Creative Waste Solutions (CWSS) 10-Q 11 May 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Mar. 31, 2016	May. 10, 2016
Document And Entity Information
Entity Registrant Name	SILVERSTAR RESOURCES, INC.
Entity Central Index Key	1,385,329
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		3,436,840
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,016

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2016	Sep. 30, 2015
Current Assets:
Cash and cash equivalents	$ 133	$ 209
Total current assets	133	209
Total assets	133	209
Current Liabilities:
Accounts payable and accrued expenses	137,132	114,521
Convertible debentures, related parties	224,896	224,896
Convertible debentures	18,912	18,912
Note payable	159,489	141,989
Advances - related parties	55,746	55,746
Derivative liability	1,444,835	4,152,164
Total current liabilities	2,041,010	4,708,228
Total liabilities	$ 2,041,010	$ 4,708,228
Stockholders' deficit:
Preferred Stock; $.001 value 5,000,000 shares authorized, none issued and outstanding
Common Stock; $.001 par value, 225,000,000 authorized 3,436,840 and 3,436,840 shares issued and outstanding	$ 3,437	$ 3,437
Additional paid-in capital	2,281,275	2,281,275
Accumulated deficit	(4,325,589)	(6,992,731)
Total stockholders' deficit	(2,040,877)	(4,708,019)
Total Liabilities and Stockholders' (Deficit)	$ 133	$ 209

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2016	Sep. 30, 2015
Stockholders' Equity (Deficit)
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	225,000,000	225,000,000
Common stock, shares issued	3,436,840	3,436,840
Common stock, shares outstanding	3,436,840	3,436,840

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015
Operating Expenses:
General and administrative	$ 15,406	$ 102,876	$ 26,076	$ 123,691
Loss from operations	(15,406)	(102,876)	(26,076)	(123,691)
Other income (expenses):
Gain (loss) on derivative liability	2,822,259	(109,348)	2,707,329	(109,348)
Interest expense	$ (7,146)	$ (35,626)	$ (14,111)	(41,617)
Gain on settlement of accounts payable				9,015
Total other income (expenses)	$ 2,815,113	$ (144,974)	$ 2,693,218	(141,950)
Net income (loss)	$ 2,799,707	$ (247,850)	$ 2,667,142	$ (265,641)
Earning (loss) per share
Basic	$ 0.81	$ (0.08)	$ 0.78	$ (0.09)
Diluted	$ (0.01)	$ (0.08)	$ (0.01)	$ (0.09)
Weighted average common shares outstanding
Basic	3,436,840	3,256,070	3,436,840	2,903,657
Diluted	4,261,565	3,256,070	4,261,565	2,903,657

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
CASH FLOW FROM OPERATING ACTIVITIES
Net income (loss)	$ 2,667,142	$ (265,641)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Stock based compensation		73,500
(Gain) loss in fair value of derivative liability	$ (2,707,329)	109,348
Gain on settlement of accounts payable		(9,015)
Amortization of beneficial conversion feature		29,841
Changes in operating assets and liabilities
Accounts payable and accrued expense	$ 22,611	39,712
NET CASH USED IN OPERATING ACTIVITIES	(17,576)	$ (22,255)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from note payable	$ 17,500
Proceeds from advances- related parity		$ 22,450
NET CASH PROVIDED BY FINANCING ACTIVITIES	$ 17,500	22,450
Net increase (decrease) in cash	(76)	195
Cash, beginning of period	209	24
Cash, end of period	$ 133	$ 219
SUPPLEMENTAL CASH FLOWS INFORMATION
Interest paid
Income taxes paid
SUPPLEMENTAL NON CASH INVESTING AND FINANCING ACTIVITIES:
Common stock issued for settlement of accounts payable		$ 12,166
Common stock issued for debt		$ 10,000

ORGANIZATION AND BASIS OF PRESE

ORGANIZATION AND BASIS OF PRESENTATION	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION	Silverstar Resources, Inc (formally Silverstar Mining Corp) (the "Company") was incorporated under the laws of the State of Nevada on December 5, 2003. On March 4, 2008, the Company completed a merger with its wholly-owned subsidiary, Silverstar Resources Corp., which was incorporated by the Company solely to effect the name change of the Company to Silverstar Resources Corp. The Company was incorporated for the purpose to promote and carry on any lawful business for which a corporation may be incorporated under the laws of the State of Nevada. On January 23, 2015 the board of directors with the consent of a majority of its shareholders approved amended articles of incorporation to include a change of name to Silverstar Resources, Inc. and a reverse split of its common stock resulting in shareholders receiving one share for every five shares (5 to 1) they hold as of record of that date. In addition the amendment set the authorized shares of common stock at 225,000,000 and preferred stock at 5,000,000 shares both at a par value of $0.001. All share and per share numbers have been retroactively restated to reflect this stock split. On March 10, 2015 the Company formed 1030029 Ltd, an Alberta numbered company as a wholly owned subsidiary to meet the requirements of holding working interest of Alberta producing oil and gas properties.

BASIS OF PRESENTATION

BASIS OF PRESENTATION	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
NOTE 2 - BASIS OF PRESENTATION	The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (SEC), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's September 30, 2015 Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year end September 30, 2015 as reported on Form 10-K, have been omitted.

GOING CONCERN

GOING CONCERN	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
NOTE 3 - GOING CONCERN	As shown in the accompanying financial statements, Silverstar Resources has an accumulated deficit of $4,325,589 as of March 31, 2016. Unless the Company is able to attain profitability and increases in stockholders' equity, these conditions raise substantial doubt as to the Company's ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. The Company continues to review its expense structure in an attempt to reduce operating costs. The Company's expenses are planned to decrease, which would result in an improvement to its results of operations.

CONVERTIBLE DEBENTURES - RELATE

CONVERTIBLE DEBENTURES - RELATED PARTIES	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
NOTE 4 - CONVERTIBLE DEBENTURES - RELATED PARTIES	On January 15, 2015 the Company amended the convertible debenture with the principal of $75,754 of a related party so that the debenture became anti-dilutive with a conversion price set at $0.35 regardless of any forward or reverse splits in the Company's common stock. On February 23, 2015 a shareholder holding a debenture with a principal balance of $75,754 and other advances to the Company of $149,212 of which $24,398 was borrowed during September 30, 2015 and $124,814 was the outstanding balance at September 30, 2014 made demand for payment of the total amounts owed including interest. The Company was not able to pay the outstanding balances. The Company and shareholder came to an agreement that the shareholder could convert his $75,754 convertible note payable and interest at $0.15 and the advances of $149,212 plus further advances up to $150,000 at a 15% discount to the closing price as of date of the agreement or $0.15 per share. The shareholder agreed to advance an additional $50,000 to the Company to acquire assets for the Company. The $50,000 is not convertible and is accounted for as advances due to related party see Note 6. The change is terms of the $75,754 convertible note created derivative liability and required the Company to record fair value at the inception of the derivative and for each subsequent reporting period. The fair value of the embedded derivatives at inception was determined using the Black Scholes based on the following assumptions: (1) dividend yield of 0%; (2) expected volatility of 298%, (3) weighted average risk-free interest rate of 0.26%, (4) expected life of 1.31 years, and (5) estimated fair value of the Company's common stock is $2.00. The fair value calculated as of March 31, 2016 was $1,444,835. During the six months March 31, 2016 the change in fair value of $2,707,329 resulted in a gain reflected in the statement of operations. The addition of a conversion feature for the advances of $149,212 created a beneficial conversion feature as of September 30, 2015 of $149,212. Due to the advances having no terms and being due on demand, this amount was expensed as interest expense for the year ended September 30, 2015. As of March 31, 2016 and September 30, 2015, the amount due under the convertible debentures to related party was $224,896 and $224,896 respectively.

NOTES PAYABLE

NOTES PAYABLE	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
NOTE 5 - NOTES PAYABLE	On June 2, 2014 the Company issued a long term note payable for $81,989 to an entity for advances on work completed on the Company's Ahbau Lake mining property in British Columbia, Canada. The note is unsecured, and bears interest at 10% per year and matures in one year at which time all principal and interest is due and payable. As of March 31, 2016 and September 30, 2015 the outstanding balance of was $81,989 and $81,989, respectively. On April 2, 2015 the Company issued a $60,000 one year note bearing interest of 9% as part of the acquisition of the working interest in the Alberta oil and gas property. As of March 31, 2016 and September 30, 2015 the outstanding balance of was $60,000 and $60,000, respectively. On December 29, 2015 the Company issued a $17,500 note payable bearing interest of 6% to an unrelated party in exchange for $17,500 of cash for the purpose of working capital.

ADVANCES - RELATED PARTIES

ADVANCES - RELATED PARTIES	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
NOTE 6 - ADVANCES - RELATED PARTIES	During the year ended September 30, 2015 an officer and director and a related party shareholder of the Company advanced $68,630 in cash, paid $5,748 for interest on behalf of the Company and came to an agreement that $24,398 would be convertible and borrowed $123,853 during the year ended September 30, 2014 to the Company by paying certain Company expenses or to pay its expenses. During the year ended September 30, 2015, $149,212 of the total advances was converted into a convertible debenture. As of March 31, 2016 and September 30, 2015 the total amount due to the related parties under these advances were $55,746 and $55,746, respectively. The advances are unsecured, do not have a term and carry no interest rate.

DERIVATIVE INSTRUMENTS

DERIVATIVE INSTRUMENTS	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
Note 7 - DERIVATIVE INSTRUMENTS	During the year ended September 30, 2015 the Company changed the conversion features on a convertible instrument that require liability classification under ASC 815. These instruments are measured at fair value at the end of each reporting period. (See Note 4). As defined in FASB ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilized the market data of similar entities in its industry or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. FASB ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). The three levels of the fair value hierarchy are as follows: · Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities · Level 2 - Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars. · Level 3 - Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management's best estimate of fair value. The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as of March 31, 2016 and September 30, 2015: Recurring Fair Value Measures Level 1 Level 2 Level 3 Total Derivative liabilities at March 31, 2016 $ - $ - $ 1,444,835 $ 1,444,835 Derivative liabilities at September 30, 2015 $ - $ - $ 4,152,164 $ 4,152,164 The below table represents the change in the fair value of the derivative liabilities during the six months March 31, 2016: Fair value of derivatives, September 30, 2015 $ 4,152,164 Change in fair value of derivative liability - gain (2,707,329 ) Fair value of derivatives, March 31, 2016 $ 1,444,835

EARNINGS (LOSS) PER SHARE

EARNINGS (LOSS) PER SHARE	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
Note 8 - EARNINGS (LOSS) PER SHARE	Earnings (loss) per share is calculated using the weighted average number of shares of common stock outstanding during the applicable period. Basic weighted average common shares outstanding is computed using the weighted average shares outstanding during the period. Diluted earnings (loss) per share is computed using the weighted average number of common shares outstanding and if dilutive, potential common shares outstanding during the period. Potential common shares consist of the additional common shares issuable upon the conversion of convertible debentures. The potential dilutive effect of convertible debentures is shown below. The following table presents the computation of basic and diluted earnings (loss) per share: Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Basic Net income (loss) $ 2,799,707 $ (247,850 ) $ 2,667,142 $ (265,641 ) Weighted average common shares outstanding 3,436,840 3,256,070 3,436,840 2,903,657 Basic earnings (loss) per share $ 0.81 $ (0.08 ) $ 0.78 $ (0.09 ) Diluted Net income (loss) $ 2,799,707 $ (247,850 ) $ 2,667,142 $ (265,641 ) Subtract: Interest expense for convertible debentures (3,228 ) - (6,456 ) - Subtract: Change in derivative liability (2,822,259 ) - (2,707,329 ) - Net income (loss) applicable for diluted earnings (loss) per share $ (25,780 ) $ (247,850 ) $ (46,643 ) $ (265,641 ) Weighted average common shares outstanding 3,436,840 3,256,070 3,436,840 2,903,657 Add: Shares issued upon conversion of convertible debentures 824,725 - 824,725 - Assumed weighted average common shares outstanding 4,261,565 3,256,070 4,261,565 2,903,657 Diluted earnings (loss) per share $ (0.01 ) $ (0.08 ) $ (0.01 ) $ (0.09 )

SUBSEQUENT EVENT

SUBSEQUENT EVENT	6 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
Note 9 - SUBSEQUENT EVENT	On April 7, 2016, the Company entered into a membership purchase agreement with Creative Waste Solutions, LLC, a Florida limited liability corporation ("Creative") whereby the Company purchased 100% of the membership interest for $25,000. To finance the purchase of Creative Waste Solutions, the Company issued an additional Note of $29,000.

DERIVATIVE INSTRUMENTS (Tables)

DERIVATIVE INSTRUMENTS (Tables)	6 Months Ended
	Mar. 31, 2016
Derivative Instruments Tables
Financial assets and liabilities that were accounted for at fair value	The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as of March 31, 2016 and September 30, 2015: Recurring Fair Value Measures Level 1 Level 2 Level 3 Total Derivative liabilities at March 31, 2016 $ - $ - $ 1,444,835 $ 1,444,835 Derivative liabilities at September 30, 2015 $ - $ - $ 4,152,164 $ 4,152,164
Change in the fair value of the derivative liabilities	The below table represents the change in the fair value of the derivative liabilities during the six months March 31, 2016: Fair value of derivatives, September 30, 2015 $ 4,152,164 Change in fair value of derivative liability - gain (2,707,329 ) Fair value of derivatives, March 31, 2016 $ 1,444,835

EARNINGS (LOSS) PER SHARE (Tabl

EARNINGS (LOSS) PER SHARE (Tables)	6 Months Ended
	Mar. 31, 2016
Earnings Loss Per Share Tables
Summary of computation of basic and diluted earnings (loss) per share	The following table presents the computation of basic and diluted earnings (loss) per share: Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Basic Net income (loss) $ 2,799,707 $ (247,850 ) $ 2,667,142 $ (265,641 ) Weighted average common shares outstanding 3,436,840 3,256,070 3,436,840 2,903,657 Basic earnings (loss) per share $ 0.81 $ (0.08 ) $ 0.78 $ (0.09 ) Diluted Net income (loss) $ 2,799,707 $ (247,850 ) $ 2,667,142 $ (265,641 ) Subtract: Interest expense for convertible debentures (3,228 ) - (6,456 ) - Subtract: Change in derivative liability (2,822,259 ) - (2,707,329 ) - Net income (loss) applicable for diluted earnings (loss) per share $ (25,780 ) $ (247,850 ) $ (46,643 ) $ (265,641 ) Weighted average common shares outstanding 3,436,840 3,256,070 3,436,840 2,903,657 Add: Shares issued upon conversion of convertible debentures 824,725 - 824,725 - Assumed weighted average common shares outstanding 4,261,565 3,256,070 4,261,565 2,903,657 Diluted earnings (loss) per share $ (0.01 ) $ (0.08 ) $ (0.01 ) $ (0.09 )

GOING CONCERN (Details Narrativ

GOING CONCERN (Details Narrative) - USD ($)	Mar. 31, 2016	Sep. 30, 2015
Going Concern Details Narrative
Accumulated deficit	$ (4,325,589)	$ (6,992,731)

CONVERTIBLE DEBENTURES - RELA18

CONVERTIBLE DEBENTURES - RELATED PARTIES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015	Sep. 30, 2015
Convertible Debentures - Related Parties Details Narrative
Fair value of the embedded debt derivative	$ 1,444,835		$ 1,444,835
Loss on derivative liability	2,822,259	$ (109,348)	2,707,329	$ (109,348)
Convertible debentures	$ 224,896		$ 224,896		$ 224,896
Additional beneficial conversion feature					$ 149,212

NOTES PAYABLE (Details Narrativ

NOTES PAYABLE (Details Narrative) - USD ($)	Mar. 31, 2016	Sep. 30, 2015
Ahbau Lake mining property [Member}
Outstanding balance of principal	$ 81,989	$ 81,989
Alberta oil and gas property [Member}
Outstanding balance of principal	$ 60,000	$ 60,000

ADVANCES - RELATED PARTIES (Det

ADVANCES - RELATED PARTIES (Details Narrative) - USD ($)	Mar. 31, 2016	Sep. 30, 2015
Advances - Related Parties Details Narrative
Advances - related parties	$ 55,746	$ 55,746

DERIVATIVE INSTRUMENTS (Details

DERIVATIVE INSTRUMENTS (Details) - USD ($)	Mar. 31, 2016	Sep. 30, 2015
Derivative liabilities	$ 1,444,835	$ 4,152,164
Level 1 [Member]
Derivative liabilities
Level 2 [Member]
Derivative liabilities
Level 3 [Member]
Derivative liabilities	$ 1,444,835	$ 4,152,164

DERIVATIVE INSTRUMENTS (Detai22

DERIVATIVE INSTRUMENTS (Details 1)	6 Months Ended
	Mar. 31, 2016USD ($)
Derivative Instruments Details 1
Fair value of derivatives, Beginning	$ 4,152,164
Change in fair value of derivative liability - gain	(2,707,329)
Fair value of derivatives, Ending	$ 1,444,835

EARNINGS (LOSS) PER SHARE (Deta

EARNINGS (LOSS) PER SHARE (Details) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015
Basic
Net income (loss)	$ 2,799,707	$ (247,850)	$ 2,667,142	$ (265,641)
Weighted average common shares outstanding	3,436,840	3,256,070	3,436,840	2,903,657
Basic earnings (loss) per share	$ 0.81	$ (0.08)	$ 0.78	$ (0.09)
Diluted
Net income (loss)	$ 2,799,707	$ (247,850)	$ 2,667,142	$ (265,641)
Subtract: Interest expense for convertible debentures	(3,228)		(6,456)
Subtract: Change in derivative liability	(2,822,259)		(2,707,329)
Net income (loss) applicable for diluted earnings (loss) per share	$ (25,780)	$ (247,850)	$ (46,643)	$ (265,641)
Weighted average common shares outstanding	3,436,840	3,256,070	3,436,840	2,903,657
Add: Shares issued upon conversion of convertible debentures	824,725		824,725
Assumed weighted average common shares outstanding	4,261,565	3,256,070	4,261,565	2,903,657
Diluted earnings (loss) per share	$ (0.01)	$ (0.08)	$ (0.01)	$ (0.09)