Leo Motors (LEOM) 10-Q 21 Aug 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Aug. 17, 2017
Details
Registrant Name	Leo Motors, Inc.
Registrant CIK	1,356,564
SEC Form	10-Q
Period End date	Jun. 30, 2017
Fiscal Year End	--12-31
Trading Symbol	leom
Tax Identification Number (TIN)	814,108,026
Number of common stock shares outstanding		174,559,116
Filer Category	Smaller Reporting Company
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	Q2
Contained File Information, File Number	000-53525
Entity Incorporation, State Country Name	Nevada
Entity Address, Address Line One	ES Tower 7F, Teheranro 52 Gil 17
Entity Address, City or Town	Gangnamgu, Seoul
Entity Address, Country	Rep. of Korea
Entity Address, Postal Zip Code	6,212
City Area Code	82-70
Local Phone Number	4699-3585

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Current Assets
Cash and cash equivalents	$ 448,744	$ 460,671
Accounts receivable	869,998	433,205
Inventories	1,293,887	1,088,298
Prepayment to suppliers	489,698	457,643
Other current assets	356,662	91,973
Total Current Assets	3,458,989	2,531,790
Fixed assets, net	240,510	129,157
Deposits and Other Assets	725,524	346,255
Intangible assets	40,583	88,503
Goodwill	2,613,486	2,613,486
Total Assets	7,079,093	5,709,191
Current Liabilities:
Accounts payable	863,261	1,411,130
Accrued expenses	6,341,539	4,345,772
Advance from customers	169,294	386,624
Due to related parties	410,546	358,680
Taxes payable	186,642	29,635
Notes Payable current portion	274,984	268,824
Total Current Liabilities	8,246,267	6,800,665
Accrued retirement benefits	260,791	216,195
Other long term liabilities	492,951	72,851
Total Liabilities	9,000,008	7,089,711
Leo Motors, Inc. ('LEOM') Equity (Deficit):
Common stock ($0.001 par value; 300,000,000 shares authorized); 174,559,116 and 172,528,016 shares issued and outstanding at June 30, 2017 and December 31, 2016	174,559	172,528
Additional paid-in capital	21,641,983	21,411,832
Accumulated other comprehensive income	4,899,720	1,184,443
Accumulated loss	(34,341,025)	(29,776,217)
Total Equity (Deficit) Leo Motors, Inc.	(7,624,764)	(7,007,414)
Non-controlling interest	5,703,849	5,626,894
Total Equity (Deficit)	(1,920,914)	(1,380,520)
Total Liabilities and Equity(Deficit)	$ 7,079,093	$ 5,709,191

CONSOLIDATED BALANCE SHEETS - P

CONSOLIDATED BALANCE SHEETS - Parenthetical - $ / shares	Jun. 30, 2017	Dec. 31, 2016
Details
Common Stock, Par or Stated Value Per Share	$ 0.001	$ 0.001
Common Stock, Shares Authorized	300,000,000	300,000,000
Common Stock, Shares, Issued	174,559,116	172,528,016
Common Stock, Shares, Outstanding	174,559,116	172,528,016

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Details
Revenues	$ 433,992	$ 806,456	$ 832,943	$ 1,552,162
Cost of Revenues	605,133	690,074	791,469	981,088
Gross Profit	(171,141)	116,382	41,474	571,074
Operating Expenses	3,108,804	1,008,491	5,614,273	1,917,351
Income(loss) from Continuing Operations	(3,279,945)	(892,109)	(5,572,799)	(1,346,277)
Other Income (Expenses)
Interest expense	(7,019)	(8,436)	(14,678)	(17,764)
Currency Gains (Losses)	116,664	(46,952)	9,308	(29,865)
Non-Operating (expense) income	91,055	78,119	112,197	66,362
Total Other Income (Expenses)	200,700	22,731	106,827	18,733
Income(loss) from Continuing Operations Before Income Taxes	(3,079,245)	(869,378)	(5,465,972)	(1,327,544)
Income Tax Expense	1,199	0	1,249	0
Net Income(Loss)	(3,080,444)	(869,378)	(5,467,221)	(1,327,544)
Income(loss) attributable to non-controlling interest	(172,481)	(51,235)	(902,414)	(86,890)
Net Income(Loss) Attributable To Leo Motors, Inc.	(2,907,964)	(818,143)	(4,564,808)	(1,240,654)
Other Comprehensive Income:
Net Income(Loss)	(3,080,444)	(869,378)	(5,467,221)	(1,327,544)
Unrealized foreign currency translation gain	(107,356)	97,510	66,667	175,630
Comprehensive Income (loss) Attributable to Leo Motors, Inc.	$ (3,187,800)	$ (771,868)	$ (5,400,544)	$ (1,151,914)
Net Loss per Common Share:
Basic	$ (0.02)	$ (0.01)	$ (0.03)	$ (0.01)
Diluted	$ (0.02)	$ (0.01)	$ (0.03)	$ (0.01)
Weighted Average Common Shares Outstanding:
Basic	173,551,978	161,878,686	172,979,055	161,878,686
Diluted	173,551,978	161,878,686	172,979,055	161,878,686

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash flows from Operating Activities:
Net loss	$ (4,564,808)	$ (1,240,654)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	106,848	45,422
Foreign currency translation	0	175,630
Net loss attributed to NCI	902,414	86,890
Stock-based compensation	32,182	131,247
Changes in assets and liabilities:
Prepaid Expenses	(394)	0
Accounts Receivable	(247,177)	689,931
Inventories	(134,112)	(217,138)
Prepayment to suppliers	(7,859)	(186,625)
Other current assets	260,352	0
Other assets	(160,882)	(61,696)
Accounts payable, other payables and accrued expenses	897,741	(82,224)
Accrued retirement benefits	32,888	77,942
Advances from customers	10,581	(131,724)
Taxes payable	25,412	105,635
Net cash used in operating activities:	(4,651,643)	(781,144)
Cash flows from investing activities:
Purchase of property and equipment	(218,201)	(65,302)
Write off intangibles	47,920	0
Net cash provided(used) in investing activities:	(170,281)	(65,302)
Cash flows from financing activities:
Proceeds (payments) on notes payable / long term payables	426,260	186,946
Payments on notes payable	(9,923)	0
Proceeds on notes payable - related party	51,866	259,578
Other Comprehensive Income	3,715,277	0
Proceeds from issuance of stock & warrants	200,000	1,123,475
Net cash provided(used) by financing activities:	4,383,480	1,569,999
Effect of Foreign Exchange Rate on Cash	426,517	0
Net Increase in cash and cash equivalents:	(11,927)	723,553
Cash and cash equivalents - beginning of year	460,671	243,809
Cash and cash equivalents - end of period	448,744	967,362
Supplemental disclosure of cash flow activities:
Interest	14,678	9,328
Income taxes	0	0
Supplemental disclosures of non-cash activities:
Common stock issued for services	32,182	131,247
Goodwill on Acquisition	$ 0	$ 660,928

Note 1 - Company Background

Note 1 - Company Background	6 Months Ended
	Jun. 30, 2017
Notes
Note 1 - Company Background	NOTE 1 - COMPANY BACKGROUND Leo Motors, Inc. (the “Company” or “we”) is currently in development, assembly and sales of the energy storage devices and electric vehicle components. The Company was originally incorporated in California as N. Org., Inc. on December 12, 1983. The Company then underwent several name changes from Natural Organics Corporation to Classic Auto Accessories of North America and then to FCR Automotive Group, Inc. On September 20, 2004, the Company reincorporated in Delaware by merging into FCR Group, Inc., a Delaware Automotive corporation, which was organized on September 8, 2004. On July 26, 2005, the Company acquired Shinil Precision Co., Ltd., a Korean Company, as its operating business and on July 18, 2005, changed its name to Shinil Precision Machinery, Inc. to reflect its anticipated new business. Upon failure of certain terms and conditions of the acquisition agreement, the Company returned the shares of Shinil and recovered and cancelled the Company's shares issued in the acquisition. In 2012, the Company changed its domicile to Nevada. The Company had been dormant since 1989, and consummated a reverse merger on November 12, 2007 with Leozone Inc., a South Korean company (“Leozone”), which is the maker of electrical transportation devices. The merger essentially exchanges shares in Leo Motors, Inc. for shares in Leozone. As this is a reverse merger the accounting treatment of such is that of a combination of the two entities with the activity of Leozone, the surviving entity, going forward. The financial statements reflect the activity for all periods presented as if the merger had occurred January 1, 2007. Leozone has continued to operate as a separate subsidiary, Leo Motors Co. Ltd. of Korea (“Leo Korea”) since that time. On February 11, 2010, the Company acquired 50% of Leo B&T Corp., a South Korean corporation (“B&T”), from two shareholders of B&T in exchange for 7,000,000 shares of the Company’s common stock. Our ownership in B&T was reduced to 30% in 2011. Additionally, this investment was written down as impairment expense during 2011 and the remaining investment was exchanged in 2012 for a return of Leo Motors stock. On November 10, 2012, the Company signed an agreement with PDI C&D/RDC SPRL Inc. ("PDI"), an affiliate of PDI Global LLC, a major architectural design company in the U.S., to supply an independent solar power system grafted with the Company’s E-Box power storage device for a housing project in the Democratic Republic of the Congo ("DRC"). The Company will have a 10% interest in the overall project. This project has incurred an impairment charge as details in these footnotes. On July 1, 2014, the Company acquired all of the outstanding common stock of LGM Co. Ltd., a corporation incorporated in the Republic of Korea (“LGM”), from LGM’s shareholders, which represents 813,747 shares of LGM common stock, in exchange for 47,352,450 shares of the Company's common stock pursuant to the Share Swap Agreement entered into by and between LGM and the Company. Upon closing of the Share Swap Agreement, LGM became a wholly-owned subsidiary of the Company. On March 31, 2015, the Company acquired 50% interest in each of Leo Motors Factory, Inc. (“Leo Factory 1”) and Leo Motors Factory 2, Inc. (“Leo Factory 2”) The Company acquired Leo AIC Co., Ltd. (“Leo AIC”)(formerly known as Lelcon) on June 3, 2016, which became a subsidiary of the Company. With the acquisition, the Company was engaged in connected car and artificial intelligence (AI) related businesses for a smart city. On March 8, 2017, the Company acquired 100% of a startup corporation owned by its director called Leo Members, Inc (“Leo Members”). This new wholly owned subsidiary then exchanged interest with Leo Motors in Leo Factory 1, Leo Factory 2, and Leo Trading in a common control transaction. Certain information and disclosures normally included in the notes to financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements of the Company for the year ended December 31, 2016.

Note 2 - Policies

Note 2 - Policies	6 Months Ended
	Jun. 30, 2017
Notes
Note 2 - Policies	NOTE 2 - POLICIES This summary of significant account policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and the notes are the representation of the Company’s management, who are responsible for their integrity and objectivity. These accounting policies conform to U.S. generally accepted accounting principles (“USGAAP”) and have been consistently applied in the preparation of the financial statements. Basis of Presentation and Consolidation These financial statements and related notes are expressed in US dollars. The Company’s fiscal year-end is December 31. The consolidated financial statements include the financial statements of Leo Korea, LGM, Leo Factory 1, Leo Factory 2, Leo Trading, Leo Members, and Leo AIC. The Company has significant control of all subsidiaries through direct as well as indirect stock ownership and voting board control from parent board members at the subsidiary level. All inter-company transactions and balances have been eliminated upon consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Fair Value of Financial Instruments For certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable inventory and prepaid expenses, accounts payable and deferred revenues, the carrying amounts approximate fair value due to their short maturities. Revenue Recognition The Company follows the guidance of the Securities and Exchange Commission’s Staff Accounting Bulletin No. 104, “Revenue Recognition in Financial Statements”. In general, the Company records revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The following policies reflect specific criteria for the various revenues streams of the Company. The Company generates revenue from the delivery of goods and records revenues when the sales are completed, already collected or collectability is reasonably assured, there is no future obligation and there is remote chance of future claim or refund to the customers. Revenue is recognized when risk of ownership and title pass to the buyer, generally upon the delivery of professional services. Pricing is fixed and determinable according to the Company’s published brochures and price lists. Accounts Receivables Accounts receivables of the Company are reviewed to determine if their carrying value has become impaired. The Company considers the assets to be impaired if the balances are greater than one-year old. Management regularly reviews accounts receivable and will establish an allowance for potentially uncollectible amounts when appropriate. When accounts are written off, they will be charged against the allowance. Receivables are not collateralized and do not bear interest. Cash Equivalents For purposes of reporting cash flows, the Company considers all short-term investments with an original maturity of three months or less to be cash equivalent. Fixed Assets Fixed assets are stated at cost, less accumulated depreciation. Depreciation is provided principally on the straight-line method over the estimated useful lives of the assets, which is generally 3 to 10 years. The cost of repairs and maintenance is charged to expense as incurred. Expenditures for property betterments and renewals are capitalized. Upon sale or other disposition of a depreciable asset, cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in other income (expense). The Company will periodically evaluate whether events and circumstances have occurred that may warrant revision of the estimated useful lives of fixed assets or whether the remaining balance of fixed assets should be evaluated for possible impairment. We use an estimate of the related undiscounted cash flows over the remaining life of the fixed assets in measuring their recoverability. Intangible and Long Lived Assets The Company follows ASC 360-10, “Property, Plant, and Equipment,” Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740-10, “Accounting for Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year; and, (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if, based on the weight of available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken on a tax return. Under ASC 740-10, a tax benefit from an uncertain tax position taken or expected to be taken may be recognized only if it is “more likely than not” that the position is sustainable upon examination, based on its technical merits. The tax benefit of a qualifying position under ASC 740-10 would equal the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with a taxing authority having full knowledge of all the relevant information. A liability (including interest and penalties, if applicable) is established to the extent a current benefit has been recognized on a tax return for matters that are considered contingent upon the outcome of an uncertain tax position. Related interest and penalties, if any, are included as components of income tax expense and income taxes payable. Loss per Share Basic earnings (loss) per share is computed by dividing net income, or loss, by the weighted average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share is computed by dividing net income, or loss, by the weighted average number of shares of both common and preferred stock outstanding for the period. Inventory Inventory consist mostly of items purchased as finished goods and used in the repair of automobiles and boats and are recorded at cost and is valued using the first in, first out method. Stock-Based Compensation SFAS No. 123, “Accounting for Stock-Based Compensation,” establishes and encourages the use of the fair value based method of accounting for stock-based compensation arrangements under which compensation cost is determined using the fair value of stock-based compensation determined as of the date of grant and is recognized over the periods in which the related services are rendered. For stock based compensation the Company recognizes an expense in accordance with SFAS No. 123 and values the equity securities based on the fair value of the security on the date of grant. Stock option awards are valued using the Black-Scholes option-pricing model. Reclassifications Certain reclassifications have been made to prior year balances to conform to the current year presentation. Foreign Currency Translation And Comprehensive Income The reporting currency of the Company is the US$. The functional currency of the parent company is the US$ and the functional currency of the Company’s operating subsidiaries is the Korean Won (“KRW”). The subsidiaries results of operations and cash flows are translated at average exchange rates during the year, assets and liabilities are translated at the unified exchange rate at the end of the year, and equity is translated at historical exchange rates. Translation adjustments resulting from the process of translating the functional currency financial statements into US$ are included in determining comprehensive income. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. The Company does not enter any material transaction in foreign currencies and accordingly, transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company. Recent Accounting Pronouncements The Company continually assesses any new accounting pronouncements to determine their applicability to the Company. Where it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and assures that there are proper controls in place to ascertain that the Company’s financials properly reflect the change. The Company currently does not have any recent accounting pronouncements that they are studying and feel may be applicable.

Note 3 - Due To Related Party

Note 3 - Due To Related Party	6 Months Ended
	Jun. 30, 2017
Notes
Note 3 - Due To Related Party	NOTE 3 - DUE TO RELATED PARTY The company is indebted to its officer for advances. There are various advances and repayments throughout the periods in small amounts. They are all short term in nature and provide working capital to the various subsidiaries. Repayment is on demand without interest. The balance was $410,546 at June 30, 2017 and $358,680 at December 31, 2016. There are no other related party transactions.

Note 4 - Payments Received in A

Note 4 - Payments Received in Advance	6 Months Ended
	Jun. 30, 2017
Notes
Note 4 - Payments Received in Advance	NOTE 4 - PAYMENTS RECEIVED IN ADVANCE The Company during the periods received payments from potential customers, or deposits, on future orders. The Company’s policy is to record these payments as a liability until the product is completed and shipped to the customer at which the Company recognizes revenue. As of June 30, 2017 and December 31, 2016, the balance of payments received in advance was $169,294 and $386,624, respectively.

Note 5 - Going Concern

Note 5 - Going Concern	6 Months Ended
	Jun. 30, 2017
Notes
Note 5 - Going Concern	NOTE 5 - GOING CONCERN As reported in the consolidated financial statements, the Company has accumulated deficits of $34,341,025 as of June 30, 2017 and its current liabilities exceeded its current assets. These negative trends have been consistent over the last few years except for asset sales. These factors create uncertainty about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable and to create operations that contribute capital from normal operations. If the Company cannot obtain adequate capital it could be forced to cease operations. In order to continue as a going concern, develop and generate revenues and achieve a profitable level of operations, the Company will need, among other things, additional capital resources. Management's plans to obtain such resources for the Company include (1) raising additional capital through sales of common stock, (2) converting promissory notes into common stock and (3) entering into acquisition agreements with profitable entities with significant operations. In addition, management is continually seeking to streamline its operations and expand the business through a variety of industries, including real estate and financial management. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Note 6 - Commitments and Contin

Note 6 - Commitments and Contingencies	6 Months Ended
	Jun. 30, 2017
Notes
Note 6 - Commitments and Contingencies	NOTE 6 - COMMITMENTS AND CONTINGENCIES (a) Lease Commitments The Company leases its office space in Ha-Nam City in Korea which expires on December 31, 2017. The minimum obligations under such commitments for the years ending December 31, 2017 through December 31, 2019 are listed on the table below. For the Year Ending Amount 2017 $ 75,000 2018 0 2019 and beyond 0 Total Commitment $ 75,000 (b) Loss Contingencies The company currently has no loss contingencies.

Note 7 - Inventories

Note 7 - Inventories	6 Months Ended
	Jun. 30, 2017
Notes
Note 7 - Inventories	NOTE 7 - INVENTORIES Inventories consist of the following: June 30, 2017 Dec 31, 2016 US$ US$ Raw material $ 68,013 $ 420,768 Work in process 797,026 155,778 Finished goods 428,848 511,752 $ 1,293,887 $ 1,088,298

Note 8 - Property and Equipment

Note 8 - Property and Equipment	6 Months Ended
	Jun. 30, 2017
Notes
Note 8 - Property and Equipment	NOTE 8 - PROPERTY AND EQUIPMENT Property and equipment consisted of the following: June 30, 2017 Dec 31, 2016 Vehicles $ 159,224 $ 87,218 Tools 78,912 71,818 Office 216,495 179,791 Facility equipment 302,565 202,168 Total property and equipment 757,196 540,995 Accumulated depreciation (516,686) (411,838) Property and equipment, net $ 240,510 $ 129,157 Depreciation expense for the six months ended June 30, 2017 and 2016 amounted to $106,848 and $45,422, respectively.

Note 9 - Short Term Borrowings

Note 9 - Short Term Borrowings and Notes Payable	6 Months Ended
	Jun. 30, 2017
Notes
Note 9 - Short Term Borrowings and Notes Payable	NOTE 9 - SHORT TERM BORROWINGS AND NOTES PAYABLE The Company continues to fund itself through borrowing and equity sales until sales return to historical levels. At June 30, 2017 and December 31, 2016, the Company had short term borrowings of $274,984 and $268,824. The notes are short term working capital advances that have been advanced to their Korean Subsidiary from various local parties. These advances are due on demand, interest free and unsecured. As of June 30, 2017, the major components of our notes and borrowings consisted of the following: June 30, 2017 Dec 31, 2016 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 3.77% interest only payable monthly and secured by the Company. $ 47,765 $ 47,258 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 3.28% interest only payable monthly. 87,578 69,319 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 13.00% interest only payable monthly and secured by the Company. 61,304 86,648 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 3.77 interest only payable monthly. 46,819 34,406 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 9.24 interest only payable monthly. 31,518 31,193 Total Liabilities 274,984 268,824 Less current portion 274,984 268,824 Long term debt $ 0 $ 0

Note 10 - Intangible Assets

Note 10 - Intangible Assets	6 Months Ended
	Jun. 30, 2017
Notes
Note 10 - Intangible Assets	NOTE 10 - INTANGIBLE ASSETS The Company accounts for its long-lived assets in accordance with Accounting Standards Codification (“ASC”) Topic 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” ASC Topic 360-10-05 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value. The Company increased goodwill as a result of its 2016 first quarter acquisition by $612,445 but also impaired the goodwill on its 2015 acquisitions. The company has retained the goodwill from its LGM acquisition which has substantial market value assets in excess of carrying cost. The Company added to the value of its intangibles in the six months ended June 30, 2017 with development costs associated with its intangibles. June 30, 2017 Dec 31, 2016 Patents $ 40,306 $ 88,226 Trademarks 277 277 Goodwill 3,717,931 3,717,931 Intangible assets 3,758,514 3,806,434 Less impairments (1,104,445) (1,104,445) Intangible assets, net $ 2,654,069 $ 2,701,989

NOTE 11 - EQUITY

NOTE 11 - EQUITY	6 Months Ended
	Jun. 30, 2017
Notes
NOTE 11 - EQUITY	NOTE 11 - EQUITY In the six months ended June 30, 2017, the Company sold 2,000,000 shares of common stock for $200,000. The Company issued 192,638 shares of common stock, with a fair market value of $32,182, for compensation.

NOTE 12 - SUBSEQUENT EVENTS

NOTE 12 - SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2017
Notes
NOTE 12 - SUBSEQUENT EVENTS	On August 1, 2017, the Company acquired 15.66% of Leo Kartrena, Inc. (“Leo Kartrena”). The Company invested an aggregate of Two Hundred Sixty Million (260,000,000 KRW) South Korean Won (approximately $226,000 USD), or Seven Hundred (700 KRW) South Korean Won (approximately $0.61 USD per share), to Leo Kartrena in consideration for the issuance of Three Hundred Seventy One Thousand Four Hundred Twenty Eight (371,428) shares of Leo Kartrena’s common stock. Leo Kartrena is an electric Go Kart development company which will use the battery swappable electric Go Kart developed by LGM. As its Go Kart venues develop, Leo Kartrena will be a significant client of LGM and Leo Motors, Inc.

Note 2 - Policies (Policies)

Note 2 - Policies (Policies)	6 Months Ended
	Jun. 30, 2017
Policies
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation These financial statements and related notes are expressed in US dollars. The Company’s fiscal year-end is December 31. The consolidated financial statements include the financial statements of Leo Korea, LGM, Leo Factory 1, Leo Factory 2, Leo Trading, Leo Members, and Leo AIC. The Company has significant control of all subsidiaries through direct as well as indirect stock ownership and voting board control from parent board members at the subsidiary level. All inter-company transactions and balances have been eliminated upon consolidation.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Fair Value of Financial Instruments	Fair Value of Financial Instruments For certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable inventory and prepaid expenses, accounts payable and deferred revenues, the carrying amounts approximate fair value due to their short maturities.
Revenue Recognition	Revenue Recognition The Company follows the guidance of the Securities and Exchange Commission’s Staff Accounting Bulletin No. 104, “Revenue Recognition in Financial Statements”. In general, the Company records revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The following policies reflect specific criteria for the various revenues streams of the Company. The Company generates revenue from the delivery of goods and records revenues when the sales are completed, already collected or collectability is reasonably assured, there is no future obligation and there is remote chance of future claim or refund to the customers. Revenue is recognized when risk of ownership and title pass to the buyer, generally upon the delivery of professional services. Pricing is fixed and determinable according to the Company’s published brochures and price lists.
Accounts Receivables	Accounts Receivables Accounts receivables of the Company are reviewed to determine if their carrying value has become impaired. The Company considers the assets to be impaired if the balances are greater than one-year old. Management regularly reviews accounts receivable and will establish an allowance for potentially uncollectible amounts when appropriate. When accounts are written off, they will be charged against the allowance. Receivables are not collateralized and do not bear interest.
Cash Equivalents	Cash Equivalents For purposes of reporting cash flows, the Company considers all short-term investments with an original maturity of three months or less to be cash equivalent.
Fixed Assets	Fixed Assets Fixed assets are stated at cost, less accumulated depreciation. Depreciation is provided principally on the straight-line method over the estimated useful lives of the assets, which is generally 3 to 10 years. The cost of repairs and maintenance is charged to expense as incurred. Expenditures for property betterments and renewals are capitalized. Upon sale or other disposition of a depreciable asset, cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in other income (expense). The Company will periodically evaluate whether events and circumstances have occurred that may warrant revision of the estimated useful lives of fixed assets or whether the remaining balance of fixed assets should be evaluated for possible impairment. We use an estimate of the related undiscounted cash flows over the remaining life of the fixed assets in measuring their recoverability.
Intangible and Long Lived Assets	Intangible and Long Lived Assets The Company follows ASC 360-10, “Property, Plant, and Equipment,”
Income Taxes	Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740-10, “Accounting for Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year; and, (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if, based on the weight of available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken on a tax return. Under ASC 740-10, a tax benefit from an uncertain tax position taken or expected to be taken may be recognized only if it is “more likely than not” that the position is sustainable upon examination, based on its technical merits. The tax benefit of a qualifying position under ASC 740-10 would equal the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with a taxing authority having full knowledge of all the relevant information. A liability (including interest and penalties, if applicable) is established to the extent a current benefit has been recognized on a tax return for matters that are considered contingent upon the outcome of an uncertain tax position. Related interest and penalties, if any, are included as components of income tax expense and income taxes payable.
Loss Per Share	Loss per Share Basic earnings (loss) per share is computed by dividing net income, or loss, by the weighted average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share is computed by dividing net income, or loss, by the weighted average number of shares of both common and preferred stock outstanding for the period.
Inventory	Inventory Inventory consist mostly of items purchased as finished goods and used in the repair of automobiles and boats and are recorded at cost and is valued using the first in, first out method.
Stock-based Compensation	Stock-Based Compensation SFAS No. 123, “Accounting for Stock-Based Compensation,” establishes and encourages the use of the fair value based method of accounting for stock-based compensation arrangements under which compensation cost is determined using the fair value of stock-based compensation determined as of the date of grant and is recognized over the periods in which the related services are rendered. For stock based compensation the Company recognizes an expense in accordance with SFAS No. 123 and values the equity securities based on the fair value of the security on the date of grant. Stock option awards are valued using the Black-Scholes option-pricing model.
Reclassifications	Reclassifications Certain reclassifications have been made to prior year balances to conform to the current year presentation.
Foreign Currency Translation and Comprehensive Income	Foreign Currency Translation And Comprehensive Income The reporting currency of the Company is the US$. The functional currency of the parent company is the US$ and the functional currency of the Company’s operating subsidiaries is the Korean Won (“KRW”). The subsidiaries results of operations and cash flows are translated at average exchange rates during the year, assets and liabilities are translated at the unified exchange rate at the end of the year, and equity is translated at historical exchange rates. Translation adjustments resulting from the process of translating the functional currency financial statements into US$ are included in determining comprehensive income. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. The Company does not enter any material transaction in foreign currencies and accordingly, transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company.
Recent Accounting Pronouncements	Recent Accounting Pronouncements The Company continually assesses any new accounting pronouncements to determine their applicability to the Company. Where it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and assures that there are proper controls in place to ascertain that the Company’s financials properly reflect the change. The Company currently does not have any recent accounting pronouncements that they are studying and feel may be applicable.

Note 6 - Commitments and Cont19

Note 6 - Commitments and Contingencies (Tables)	6 Months Ended
	Jun. 30, 2017
Tables/Schedules
Schedule of Future Minimum Rental Payments for Operating Leases	The Company leases its office space in Ha-Nam City in Korea which expires on December 31, 2017. The minimum obligations under such commitments for the years ending December 31, 2017 through December 31, 2019 are listed on the table below. For the Year Ending Amount 2017 $ 75,000 2018 0 2019 and beyond 0 Total Commitment $ 75,000

Note 7 - Inventories (Tables)

Note 7 - Inventories (Tables)	6 Months Ended
	Jun. 30, 2017
Tables/Schedules
Schedule of Inventories	Inventories consist of the following: June 30, 2017 Dec 31, 2016 US$ US$ Raw material $ 68,013 $ 420,768 Work in process 797,026 155,778 Finished goods 428,848 511,752 $ 1,293,887 $ 1,088,298

Note 8 - Property and Equipme21

Note 8 - Property and Equipment (Tables)	6 Months Ended
	Jun. 30, 2017
Tables/Schedules
Property, Plant and Equipment	Property and equipment consisted of the following: June 30, 2017 Dec 31, 2016 Vehicles $ 159,224 $ 87,218 Tools 78,912 71,818 Office 216,495 179,791 Facility equipment 302,565 202,168 Total property and equipment 757,196 540,995 Accumulated depreciation (516,686) (411,838) Property and equipment, net $ 240,510 $ 129,157

Note 9 - Short Term Borrowing22

Note 9 - Short Term Borrowings and Notes Payable (Tables)	6 Months Ended
	Jun. 30, 2017
Tables/Schedules
Schedule of Short-term Debt	As of June 30, 2017, the major components of our notes and borrowings consisted of the following: June 30, 2017 Dec 31, 2016 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 3.77% interest only payable monthly and secured by the Company. $ 47,765 $ 47,258 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 3.28% interest only payable monthly. 87,578 69,319 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 13.00% interest only payable monthly and secured by the Company. 61,304 86,648 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 3.77 interest only payable monthly. 46,819 34,406 Bank loan six month note extended with 12 month term renewable periods with a variable interest rate currently at 9.24 interest only payable monthly. 31,518 31,193 Total Liabilities 274,984 268,824 Less current portion 274,984 268,824 Long term debt $ 0 $ 0

Note 10 - Intangible Assets (Ta

Note 10 - Intangible Assets (Tables)	6 Months Ended
	Jun. 30, 2017
Tables/Schedules
Schedule of Intangible Assets and Goodwill	June 30, 2017 Dec 31, 2016 Patents $ 40,306 $ 88,226 Trademarks 277 277 Goodwill 3,717,931 3,717,931 Intangible assets 3,758,514 3,806,434 Less impairments (1,104,445) (1,104,445) Intangible assets, net $ 2,654,069 $ 2,701,989

Note 1 - Company Background (De

Note 1 - Company Background (Details) - shares	3 Months Ended	6 Months Ended
	Mar. 31, 2010	Jun. 30, 2017	Dec. 31, 2011
Common Stock
Conversion of Stock, Shares Issued		47,352,450
Leo B T Corp
Noncash or Part Noncash Acquisition, Interest Acquired	50.00%
Noncash or Part Noncash Acquisition, Noncash Financial or Equity Instrument Consideration, Shares Issued	7,000,000
Equity Method Investment, Ownership Percentage			30.00%
PDI
Long Term Investment Percentage Of Investment Owned		10.00%
LGM Co Ltd
Conversion of Stock, Shares Converted		813,747
Leo Motors Factory 1
Noncash or Part Noncash Acquisition, Interest Acquired		50.00%
Leo Trade
Noncash or Part Noncash Acquisition, Interest Acquired		50.00%
Leo Members, Inc
Noncash or Part Noncash Acquisition, Interest Acquired		100.00%

Note 3 - Due To Related Party (

Note 3 - Due To Related Party (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Due to related parties	$ 410,546	$ 358,680
Officer
Due to related parties	$ 410,546	$ 358,680

Note 4 - Payments Received in26

Note 4 - Payments Received in Advance (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Details
Advance from customers	$ 169,294	$ 386,624

Note 5 - Going Concern (Details

Note 5 - Going Concern (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Details
Accumulated deficits	$ (34,341,025)	$ (29,776,217)

Note 6 - Commitments and Cont28

Note 6 - Commitments and Contingencies: Schedule of Future Minimum Rental Payments for Operating Leases (Details)	Jun. 30, 2017USD ($)
Details
2,017	$ 75,000
2,018	0
2019 and beyond	0
Total Commitment	$ 75,000

Note 7 - Inventories_ Schedule

Note 7 - Inventories: Schedule of Inventories (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Details
Raw material	$ 68,013	$ 420,768
Work in process	797,026	155,778
Finished goods	428,848	511,752
Inventories	$ 1,293,887	$ 1,088,298

Note 8 - Property and Equipme30

Note 8 - Property and Equipment: Property, Plant and Equipment (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Property, Plant and Equipment, Gross	$ 757,196	$ 540,995
Accumulated depreciation	(516,686)	(411,838)
Property and equipment, net	240,510	129,157
Tools
Property, Plant and Equipment, Gross	78,912	71,818
Office Equipment
Property, Plant and Equipment, Gross	216,495	179,791
Facility Equipment
Property, Plant and Equipment, Gross	302,565	202,168
Vehicles
Property, Plant and Equipment, Gross	$ 159,224	$ 87,218

Note 8 - Property and Equipme31

Note 8 - Property and Equipment (Details) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Details
Depreciation	$ 106,848	$ 45,422

Note 9 - Short Term Borrowing32

Note 9 - Short Term Borrowings and Notes Payable (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Note 1
Short-term Debt	$ 274,984	$ 268,824

Note 9 - Short Term Borrowing33

Note 9 - Short Term Borrowings and Notes Payable: Schedule of Short-term Debt (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Total Liabilities	$ 274,984	$ 268,824
Less current portion	274,984	268,824
Long term debt	0	0
Note 3
Notes payable to bank	47,765	47,258
Note 4
Notes payable to bank	87,578	69,319
Note 5
Notes payable to bank	61,304	86,648
Note 6
Notes payable to bank	46,819	34,406
Note 7
Notes payable to bank	$ 31,518	$ 31,193

Note 10 - Short Term Borrowings

Note 10 - Short Term Borrowings and Notes Payable: Schedule of Short-term Debt - Parenthetical (Details)	Jun. 30, 2017
Note 3
Debt Instrument, Interest Rate, Stated Percentage	3.77%
Note 4
Debt Instrument, Interest Rate, Stated Percentage	3.28%
Note 5
Debt Instrument, Interest Rate, Stated Percentage	13.00%
Note 6
Debt Instrument, Interest Rate, Stated Percentage	3.77%
Note 7
Debt Instrument, Interest Rate, Stated Percentage	9.24%

Note 10 - Intangible Assets (De

Note 10 - Intangible Assets (Details)	12 Months Ended
	Dec. 31, 2016USD ($)
Details
Goodwill increased	$ 612,445

Note 10 - Intangible Assets_ Sc

Note 10 - Intangible Assets: Schedule of Intangible Assets and Goodwill (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Details
Patents	$ 40,306	$ 88,226
Trademarks	277	277
Goodwill	3,717,931	3,717,931
Intangible assets	3,758,514	3,806,434
Less impairments	(1,104,445)	(1,104,445)
Intangible assets, net	$ 2,654,069	$ 2,701,989

NOTE 11 - EQUITY (Details)

NOTE 11 - EQUITY (Details)	6 Months Ended
	Jun. 30, 2017USD ($)shares
Stock Issued During Period, Value, New Issues | $	$ 200,000
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures | $	$ 32,182
Common Stock
Stock Issued During Period, Shares, New Issues | shares	2,000,000
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | shares	192,638

NOTE 12 - SUBSEQUENT EVENTS (De

NOTE 12 - SUBSEQUENT EVENTS (Details) - Subsequent Event - Leo Kartrena, Inc.	Aug. 01, 2017USD ($)$ / sharesshares
Business Acquisition, Percentage of Voting Interests Acquired	15.66%
Stock Issued During Period, Value, Acquisitions | $	$ 226,000
Business Acquisition, Share Price | $ / shares	$ 0.61
Common Stock
Stock Issued During Period, Shares, Acquisitions | shares	371,428