s inventory valuation and gross margin. The Company attempts to sell products with short shelf life with significant rebates. Any unsold products with short shelf life and expired products are written-off. Revenue recognition Revenues are recognized when the risks and rewards of ownership have passed to the customer based on the terms of the sale, collection of the relevant receivable is probable, evidence of an arrangement exists and the sales price is fixed or determinable. Risks and rewards of ownership pass to the customer upon successful completion of shipment of pharmaceuticals. Provisions for sales discounts, incentives, and rebates and returns are made based upon historical experiences. Useful lives of depreciable assets The Company reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected utilization of the assets. Uncertainties in these estimates relate to technical obsolescence that may change the utilization of certain equipment. Intellectual property The recoverability of the carrying value of the intellectual property is dependent on successful development and commercial stage to the point where revenue is possible. The carrying value of these assets is reviewed by management when events or circumstances indicate that its carrying value may not be recovered. If impairment is determined to exist, an impairment loss is recognized to the extent that the carrying amount exceeds the recoverable amount. Share-based payments The Company grants share-based awards to certain directors, officers, employees, consultants and other eligible persons. For equity-settled awards, the fair value is charged to the statement of operations and comprehensive loss and credited to the reserves over the vesting period using the graded vesting method, after adjusting for the estimated number of awards that are expected to vest. The fair value of equity-settled awards is determined at the date of the grant using the Black-Scholes option pricing model. For equity-settled awards to non-employees, the fair value is measured at each vesting date. The estimate of warrant and option valuation also requires determining the most appropriate inputs to the valuation model, including the volatility, expected life of warrants and options, risk free interest rate and dividend yield. Changes in these assumptions can materially affect the fair value estimate, and therefore the existing models do not necessarily provide a reliable measure of the fair value of the CompanyÂ’s options and warrants issued. Management must also make significant judgments or assessments as to how financial assets and liabilities are categorized. Significant judgements Significant judgments used in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements are as follows: Tax interpretations, regulations and legislation in the various jurisdictions in which the Company operates are subject to change. The determination of income tax expense and deferred tax involves judgment and estimates as to the future taxable earnings, expected timing of reversals of deferred tax assets and liabilities, and interpretations of laws in the countries in which the Company operates. The Company is subject to assessments by tax authorities who may interpret the tax law differently. Changes in these estimates may materially affect the final amount of deferred taxes or the timing of tax payments. |
1. NATURE OF OPERATIONS AND G45
1. NATURE OF OPERATIONS AND GOING CONCERN: Schedule of Loss, Deficit and Working Capital (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Loss, Deficit and Working Capital | Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 $ $ $ $ Comprehensive loss (2,736,717) (2,613,904) (1,190,414) (2,200,648) Deficit (21,091,609) (18,354,892) (15,740,988) (14,550,574) Working capital 1,272,259 1,886,976 3,207,630 3,305,603 |
4. ACQUISITION_ Aggregate fair
4. ACQUISITION: Aggregate fair values of assets acquired and liabilities assumed in acquisition (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Aggregate fair values of assets acquired and liabilities assumed in acquisition | $ Purchase consideration: Cash 100,000 Asset acquisition liability 100,000 Shares to be issued 973,333 Acquisition costs 28,806 1,202,139 Net assets acquired: Cash 38 Equipment 64,608 Intangible assets 1,140,283 Accounts payable and accrued liabilities (2,790) Total net assets acquired 1,202,139 |
5. ACCOUNTS RECEIVABLE_ Schedul
5. ACCOUNTS RECEIVABLE: Schedule of Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Accounts Receivable | December 31, 2017 December 31, 2016 $ $ Trade receivables 425,284 668,917 GST receivable 24,995 48,242 Employee advances 158 2,246 450,437 719,405 |
7. INVENTORIES_ Schedule of Inv
7. INVENTORIES: Schedule of Inventory (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Inventory | December 31, 2017 December 31, 2016 $ $ Work in process 39,845 5,987 Finished goods 171,380 1,050,300 211,225 1,056,287 |
8. EQUIPMENT_ Schedule of Equip
8. EQUIPMENT: Schedule of Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Equipment | Office Furniture and Equipment Computer equipment and Systems Laboratory Equipment Leasehold Improvements Total Cost $ $ $ $ $ Balance, December 31, 2015 1,702 - 36,822 24,182 62,706 Additions 369 3,898 2,074 - 6,341 Balance, December 31, 2016 2,071 3,898 38,896 24,182 69,047 Acquired assets 1,636 62,972 - - 64,608 Additions 3,784 - - - 3,784 Balance, December 31, 2017 7,491 66,870 38,896 24,182 137,439 Accumulated Amortization Balance, December 31, 2015 759 - 12,449 10,153 23,361 Amortization 330 1,151 7,085 6,103 14,669 Balance, December 31, 2016 1,089 1,151 19,534 16,256 38,030 Amortization 523 979 5,808 2,378 9,688 Balance, December 31, 2017 1,612 2,130 25,342 18,634 47,718 Carrying value As at December 31, 2016 982 2,747 19,362 7,926 31,017 As at December 31, 2017 5,879 64,740 13,554 5,548 89,721 |
9. INTANGIBLE ASSETS_ Schedule
9. INTANGIBLE ASSETS: Schedule of Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Intangible Assets | Cost $ Balance, December 31, 2016 - Acquired assets 1,140,283 Balance, December 31, 2017 1,140,283 Accumulated Amortization Balance, December 31, 2016 - Amortization 4,166 Balance, December 31, 2017 4,166 Carrying value As at December 31, 2016 - As at December 31, 2017 1,136,117 |
10. ACCOUNTS PAYABLE AND ACCR51
10. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES: Schedule of accounts payable and accrued costs (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of accounts payable and accrued costs | December 31, 2017 December 31, 2016 $ $ Trade accounts payable 160,249 100,342 Accrued liabilities 141,840 257,000 302,089 357,342 |
11. SHAREHOLDERS' EQUITY_ Sched
11. SHAREHOLDERS' EQUITY: Schedule of changes in share options (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of changes in share options | Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Number of Options Weighted Average Exercise Price Beginning balance 1,460,938 $1.38 1,303,750 $1.52 1,220,000 $1.08 562,500 $0.44 Options granted 2,420,000 $0.24 672,500 $1.38 201,250 $1.64 1,063,750 $1.24 Expired/Cancelled (1,460,938) $1.38 (115,312) $1.51 (80,000) $1.80 - - Exercised - - (400,000) $0.48 (37,500) $0.60 (406,250) $0.64 Ending balance 2,420,000 $0.24 1,460,938 $1.38 1,303,750 $1.52 1,220,000 $1.08 Exercisable 1,188,750 $0.22 1,184,324 $1.38 1,035,625 $1.52 774,375 $0.76 |
11. SHAREHOLDERS' EQUITY_ Sch53
11. SHAREHOLDERS' EQUITY: Schedule of share options outstanding and exercisable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of share options outstanding and exercisable | Exercise Price Expiry date Options Outstanding Exercisable $0.22 January 27, 2022 300,000 300,000 $0.15 July 20, 2022 150,000 150,000 $0.15 August 3, 2019 125,000 41,250 $0.15 August 15, 2022 150,000 150,000 $0.15 August 24, 2019 150,000 48,750 $0.28 November 20, 2022 150,000 150,000 $0.28 December 8, 2022 1,395,000 348,750 2,420,000 1,188,750 |
11. SHAREHOLDERS' EQUITY_ Sch54
11. SHAREHOLDERS' EQUITY: Schedule of Share-based payments for options granted (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Share-based payments for options granted | Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Expected life 2.0 – 5.0 years 2.0 – 5.0 years 4.1 years 4.1 years Volatility 148% - 164% 100% - 155% 172% 169% Dividend yield 0% 0% 0% 1% Risk-free interest rate 1.23% - 1.69% 0.47% - 0.58% 0.44% 1.03% |
11. SHAREHOLDERS' EQUITY_ Sch55
11. SHAREHOLDERS' EQUITY: Schedule of changes in warrants (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of changes in warrants | Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Beginning balance - - 1,301,250 $1.24 1,748,135 $1.24 2,950,000 $1.32 Warrants issued 10,655,326 $0.20 - - - - 1,103,063 $1.00 Expired/Cancelled - - (976,250) $0.50 (12,858) $1.00 - - Exercised (2,274,000) $0.20 (325,000) $0.52 (434,027) $1.00 (2,304,928) $1.24 Outstanding 8,381,326 $0.20 - - 1,301,250 $1.64 1,748,135 $1.24 |
11. SHAREHOLDERS' EQUITY_ Sch56
11. SHAREHOLDERS' EQUITY: Schedule of warrants outstanding and exercisable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of warrants outstanding and exercisable | Exercise Price Expiry date Warrants Outstanding $0.20 June 26, 2022 2,182,659 $0.20 August 3, 2022 1,326,667 $0.20 November 27, 2022 4,872,000 8,381,326 |
11. SHAREHOLDERS' EQUITY_ Sch57
11. SHAREHOLDERS' EQUITY: Schedule of Fair Value of Finder's Warrants (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Fair Value of Finder's Warrants | Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 Expected life 5.0 years - - 1.0 years Volatility 154% - 159% - - 179% Dividend yield 0% - - 0% Risk-free interest rate 1.15% - 1.62% - - 1.07% |
11. SHAREHOLDERS' EQUITY_ Sch58
11. SHAREHOLDERS' EQUITY: Schedule of Assumptions in Fair Value Measurement of Warrants (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Assumptions in Fair Value Measurement of Warrants | Year ended December 31, 2016 Expected life 0.03 – 0.56 years Volatility 75% - 110% Dividend yield 0% Risk-free interest rate 0.61% |
12. PRODUCT REGISTRATION AND 59
12. PRODUCT REGISTRATION AND DEVELOPMENT: Schedule of Product Registration and Development (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Product Registration and Development | Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Payroll 126,859 168,964 - - Product registration and licensing fees 115,444 39,820 930 56,143 242,303 208,784 930 56,143 |
13. SELLING AND MARKETING EXP60
13. SELLING AND MARKETING EXPENSES: Schedule of Selling and Marketing Expense (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Selling and Marketing Expense | Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Payroll (sales personnel) 335,920 329,091 - - Marketing and advertising 178,058 105,658 103,123 9,858 Distribution 102,948 161,304 - - Travel 79,235 67,769 - - 696,161 663,822 103,123 9,858 |
14. GENERAL AND ADMINISTRATIV61
14. GENERAL AND ADMINISTRATIVE EXPENSES: Schedule of General and Administrative Expenses (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of General and Administrative Expenses | Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Management and consulting fees (Note 15) 192,621 242,667 155,084 362,727 Payroll 79,847 122,330 149,034 54,665 Bad debt 62,930 99,000 - - Investor relations 7,174 70,332 58,024 54,334 Office maintenance 180,984 55,168 33,881 51,357 Legal, audit and accounting 279,097 61,409 37,587 37,806 Travel 41,246 34,020 33,961 30,441 Insurance 34,573 34,453 25,250 18,366 Seminars and conferences - 445 14,582 23,084 Rent 49,229 46,050 20,429 48,982 Filing and registration fees 74,898 62,130 13,688 53,714 Amortization 13,854 14,668 8,513 13,900 Bank service charges 2,480 1,330 1,690 1,061 Foreign exchange 3,630 (3,210) - 1,337 1,022,563 840,792 551,723 751,774 |
15. RELATED PARTY TRANSACTIONS_
15. RELATED PARTY TRANSACTIONS: Schedule of Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Related Party Transactions | Year ended December 31, 2017 Year ended December 31, 2016 Six months ended December 31, 2015 Year ended June 30, 2015 $ $ $ $ Management and consulting fees 60,010 242,667 154,356 149,667 Rent - - - 4,500 Salaries and benefits 132,613 - - - Share-based compensation 280,864 - - - 473,487 242,667 154,356 154,167 |
17. COMMITMENTS_ Schedule of fu
17. COMMITMENTS: Schedule of future minimum lease payments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of future minimum lease payments | December 31, 2017 $ Within 1 year 38,447 2 years 83,560 122,007 |
18. FINANCIAL INSTRUMENTS AND64
18. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT: Schedule of aging of accounts receivable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of aging of accounts receivable | December 31, 2017 December 31, 2016 $ $ Current 251,693 245,071 0 – 30 days past due 23,062 242,250 31 – 60 days past due 7,055 25,119 61 – 90 days past due 15,387 31,837 Over 90 days past due 128,087 124,640 425,284 668,917 |
19. SUPPLEMENTAL CASH FLOW IN65
19. SUPPLEMENTAL CASH FLOW INFORMATION: Schedule of Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Supplemental Cash Flow Information | Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Cash paid for interest - - - - Cash paid for income taxes - - - - - - - - |
20. INCOME TAXES_ Schedule of I
20. INCOME TAXES: Schedule of Income Tax Reconciliation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Income Tax Reconciliation | Year ended December 31, Six months ended December 31, Year ended June 30, 2017 2016 2015 2015 $ $ $ $ Net loss before taxes (2,736,717) (2,613,904) (1,190,414) (2,200,648) Statutory tax rate 26.0% 26.0% 26.0% 26.0% Expected income tax (recovery) (711,546) (679,615) (309,508) (572,169) Non-deductible items 84,637 241,475 166,482 237,955 Change in estimates (768) (11,699) - - Share issue costs (2,730) - (19,205) (2,771) Loss expired - - 166,689 84,778 Change in statutory rates and other (155,379) - - - Change in deferred tax asset not recognized 785,786 449,839 (4,458) 252,207 - - - - |
20. INCOME TAXES_ Schedule of D
20. INCOME TAXES: Schedule of Deferred Tax Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Tables/Schedules | |
Schedule of Deferred Tax Assets and Liabilities | Year ended December 31, 2017 2016 $ $ Non-capital loss carry-forwards 3,959,367 3,170,690 Property and equipment 147,189 139,259 Intangible asset 94,126 90,639 Financing costs 26,469 40,777 4,227,151 3,441,365 Deferred tax asset not recognized 4,227,151 3,441,365 Net deferred tax asset (liability) - - |
1. NATURE OF OPERATIONS AND G68
1. NATURE OF OPERATIONS AND GOING CONCERN (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Name of reporting entity or other means of identification | VANC Pharmaceuticals Inc. | |||
Legal form of entity | incorporated | |||
Domicile of entity | British Columbia | |||
Entity Incorporation, Date of Incorporation | May 30, 2000 | |||
Trading Symbol | vanc | |||
Entity Address, Address Line One | Suite 810 - 789 West Pender Street | |||
Entity Address, City or Town | Vancouver | |||
Entity Address, State or Province | British Columbia | |||
Entity Address, Postal Zip Code | V6C 1H2 | |||
Description of nature of entity's operations and principal activities | The Company’s operations consist of the marketing and distribution of generic and over-the-counter (“OTC”) pharmaceuticals. | |||
Net loss and comprehensive loss for the period | $ (1,190,414) | $ (2,736,717) | $ (2,613,904) | $ (2,200,648) |
TSX Venture Exchange | ||||
Trading Symbol | NPH | |||
OTCIQ Market | ||||
Trading Symbol | NUVPF |
1. NATURE OF OPERATIONS AND G69
1. NATURE OF OPERATIONS AND GOING CONCERN: Schedule of Loss, Deficit and Working Capital (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Details | ||||
Net loss and comprehensive loss for the period | $ (1,190,414) | $ (2,736,717) | $ (2,613,904) | $ (2,200,648) |
Deficit | (15,740,988) | (21,091,609) | (18,354,892) | (14,550,574) |
Working capital | $ 3,207,630 | $ 1,272,259 | $ 1,886,976 | $ 3,305,603 |
4. ACQUISITION_ Aggregate fai70
4. ACQUISITION: Aggregate fair values of assets acquired and liabilities assumed in acquisition (Details) - CAD ($) | Dec. 31, 2017 | Dec. 28, 2017 | [1] | Dec. 31, 2016 |
Purchase consideration | ||||
Purchase consideration - Cash | $ 100,000 | |||
Purchase consideration - Asset acquisition liability | 100,000 | $ 100,000 | ||
Purchase consideration - Shares to be issued | 973,333 | $ 973,333 | ||
Purchase consideration - Acquisition costs | 28,806 | |||
Purchase consideration | 1,202,139 | |||
Net assets acquired | ||||
Net Assets Acquired - Cash | 38 | |||
Net Assets Acquired - Equipment | 64,608 | |||
Net Assets Acquired - Intangible assets | 1,140,283 | $ 0 | ||
Net Assets Acquired - Accounts payable and accrued liabilities | (2,790) | |||
Total net assets acquired | $ 1,202,139 | |||
[1] | Note 4 |
5. ACCOUNTS RECEIVABLE_ Sched71
5. ACCOUNTS RECEIVABLE: Schedule of Accounts Receivable (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 | |
Details | |||
Trade receivables | $ 425,284 | $ 668,917 | |
GST receivable | 24,995 | 48,242 | |
Employee advances | 158 | 2,246 | |
Accounts receivable | [1] | $ 450,437 | $ 719,405 |
[1] | Note 5 |
6. PREPAID EXPENSES AND DEPOS72
6. PREPAID EXPENSES AND DEPOSITS (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Details | ||
Deposits for inventory purchases and prepaid expense to vendors | $ 437,137 | $ 26,198 |
Prepaid Office Rent | 8,420 | 8,420 |
Prepaid business insurance | $ 7,396 | $ 6,526 |
7. INVENTORIES_ Schedule of I73
7. INVENTORIES: Schedule of Inventory (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 | |
Details | |||
Work in process | $ 39,845 | $ 5,987 | |
Finished goods | 171,380 | 1,050,300 | |
Inventories | [1] | $ 211,225 | $ 1,056,287 |
[1] | Note 7 |
8. EQUIPMENT_ Schedule of Equ74
8. EQUIPMENT: Schedule of Equipment (Details) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | ||
Equipment, Gross, start of period | $ 69,047 | $ 62,706 | |
Additions other than through business combinations, property, plant and equipment | 3,784 | 6,341 | |
Acquisitions through business combinations, property, plant and equipment | 64,608 | ||
Equipment, Gross, end of period | 137,439 | 69,047 | |
Accumulated Amortization, start of period | 38,030 | 23,361 | |
Amortisation expense | 9,688 | 14,669 | |
Accumulated Amortization, end of period | 47,718 | 38,030 | |
Equipment, Carrying Value, start of period | [1] | 31,017 | |
Equipment, Carrying Value, end of period | [1] | 89,721 | 31,017 |
Office equipment | |||
Equipment, Gross, start of period | 2,071 | 1,702 | |
Additions other than through business combinations, property, plant and equipment | 3,784 | 369 | |
Acquisitions through business combinations, property, plant and equipment | 1,636 | ||
Equipment, Gross, end of period | 7,491 | 2,071 | |
Accumulated Amortization, start of period | 1,089 | 759 | |
Amortisation expense | 523 | 330 | |
Accumulated Amortization, end of period | 1,612 | 1,089 | |
Equipment, Carrying Value, start of period | 982 | ||
Equipment, Carrying Value, end of period | 5,879 | 982 | |
Computer equipment | |||
Equipment, Gross, start of period | 3,898 | 0 | |
Additions other than through business combinations, property, plant and equipment | 0 | 3,898 | |
Acquisitions through business combinations, property, plant and equipment | 62,972 | ||
Equipment, Gross, end of period | 66,870 | 3,898 | |
Accumulated Amortization, start of period | 1,151 | 0 | |
Amortisation expense | 979 | 1,151 | |
Accumulated Amortization, end of period | 2,130 | 1,151 | |
Equipment, Carrying Value, start of period | 2,747 | ||
Equipment, Carrying Value, end of period | 64,740 | 2,747 | |
Laboratory Equipment | |||
Equipment, Gross, start of period | 38,896 | 36,822 | |
Additions other than through business combinations, property, plant and equipment | 0 | 2,074 | |
Acquisitions through business combinations, property, plant and equipment | 0 | ||
Equipment, Gross, end of period | 38,896 | 38,896 | |
Accumulated Amortization, start of period | 19,534 | 12,449 | |
Amortisation expense | 5,808 | 7,085 | |
Accumulated Amortization, end of period | 25,342 | 19,534 | |
Equipment, Carrying Value, start of period | 19,362 | ||
Equipment, Carrying Value, end of period | 13,554 | 19,362 | |
Leasehold Improvements | |||
Equipment, Gross, start of period | 24,182 | 24,182 | |
Additions other than through business combinations, property, plant and equipment | 0 | 0 | |
Acquisitions through business combinations, property, plant and equipment | 0 | ||
Equipment, Gross, end of period | 24,182 | 24,182 | |
Accumulated Amortization, start of period | 16,256 | 10,153 | |
Amortisation expense | 2,378 | 6,103 | |
Accumulated Amortization, end of period | 18,634 | 16,256 | |
Equipment, Carrying Value, start of period | 7,926 | ||
Equipment, Carrying Value, end of period | $ 5,548 | $ 7,926 | |
[1] | Note 8 |
9. INTANGIBLE ASSETS_ Schedul75
9. INTANGIBLE ASSETS: Schedule of Intangible Assets (Details) | 12 Months Ended | |
Dec. 31, 2017CAD ($) | ||
Details | ||
Intangible Assets, Gross, start of period | $ 0 | |
Acquired assets | 1,140,283 | |
Intangible Assets, Gross, end of period | 1,140,283 | |
Intangible Assets, Accumulated Amortization, starting balance | 0 | |
Intangible Assets, Amortization over period | 4,166 | |
Intangible Assets, Accumulated Amortization, ending balance | 4,166 | |
Intangible Assets, Carrying Value, start of period | 0 | [1] |
Intangible Assets, Carrying Value, end of period | $ 1,136,117 | [1] |
[1] | Note 9 |
10. ACCOUNTS PAYABLE AND ACCR76
10. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES: Schedule of accounts payable and accrued costs (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 | |
Details | |||
Trade accounts payable | $ 160,249 | $ 100,342 | |
Accrued liabilities | 141,840 | 257,000 | |
Accounts payable and accrued liabilities | [1] | $ 302,089 | $ 357,342 |
[1] | Note 10 |
11. SHAREHOLDERS' EQUITY (Detai
11. SHAREHOLDERS' EQUITY (Details) | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2015CAD ($) | Dec. 31, 2017CAD ($)shares | Dec. 31, 2016CAD ($) | Jun. 30, 2015CAD ($) | Dec. 31, 2017$ / sharesshares | |
Proceeds from issuance of shares, net | $ 0 | $ 1,577,299 | $ 0 | $ 846,323 | |
Share issuance costs | (10,500) | (294,777) | |||
Key management personnel compensation, share-based payment | $ 630,401 | $ 311,389 | $ 736,422 | 915,211 | |
Fair Value Measurements, Valuation Techniques | Black-Scholes Option Pricing Model | ||||
Issue 1 | |||||
Date of Transaction | Jun. 26, 2017 | ||||
Description of significant events and transactions | Company closed a private placement | ||||
Number of shares issued | shares | 4,408,659 | ||||
Par value per share | $ / shares | $ 0.15 | ||||
Proceeds from issuance of shares, net | $ 661,299 | ||||
Finder's fees | $ 7,200 | ||||
Warrants issued | shares | 48,000 | ||||
Warrants issued, fair value | $ 8,210 | ||||
Issue 2 | |||||
Date of Transaction | Aug. 3, 2017 | ||||
Description of significant events and transactions | Company closed a private placement | ||||
Number of shares issued | shares | 1,326,667 | ||||
Par value per share | $ / shares | $ 0.15 | ||||
Proceeds from issuance of shares, net | $ 199,000 | ||||
Issue 3 | |||||
Date of Transaction | Nov. 27, 2017 | ||||
Description of significant events and transactions | Company closed a private placement | ||||
Number of shares issued | shares | 4,850,000 | ||||
Par value per share | $ / shares | $ 0.15 | ||||
Proceeds from issuance of shares, net | $ 727,500 | ||||
Finder's fees | $ 3,300 | ||||
Warrants issued | shares | 22,000 | ||||
Warrants issued, fair value | $ 3,404 | ||||
Issue 4 | |||||
Date of Transaction | Dec. 8, 2017 | ||||
Description of significant events and transactions | Company issued 2,274,000 common shares | ||||
Number of shares issued | shares | 2,274,000 | ||||
Proceeds from issuance of shares, net | $ 454,800 | ||||
Issue 5 | |||||
Description of significant events and transactions | Company issued 400,000 common shares | ||||
Number of shares issued | shares | 400,000 | ||||
Proceeds from issuance of shares, net | $ 193,000 | ||||
Issue 5 | Bottom of range | |||||
Date of Transaction | Jan. 1, 2016 | ||||
Issue 5 | Top of range | |||||
Date of Transaction | Dec. 31, 2016 | ||||
Issue 6 | |||||
Description of significant events and transactions | 325,000 common shares were issued | ||||
Number of shares issued | shares | 325,000 | ||||
Proceeds from issuance of shares, net | $ 169,000 | ||||
Issue 6 | Bottom of range | |||||
Date of Transaction | Jan. 1, 2016 | ||||
Issue 6 | Top of range | |||||
Date of Transaction | Dec. 31, 2016 | ||||
Issue 7 | |||||
Description of significant events and transactions | 37,500 shares were issued for the exercise of options | ||||
Number of shares issued | shares | 37,500 | ||||
Issue 7 | Bottom of range | |||||
Date of Transaction | Jul. 1, 2015 | ||||
Issue 7 | Top of range | |||||
Date of Transaction | Dec. 31, 2015 | ||||
Issue 8 | |||||
Description of significant events and transactions | 434,027 shares were issued for the exercise of warrants | ||||
Number of shares issued | shares | 434,027 | ||||
Issue 8 | Bottom of range | |||||
Date of Transaction | Jul. 1, 2015 | ||||
Issue 8 | Top of range | |||||
Date of Transaction | Dec. 31, 2015 | ||||
Issue 9 | |||||
Date of Transaction | Dec. 10, 2014 | ||||
Description of significant events and transactions | Company closed a non-brokered private placement | ||||
Number of shares issued | shares | 1,901,833 | ||||
Par value per share | $ / shares | $ 0.60 | ||||
Proceeds from issuance of shares, net | $ 1,141,100 | ||||
Finder's fees | $ 91,287 | ||||
Warrants issued | shares | 152,147 | ||||
Warrants issued, fair value | $ 67,533 | ||||
Relating to options and warrants exercised | |||||
Share issuance costs | $ 203,490 | ||||
Share-based payments for options granted | |||||
Fair Value Measurements, Valuation Techniques | Black-Scholes option pricing model | ||||
Fair value of each warrant | |||||
Fair Value Measurements, Valuation Techniques | Black-Scholes pricing model |
11. SHAREHOLDERS' EQUITY_ Sch78
11. SHAREHOLDERS' EQUITY: Schedule of changes in share options (Details) - Share options including those granted to directors, officers, employees and consultants - $ / shares | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance | 1,220,000 | 1,460,938 | 1,303,750 | 562,500 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Beginning Balance | $ 1.08 | $ 1.38 | $ 1.52 | $ 0.44 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 201,250 | 2,420,000 | 672,500 | 1,063,750 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 1.64 | $ 0.24 | $ 1.38 | $ 1.24 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | (80,000) | (1,460,938) | (115,312) | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price | $ 1.80 | $ 1.38 | $ 1.51 | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (37,500) | 0 | (400,000) | (406,250) |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 0.60 | $ 0 | $ 0.48 | $ 0.64 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 1,303,750 | 2,420,000 | 1,460,938 | 1,220,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Ending Balance | $ 1.52 | $ 0.24 | $ 1.38 | $ 1.08 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 1,035,625 | 1,188,750 | 1,184,324 | 774,375 |
Weighted Average Exercise price at end of period | $ 1.52 | $ 0.22 | $ 1.38 | $ 0.76 |
11. SHAREHOLDERS' EQUITY_ Sch79
11. SHAREHOLDERS' EQUITY: Schedule of share options outstanding and exercisable (Details) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Share Options, Outstanding | 2,420,000 |
Share Options, Exercisable | 1,188,750 |
Share Option 1 | |
Share Options, Exercise Price | $ / shares | $ 0.22 |
Share Options, Expiry Date | Jan. 27, 2022 |
Share Options, Outstanding | 300,000 |
Share Options, Exercisable | 300,000 |
Share Option 2 | |
Share Options, Exercise Price | $ / shares | $ 0.15 |
Share Options, Expiry Date | Jul. 20, 2022 |
Share Options, Outstanding | 150,000 |
Share Options, Exercisable | 150,000 |
Share Option 3 | |
Share Options, Exercise Price | $ / shares | $ 0.15 |
Share Options, Expiry Date | Aug. 3, 2019 |
Share Options, Outstanding | 125,000 |
Share Options, Exercisable | 41,250 |
Share Option 4 | |
Share Options, Exercise Price | $ / shares | $ 0.15 |
Share Options, Expiry Date | Aug. 15, 2022 |
Share Options, Outstanding | 150,000 |
Share Options, Exercisable | 150,000 |
Share Option 5 | |
Share Options, Exercise Price | $ / shares | $ 0.15 |
Share Options, Expiry Date | Aug. 24, 2019 |
Share Options, Outstanding | 150,000 |
Share Options, Exercisable | 48,750 |
Share Option 6 | |
Share Options, Exercise Price | $ / shares | $ 0.28 |
Share Options, Expiry Date | Nov. 20, 2022 |
Share Options, Outstanding | 150,000 |
Share Options, Exercisable | 150,000 |
Share Option 7 | |
Share Options, Exercise Price | $ / shares | $ 0.28 |
Share Options, Expiry Date | Dec. 8, 2022 |
Share Options, Outstanding | 1,395,000 |
Share Options, Exercisable | 348,750 |
11. SHAREHOLDERS' EQUITY_ Sch80
11. SHAREHOLDERS' EQUITY: Schedule of Share-based payments for options granted (Details) - Share-based payments for options granted | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Expected life | 4 years 1 month 6 days | 4 years 1 month 6 days | ||
Volatility | 172.00% | 169.00% | ||
Dividend yield | 0.00% | 0.00% | 0.00% | 1.00% |
Risk-free interest rate | 0.44% | 1.03% | ||
Bottom of range | ||||
Expected life | 2 years | 2 years | ||
Volatility | 148.00% | 100.00% | ||
Risk-free interest rate | 1.23% | 0.47% | ||
Top of range | ||||
Expected life | 5 years | 5 years | ||
Volatility | 164.00% | 155.00% | ||
Risk-free interest rate | 1.69% | 0.58% |
11. SHAREHOLDERS' EQUITY_ Sch81
11. SHAREHOLDERS' EQUITY: Schedule of changes in warrants (Details) - Warrants entitling the holders to acquire common shares - $ / shares | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance | 1,748,135 | 0 | 1,301,250 | 2,950,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Beginning Balance | $ 1.24 | $ 0 | $ 1.24 | $ 1.32 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 10,655,326 | 0 | 1,103,063 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 0 | $ 0.20 | $ 0 | $ 1 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | (12,858) | 0 | (976,250) | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price | $ 1 | $ 0 | $ 0.50 | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (434,027) | (2,274,000) | (325,000) | (2,304,928) |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 1 | $ 0.20 | $ 0.52 | $ 1.24 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 1,301,250 | 8,381,326 | 0 | 1,748,135 |
Weighted Average Exercise price at end of period | $ 1.64 | $ 0.20 | $ 0 | $ 1.24 |
11. SHAREHOLDERS' EQUITY_ Sch82
11. SHAREHOLDERS' EQUITY: Schedule of warrants outstanding and exercisable (Details) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Warrants outstanding | 8,381,326 |
Warrant 1 | |
Warrant Exercise Price | $ / shares | $ 0.20 |
Warrant Expiry Date | Jun. 26, 2022 |
Warrants outstanding | 2,182,659 |
Warrant 2 | |
Warrant Exercise Price | $ / shares | $ 0.20 |
Warrant Expiry Date | Aug. 3, 2022 |
Warrants outstanding | 1,326,667 |
Warrant 3 | |
Warrant Exercise Price | $ / shares | $ 0.20 |
Warrant Expiry Date | Nov. 27, 2022 |
Warrants outstanding | 4,872,000 |
11. SHAREHOLDERS' EQUITY_ Sch83
11. SHAREHOLDERS' EQUITY: Schedule of Fair Value of Finder's Warrants (Details) - Fair value of finder's warrants | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Expected life | 0 years | 5 years | 0 years | 1 year |
Volatility | 0.00% | 0.00% | 179.00% | |
Dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Risk-free interest rate | 0.00% | 0.00% | 1.07% | |
Bottom of range | ||||
Volatility | 154.00% | |||
Risk-free interest rate | 1.15% | |||
Top of range | ||||
Volatility | 159.00% | |||
Risk-free interest rate | 1.62% |
11. SHAREHOLDERS' EQUITY_ Sch84
11. SHAREHOLDERS' EQUITY: Schedule of Assumptions in Fair Value Measurement of Warrants (Details) - Fair value of each warrant | 12 Months Ended |
Dec. 31, 2016 | |
Dividend yield | 0.00% |
Risk-free interest rate | 0.61% |
Bottom of range | |
Expected life | 11 days |
Volatility | 75.00% |
Top of range | |
Expected life | 6 months 22 days |
Volatility | 110.00% |
12. PRODUCT REGISTRATION AND 85
12. PRODUCT REGISTRATION AND DEVELOPMENT: Schedule of Product Registration and Development (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | ||
Details | |||||
Payroll | $ 0 | $ 126,859 | $ 168,964 | $ 0 | |
Product registration and licensing fees | 930 | 115,444 | 39,820 | 56,143 | |
Product registration and development | [1] | $ 930 | $ 242,303 | $ 208,784 | $ 56,143 |
[1] | Note 12 |
13. SELLING AND MARKETING EXP86
13. SELLING AND MARKETING EXPENSES: Schedule of Selling and Marketing Expense (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | ||
Details | |||||
Payroll (sales personnel) | $ 0 | $ 335,920 | $ 329,091 | $ 0 | |
Marketing and advertising | 103,123 | 178,058 | 105,658 | 9,858 | |
Distribution | 0 | 102,948 | 161,304 | 0 | |
Travel | 0 | 79,235 | 67,769 | 0 | |
Selling and marketing | [1] | $ 103,123 | $ 696,161 | $ 663,822 | $ 9,858 |
[1] | Note 13 |
14. GENERAL AND ADMINISTRATIV87
14. GENERAL AND ADMINISTRATIVE EXPENSES: Schedule of General and Administrative Expenses (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | ||
Details | |||||
Management and consulting fees | [1] | $ 155,084 | $ 192,621 | $ 242,667 | $ 362,727 |
Payroll | 149,034 | 79,847 | 122,330 | 54,665 | |
Bad debt | 0 | 62,930 | 99,000 | 0 | |
Investor relations | 58,024 | 7,174 | 70,332 | 54,334 | |
Office maintenance | 33,881 | 180,984 | 55,168 | 51,357 | |
Legal, audit and accounting | 37,587 | 279,097 | 61,409 | 37,806 | |
Travel | 33,961 | 41,246 | 34,020 | 30,441 | |
Insurance | 25,250 | 34,573 | 34,453 | 18,366 | |
Seminars and conferences | 14,582 | 0 | 445 | 23,084 | |
Rent | 20,429 | 49,229 | 46,050 | 48,982 | |
Filing and registration fees | 13,688 | 74,898 | 62,130 | 53,714 | |
Amortization | 8,513 | 13,854 | 14,668 | 13,900 | |
Bank service charges | 1,690 | 2,480 | 1,330 | 1,061 | |
Foreign exchange | 0 | 3,630 | (3,210) | 1,337 | |
General and administrative | [2] | $ 551,723 | $ 1,022,563 | $ 840,792 | $ 751,774 |
[1] | Note 15 | ||||
[2] | Note 14 |
15. RELATED PARTY TRANSACTION88
15. RELATED PARTY TRANSACTIONS: Schedule of Related Party Transactions (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Details | ||||
Management and consulting fees | $ 154,356 | $ 60,010 | $ 242,667 | $ 149,667 |
Rent | 0 | 0 | 0 | 4,500 |
Salaries and benefits | 0 | 132,613 | 0 | 0 |
Share-based compensation | 0 | 280,864 | 0 | 0 |
Related Party Expenses | $ 154,356 | $ 473,487 | $ 242,667 | $ 154,167 |
15. RELATED PARTY TRANSACTIONS
15. RELATED PARTY TRANSACTIONS (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Details | ||
Due to related parties included in accounts payable and accrued liabilities | $ 13,152 | $ 3,275 |
17. COMMITMENTS_ Schedule of 90
17. COMMITMENTS: Schedule of future minimum lease payments (Details) | 12 Months Ended |
Dec. 31, 2017CAD ($) | |
Total future minimum lease payments | $ 122,007 |
Not later than one year | |
Total future minimum lease payments | 38,447 |
Later than one year and not later than five years | |
Total future minimum lease payments | $ 83,560 |
18. FINANCIAL INSTRUMENTS AND91
18. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT: Schedule of aging of accounts receivable (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Trade receivables | $ 425,284 | $ 668,917 |
Current | ||
Trade receivables | 251,693 | 245,071 |
0 - 30 days past due | ||
Trade receivables | 23,062 | 242,250 |
31 - 60 days past due | ||
Trade receivables | 7,055 | 25,119 |
61 - 90 days past due | ||
Trade receivables | 15,387 | 31,837 |
Over 90 days past due | ||
Trade receivables | $ 128,087 | $ 124,640 |
18. FINANCIAL INSTRUMENTS AND92
18. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 | |
Details | |||
Allowance for doubtful accounts receivable | $ 59,045 | $ 99,000 | |
Accounts payable and accrued liabilities | [1] | 302,089 | 357,342 |
Asset acquisition liability | [2] | $ 100,000 | $ 0 |
[1] | Note 10 | ||
[2] | Note 4 |
19. SUPPLEMENTAL CASH FLOW IN93
19. SUPPLEMENTAL CASH FLOW INFORMATION: Schedule of Supplemental Cash Flow Information (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Details | ||||
Cash paid for interest | $ 0 | $ 0 | $ 0 | $ 0 |
Cash paid for income taxes | $ 0 | $ 0 | $ 0 | $ 0 |
19. SUPPLEMENTAL CASH FLOW IN94
19. SUPPLEMENTAL CASH FLOW INFORMATION (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | Dec. 28, 2017 | [2] | Apr. 26, 2017 | Dec. 10, 2014 | ||
Details | |||||||||
Finder's warrants, number issued | [1] | 70,000 | 152,147 | ||||||
Finder's warrants, fair value | [1] | $ 11,614 | $ 67,533 | ||||||
Purchase consideration - Shares to be issued | $ 973,333 | $ 973,333 | |||||||
Purchase consideration - Asset acquisition liability | 100,000 | $ 100,000 | |||||||
Write-downs (reversals of write-downs) of inventories | [3] | $ 0 | 745,977 | $ 291,794 | $ 0 | ||||
Impairment of intellectual property | $ 0 | $ 0 | $ 0 | $ (476,000) | |||||
[1] | Note 11 | ||||||||
[2] | Note 4 | ||||||||
[3] | Note 7 |
20. INCOME TAXES_ Schedule of95
20. INCOME TAXES: Schedule of Income Tax Reconciliation (Details) - CAD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2015 | |
Details | ||||
Net loss and comprehensive loss for the period | $ (1,190,414) | $ (2,736,717) | $ (2,613,904) | $ (2,200,648) |
Statutory tax rate | 26.00% | 26.00% | 26.00% | 26.00% |
Expected income tax (recovery) | $ (309,508) | $ (711,546) | $ (679,615) | $ (572,169) |
Non-deductible items | 166,482 | 84,637 | 241,475 | 237,955 |
Change in estimates | 0 | (768) | (11,699) | 0 |
Share issue costs | (19,205) | (2,730) | 0 | (2,771) |
Loss expired | 166,689 | 0 | 0 | 84,778 |
Change in statutory rates and other | 0 | (155,379) | 0 | 0 |
Change in deferred tax asset not recognized | $ (4,458) | $ 785,786 | $ 449,839 | $ 252,207 |
20. INCOME TAXES_ Schedule of96
20. INCOME TAXES: Schedule of Deferred Tax Assets and Liabilities (Details) - CAD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Details | ||
Non-capital loss carry-forwards | $ 3,959,367 | $ 3,170,690 |
Property and equipment | 147,189 | 139,259 |
Intangible asset | 94,126 | 90,639 |
Financing costs | 26,469 | 40,777 |
Deferred tax assets | 4,227,151 | 3,441,365 |
Deferred tax asset not recognized | 4,227,151 | 3,441,365 |
Net deferred tax asset (liability) | $ 0 | $ 0 |
21. SUBSEQUENT EVENTS (Details)
21. SUBSEQUENT EVENTS (Details) | 12 Months Ended | |
Dec. 31, 2017shares | ||
In January and April 2018 | ||
Description of significant events and transactions | Company issued 2,591,500 common shares | |
Increase (decrease) in number of ordinary shares issued | 2,591,500 | |
In February 2018 | ||
Description of significant events and transactions | a total of 150,000 stock options were granted to an officer of the Company | |
Stock options granted | 150,000 | |
In April 2018 | ||
Description of significant events and transactions | a total of 200,000 stock options were granted to a director of the Company | |
Stock options granted | 200,000 | |
On April 15, 2018 | ||
Description of significant events and transactions | Company issued 3,030,303 share purchase warrants | |
Share purchase warrants issued | 3,030,303 | |
On April 27, 2018 | ||
Description of significant events and transactions | Company issued 880,000 common shares | [1] |
Increase (decrease) in number of ordinary shares issued | 880,000 | [1] |
April 2,018 | ||
Description of significant events and transactions | Company entered into an agreement with Corozon Consulting Corporation to acquire the Corozon Platform | |
[1] | Note 4 |