| NATURE OF OPERATIONS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. NATURE OF OPERATIONS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations Beam Global, a Nevada corporation
(hereinafter the “Company,” “us,” “we,” “our” or “Beam”) is a cleantech innovation
company based in San Diego, California. Beam develops, designs, engineers, manufactures and sells high-quality, renewably energized infrastructure
products for electric vehicle charging, outdoor media and energy security and disaster preparedness. Beam’s products enable vital
and highly valuable energy production in locations where it is either too expensive or too impactful to connect to the utility grid, or
where the requirements for electrical power are so important that grid failures, like blackouts, are intolerable. When competing with
utilities or typical solar companies, we rely on our products’ ease of deployment, reliability, accessibility, and total cost of
ownership, rather than producing the cheapest kilowatt hour with the help of subsidies. Basis of Presentation The interim unaudited condensed
financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States
(“GAAP”) for interim financial statements and are in the form prescribed by the Securities and Exchange Commission in instructions
to Form 10-Q and Rule 10-01 of Regulation S-X. In management’s opinion, all adjustments (consisting of normal recurring adjustments
and reclassifications) necessary to present fairly our results of operations and cash flows for the nine months ended September 30, 2021
and 2020, and our financial position as of September 30, 2021, have been made. The results of operations for such interim periods are
not necessarily indicative of the operating results to be expected for the full year. Certain information and disclosures
normally included in the notes to the annual financial statements have been condensed or omitted from these interim financial statements.
Accordingly, these interim unaudited condensed financial statements should be read in conjunction with the financial statements and notes
thereto for the year ended December 31, 2020. The December 31, 2020 balance sheet is derived from those statements. Risks and Uncertainties The ongoing novel coronavirus
(COVID-19) pandemic has resulted in travel restrictions, quarantines, “stay-at-home” and “shelter-in-place” orders as
well as the shutdown of many businesses around the world. These shutdowns have resulted in product shortages and longer delivery lead-times,
global shipping disruptions and higher costs due to increasing demands for these goods and services. While we have been impacted by supplier
cost increases and other supply chain issues, the COVID-19 pandemic did not have a material adverse effect on our financial position or
results of operations for the nine months ended September 30, 2021. With the rollout of a COVID-19 vaccine and booster shots, businesses
and governments are beginning to return to pre-pandemic status. However, it is difficult to predict what governmental actions may be enacted in
the future or what impact the widespread economic disruption arising from the pandemic could have on our business. The extent and duration
of the pandemic is unknown, and the future effects on our business are uncertain. The Company is continuing to monitor the events and
circumstances surrounding the COVID-19 pandemic, which may require adjustments to the Company’s estimates and assumptions in the
future. Use of Estimates The preparation of financial
statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and
liabilities and 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. Significant estimates in the accompanying
financial statements include the allowance for doubtful accounts receivable, valuation of inventory and standard cost allocations, depreciable
lives of property and equipment, valuation of intangible assets, estimates of loss contingencies, estimates of the valuation of lease
liabilities and the related right of use assets, valuation of share-based costs, and the valuation allowance on deferred tax assets. Recent Accounting Pronouncements In August 2020, the Financial
Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2020-06, Debt—Debt with Conversion and Other Options
(Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible
Instruments and Contracts in an Entity’s Own Equity The ASU is effective for smaller
reporting companies in fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, although early
adoption is permitted, as early as fiscal years beginning after December 15, 2020. As such, the Company adopted ASU 2020-06 effective
January 1, 2021, on a full retrospective basis, which will allow the Company to continue to classify the warrants as equity, and as a
result, had no effect on its condensed financial statements and related disclosures. If the Company had recorded the warrants as a liability
in prior periods, with the full retrospective adoption on January 1, 2021, the liability would have been recast as equity and retained
earnings adjusted to reverse the effect of the liability entries and as a result, there would be no impact on the financial statements
for any periods presented. In June 2016, the FASB issued
ASU 2016-13, Financial Instruments – Credit Losses Concentrations Credit Risk Financial instruments that
potentially subject us to concentrations of credit risk consist of cash and accounts receivable. The Company maintains its
cash in banks and financial institution deposits that at times may exceed federally insured limits. The Company has not experienced any
losses in such accounts from inception through September 30, 2021. As of September 30, 2021, $ 23,184,771 Major Customers For the three months ended
September 30, 2021, revenues from one customer accounted for 74 36 52 16 For the three months ended
September 30, 2020, revenues from four customers accounted for 41 27 14 11 14 13 42 29 14 10 For the nine months ended
September 30, 2021 and 2020, we had a heavy concentration of sales to federal, state and local governments which represented 71 60 Cash and Cash Equivalents For the purposes of the unaudited
condensed statements of cash flows, the Company considers all liquid investments with an original maturity of three months or less when
purchased to be cash equivalents. There were no Fair Value of Financial Instruments The Company’s financial
instruments, including accounts receivable, accounts payable, accrued expenses, and short-term loans, are carried at historical cost basis.
At September 30, 2021, the carrying amounts of these instruments approximated their fair values because of the short-term nature of these
instruments. Accounts Receivable Accounts receivable are customer
obligations due under normal trade terms. Management reviews accounts receivable on a periodic basis to determine if any receivables may
become uncollectible. Management’s evaluation includes several factors including the aging of the accounts receivable balances,
a review of significant past due accounts, dialogue with the customer, the financial profile of a customer, our historical write-off experience,
net of recoveries, and economic conditions. The Company includes any accounts receivable balances that are determined to be uncollectible
in its overall allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off
against the allowance. Inventory Inventory is stated at the
lower of cost and net realizable value. Cost is determined using the first-in, first-out method of accounting. Inventory costs primarily
relate to purchased raw materials and components used in the manufacturing of our products, work in process for products being manufactured,
and finished goods. Included in these costs are direct labor and certain manufacturing overhead costs associated with the manufacturing
process. The Company regularly reviews inventory components and quantities on hand and performs annual physical inventory counts. A reserve
is established if this review process determines the net realizable value of such inventory may be below the carrying value. Patents The Company believes it will
achieve future economic value benefits for its patents. All administrative costs for obtaining patents are accumulated on the balance
sheet as a patent asset until such time as a patent is issued. The costs of these intangible assets are classified as a long-term asset
and amortized on a straight-line basis over the legal life of such asset, which is typically 20 years. In the event a patent is denied
or abandoned, all accumulated administrative costs will be expensed in the period in which the patent was denied or abandoned. Patent
amortization expense was $ 13,156 3,273 Leases In February 2016, the Financial
Accounting Standards Board issued Accounting Standards Update No. 2016-02: “Leases (Topic 842)” whereby lessees need to recognize
almost all leases on the balance sheet as a right of use asset and a corresponding lease liability. The Company adopted this standard
as of January 1, 2019 using the effective date method and applying the package of practical expedients to leases that commenced before
the effective date whereby the Company elected not to reassess the following: (i) whether any expired or existing contracts contain leases,
and (ii) initial direct costs for any existing leases. For contracts entered into after the effective date, at the inception of a contract
the Company assesses whether the contract is, or contains, a lease. The Company’s assessment is based on: (1) whether the contract
involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use
of the asset throughout the period, and (3) whether it has the right to direct the use of the asset. The Company allocates the consideration
in the contract to each lease component based on its relative stand-alone price to determine the lease payments. The Company has elected
to not recognize right of use assets and lease liabilities for short term leases that have a term of 12 months or less. Revenue Recognition Beam follows the revenue standards
of Financial Accounting Standards Board Update No. 2014-09: “Revenue from Contracts with Customers (Topic 606).” The core
principle of this Topic is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount
that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Revenue is recognized
in accordance with that core principle by applying the following five steps: 1) identify the contracts with a customer; 2) identify the
performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations;
and 5) recognize revenue when (or as) we satisfy a performance obligation. Revenues are primarily derived
from the direct sales of manufactured products. Revenues may also consist of maintenance fees for the maintenance of previously sold products
and revenues from sales of professional services. Revenues from inventoried
product are recognized upon the final delivery of such product to the customer or when legal transfer of ownership takes place. Revenue
values are fixed price arrangements determined at the time an order is placed or a contract is entered into. The customer is typically
obligated to make payment for such products within a 30-45 day period after delivery. Revenues from maintenance
fees for services provided by the Company are recognized equally over the period of the maintenance term. Revenue values are fixed price
arrangements determined at the time an order is placed or a contract is entered into. The customer is typically obligated to make payment
for the service in advance of the maintenance period. Extended maintenance or warranty
services, where the customer has the option to purchase this extension as a separate purchase option, are considered a separate performance
obligation. If the Company does not control the extended services, in terms of having the responsibility for fulfillment of the obligation
or the option to choose who will perform the services, the Company is acting as an agent and would report the revenues on a net basis. Revenues from professional
services are recognized when services are performed. Revenue values are based upon fixed fee arrangements or hourly fee-based arrangements
with agreed to hourly rates of service categories in line with expertise requirements. These services are billed to a customer as such
services are provided and the customer will be obligated to make payments for such services typically within a 30-45 day period. Revenues on a bill-and-hold
arrangement are recognized when control of the product is transferred to the customer, but physical possession of the product transfers
at a point in time in the future. To determine this, the reason for the arrangement must be substantive, the product must be separately
identified and ready for physical transfer, the customer has the ability to direct the use of the product and the product cannot be directed
to another customer. The Company has a policy of
recording sales incentives as a contra revenue. The Company includes shipping
and handling fees billed to customers as revenues. Any deposits received from
a customer prior to delivery of the purchased product or monies paid prior to the period for which a service is provided are accounted
for as deferred revenue on the balance sheet. Sales tax is recorded on a
net basis and excluded from revenue. The Company generally provides
a standard one-year warranty on its products for materials and workmanship but may provide multiple year warranties as negotiated, and
it will pass on the warranties from its vendors, if any, which generally covers this one-year period. In accordance with ASC 450-20-25,
the Company accrues for product warranties when the loss is probable and can be reasonably estimated. At September 30, 2021, the
Company has no product warranty accrual given the Company’s historical financial warranty expense. Cost of Revenues The Company records direct
material and component costs, direct labor and associated benefits, and manufacturing overhead costs such as supervision, manufacturing
equipment depreciation, rent, and utility costs, all of which are included in inventory prior to a sale, as costs of revenues. The Company
further includes shipping and handling costs as cost of revenues. Stock-Based Compensation The Company follows ASC 718,
“Compensation – Stock Compensation.” ASC 718 requires companies to estimate and recognize the fair value of stock-based
awards to employees and directors. The fair value of the portion of an award that is ultimately expected to vest is recognized as an expense
over the shorter of the service periods or vesting periods using the straight-line attribution method. The Company adopted ASU 2018-07
and accounts for non-employee share-based awards in accordance with the measurement criteria of ASC 718 and recognizes the fair value
of such awards over the service period. The Company used the modified prospective method of adoption. The Company estimates the
fair value of each stock option at the grant date by using the Black-Scholes option pricing model. Net Loss Per Share Basic net loss per share is
computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the periods presented. Diluted
net loss per common share is computed using the weighted average number of common stock outstanding for the period, and, if dilutive,
potential common stock outstanding during the period. Potential common stock consists of the incremental shares of common stock issuable
upon the exercise of stock options, stock warrants, convertible debt instruments or other common stock equivalents. Potentially dilutive
securities are excluded from the computation if their effect is anti-dilutive. Options to purchase 222,383 542,823 Reclassifications Where necessary, the
prior year’s information has been reclassified to conform to the current period’s statement presentation. On the
Condensed Statements of Cash Flows, the prepaid inventory of $126,100 that was converted to inventory at September 30, 2020 was
reclassified from inventory to conform to the September 30, 2021 presentation and $69,711
of deferred revenue was reclassed to deferred revenue, noncurrent on the Condensed Balance Sheets. Segments The Company follows ASC 280-10
"Disclosures about Segments of an Enterprise and Related Information." During the nine months ended September 30, 2021 and 2020,
the Company only operated in one segment; therefore, segment information has not been presented. |
