| Summary of Significant Accounting Policies | NOTE
1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization
and Nature of Business ACRT (“ACRT”, “We”
or the “Company”) is a development-stage technology company focused on fraud prevention and credit management. The Company offers a proprietary
software platform branded as CyberloQ™ . While previously the Company licensed CyberloQ, in the third quarter of 2017, the
Company acquired the CyberloQ technology and is now the exclusive owner of CyberloQ. CyberloQ is a banking fraud prevention
technology that is offered to institutional clients in order to combat fraudulent transactions and unauthorized access to customer
accounts. Through the use of a customer’s smart-phone, CyberloQ uses a multi-factor authentication system to control access
to a bank card, transaction type or amount, website, database or digital service. The mobile applications for CyberloQ have been
built, and the Company is currently beta-testing the technology in the banking ecosystem. In addition to CyberloQ, the Company
offers a web-based proprietary software platform under the brand name Turnscor® which allows customers to monitor and manage
their credit from the privacy of their own homes. Although individuals can sign-up for Turnscor on their own, the Company also
intends to market Turnscor to certain institutional clients, where appropriate, in conjunction with CyberloQ as a value-added
benefit to offer their customers. Moreover, on March 30, 2017 the
Company entered into an Agreement with Swiss Venture Trust, a subsidiary of XCELL Security House, S.A. of Lausanne, Switzerland
whose President, Lynnwood Farr, is a member of the Company’s Board of Directors. The equity exchange and revenue sharing
agreements entered into between the two companies are currently in the process of being renegotiated, and the renegotiated terms
of such contracts will be disclosed when finalized. On June 15, 2017, the Company created
a private limited company in the United Kingdom named CyberloQ Technologies LTD. CyberloQ Technologies LTD is a wholly-owned subsidiary
of the Company, and any business that the Company has in the United Kingdom will be transacted through CyberloQ Technologies LTD.
However, to date CyberloQ Technologies LTD has not had any operating activity or generated any revenue for the Company. Basis
of Presentation The financial statements of the
Company have been prepared using the accrual basis of accounting in accordance with generally accepted accounting principles in
the United States of America and are presented in U.S. dollars. The Company has adopted a December 31 fiscal year end. Certain information and note disclosures
normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have
been condensed or omitted. These consolidated financial statements should be read in conjunction with a reading of the financial
statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as filed
with the U.S. Securities and Exchange Commission. Principles of Consolidation –
The consolidated financial statements include the accounts of the Company and its wholly-owned or controlled operating subsidiaries.
All intercompany accounts and transactions have been eliminated. Reclassification Certain
reclassifications have been made to conform previously reported data to the current presentation. These reclassifications have
no effect on our net income (loss) or financial position as previously reported. Use of Estimates In
preparing these financial statements, management makes estimates and assumptions that affect the reported amounts of assets and
liabilities in the balance sheets and revenues and expenses during the year reported. Actual results may differ from these estimates.
The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes
to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of
assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results
experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material
differences between the estimates and the actual results, future results of operations will be affected. Cash
and Cash Equivalents Cash
equivalents are comprised of certain highly liquid investments with maturities of three months or less when purchased. The Company
maintains its cash in bank deposit accounts, which at times, may exceed federally insured limits. The Company has not experienced
any losses related to this concentration of risk. As of March 31, 2018 and December 31, 2017, the Company had no in deposits in
excess of federally-insured limits. Research
and Development, Software Development Costs, and Internal Use Software Development Costs Software development costs
are accounted for in accordance with ASC Topic No. 985. Software development costs are capitalized once technological feasibility
of a product is established and such costs are determined to be recoverable. For products where proven technology exists, this
may occur very early in the development cycle. Factors we consider in determining when technological feasibility has been established
include (i) whether a proven technology exists; (ii) the quality and experience levels of the individuals developing
the software; (iii) whether the software is similar to previously developed software which has used the same or similar technology;
and (iv) whether the software is being developed with a proven underlying engine. Technological feasibility is evaluated
on a product-by-product basis. Capitalized costs for those products that are canceled or abandoned are charged immediately to
cost of sales. The recoverability of capitalized software development costs is evaluated on the expected performance of the specific
products for which the costs relate. Internal
use software development costs are accounted for in accordance with ASC Topic No. 350 which requires the capitalization of certain
external and internal computer software costs incurred during the application development stage. The application development stage
is characterized by software design and configuration activities, coding, testing and installation. Training costs and maintenance
are expensed as incurred, while upgrades and enhancements are capitalized if it is probable that such expenditures will result
in additional functionality. In
accounting for website software development costs, we have adopted the provisions of ASC Topic No. 350. ASC Topic No. 350 provides
that certain planning and training costs incurred in the development of website software be expensed as incurred, while application
development stage costs are to be capitalized. During the periods ending March 31, 2018 and 2017, we expensed $1,500 and $0 in
expenditures on research and development, respectively. Of the $1,500 paid in 2018, none was paid to related parties. Fixed
Assets The
Company records its fixed assets at historical cost. The Company expenses maintenance and repairs as incurred. Upon disposition
of fixed assets, the gross cost and accumulated depreciation are written off and the difference between the proceeds and the net
book value is recorded as a gain or loss on sale of assets. The Company depreciates its fixed assets over their respective estimated
useful lives ranging from three to fifteen years. Intangible
and Long-Lived Assets The
Company follows FASB ASC 360-10, "Property, Plant, and Equipment," Revenue
Recognition The
Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable
and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed and determinable,
and collectability is reasonably assured. Determining whether some or all of these criteria have been met involves assumptions
and judgments that can have a significant impact on the timing and amount of revenue the Company reports. Fair
Value Measurements For
certain financial instruments, including accounts receivable, accounts payable, accrued expenses, interest payable, advances payable
and notes payable, the carrying amounts approximate fair value due to their relatively short maturities. The
Company has adopted FASB ASC 820-10, "Fair Value Measurements and Disclosures." ·
Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities
in active markets. ·
Level 2 inputs to the valuation methodology include quoted prices for similar assets and
liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially
the full term of the financial instrument. ·
Level 3 inputs to the valuation methodology are unobservable and significant to the fair
value measurement. The
Company did not identify any other non-recurring assets and liabilities that are required to be presented in the balance sheets
at fair value in accordance with FASB ASC 815. In February
2007, the FASB issued FAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities," "Financial Instruments." Segment
Reporting FASB
ASC 280, "Segment Reporting" Income
Taxes Deferred
income taxes are provided using the liability method whereby deferred tax assets are recognized for deductible temporary differences
and operating loss and tax credit carry forwards, and deferred tax liabilities are recognized for taxable temporary differences.
Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred
tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion
or all-of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of the
changes in tax laws and rates of the date of enactment. When
tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities,
while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately
sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available
evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution
of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions
that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent
likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax
positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits
in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities
upon examination. Applicable interest and penalties associated with unrecognized tax benefits are classified as additional income
taxes in the statements of operations. The Company is not aware of uncertain tax positions. Earnings
(Loss) Per Share Earnings
per share is calculated in accordance with the FASB ASC 260-10, "Earnings Per Share." Basic earnings (loss) per share
is based upon the weighted average number of common shares outstanding. Diluted earnings (loss) per share is based on the assumption
that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury
stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time
of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during
the period. At March
31, 2018 and 2017 the Company has 1,250,000 and 0 warrants issued (respectively) that can be exercised and could be dilutive to
the existing number of shares issued and outstanding. However, due to the Company’s periods of losses, the basic weighted
average is equal to the weighted average shares outstanding. The
computation of earnings per share of common stock is based on the weighted average number of shares outstanding at the date of
the financial statements. Stock
Based Compensation The
Company adopted FASB ASC Topic 718 – Compensation – Stock Compensation (formerly SFAS 123R), which establishes
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 FASB ASC Topic 718 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. The
Company accounts for stock issued to non-employees where the value of the stock compensation is based upon the measurement date
as determined at either (a) the date at which a performance commitment is reached, or (b) at the date at which the necessary performance
to earn the equity instruments is complete. Recent
Accounting Pronouncements In January
2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which revises
the accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation
of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements
associated with the fair value of financial instruments. The new guidance requires the fair value measurement of investments in
equity securities and other ownership interests in an entity, including investments in partnerships, unincorporated joint ventures
and limited liability companies (collectively, equity securities) that do not result in consolidation and are not accounted for
under the equity method. Entities will need to measure these investments and recognize changes in fair value in net income. Entities
will no longer be able to recognize unrealized holding gains and losses on equity securities they classify under current guidance
as available for sale in other comprehensive income (OCI). They also will no longer be able to use the cost method of accounting
for equity securities that do not have readily determinable fair values. Instead, for these types of equity investments that do
not otherwise qualify for the net asset value practical expedient, entities will be permitted to elect a practicability exception
and measure the investment at cost less impairment plus or minus observable price changes (in orderly transactions). The ASU also
establishes an incremental recognition and disclosure requirement related to the presentation of fair value changes of financial
liabilities for which the fair value option (FVO) has been elected. Under this guidance, an entity would be required to separately
present in OCI the portion of the total fair value change attributable to instrument-specific credit risk as opposed to reflecting
the entire amount in earnings. For derivative liabilities for which the FVO has been elected, however, any changes in fair value
attributable to instrument-specific credit risk would continue to be presented in net income, which is consistent with current
guidance. For the Company, this standard is effective beginning January 1, 2018 via a cumulative-effect adjustment to beginning
retained earnings, except for guidance relative to equity securities without readily determinable fair values which is applied
prospectively. The Company is currently assessing this ASU's impacts on the Company's consolidated results of operations and financial
condition. In March 2016, the FASB issued
ASU 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue
Gross versus Net)”. The amendments in this ASU are intended to improve the operability and understandability of the implementation
guidance on principal versus agent considerations by amending certain existing illustrative examples and adding additional illustrative
examples to assist in the application of the guidance. The effective date and transition of these amendments is the same as the
effective date and transition of ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”. Public entities
should apply the amendments in ASU 2014-09 for annual reporting periods beginning after December 15, 2017, including interim reporting
periods therein. The Company is currently not generating any revenue, however, the Company will report gross revenue and agent
considerations as separate line items upon revenue receipt. In March 2016, the FASB issued
ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”.
The amendments are effective for public companies for annual periods beginning after December 15, 2016, and interim periods within
those annual periods. Several aspects of the accounting for share-based payment award transactions are simplified, including:
(a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement
of cash flows. The Company has implemented this effective January 1, 2017. The impact on the financial statements is enhanced
disclosure in the statement of cash flows. In March 2016, the FASB
issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which modifies certain accounting aspects
for share-based payments to employees including, among other elements, the accounting for income taxes and forfeitures, as
well as classifications in the statement of cash flows. With respect to income taxes, under current guidance, when a
share-based payment award such as a stock option or restricted stock unit (RSU) is granted to an employee, the fair value of
the award is generally recognized over the vesting period. However, the related deduction from taxes payable is based on the
award’s intrinsic value at the time of exercise (for an option) or on the fair value upon vesting of the award (for
RSUs), which can be either greater (creating an excess tax benefit) or less (creating a tax deficiency) than the compensation
cost recognized in the financial statements. Excess tax benefits are recognized in additional paid-in capital (APIC) within
equity, and tax deficiencies are similarly recognized in APIC to the extent there is a sufficient APIC amount (APIC pool)
related to previously recognized excess tax benefits. Under the new guidance, all excess tax benefits/deficiencies would be
recognized as income tax benefit/expense in the statement of income. The new ASU’s income tax aspects also impact the
calculation of diluted earnings per share by excluding excess tax benefits/deficiencies from the calculation of assumed
proceeds available to repurchase shares under the treasury stock method. Relative to forfeitures, the new standard allows an
entity-wide accounting policy election either to continue to estimate the number of awards that will be forfeited or to
account for forfeitures as they occur. The new guidance also impacts classifications within the statement of cash flows by no
longer requiring inclusion of excess tax benefits as both a hypothetical cash outflow within cash flows from operating
activities and hypothetical cash inflow within cash flows from financing activities. Instead, excess tax benefits would be
classified in operating activities in the same manner as other cash flows related to income taxes. Additionally, the new
ASU requires cash payments to tax authorities when an employer uses a net-settlement feature to withhold shares to meet
statutory tax withholding provisions to be presented as financing activity (eliminating previous diversity in practice). For
the Company, this standard was adopted effective January 1, 2017, and has had no accounting effect to date because the
Company has no employees. In
August 2016, the FASB issued ASU No. 2016-15, Classification of Certain
Cash Receipts and Cash Payments, which is intended to reduce diversity
in practice in how certain cash receipts and payments are presented and classified in the statement of cash flows. The standard
provides guidance in a number of situations including, among others, settlement of zero-coupon bonds, contingent consideration
payments made after a business combination, proceeds from the settlement of insurance claims, and distributions received from
equity method investees. The ASU also provides guidance for classifying cash receipts and payments that have aspects of more than
one class of cash flows. For the Company, this ASU is effective January 1, 2018, with early adoption permitted. The standard requires
application using a retrospective transition method. The Company has adopted this standard however, currently this ASU has no
impact on its results of operations and financial condition. In November 2016, the FASB issued
ASU No. 2016-18, Restricted Cash, which clarifies guidance on the classification and presentation of restricted cash in the statement
of cash flows. Under the ASU, changes in restricted cash and restricted cash equivalents would be included along with those of
cash and cash equivalents in the statement of cash flows. As a result, entities would no longer present transfers between cash/equivalents
and restricted cash/equivalents in the statement of cash flows. In addition, a reconciliation between the balance sheet and the
statement of cash flows would be disclosed when the balance sheet includes more than one line item for cash/equivalents and restricted
cash/equivalents. For the Company, this ASU is effective January 1, 2018, with early adoption permitted. Entities are required
to apply the standard’s provisions on a retrospective basis. The Company has adopted this standard and this ASU has neither
a retrospective nor current material impact on the Company’s condensed results of operations and financial condition, as
the Company has no restricted cash. |
