Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 12, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | ADVANCED CREDIT TECHNOLOGIES INC | ||
Entity Central Index Key | 0001437517 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity's Reporting Status Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Extended Transition Period | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 7,947,548 | ||
Entity Common Stock, Shares Outstanding | 66,030,515 | ||
Trading Symbol | ACRT | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash | $ 21,009 | $ 112,799 |
Advanced Commissions | 16,000 | |
Commitment Receivable | 9,000 | |
Total Current Assets | 30,009 | 128,799 |
Fixed Assets | ||
Software and Computer Equipment, Net | 550,679 | 670,728 |
Total Fixed Assets | 550,679 | 670,728 |
Total Assets | 580,688 | 799,527 |
Current Liabilities | ||
Accounts Payable and Accrued Expenses | 9,851 | 10,128 |
Customer Prepayments | 39,585 | |
Accrued Expenses - Related Party | ||
Loans Payable - Stockholders | 45,000 | 50,000 |
Loans from Related Parties | 145,000 | |
Total Current Liabilities | 94,436 | 205,128 |
Total Liabilities | 94,436 | 205,128 |
Commitments and Contingencies | ||
Stockholders' Equity (Deficit) | ||
Common stock: $0.001 par value,100,000,000 shares authorized; 65,830,515 and 61,982,181 shares issued and outstanding as of December 31, 2018 and December 31, 2017 respectively | 65,831 | 61,982 |
Preferred Stock $0.001 per value - 30,000 shares authorized; issued and outstanding as of December 31, 2018 and 2017 respectively | 30 | 30 |
Shares to be Issued: 3,633,333 common shares as of 12/31/18; 150,000 common shares as of 12/31/17 | 348,000 | 12,000 |
Stock Subscription Receivable | (150,000) | |
Additional Paid in Capital | 3,884,102 | 3,141,639 |
Accumulated Deficit | (3,661,711) | (2,621,252) |
Total Stockholders' Equity (Deficit) | 486,252 | 594,399 |
Total Liabilities and Stockholders' Equity | $ 580,688 | $ 799,527 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 65,830,515 | 61,982,181 |
Common stock, shares outstanding | 65,830,515 | 61,982,181 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 30,000 | 30,000 |
Preferred stock, shares issued | 30,000 | 30,000 |
Preferred stock, shares outstanding | 30,000 | 30,000 |
Common shares to be issued | 3,633,333 | 150,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | ||
Service Revenue | $ 10,415 | |
Total Revenue | 10,415 | |
Operational Expense | ||
Professional Fees | 66,655 | 91,523 |
Research | 30,642 | 76,673 |
Stock Compensation | 442,311 | 12,000 |
Officer's Compensation | 295,489 | 315,174 |
Travel and Entertainment | 32,717 | 88,368 |
Rent | 675 | 600 |
Depreciation | 120,050 | 50,021 |
Computer and Internet | 5,018 | 3,530 |
Office Supplies and Expenses | 25,670 | 10,828 |
Other Operating Expenses | 19,007 | 1,987 |
Total Operating Expenses | 1,038,234 | 650,704 |
Loss from Operations | (1,027,819) | (650,704) |
Other Income (Expense) | ||
Gain (Loss) of Settlement of Debt | (12,000) | 151,324 |
Interest | (640) | (60,520) |
Total Other Income (Expenses) | (12,640) | 90,804 |
Provision for Income Taxes | ||
Net Loss | $ (1,040,459) | $ (559,900) |
Loss per common share-Basic and diluted | $ (0.016) | $ (0.011) |
Weighted Average Number of CommonShares Outstanding Basic and diluted | 64,162,570 | 52,954,326 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) | Common Stock [Member] | Common Stock (Unissued) [Member] | Preferred Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2016 | $ 44,455 | $ 1,732,926 | $ (2,061,352) | $ (283,971) | ||
Balance, shares at Dec. 31, 2016 | 44,455,181 | |||||
Proceeds from Issuance of Common Stock | $ 12,677 | 688,173 | $ 700,850 | |||
Proceeds from Issuance of Common Stock, shares | 12,677,000 | 12,677,000 | ||||
Unissued Common Stock | $ 12,000 | $ 12,000 | ||||
Unissued Common Stock, shares | 150,000 | |||||
Preferred Stock | $ 30 | 30 | ||||
Preferred Stock, shares | 30,000 | |||||
Shares issued for software | $ 4,000 | 516,000 | $ 520,000 | |||
Shares issued for software, shares | 4,000,000 | 4,000,000 | ||||
Shares issued for services | $ 350 | 55,040 | $ 55,390 | |||
Shares issued for services, shares | 350,000 | 19,500 | ||||
Shares issued for conversion of debt | $ 500 | 149,500 | $ 150,000 | |||
Shares issued for conversion of debt, shares | 500,000 | 500,000 | ||||
Net loss | (559,900) | $ (559,900) | ||||
Balance at Dec. 31, 2017 | $ 61,982 | $ 12,000 | $ 30 | 3,141,639 | (2,621,252) | 594,399 |
Balance, shares at Dec. 31, 2017 | 61,982,181 | 150,000 | 30,000 | |||
Proceeds from Issuance of Common Stock | $ 3,204 | 318,797 | $ 322,001 | |||
Proceeds from Issuance of Common Stock, shares | 3,203,334 | 3,203,334 | ||||
Unissued Common Stock | $ 348,000 | $ 348,000 | ||||
Unissued Common Stock, shares | 3,633,333 | |||||
Shares issued for services | $ 435 | 82,865 | $ 83,300 | |||
Shares issued for services, shares | 435,000 | |||||
Shares issued for conversion of debt | $ 210 | $ (12,000) | 29,790 | $ 18,000 | ||
Shares issued for conversion of debt, shares | 210,000 | (150,000) | 12,000 | |||
Net loss | (1,040,459) | $ (1,040,459) | ||||
Warrants Issued for Services | 78,073 | 78,073 | ||||
Options Issued for Services | 232,938 | 232,938 | ||||
Stock subscriptions | (150,000) | (150,000) | ||||
Balance at Dec. 31, 2018 | $ 65,831 | $ 198,000 | $ 30 | $ 3,884,102 | $ (3,661,711) | $ 486,252 |
Balance, shares at Dec. 31, 2018 | 65,830,515 | 3,633,333 | 30,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
OPERATING ACTIVITIES | ||
Net loss | $ (1,040,459) | $ (559,900) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Gain (Loss) of Settlement of Debt | 12,000 | (151,324) |
Depreciation | 120,050 | 50,021 |
Stock Compensation | 442,311 | 12,000 |
Change in Operating Assets and Liabilities: | ||
Advanced Commissions | 16,000 | (16,000) |
Commitment Receivable | (9,000) | |
Accounts Payable and Accrued Expenses | 5,723 | 81,705 |
Customer Prepayments | 39,585 | |
Due to Related Parties | ||
Net Cash Used in Operating Activities | (413,790) | (564,077) |
INVESTING ACTIVITIES | ||
Software | (50,750) | |
Net cash provided by (used) in investing activities | (50,750) | |
FINANCING ACTIVITIES | ||
Proceeds from Common Stock Issuance | 322,000 | 700,850 |
Proceeds from Common Stock to be Issued | 150,000 | |
Repayment of Note Principal | (150,000) | (5,000) |
Net Cash Provided by Financing Activities | 322,000 | 695,850 |
Net Increase (Decrease) in Cash and Equivalents | (91,790) | 81,023 |
Cash and Equivalents at Beginning of the Period | 112,799 | 31,776 |
Cash and Equivalents at End of the Period | 21,009 | 112,799 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Interest Paid | (640) | |
Income Taxes Paid | ||
NON-CASH DISCLOSURES | ||
Company issued 60,000 shares of Stock for payment of $6,000 accrued expenses | 6,000 | |
Company issued 500,000 shares of Stock for retirement of debt of $150,000 | 150,000 | |
Company issued 200,000 shares of Stock for vendor services of $19,400 | 19,500 | |
Company issued 4,000,000 shares of Stock for payment of software valued at $520,000 | 520,000 | |
Company issued a note for $150,000 as payment for software | 150,000 | |
Company issued 150,000 shares of Stock in settlement of accounts payable of $15,000 | 15,000 | |
Company issued 150,000 shares of Stock for retirement of debt of $12,000 | $ 12,000 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Cash Flows [Abstract] | ||
Stock issued for payment | 60,000 | |
Payment for accrued expenses | $ 6,000 | |
Stock issued for retirement | 150,000 | 500,000 |
Retirement of debt | $ 12,000 | $ 150,000 |
Stock issued for vendor services | 200,000 | |
Stock issued for vendor services, value | $ 19,400 | |
Stock issued for software payment | 4,000,000 | |
Stock issued for software payment, value | $ 520,000 | |
Issued notes for software | $ 150,000 | |
Stock issued for settlement | 150,000 | |
Accounts payable | $ 15,000 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Nature of Business ACRT (“the Company’s TurnScor® and CyberloQ™ products”, “We” or the “Company”) is a development-stage technology company focused on fraud prevention and credit management. The Company was incorporated in the State of Nevada on February 25, 2008. 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. The CyberloQ Vault is a “cloud based’ security protocol that allows clients the ability to send/receive secure DATA without having to use traditional e-mail which is prone to a breach. This CyberloQ service uses CLOUD BASED encryption and a secure web portal to send/receive confidential DATA, the SENDER and RECEIVER both must have authenticated their position within the prescribed GEO coordinates as well as authenticate their mobile devices prior to SENDING/RECEIVING any DATA. Thus rendering a hack or breach utterly useless for the encrypted DATA is unusable without the CyberloQ authentication component. 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 certain agreements 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. On December 31, 2018 the agreements were mutually terminated by both parties since the projects contemplated by the agreements were no longer moving forward. The parties are in the process of renegotiating the details of their relationship, and the terms of any new 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 the rules of the Securities and Exchange Commission. All amounts are presented in U.S. dollars. The Company has adopted a December 31 fiscal year end. 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. As of December 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 December 31, 2018 and 2017, we expensed $30,642 and $0 in expenditures on research and development, respectively. Of the $30,642 paid in 2018, none was paid to related parties. Fixed Assets, Intangibles and Long-Lived 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. The Company follows FASB ASC 360-10, “Property, Plant, and Equipment,” Revenue Recognition Effective January 1, 2018, the Company adopted the requirements of ASU No. 2014-09, Revenue from Contracts with Customers: Topic 606 Revenue Recognition Policy Under ASC 606, the Company recognizes revenue upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. To achieve the core principle of ASC 606, the Company performs the following steps: 1) Identify the contract(s) 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 in the contract; and 5) Recognize revenue when (or as) we satisfy a performance obligation. The Company derives its revenue from two sources: (1) subscription revenues, which are comprised of subscription fees from customers accessing the Company’s TurnScor® and CyberloQ™ products and from customers purchasing additional support beyond the standard support that is included in the basic subscription fees; and (2) related professional services and other revenue, which consists primarily of certain performance obligations related to set-up, ingestion, consulting and training fees. The Company’s subscription arrangements provide customers the right to access the Company’s hosted software applications. Customers do not have the right to take possession of the Company’s software during the hosting arrangement. As of December 31, 2018, the Company has $0 in contract assets, however there is a commitment receivable of $9,000 from a customer’s non-refundable two year (beginning August 28, 2018) service contract, as well as a contract liability of $39,585 to perform on that contract. The commitment receivable is past due, but has been fully received in January 2019. This contract liability will be reduced by $2,083 per month as the Company provides a non-exclusive, non-transferable license to use the CyberloQ Vault Services for the customer’s internal purposes and earns and recognizes related revenue. 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” Advertising Advertising costs are expensed as incurred. Advertising expense for the year ended December 31, 2018 and 2017 was $13,192 and $0 respectively. Income Taxes Deferred income taxes are provided using the liability method (in accordance with ASC 740) 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 December 31, 2018 and December 31, 2017 the Company has 1,125,000 and 1,750,000 warrants as well as 1,200,000 and 0 options, 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 diluted 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 and warrant awards are valued using the Black-Scholes option-pricing model, which according to ASC 820-10 is a level 3 value on the hierarchy.Black Scholes assumptions were calculated using stock price at grant date between $0.29 to $0.149; exercise prices between $0.15 to $0.20: life expectancy between 5 years to ½ year; and volatility ranging from 163% to 68%. In accordance with ASC Topic 505, 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 July 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting. The amendments expand the scope of ASC 718, Compensation – Stock Compensation, to include share-based payment transactions for acquiring goods and services from nonemployees and to supersede the guidance in ASC 505-50, Equity-Based Payments to Non-Employees. The accounting for nonemployee awards will now be substantially the same as current guidance for employee awards. ASU 2018-07 impacts all entities that issue awards to nonemployees in exchange for goods or services to be used or consumed in the grantor’s own operations, as well as to nonemployees of an equity method investee that provide goods or services to the investee that are used or consumed in the investee’s operations. ASU 2018-07 aligns the measurement-date guidance for employee and nonemployee awards using the current employee model, meaning that the measurement date for nonemployee equity-classified awards generally will be the grant date, while liability-classified awards generally will be the settlement date. ASU 2018-07 is effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Company is considering the effect of this adoption to its financial reports. 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. This adoption has not affected the financial statements. 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 adopted ASU 2016-08 in January 2018. Prior to that time the Company had no material income and the Company will report gross revenue and agent considerations as separate line items upon revenue receipt. |
Fixed Assets
Fixed Assets | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | NOTE 2 – FIXED ASSETS Software and computer equipment, recorded at cost, consisted of the following: December 31, 2018 December 31, 2017 Software and computer equipment $ 720,750 $ 720,750 Less: accumulated depreciation (170,071 ) (50,022 ) Property and equipment, net $ 550,679 $ 670,728 Depreciation expense was $120,050 and $50,022 for the periods ended December 31, 2018 and 2017, respectively. |
Going Concern
Going Concern | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 3 – GOING CONCERN The Company has incurred losses since Inception resulting in an accumulated deficit of $3,661,711 as of December 31, 2018 that includes a loss of $1,040,459 for the year ended December 31, 2018. Further losses are anticipated in the development of its business. Accordingly, there is substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that could result from the outcome of this uncertainty. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern. |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Stockholders' Deficit | NOTE 4 – STOCKHOLDERS’ DEFICIT Common Stock The Company has 100,000,000 shares of $.001 par value common stock authorized as of December 31, 2018 and December 31, 2017. The Company has an agreement to issue 3,333,333 common shares for $300,000 by March 31, 2019. Currently, the Company has collected $150,000 towards that agreement, and is disclosing the full amount and the related 3,333,333 common shares as “To be Issued”. Once the remaining stock subscription of $150,000 is collected, the Company will issue the entire 3,333,333 common shares. In addition, the Company has 300,000 shares of common stock to be issued to officers as of December, 31, 2019, these shares are valued at $48,000 and will be issued during the first quarter of 2019. During fiscal year 2018, the Company received $322,000 in payment for 3,203,334 shares of common stock; received $83,300 in services for 435,000 shares of common stock. Also during the same period, the Company issued 60,000 shares of common stock in payment of $6,000 of accrued legal fees, recognizing a loss on settlement of debt of $12,000; and a conversion of $12,000 of debt into 150,000 shares, these shares were previously recorded as “Shares to be Issued” in the Balance Sheet. There were 65,830,515 shares of common stock issued and outstanding as of the period end. In 2017, the Company received $700,850 in payment for 12,677,000 shares of common stock. Also in 2017, the Company issued 4,000,000 shares of common stock to acquire the Cyberloq™ technology, and 350,000 shares of common stock were issued as compensation for services. Furthermore, the company issued 500,000 shares of common stock for the conversion of debt. There were 61,982,181 shares of common stock issued and outstanding as of December 31, 2017. Preferred Stock The Company did not have any preferred stock prior to 2017. In April of 2017, the Company amended its articles of incorporation to create a new class of stock designated Series A Super Voting Preferred Stock consisting of thirty-thousand (30,000) shares at par value of $0.001 per share. Certain rights, preferences, privileges and restrictions were established for the Series A Preferred Stock as follows: (a) the amount to be represented in stated capital at all times for each share of Series A Preferred Stock shall be its par value of $0.001 per share; (b) except as otherwise required by law, holders of shares of Series A Preferred Stock shall vote together with the common stock as a single class and the holders of Series A Preferred Stock shall be entitled to five-thousand (5,000) votes per share of Series A Preferred Stock; and (c) in the event of any liquidation, dissolution or winding-up of the Company, either voluntary or involuntary, the holders of the Series A Preferred Stock shall be entitled to receive, prior and in preference to any distribution of assets of the Corporation to the holders of the common stock, the original purchase price paid for the Series A Preferred Stock. All 30,000 shares of the Series A Super Voting Preferred Stock were issued in 2017. |
Commitments
Commitments | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | NOTE 5 – COMMITMENTS The Company rents office space on a month to month basis for its main office at 871 Venetia Bay Blvd Suite #202 Venice, FL 34285. Monthly rent for this space is $50. All conditions have been met and paid by the Company. In 2015, in conjunction with a proposed TurnScor Card platform, the Company signed three Investor Royalty and Warrant Agreements with four parties. In exchange for the funds contributed by the four parties, the Company agreed to: 1. Pay the investors monthly residuals of 2.0% to 5% per month on the gross revenue after expenses generated by the Company’s primary platform in conjunction with the Company’s TurnScor Card; 2. Pay the investors a residual in perpetuity on 2% to 5% of all sub-platform revenue generated; and 3. Issue warrants to investors all of which have either been exercised or expired except for one individual that has two unexercised warrants: one to purchase 250,000 shares of common stock at $0.15 per share that expires in November of 2019, and another to purchase 250,000 shares of common stock at $0.20 per share that expires in November of 2020. The Company does not plan to proceed with the TurnScor Card at this time. During fiscal year 2018, the Company wrote off $17,646 in advanced commissions paid to a sales person who dissolved their contractor agreement with the Company. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 6 – RELATED PARTY TRANSACTIONS Acquisition of Cyberloq™ During 2017, the Company acquired the CyberloQ™ banking fraud prevention technology. (the “Technology”) Pursuant to the asset purchase agreement, the prior license agreement between the Company and CartenTech LLC was terminated, and the Company is now the exclusive owner of the CyberloQ™ banking fraud prevention technology along with all intellectual property rights associated with the Technology which is copyrighted with the United States Copyright Office. The owner of CartenTech LLC is Mark Carten, who is also a director of ACRT and its Chief Technology Officer. On July 28, 2017, the Company purchased the Technology with a value of $720,000. As consideration for the acquisition of and all rights to the Technology, CartenTech LLC received: (a) payment of $50,000, (b) a note for $150,000, and (c) 4,000,000 shares of the Company’s common stock. The software is being depreciated over its useful life of six-years in conjunction with the Company’s depreciation policy. Issuance of Warrants/Options The following is a summary of the warrants issued in connection with common stock: Date 11/30/15 11/30/15 6/28/16 12/21/17 Weighted Avg. Warrants 250,000 250,000 625,000 625.000 - Exercise price $ 0.15 $ 0.20 $ 0.20 $ 0.20 - Expected life 4 year 5 year 3 year 6 months - Unexpired 12/31/17 250,000 250,000 625,000 625,000 $ 0.1929 Unexpired 12/31/18 250,000 250,000 625,000 0 $ 0.1889 The following is a summary of the options issued in connection with common stock: Date FY 2017 FY2018 Weighted Avg. Options 100,000 1,100,000 - Exercise price $ 0.15 $ 0.15 - Expected life 5 year 5 year - Unexpired 12/31/17 100,000 - $ 0.15 Unexpired 12/31/18 100,000 1,100,000 $ 0.15 In 2016 and 2017, Rex Schuette, one of the Company’s directors, was issued two warrants to potentially acquire a total of 1,250,000 additional shares of common stock. One warrant to potentially acquire an additional 625,000 shares of common stock expired on June 19, 2018, and the other warrant to potentially acquire an additional 625,000 shares of common stock expires on June 28, 2019. Both warrants are exercisable at $0.20 per share. The Company revalued the warrants based on information that has come forward that caused a recalculation of the 1,250,000 warrants value from the $51,592 (as disclosed in the December 31, 2017 footnote) to the corrected amount $96,643. This re-valuation had no material impact on 2017, given that the majority of expense was recorded in 2018 and 2019. The Company has issued non-qualified options to an independent contractor, during 2018 there have been 1,200,000 options issued to this contractor. All options are exercisable at $0.15 per share and have a 5 year life. All non-expired warrants are being expensed ratably through expiration; all non-expired options are expensed as stock compensation is vested. As of December 31, 2018, the remaining non-expired warrant amount to be expensed is $18,570; the amount expensed during the year for these warrants is $78,073 and for options is $232,938. The total number of warrants and options outstanding as of December 31, 2018 is 1,125,000 and 1,200,000 respectively. Related Party Loans Payable The following is a summary of related party loans payable: For the Periods Ended December 31, 2018 December 31, 2017 Loans payable - stockholders $ 45,000 $ 50,000 Loans from related parties $ 0 $ 145,000 Loans Payable - Stockholders On December 29, 2014, the Company entered into a partially-convertible promissory note with a shareholder in the amount of $35,000. In January of 2015, the shareholder partially-exercised its conversion option, and in May of 2016 the shareholder exercised the remainder of its conversion option. In December 2017, the remaining unpaid principal and interest due on the note was settled in full for a $50,000 note and the Company recognized $151,324 in gain on settlement of debt. The $50,000 note has a current principle balance of $45,000, a stated interest rate of 0% and an extended due date of March 31, 2019. On October 26, 2013 the Company issued a promissory note of $150,000. On September 28, 2017 the total amount of $160,900 was converted to 500,000 shares of stock for a value of $150,000 and recorded other income gain of $10,900 by the Company. Loans from Related Parties As set forth above, during 2017 the Company acquired the intellectual property and ownership rights to CyberloQ™ from Carten Tech, LLC. The owner was the Company’s Chief Technology Officer, Mark Carten. The purchase included $50,000 in cash, a non-interest bearing note payable of $150,000, and 4,000,000 shares of Common Stock. The note has been paid in full, the balance of this note payable as of December 31, 2018 is $0. |
Convertible Notes - Stockholder
Convertible Notes - Stockholders | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Convertible Notes - Stockholders | NOTE 7 – CONVERTIBLE NOTES-STOCKHOLDERS On June 26, 2012 the company issued a note to a shareholder for $12,000. Principal and interest were not originally recognized on this note in 2012. On December 29, 2017 this note was converted to 150,000 shares of common stock and the Company recognized the transaction as stock compensation expense upon such conversion. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 8 – INCOME TAXES At December 31, 2018, the Company had available federal net operating loss carry forwards to reduce future taxable income. The amount available was approximately $2,880,927 for federal purposes. The federal net operating loss carry forwards begin to expire in 2028. Given the Company’s history of net operating losses, management has determined that it is more likely than not that the Company will not be able to realize the tax benefit of the net operating loss carry forwards. Accordingly, the Company has recognized a valuation allowance that offsets the deferred tax asset for this benefit. FASB ASC Topic 740 – Income Taxes (formerly SFAS 109) requires that the Company establish a valuation allowance when it is more likely than not that all or a portion of deferred tax assets will not be realized. Due to restrictions imposed by Internal Revenue Code Section 382 regarding substantial changes in ownership of companies with net operating loss carry forwards, the utilization of the Company’s net operating loss carry- forward will likely be limited as a result of cumulative changes in stock ownership. The Company has not recognized a deferred asset and, as a result, the change in stock ownership will not result in any change to the valuation allowances. Upon the attainment of taxable income by the Company, management will assess the likelihood of realizing the tax benefit associated with the use of the carry forwards and will recognize a deferred tax asset at that time. The provision for Federal income tax consists of the following: For the Year Ended December 31, 2018 2017 Federal income tax benefit attributable to: Net operating loss $ 218,496 $ 136,491 Less: valuation allowance $ (218,496 ) $ (136,491 ) Provision for Federal tax benefit $ - $ - The Tax Cuts and Jobs Act of 2018 will reduce the dollar value of the net operating loss carry-forwards due to the corporate tax rate decrease to 21%. However, the actual benefit will remain because, if allowed, the losses from prior years will offset taxable income in future years regardless of the tax rate. The cumulative tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows: For the Year Ended December 31, 2018 2017 Deferred tax assets attributable to: Net operating loss carryover $ 604,995 $ 837,351 Less: valuation allowance $ (604,995 ) $ (837,351 ) Net deferred tax assets $ - $ - The Company files income tax returns in the U.S. federal jurisdiction and various states. The Company is current on all income tax filings. The Company is subject to U.S. federal or state income tax examinations by tax authorities for three years following the filing of such returns. During the periods open to examination, the Company has net operating loss and tax credit carry forwards for U.S. federal and state tax purposes that have attributes from closed periods. Since these NOL’s and tax credit carry forwards may be utilized in future periods, they remain subject to examination. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 9 – SUBSEQUENT EVENTS As of January 7, 2019, the Company has received all remaining funds on the $9,000 commitment receivable. On January 28, 2019, the Company entered into a contract with a software developing company in Poland for the creation of a blockchain network. The agreed upon fee is $15,750, and the completion date is estimated to be March 10, 2019. On January 31, 2019, Advanced Credit Technologies, Inc. (the “Company”) entered into an agreement with The Diabetic Help Centers LLC (“TDHC”) to provide TDHC with an interactive database for use in the keeping and safeguarding of medical records. The Company will also be developing and attaching a private blockchain to the SQL database and further securing the database through use of the Company’s CyberloQ TM On February 22, 2019, the Company issued 200,000 shares of common stock at $0.10 per share, for a total of $20,000 cash. As of February 22, 2019, the Company has received $75,000 of the $150,000 stock subscription receivable, leaving a balance in the stock subscription of $75,000. Other than the foregoing, the Company is not aware of any subsequent events through the date of this filing that require disclosure or recognition in these financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Nature of Business | Organization and Nature of Business ACRT (“the Company’s TurnScor® and CyberloQ™ products”, “We” or the “Company”) is a development-stage technology company focused on fraud prevention and credit management. The Company was incorporated in the State of Nevada on February 25, 2008. 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. The CyberloQ Vault is a “cloud based’ security protocol that allows clients the ability to send/receive secure DATA without having to use traditional e-mail which is prone to a breach. This CyberloQ service uses CLOUD BASED encryption and a secure web portal to send/receive confidential DATA, the SENDER and RECEIVER both must have authenticated their position within the prescribed GEO coordinates as well as authenticate their mobile devices prior to SENDING/RECEIVING any DATA. Thus rendering a hack or breach utterly useless for the encrypted DATA is unusable without the CyberloQ authentication component. 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 certain agreements 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. On December 31, 2018 the agreements were mutually terminated by both parties since the projects contemplated by the agreements were no longer moving forward. The parties are in the process of renegotiating the details of their relationship, and the terms of any new 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 | 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 the rules of the Securities and Exchange Commission. All amounts are presented in U.S. dollars. The Company has adopted a December 31 fiscal year end. 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 | 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 | 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 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. As of December 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 | 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 December 31, 2018 and 2017, we expensed $30,642 and $0 in expenditures on research and development, respectively. Of the $30,642 paid in 2018, none was paid to related parties. |
Fixed Assets, Intangibles and Long-Lived Assets | Fixed Assets, Intangibles and Long-Lived 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. The Company follows FASB ASC 360-10, “Property, Plant, and Equipment,” |
Revenue Recognition | Revenue Recognition Effective January 1, 2018, the Company adopted the requirements of ASU No. 2014-09, Revenue from Contracts with Customers: Topic 606 Revenue Recognition Policy Under ASC 606, the Company recognizes revenue upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. To achieve the core principle of ASC 606, the Company performs the following steps: 1) Identify the contract(s) 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 in the contract; and 5) Recognize revenue when (or as) we satisfy a performance obligation. The Company derives its revenue from two sources: (1) subscription revenues, which are comprised of subscription fees from customers accessing the Company’s TurnScor® and CyberloQ™ products and from customers purchasing additional support beyond the standard support that is included in the basic subscription fees; and (2) related professional services and other revenue, which consists primarily of certain performance obligations related to set-up, ingestion, consulting and training fees. The Company’s subscription arrangements provide customers the right to access the Company’s hosted software applications. Customers do not have the right to take possession of the Company’s software during the hosting arrangement. As of December 31, 2018, the Company has $0 in contract assets, however there is a commitment receivable of $9,000 from a customer’s non-refundable two year (beginning August 28, 2018) service contract, as well as a contract liability of $39,585 to perform on that contract. The commitment receivable is past due, but has been fully received in January 2019. This contract liability will be reduced by $2,083 per month as the Company provides a non-exclusive, non-transferable license to use the CyberloQ Vault Services for the customer’s internal purposes and earns and recognizes related revenue. |
Fair Value Measurements | 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 | Segment Reporting FASB ASC 280, “Segment Reporting” |
Advertising | Advertising Advertising costs are expensed as incurred. Advertising expense for the year ended December 31, 2018 and 2017 was $13,192 and $0 respectively. |
Income Taxes | Income Taxes Deferred income taxes are provided using the liability method (in accordance with ASC 740) 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 (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 December 31, 2018 and December 31, 2017 the Company has 1,125,000 and 1,750,000 warrants as well as 1,200,000 and 0 options, 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 diluted 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 | 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 and warrant awards are valued using the Black-Scholes option-pricing model, which according to ASC 820-10 is a level 3 value on the hierarchy.Black Scholes assumptions were calculated using stock price at grant date between $0.29 to $0.149; exercise prices between $0.15 to $0.20: life expectancy between 5 years to ½ year; and volatility ranging from 163% to 68%. In accordance with ASC Topic 505, 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 | Recent Accounting Pronouncements In July 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting. The amendments expand the scope of ASC 718, Compensation – Stock Compensation, to include share-based payment transactions for acquiring goods and services from nonemployees and to supersede the guidance in ASC 505-50, Equity-Based Payments to Non-Employees. The accounting for nonemployee awards will now be substantially the same as current guidance for employee awards. ASU 2018-07 impacts all entities that issue awards to nonemployees in exchange for goods or services to be used or consumed in the grantor’s own operations, as well as to nonemployees of an equity method investee that provide goods or services to the investee that are used or consumed in the investee’s operations. ASU 2018-07 aligns the measurement-date guidance for employee and nonemployee awards using the current employee model, meaning that the measurement date for nonemployee equity-classified awards generally will be the grant date, while liability-classified awards generally will be the settlement date. ASU 2018-07 is effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Company is considering the effect of this adoption to its financial reports. 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. This adoption has not affected the financial statements. 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 adopted ASU 2016-08 in January 2018. Prior to that time the Company had no material income and the Company will report gross revenue and agent considerations as separate line items upon revenue receipt. |
Fixed Assets (Tables)
Fixed Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Software and computer equipment, recorded at cost, consisted of the following: December 31, 2018 December 31, 2017 Software and computer equipment $ 720,750 $ 720,750 Less: accumulated depreciation (170,071 ) (50,022 ) Property and equipment, net $ 550,679 $ 670,728 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Summary of Warrants Issued | The following is a summary of the warrants issued in connection with common stock: Date 11/30/15 11/30/15 6/28/16 12/21/17 Weighted Avg. Warrants 250,000 250,000 625,000 625.000 - Exercise price $ 0.15 $ 0.20 $ 0.20 $ 0.20 - Expected life 4 year 5 year 3 year 6 months - Unexpired 12/31/17 250,000 250,000 625,000 625,000 $ 0.1929 Unexpired 12/31/18 250,000 250,000 625,000 0 $ 0.1889 |
Summary of Options Issued | The following is a summary of the options issued in connection with common stock: Date FY 2017 FY2018 Weighted Avg. Options 100,000 1,100,000 - Exercise price $ 0.15 $ 0.15 - Expected life 5 year 5 year - Unexpired 12/31/17 100,000 - $ 0.15 Unexpired 12/31/18 100,000 1,100,000 $ 0.15 |
Schedule of Related Party Loans Payable | The following is a summary of related party loans payable: For the Periods Ended December 31, 2018 December 31, 2017 Loans payable - stockholders $ 45,000 $ 50,000 Loans from related parties $ 0 $ 145,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision for Income Taxes | The provision for Federal income tax consists of the following: For the Year Ended December 31, 2018 2017 Federal income tax benefit attributable to: Net operating loss $ 218,496 $ 136,491 Less: valuation allowance $ (218,496 ) $ (136,491 ) Provision for Federal tax benefit $ - $ - |
Schedule of Deferred Tax Assets | The cumulative tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows: For the Year Ended December 31, 2018 2017 Deferred tax assets attributable to: Net operating loss carryover $ 604,995 $ 837,351 Less: valuation allowance $ (604,995 ) $ (837,351 ) Net deferred tax assets $ - $ - |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) | 12 Months Ended | |
Dec. 31, 2018USD ($)Integer$ / sharesshares | Dec. 31, 2017USD ($)shares | |
Cash FDIC insured amount | ||
Research and development expense | 30,642 | 76,673 |
Contract asset | 0 | |
Commitment receivable | 9,000 | |
Customer prepayments | 39,585 | |
Contract with customer liability reduced | $ 2,083 | |
Operating segment | Integer | 1 | |
Advertising expenses | $ 13,192 | $ 0 |
Income tax examination, likelihood percentage | 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. | |
Warrant [Member] | ||
Computation of earnings per share, amount | shares | 1,125,000 | 1,750,000 |
Options [Member] | ||
Computation of earnings per share, amount | shares | 1,200,000 | 0 |
Stock Option and Warrant Awards [Member] | ||
Volatility, minimum | 163.00% | |
Volatility, maximum | 68.00% | |
Minimum [Member] | ||
Estimated useful lives of fixed assets | P3Y | |
Minimum [Member] | Stock Option and Warrant Awards [Member] | ||
Stock price | $ / shares | $ 0.29 | |
Exercise prices | $ / shares | $ 0.15 | |
Life expectancy | 5 years | |
Maximum [Member] | ||
Estimated useful lives of fixed assets | P15Y | |
Maximum [Member] | Stock Option and Warrant Awards [Member] | ||
Stock price | $ / shares | $ 0.149 | |
Exercise prices | $ / shares | $ 0.20 | |
Life expectancy | 6 months | |
ASC Topic No. 350 [Member] | ||
Research and development expense | $ 30,642 | $ 0 |
Fixed Assets (Details Narrative
Fixed Assets (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 120,050 | $ 50,022 |
Fixed Assets - Schedule of Prop
Fixed Assets - Schedule of Property and Equipment (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Abstract] | ||
Software and computer equipment | $ 720,750 | $ 720,750 |
Less: accumulated depreciation | (170,071) | (50,022) |
Property and equipment, net | $ 550,679 | $ 670,728 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ 3,661,711 | $ 2,621,252 |
Net loss | $ 1,040,459 | $ 559,900 |
Stockholders' Deficit (Details
Stockholders' Deficit (Details Narrative) - USD ($) | Sep. 28, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Apr. 30, 2017 |
Common stock - shares authorized | 100,000,000 | 100,000,000 | ||
Common stock - par value | $ 0.001 | $ 0.001 | ||
Number of common shares to be issued | 12,677,000 | |||
Number of common shares to be issued , amount | $ 322,001 | $ 700,850 | ||
Proceeds from issuance of common stock | $ 322,000 | $ 700,850 | ||
Number of common shares issued during period | 3,203,334 | 12,677,000 | ||
Stock issued for services, amount | $ 83,300 | $ 55,390 | ||
Stock issued for services, shares | 19,500 | |||
Loss on settlement of debt | $ (10,900) | $ 12,000 | $ (151,324) | |
Shares issued for conversion of debt, shares | 12,000 | 500,000 | ||
Common stock - shares issued | 65,830,515 | 61,982,181 | ||
Common stock, shares outstanding | 65,830,515 | 61,982,181 | ||
Shares issued for software, shares | 4,000,000 | |||
Common stock issued as compensation for services | 350,000 | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||
Preferred stock, shares issued | 30,000 | 30,000 | ||
Common Stock [Member] | ||||
Number of common shares to be issued | 3,203,334 | |||
Number of common shares to be issued , amount | $ 322,000 | |||
Proceeds from issuance of common stock | 150,000 | |||
Stock issued for services, amount | $ 83,300 | |||
Stock issued for services, shares | 435,000 | |||
Shares issued for conversion of debt, shares | 150,000 | |||
Shares issued for conversion of debt, amount | $ 12,000 | |||
Common Stock for Legal Fees [Member] | ||||
Stock issued for services, amount | $ 6,000 | |||
Stock issued for services, shares | 60,000 | |||
Series A Preferred Stock [Member] | ||||
Preferred stock, designated | 30,000 | |||
Preferred stock, par value | $ 0.001 | |||
Preferred stock , description | Certain rights, preferences, privileges and restrictions were established for the Series A Preferred Stock as follows: (a) the amount to be represented in stated capital at all times for each share of Series A Preferred Stock shall be its par value of $0.001 per share; (b) except as otherwise required by law, holders of shares of Series A Preferred Stock shall vote together with the common stock as a single class and the holders of Series A Preferred Stock shall be entitled to five-thousand (5,000) votes per share of Series A Preferred Stock; and (c) in the event of any liquidation, dissolution or winding-up of the Company, either voluntary or involuntary, the holders of the Series A Preferred Stock shall be entitled to receive, prior and in preference to any distribution of assets of the Corporation to the holders of the common stock, the original purchase price paid for the Series A Preferred Stock. All 30,000 shares of the Series A Super Voting Preferred Stock were issued in 2017. | |||
Preferred stock, shares issued | 30,000 | |||
March 31, 2019 [Member] | ||||
Number of common shares to be issued | 3,333,333 | |||
Number of common shares to be issued , amount | $ 300,000 | |||
Common stock description | The Company has an agreement to issue 3,333,333 common shares for $300,000 by March 31, 2019. Currently, the Company has collected $150,000 towards that agreement, and is disclosing the full amount and the related 3,333,333 common shares as "To be Issued". Once the remaining stock subscription of $150,000 is collected, the Company will issue the entire 3,333,333 common shares. | |||
December 31, 2019 [Member] | Officers [Member] | ||||
Number of common shares to be issued | 300,000 | |||
First Quarter of 2019 [Member] | Officers [Member] | ||||
Number of common shares to be issued , amount | $ 48,000 |
Commitments (Details Narrative)
Commitments (Details Narrative) | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Rent Expense, monthly | $ | $ 50 |
Exercise price | $ 0.15 |
Service Other [Member] | |
Commission paid | $ | $ 17,646 |
Royalty and Warrant Agreement #1 [Member] | |
Common stock purchase warrants | shares | 250,000 |
Exercise price | $ 0.15 |
Warrant expiry description | expires in November of 2019 |
Royalty and Warrant Agreement #2 [Member] | |
Common stock purchase warrants | shares | 250,000 |
Exercise price | $ 0.20 |
Warrant expiry description | expires in November of 2020 |
Minimum [Member] | |
Investors monthly residuals | 2.00% |
Maximum [Member] | |
Investors monthly residuals | 5.00% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Dec. 29, 2017 | Sep. 28, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Jul. 28, 2017 | Dec. 31, 2016 | Dec. 29, 2014 | Oct. 26, 2013 |
Acquisition value | $ 720,000 | |||||||
Payment for acquisition | $ 50,000 | |||||||
Note payable issued for acquisition | $ 150,000 | |||||||
Shares issued for software, shares | 4,000,000 | |||||||
Shares available | 1,250,000 | 1,250,000 | ||||||
Price per share | $ 0.15 | |||||||
Warrants | $ 18,570 | $ 51,592 | ||||||
Warrants revalued | 96,643 | |||||||
Non-qualified stock option awards | 1,200,000 | |||||||
Warrant term | 5 years | |||||||
Warrant expense | $ 78,073 | |||||||
Warrant options | 232,938 | |||||||
Warrants outstanding | 1,125,000 | |||||||
Options outstanding | 1,200,000 | |||||||
Convertible promissory notes | $ 160,900 | $ 35,000 | $ 150,000 | |||||
Settlement of notes payable | $ 150,000 | 50,000 | ||||||
Gain of Settlement of Debt | $ 10,900 | (12,000) | 151,324 | |||||
Promissory note | 50,000 | |||||||
Debt current principle balance | $ 45,000 | |||||||
Debt interest percentage | 0.00% | |||||||
Debt extended date | Mar. 31, 2019 | |||||||
Debt conversion of convertible debt, shares | 150,000 | 500,000 | ||||||
Debt conversion of convertible debt, amount | $ 150,000 | 150,000 | ||||||
Carten Tech, LLC [Member] | ||||||||
Loans from related parties | 50,000 | |||||||
Notes payable | $ 0 | $ 150,000 | ||||||
Common stock shares issued | 4,000,000 | |||||||
Warrant [Member] | ||||||||
Shares available | 625,000 | |||||||
Price per share | $ 0.20 | |||||||
Warrant 1 [Member] | ||||||||
Date of expiration | Jun. 19, 2018 | |||||||
Warrant 2 [Member] | ||||||||
Shares available | 625,000 | |||||||
Date of expiration | Jun. 28, 2018 | |||||||
Price per share | $ 0.20 |
Related Party Transactions - Su
Related Party Transactions - Summary of Warrants Issued (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Warrants | 1,250,000 | 1,250,000 | |
Exercise price | $ 0.15 | ||
Weighted average unexpired | $ 0.1889 | $ 0.1929 | |
11/30/15 One [Member] | |||
Warrants | 250,000 | ||
Exercise price | $ 0.15 | ||
Expected life | 4 years | ||
Unexpired 12/31/17 | 250,000 | ||
Unexpired 12/31/18 | 250,000 | ||
11/30/15 Two [Member] | |||
Warrants | 250,000 | ||
Exercise price | $ 0.20 | ||
Expected life | 5 years | ||
Unexpired 12/31/17 | 250,000 | ||
Unexpired 12/31/18 | 250,000 | ||
6/28/16 [Member] | |||
Warrants | 625,000 | ||
Exercise price | $ 0.20 | ||
Expected life | 3 years | ||
Unexpired 12/31/17 | 625,000 | ||
Unexpired 12/31/18 | 625,000 | ||
12/21/17 [Member] | |||
Warrants | 625,000 | ||
Exercise price | $ 0.20 | ||
Expected life | 6 months | ||
Unexpired 12/31/17 | 625,000 | ||
Unexpired 12/31/18 | 0 |
Related Party Transactions - _2
Related Party Transactions - Summary of Options Issued (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Options | 1,200,000 | |
Options [Member] | ||
Options | 1,100,000 | 100,000 |
Excersise price | $ 0.15 | $ 0.15 |
Expected life | 5 years | 5 years |
Unexpired 12/31/17 | 100,000 | |
Unexpired 12/31/18 | 1,100,000 | 100,000 |
Options weighted average unexpired | $ 0.15 | $ 0.15 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Loans Payable (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Related Party Transactions [Abstract] | ||
Loans payable- stockholders | $ 45,000 | $ 50,000 |
Loans from related parties | $ 145,000 |
Convertible Notes - Stockhold_2
Convertible Notes - Stockholders - (Details Narrative) - USD ($) | Dec. 29, 2017 | Sep. 28, 2017 | Jun. 26, 2012 |
Debt Disclosure [Abstract] | |||
Issued note to shareholder | $ 12,000 | ||
Number of convertible shares to common stock | 150,000 | 500,000 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Income Tax Disclosure [Abstract] | |
Available ferderal amount | $ 2,880,927 |
Net operating loss carry forwards expiry | expire in 2028 |
Corporate tax rate | 21.00% |
Tax effect description | The cumulative tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision for Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Federal income tax benefit attributable to: Net operating loss | $ 218,496 | $ 136,491 |
Less: valuation allowance | (218,496) | (136,491) |
Provision for Federal tax benefit |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets attributable to: Net operating loss carryover | $ 604,995 | $ 837,351 |
Less: valuation allowance | (604,995) | (837,351) |
Net deferred tax assets |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Feb. 22, 2019 | Jan. 28, 2019 | Jan. 14, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 07, 2019 |
Commitment receivable | $ 9,000 | |||||
Agreed upon fee | $ 66,655 | $ 91,523 | ||||
Number of stock issued during period, shares | 3,203,334 | 12,677,000 | ||||
Number of stock issued during period, value | $ 322,001 | $ 700,850 | ||||
Subsequent Event [Member] | ||||||
Commitment receivable | $ 9,000 | |||||
Monthly usage fee | $ 50,000 | |||||
Number of stock issued during period, shares | 200,000 | |||||
Stock price per share | $ 0.10 | |||||
Number of stock issued during period, value | $ 20,000 | |||||
Subscription receivable | 75,000 | |||||
Stock subscription receivable | 150,000 | |||||
Leaving balance of stock subscription | $ 75,000 | |||||
Subsequent Event [Member] | Software Developing Company [Member] | ||||||
Agreed upon fee | $ 15,750 |