Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Nov. 30, 2016 | Jan. 17, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | Chineseinvestors.com, Inc. | |
Entity Central Index Key | 1,459,482 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --05-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 7,661,805 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 |
Balance Sheets (unaudited)
Balance Sheets (unaudited) - USD ($) | Nov. 30, 2016 | May 31, 2016 |
Current assets | ||
Cash and cash equivalents | $ 646,866 | $ 197,231 |
Accounts receivable, net | 42,282 | 1,899 |
Investments, available for sale, in affiliate | 48,266 | 2,425,709 |
Investments, available for sale | 603,883 | 282,616 |
Other current assets | 58,029 | 55,780 |
Total current assets | 1,399,326 | 2,963,235 |
Non-current assets | ||
Property and equipment, net | 11,339 | 11,768 |
Website development, net | 79,942 | 78,147 |
Total non-current assets | 91,281 | 89,915 |
Total assets | 1,490,607 | 3,053,150 |
Current liabilities | ||
Accounts payable | 101,809 | 76,244 |
Deferred revenue | 396,889 | 321,416 |
Unearned revenue paid in stock | 90,144 | 90,278 |
Accrued liabilities | 490,441 | 39,153 |
Accrued dividend & interest | 128,937 | 26,529 |
Short-term secured debt | 1,070,000 | 660,000 |
Embedded incentive interest | 83,080 | 39,600 |
Total current liabilities | 2,361,300 | 1,253,220 |
Non-current liabilities | ||
Long-term deferred revenue | 65,652 | 37,642 |
Total Non-current Liabilities | 65,652 | 37,642 |
Total liabilities | 2,426,952 | 1,290,862 |
Commitments and Contingencies | ||
Shareholders' equity | ||
Common stock $0.001 par value 80,000,000 authorized and 7,661,805 and 7.661,805 were issued and outstanding November 30, 2016 and May 31, 2015, respectively | 7,663 | 7,663 |
Additional paid-in capital | 14,735,888 | 14,735,888 |
Foreign currency (loss) | (1,337) | (638) |
Unrealized gain (loss) on investments | (63,263) | 2,114,170 |
Accumulated deficit | (15,618,806) | (15,098,305) |
Total Shareholders' equity (deficit) | (936,345) | 1,762,288 |
Total liabilities and shareholders' equity | 1,490,607 | 3,053,150 |
Preferred Class A [Member] | ||
Shareholders' equity | ||
Preferred stock | 905 | 905 |
Preferred Class B [Member] | ||
Shareholders' equity | ||
Preferred stock | $ 2,605 | $ 2,605 |
Balance Sheets (unaudited) (Par
Balance Sheets (unaudited) (Parenthetical) - $ / shares | Nov. 30, 2016 | May 31, 2016 |
Stockholders' equity | ||
Preferred stock par value | $ .001 | $ .001 |
Preferred stock authorized | 40,000,000 | 40,000,000 |
Common stock par value | $ 0.001 | $ 0.001 |
Common stock authorized | 80,000,000 | 80,000,000 |
Common stock issued | 7,661,805 | 7,661,805 |
Common stock outstanding | 7,661,805 | 7,661,805 |
Preferred Class A [Member] | ||
Stockholders' equity | ||
Preferred stock par value | $ 0.001 | $ 0.001 |
Preferred stock authorized | 20,000,000 | 20,000,000 |
Preferred stock issued | 905,000 | 905,000 |
Preferred stock outstanding | 905,000 | 905,000 |
Preferred Class B [Member] | ||
Stockholders' equity | ||
Preferred stock par value | $ 0.001 | $ 0.001 |
Preferred stock authorized | 20,000,000 | 20,000,000 |
Preferred stock issued | 2,605,000 | 2,605,000 |
Preferred stock outstanding | 2,605,000 | 2,605,000 |
Statement of Comprehensive (Los
Statement of Comprehensive (Loss) and Income (unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2016 | Nov. 30, 2015 | Nov. 30, 2016 | Nov. 30, 2015 | |
Operating revenues | ||||
Investor relations | $ 278,850 | $ 107,965 | $ 369,162 | $ 159,749 |
Subscription | 232,094 | 98,982 | 481,323 | 200,903 |
Other | 0 | 12,316 | 1,783 | 24,940 |
Total revenue | 510,944 | 219,263 | 852,268 | 385,592 |
Cost of services | 220,525 | 265,973 | 449,396 | 512,217 |
Gross profit (loss) | 290,419 | (46,710) | 402,872 | (126,625) |
Operating expenses | ||||
General and administrative expense | 1,207,803 | 614,443 | 2,053,478 | 1,129,850 |
Advertising expense | 180,844 | 80,564 | 361,567 | 186,942 |
Total operating expenses | 1,388,647 | 695,007 | 2,415,045 | 1,316,792 |
Net loss from operations | (1,098,228) | (741,717) | (2,012,173) | (1,443,417) |
Other income/(expense) | ||||
Other income | 2,285 | 174 | 2,585 | 4,339 |
Interest expense | (57,921) | (4,100) | (67,634) | (4,100) |
Net realized gain/(loss) on marketable equity securities | 883,807 | (7,184) | 1,634,685 | (9,451) |
Total other income (expense) | 828,171 | (11,110) | 1,569,636 | (9,212) |
Net loss | (270,057) | (752,827) | (442,538) | (1,452,629) |
Preferred stock deemed dividend | 0 | (2,625) | 0 | (51,625) |
Preferred stock dividends | (38,976) | 0 | (77,963) | 0 |
Net loss attributable to common shareholders | $ (309,033) | $ (755,452) | $ (520,501) | $ (1,504,254) |
Earnings per share attributable to common shareholders | ||||
Basic loss per share | $ (.04) | $ (.10) | $ (.07) | $ (0.19) |
Weighted average number of shares outstanding - basic | 8,116,750 | 7,724,305 | 7,888,035 | 7,724,305 |
Other comprehensive loss | ||||
Net unrealized loss on available for sale securities | $ (848,577) | $ (51,463) | $ (2,177,433) | $ (151,436) |
Comprehensive loss | $ (1,157,610) | $ (806,915) | $ (2,697,934) | $ (1,655,690) |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 6 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVTIES | ||
Net loss | $ (442,538) | $ (1,452,629) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Non-cash revenue recognized as available for sale securities | (230,133) | (40,617) |
Net realized gain on marketable equity securities | (1,634,685) | (41,666) |
Depreciation and amortization | 6,855 | 11,010 |
Net unrealized foreign currency exchange loss (gain) | (699) | 0 |
Changes in operating assets and liabilities | ||
Accounts receivable | (40,383) | 3,377 |
Other current assets | (2,250) | 25,912 |
Accounts payable | 25,565 | 74,283 |
Deferred revenue | 103,563 | 4,024 |
Accrued liabilities | 451,289 | (44,734) |
Accrued interest and dividends | 67,925 | 35,644 |
Net cash used in operating activities | (1,695,491) | (1,425,396) |
Cash flows from investing activities | ||
Purchase of equipment | (8,222) | (17,451) |
Proceeds from the sale of marketable equity securites | 1,917,719 | 0 |
Proceeds from note receivable - affiliate | 0 | 52,026 |
Purchase of marketable equity securities-affiliate | (174,371) | 0 |
Net cash provided by investing activities | 1,735,126 | 34,575 |
Cash flows from financing activities | ||
Cash raised through sale of class B preferred stock | 0 | 720,000 |
Cash raised through issuance of long-term debt | 410,000 | 660,000 |
Net cash provided by financing activities | 410,000 | 1,380,000 |
Net increase/(decrease) in cash and cash equivalents | 449,635 | (10,821) |
Cash and cash equivalents, beginning of period | 197,231 | 498,189 |
Cash and cash equivalents, end of period | 646,866 | 487,368 |
Supplemental cash flow disclosures | ||
Cash paid for interest | 0 | 0 |
Cash paid for income taxes | $ 0 | $ 0 |
Organization and Nature of Oper
Organization and Nature of Operations | 6 Months Ended |
Nov. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Operations | Business Description During May 2000, the Company entered into an agreement with MAS Financial Corp. (“MASF”) whereby MASF agreed to transfer control of a public shell corporation to the Company and perform certain consulting services for a fee of $30,000. During June 2000, the Company completed reorganization with MAS Acquisition LII Corp. (“MASA”) with no operations or significant assets. Pursuant to the terms of the agreement, the Company acquired approximately 96% of the issued and outstanding common shares of MASA in exchange for all of its issued and outstanding common stock. MASA issued 8,200,000 shares of its restricted common stock for all of the issued and outstanding common shares of the Company. This reorganization was accounted for as though it were a recapitalization of the Company and sale by the Company of 319,900 shares of common stock in exchange for the net assets of MASA. In conjunction with the reorganization MASA changed its name to Chineseinvestors.com, Inc. The Company is now incorporated as a C corporation in the State of Indiana as of June 1, 1997. Going Concern |
1. Liquidity and Capital Resour
1. Liquidity and Capital Resources | 6 Months Ended |
Nov. 30, 2016 | |
Capital [Abstract] | |
Liquidity and Capital Resources | Cash Flows Cash flows used in operations for the six months ending November 30, 2016 and 2015 were ($1,695,491) and ($1,425,396), respectively. The increased cash used in operations were due to increased operating expenses related to employee payroll, professional fees and marketing expenses. Capital Resources Since inception in 1997, the Company has primarily relied upon proceeds from private placements of its equity securities to fund its operations. The Company anticipates continuing to rely on sales of our securities in order to continue to fund business operations. Issuances of additional shares will result in dilution to its existing stockholders. There is no assurance that the Company will be able to complete any additional sales of our equity securities or that it will be able arrange for other financing to fund our planned business activities. |
2. Critical Accounting Policies
2. Critical Accounting Policies and Estimates | 6 Months Ended |
Nov. 30, 2016 | |
Accounting Policies [Abstract] | |
Critical Accounting Policies and Estimates | Basis of Presentation Investment in Affiliate Foreign Currency Selling Price and Market Financing Expenses Numerous Intercompany Transactions Due to the functional and reporting currency both being in U.S. dollars, ASC 830-10-45-17 states that re-measurement of the books of record is not necessary. Revenue recognition The Company recognizes revenue pursuant to revenue recognition principles presented in SAB Topic 13. First, persuasive evidence of an arrangement. Second, delivery has occurred or services have been rendered, thirdly the seller’s price to the buyer is fixed or determinable and lastly collectability is reasonably assured. 1. Fees from banner advertisement, webpage hosting and maintenance, on-line promotion and translation services, advertising and promotion fees for customers in the Company’s Chinese Investment Guides, sponsorship fees from investment seminars, road shows, and forums. The sales prices of these services are fixed and determinable at the time the contracts are signed and there are no provisions for refunds contained in the contracts. These revenues are recognized when all significant contractual obligations have been satisfied and collection of the resulting receivable is reasonably assured. 2. Fees from membership subscriptions: these revenues are recognized over the term of the subscription. Subscription terms are generally between 3 and 12 months but can occasionally be as short as 1 month or as long as 60 months. Long term deferred revenues are recognized from subscriptions over 12 months. 3. Fees related to setting up and providing ongoing administrative and translation support for currency trading accounts are in association with Forex. These fees are recognized when earned. 4. Investor relations income is earned by the Company in return for delivering current, publicly available information related to our client companies. These revenues are prepaid by the client company and as such are initially recorded as an asset with an offsetting unearned revenue liability. This revenue is recognized over the term of the services period while the services are being provided. The value of the revenue earned is recognized every quarter based upon the client company’s stock closing price multiplied by the numbers of shares earned within that specific accounting period. By recognizing the revenue incrementally, we are following the guidelines of SAB Topic 13, in that we are only recognizing revenue once the value of the revenue received is fixed and determinable. In addition, we are applying the definition of readily determinable fair value presented at Accounting Standards Codification 820-10-15-5 in assessing the amount to recognize in each accounting period. The number of shares earned is a function of the time period for which services are provided over the contract period in relation to the price of the shares at the time of the services being delivered, added to the value of cash received if any, then recognized as revenue in the period the services were delivered. Costs of Services Website Development Costs Cash and Cash Equivalents Accounts Receivable and Concentration of Credit Risk The Company evaluates the need for an allowance for doubtful accounts on a regular basis. As of November 30, 2016, and May 31, 2016, the Company determined that an allowance was not needed. The operations of the Company are located in the PRC. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in the PRC, as well as by the general state of the PRC economy. Prepaid taxes Investments available for sale The Company followed the guidance of ASC 320-10-30 to determine the initial measure of value based on the quoted price of an otherwise identical unrestricted security of the same issuer, adjusted for the effect of the restriction, in accordance with the provisions of topic 820-10-15-5, which states that an equity security has a readily determinable fair value if it meets the condition of having a “sales prices or bid-and-asked quotations which are currently available on a securities exchange registered with the U.S. Securities and Exchange Commission (SEC) or in the over-the-counter market, provided that those prices or quotations for the over-the-counter market are publicly reported by the National Association of Securities Dealers Automated Quotation systems or by the OTC Markets Group Ins. Restricted stock meets that definition if the restriction terminates within one year.” These shares were classified as available for sale securities in accordance with ASC 948-310-40-1 as the Companies intention is to sell them in the near-term (less than one year). In compliance with ASC 320-10-35-1, equity securities that have readily determinable fair values that are classified as available-for-sale shall be measured subsequently at fair value in the statement of financial position. “Unrealized holding gains and losses for available-for-sale securities (including those classified as current assets) shall be excluded from earnings and reported in other comprehensive income until realized.” As these shares, will be earned over the term of the contracts, the Company will defer the recognition of the earnings of the revenue over the period the services are performed. The value recorded will be determined by multiplying the average of the closing price on the last day of the month for the period being reported based on closing market price per share. Upon receipt, these shares were recorded as an asset on the Companies financials as "Investments, available for sale". The Company will also record a corresponding contra-asset account titled "Unearned Revenue paid in stock". Other Current Assets Other current assets were $58,029 and $55,780 at November 30, 2016 and May 31, 2016, respectively. Property and Equipment Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. Gains and losses from retirement or replacement are included in operations. Impairment of Long-life Assets . Accrued dividend Accrued Liabilities November 30, 2016 May 31, 2016 China Employees' Salaries and Commissions Accrual $ 40,309 $ 30,598 Accrued Stock Compensation 382,950 – Accrued Payroll 65,269 6,799 Accrued Expenses 1,913 1,756 $ 490,441 $ 39,153 Unearned revenue, revenue paid in stock Deferred revenue Short-term debt, secured by stock In September 2016, the Company obtained short-term debt of $410,000 from various individuals. Based on the original lending agreements, the loan is secured by shares of the stocks in the following companies. The Company agrees to setup an escrow with Irvine Venture Law Firm to place those shares. Company name Shares Secured for Loan Sino-Global Shipping America LTD (SINO) 80,000.00 Recon Technology LTD (RCON) 60,000.00 Nengfa Weiye Engergy (NFEC) 185,000.00 SGOCO Group LTD (SGOC) 18,333.33 When entering the loan agreement, the Company believe that the contract would be executed and SINO shares shall be delivered upon signing the contract. However, such IR service agreement was not executed due to the disagreement among SINO’s management. As a result, the Company did not obtain the SINO shares. For NFEC, the Company obtained 100,000 shares at the time entering the contract, the remaining shares were fully received by the end of year 2016. The loan agreements are still valid after negotiating the terms with the private lenders. These notes are due on September 2017. The lenders received a 20% of the deemed increase in value of these secured shares (“Incentive Feature”). We estimate the value of the Incentive Feature of the common stock collateralizing the debt using the fair market value as of November 30, 2016. We recorded the estimated value of the Incentive Feature as and increase to the debt liability and interest expense. As of November 30, 2016, the Incentive Feature of $43,480 was recorded. Use of Estimates The financial statements include some amounts that are based on management's best estimates and judgments. The most significant estimates relate to depreciation and useful lives, and contingencies. These estimates may be adjusted as more current information becomes available, and any adjustment could be significant. Fair Value of Financial Instruments • Level one – Quoted market prices in active markets for identical assets or liabilities; • Level two – Inputs other than level one inputs that are either directly or indirectly observable; and • Level three – Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use. Much of the Company’s financial instruments are level one and are carried at market value, requiring no adjustment to book value. The financial instruments classified as level one were deemed to qualify as that classification because their value was determined by the price of identical instruments traded on an active exchange. It should be noted that 60,000 shares of the stock earned for consulting work, currently being held qualifies as a Level two instrument and has a book value of $67,500. The Company determined that the instrument was Level two because the market for this instrument was less active, as it was currently being distributed through a private placement memorandum, and was not a freely trading public stock. The value of the stock has been monitored on an ongoing basis and verified to be consistent with the carrying value and, therefore, not requiring an adjustment. Level one instruments were based upon stated balance of financial institution or calculated based upon stock trading in the public market. Level two instruments were calculated based upon the sale of stock through a private placement at arms-length where our shares were an insignificant amount of the total volume of stock sold in the issuer. Level three financial instruments were valued by a professional independent appraiser hired by the Company to determine the valuation. The level three valuation calculation included discounted cash flow models and market based models as appropriately utilized by a professional valuation firm. The inputs they used included the entities past financial performance, projected budgets, prior private stock sale history and comparable company valuations. The following table summarizes the assets we are carrying and the fair value category in which they are currently classified: November 30, 2016 May 31, 2016 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash 646,866 – – 197,231 – – Investments 584,649 67,500 – 2,640,825 67,500 – Total Financial Instruments 1,231,515 67,500 – 2,838,056 67,500 – Income Taxes Deferred tax assets are reduced by a full valuation allowance since it is more likely than not that the amount will not be realized. Deferred tax assets and liabilities are classified as current or noncurrent based on the classification of the underlying asset or liability giving rise to the temporary difference or the expected date of utilization of the carry forwards. Other Revenue Advertising Costs Earnings (Loss) Per Share Stock Based Compensation On October 2016, the Company declared restricted stock award to its eligible employees and contractors. Total shares declared were 1,035,000, and the fair market price at grant date was $0.37 per share. All these shares were fully vested at grant date, total stock compensation expense totaling $382,950 were recorded during the period. |
3. Stockholders' Equity
3. Stockholders' Equity | 6 Months Ended |
Nov. 30, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | As of November 30, 2016, and May 31, 2016, the Company was authorized to issue 80,000,000 shares of common stock, $0.001 par value per share. In addition, 40,000,000 shares of $.001 par value preferred stock were authorized. All common stock shares have full dividend rights. However, it is not anticipated that the Company will be declaring distributions in the foreseeable future. Series A Convertible Preferred Stock: The Company has 20,000,000 shares of preferred stock as series A authorized. As of November 30, 2016 and May 31, 2016, the Company has 905,000 preferred stock Series A issued and outstanding. The terms of the preferred stock allow the holder to convert each share of preferred stock into 1.25 shares of common stock at any time after nine months from the date of issuance. The holders of shares of preferred stock were entitled to receive a dividend of $0.06 per share per annum for the first two years from the issuance of the instruments. The Company maintained the right to suspend the dividend at its discretion if it is deemed necessary. Series B Convertible Preferred Stock In the years ended May 31, 2016 and 2015 the Company issued 720,000 and 1,885,000 shares of preferred stock as Series B convertible preferred stock for total proceeds of $2,605,000. The terms of the preferred stock allow the holder to convert each share of preferred stock into 2.5 shares of common stock at any time after six months from the date of issuance. The holders of shares of preferred stock shall have the right to one vote for each share of common stock into which such preferred stock could convert. The holders of shares of preferred stock are entitled to receive a dividend of $0.06 per share per annum for the first two years from the issuance of the instruments, which has been recorded as an accrued dividend on the liabilities section of the balance sheet. The Company maintained the right to suspend the dividend at its discretion if it is deemed necessary. Upon issuance of preferred stock convertible in shares of common stock at a price lower than the fair market value of common stock on the date of issuance, in accordance with the guidance provided in ASC 505-10-50 and Emerging Issues Task Force (“EITF”) No. 00-27, we have recorded the intrinsic value of this beneficial conversion feature which we calculated to be $51,625 as a deemed dividend on the Company’s income statement for the six-month ended November 30, 2015. This deemed dividend was calculated based upon a trading closing price of trading on the OTC Market exchange where are stock is traded and effective sale price (with conversion) of common stock. |
4. Property and Equipment
4. Property and Equipment | 6 Months Ended |
Nov. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment are recorded at cost, net of accumulated depreciation and are comprised of the following: November 30, 2016 May 31, 2016 Furniture & Fixtures $ 88,885 $ 87,413 Leasehold Improvements 23,417 23,417 $ 112,302 $ 110,830 Less: Accumulated Depreciation (100,963 ) (99,062 ) $ 11,339 $ 11,768 Depreciation on equipment is provided on a straight-line basis over its expected useful lives at the following annual rates. Computer equipment 3 years Furniture & fixtures 3 years Leasehold improvements Term of the lease Depreciation expense for the six months ending November 30, 2016 and 2015 was $1,901 and $5,732, respectively. |
5. Intangible Assets
5. Intangible Assets | 6 Months Ended |
Nov. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible assets are comprised of the following: November 30, 2016 May 31, 2016 Website development $ 180,795 $ 174,046 Less: Accumulated Depreciation (100,853 ) (95,899 ) $ 79,942 $ 78,147 Amortization is calculated over a straight-line basis using the economic life of the asset. Amortization expense for the six months ended November 30, 2016 and 2015 was $4,954 and $5,728 respectively. |
6. Commitments and Concentratio
6. Commitments and Concentrations | 6 Months Ended |
Nov. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Concentrations | Office Lease – Shanghai 2017 fiscal year $ 32,400 2018 fiscal year $ 64,800 2019 fiscal year $ 64,800 2020 fiscal year $ 21,600 Office Lease – Denver, Colorado Office Lease – New York Office Lease – San Gabriel, California 2017 fiscal year $ 25,450 2018 fiscal year $ 52,173 2019 fiscal year $ 53,783 2020 fiscal year $ 9,000 Office Lease – Irwindale, California Concentrations Litigation |
7. Related Party
7. Related Party | 6 Months Ended |
Nov. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party | Mrs. Lan Jiang is the spouse of the Company’s CEO, Mr. Warren Wang. During the quarter ended November 30, 2016, she received 200,000 shares of the Company’s stock compensation with the fair market value $74, 000 as of grant date. |
8. Correction of Immaterial Err
8. Correction of Immaterial Error | 6 Months Ended |
Nov. 30, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Correction of Immaterial Error | Subsequent to November 30, 2016, the Company discovered a couple of prior period accounting transactions and one preferred stock sale that was not properly recorded. These were comprised of two transactions related to service revenue paid by stocks which were not reported to the accounting department, Second, when the Company raised preferred stock, Serious B, $70,000 for purchasing 70,000 shares of preferred B stock was accidentally recorded as IR-revenue. Due to these errors, the Company’s revenue was understated by $45,200 for the year ended May 31, 2016. On balance sheet as of May 31, 2016, total assets were understated by $171,600, total liabilities were understated by $2,575 and total shareholders’ equity were understated by $169,025. The Company assessed the materiality of the errors considering both quantitatively and qualitatively effect in accordance with Staff Accounting Bulletin No. 99, Materiality and determined that the errors are not material to the decision making to a reasonable investor. Accordingly, the Company has revised its balance sheet as of May 31, 2016, and statement of comprehensive loss for three and six months ended November 30, 2015. The Company intends to revise its financial statements for certain quarterly periods through subsequent periodic filings. The effect of recording this immaterial correction in the statements of comprehensive loss for the 3 months and 6 months periods ended November 30, 2015, balance sheet as of May 31, 2016, and for financial statements in subsequent periods filings are as follows: Accounts For the For the For the For the Quarter Ended August 31, 2016 As As As As As As As As Total Revenue $ 289,263 $ 219,263 $ 191,952 $ 255,990 $ 903,185 $ 948,385 $ – $ – Operating Loss (671,248 ) (741,717 ) (768,794 ) (704,756 ) (2,922,756 ) (2,877,556 ) Net Loss (684,608 ) (752,827 ) (714,647 ) (650,609 ) (2,026,206 ) (1,981,006 ) Net Loss Attributable to Common Shareholders (684,608 ) (755,452 ) (752,987 ) (689,997 ) (2,223,182 ) (2,180,932 ) (210,410 ) (211,468 ) Investment, Available for Sale 122,646 192,646 126,240 287,840 111,016 282,616 84,384 235,084 Unearned Revenue Paid in Stock 131,944 185,944 111,111 162,273 Accrued Dividend & Interest 66,022 66,491 48,854 50,371 23,954 26,529 71,864 75,497 Preferred Stock Class B 2,535 2,605 2,535 2,605 2,535 2,605 2,535 2,605 Additional Paid in Capital 14,671,770 14,742,075 14,671,770 14,742,075 14,665,583 14,735,888 14,665,583 14,735,888 Unrealized Gain on Investments Available for Sale 364,195 380,195 1,703,406 1,749,806 2,057,770 2,114,170 749,814 785,314 Accumulated Deficit (14,350,783 ) (14,421,627 ) (15,103,771 ) (15,111,625 ) (15,140,555 ) (15,098,305 ) (15,350,965 ) (15,309,773 ) |
9. Subsequent Event
9. Subsequent Event | 6 Months Ended |
Nov. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Event | On January 19, 2017, the Company filed Form D-Notice of Exempt Offering of Securities with SEC. Through this Private Placement Memorandum, the Company is offering maximum 5,000,000 shares of its Series C preferred stock at a price of $1.00 per share. Fund raised will be used in operating activities and repayment of loan at $660,000 which has maturity date of February 28, 2017 plus of 30% appreciation of the stock value for MDCL to those individual lenders. As of January 23 rd cash from various individuals. |
2. Critical Accounting Polici16
2. Critical Accounting Policies and Estimates (Policies) | 6 Months Ended |
Nov. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
Investment in Affiliate | Investment in Affiliate |
Foreign Currency | Foreign Currency Selling Price and Market Financing Expenses Numerous Intercompany Transactions Due to the functional and reporting currency both being in U.S. dollars, ASC 830-10-45-17 states that re-measurement of the books of record is not necessary. |
Revenue recognition | Revenue recognition The Company recognizes revenue pursuant to revenue recognition principles presented in SAB Topic 13. First, persuasive evidence of an arrangement. Second, delivery has occurred or services have been rendered, thirdly the seller’s price to the buyer is fixed or determinable and lastly collectability is reasonably assured. 1. Fees from banner advertisement, webpage hosting and maintenance, on-line promotion and translation services, advertising and promotion fees for customers in the Company’s Chinese Investment Guides, sponsorship fees from investment seminars, road shows, and forums. The sales prices of these services are fixed and determinable at the time the contracts are signed and there are no provisions for refunds contained in the contracts. These revenues are recognized when all significant contractual obligations have been satisfied and collection of the resulting receivable is reasonably assured. 2. Fees from membership subscriptions: these revenues are recognized over the term of the subscription. Subscription terms are generally between 3 and 12 months but can occasionally be as short as 1 month or as long as 60 months. Long term deferred revenues are recognized from subscriptions over 12 months. 3. Fees related to setting up and providing ongoing administrative and translation support for currency trading accounts are in association with Forex. These fees are recognized when earned. 4. Investor relations income is earned by the Company in return for delivering current, publicly available information related to our client companies. These revenues are prepaid by the client company and as such are initially recorded as an asset with an offsetting unearned revenue liability. This revenue is recognized over the term of the services period while the services are being provided. The value of the revenue earned is recognized every quarter based upon the client company’s stock closing price multiplied by the numbers of shares earned within that specific accounting period. By recognizing the revenue incrementally, we are following the guidelines of SAB Topic 13, in that we are only recognizing revenue once the value of the revenue received is fixed and determinable. In addition, we are applying the definition of readily determinable fair value presented at Accounting Standards Codification 820-10-15-5 in assessing the amount to recognize in each accounting period. The number of shares earned is a function of the time period for which services are provided over the contract period in relation to the price of the shares at the time of the services being delivered, added to the value of cash received if any, then recognized as revenue in the period the services were delivered. |
Costs of Services | Costs of Services |
Website Development Costs | Website Development Costs |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Accounts Receivable and Concentration of Credit Risk | Accounts Receivable and Concentration of Credit Risk The Company evaluates the need for an allowance for doubtful accounts on a regular basis. As of November 30, 2016, and May 31, 2016, the Company determined that an allowance was not needed. The operations of the Company are located in the PRC. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in the PRC, as well as by the general state of the PRC economy. |
Prepaid taxes | Prepaid taxes |
Investments available for sale | Investments available for sale The Company followed the guidance of ASC 320-10-30 to determine the initial measure of value based on the quoted price of an otherwise identical unrestricted security of the same issuer, adjusted for the effect of the restriction, in accordance with the provisions of topic 820-10-15-5, which states that an equity security has a readily determinable fair value if it meets the condition of having a “sales prices or bid-and-asked quotations which are currently available on a securities exchange registered with the U.S. Securities and Exchange Commission (SEC) or in the over-the-counter market, provided that those prices or quotations for the over-the-counter market are publicly reported by the National Association of Securities Dealers Automated Quotation systems or by the OTC Markets Group Ins. Restricted stock meets that definition if the restriction terminates within one year.” These shares were classified as available for sale securities in accordance with ASC 948-310-40-1 as the Companies intention is to sell them in the near-term (less than one year). In compliance with ASC 320-10-35-1, equity securities that have readily determinable fair values that are classified as available-for-sale shall be measured subsequently at fair value in the statement of financial position. “Unrealized holding gains and losses for available-for-sale securities (including those classified as current assets) shall be excluded from earnings and reported in other comprehensive income until realized.” As these shares, will be earned over the term of the contracts, the Company will defer the recognition of the earnings of the revenue over the period the services are performed. The value recorded will be determined by multiplying the average of the closing price on the last day of the month for the period being reported based on closing market price per share. Upon receipt, these shares were recorded as an asset on the Companies financials as "Investments, available for sale". The Company will also record a corresponding contra-asset account titled "Unearned Revenue paid in stock". |
Other Current Assets | Other Current Assets Other current assets were $58,029 and $55,780 at November 30, 2016 and May 31, 2016, respectively. |
Property and Equipment | Property and Equipment Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. Gains and losses from retirement or replacement are included in operations. |
Impairment of Long-life Assets | Impairment of Long-life Assets . |
Accrued dividend | Accrued dividend |
Accrued liabilities | Accrued Liabilities November 30, 2016 May 31, 2016 China Employees' Salaries and Commissions Accrual $ 40,309 $ 30,598 Accrued Stock Compensation 382,950 – Accrued Payroll 65,269 6,799 Accrued Expenses 1,913 1,756 $ 490,441 $ 39,153 |
Unearned revenue, revenue paid in stock | Unearned revenue, revenue paid in stock |
Deferred revenue | Deferred revenue |
Short-term debt, secured by stock | Short-term debt, secured by stock In September 2016, the Company obtained short-term debt of $410,000 from various individuals. Based on the original lending agreements, the loan is secured by shares of the stocks in the following companies. The Company agrees to setup an escrow with Irvine Venture Law Firm to place those shares. Company name Shares Secured for Loan Sino-Global Shipping America LTD (SINO) 80,000.00 Recon Technology LTD (RCON) 60,000.00 Nengfa Weiye Engergy (NFEC) 185,000.00 SGOCO Group LTD (SGOC) 18,333.33 When entering the loan agreement, the Company believe that the contract would be executed and SINO shares shall be delivered upon signing the contract. However, such IR service agreement was not executed due to the disagreement among SINO’s management. As a result, the Company did not obtain the SINO shares. For NFEC, the Company obtained 100,000 shares at the time entering the contract, the remaining shares were fully received by the end of year 2016. The loan agreements are still valid after negotiating the terms with the private lenders. These notes are due on September 2017. The lenders received a 20% of the deemed increase in value of these secured shares (“Incentive Feature”). We estimate the value of the Incentive Feature of the common stock collateralizing the debt using the fair market value as of November 30, 2016. We recorded the estimated value of the Incentive Feature as and increase to the debt liability and interest expense. As of November 30, 2016, the Incentive Feature of $43,480 was recorded. |
Use of Estimates | Use of Estimates The financial statements include some amounts that are based on management's best estimates and judgments. The most significant estimates relate to depreciation and useful lives, and contingencies. These estimates may be adjusted as more current information becomes available, and any adjustment could be significant. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments • Level one – Quoted market prices in active markets for identical assets or liabilities; • Level two – Inputs other than level one inputs that are either directly or indirectly observable; and • Level three – Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use. Much of the Company’s financial instruments are level one and are carried at market value, requiring no adjustment to book value. The financial instruments classified as level one were deemed to qualify as that classification because their value was determined by the price of identical instruments traded on an active exchange. It should be noted that 60,000 shares of the stock earned for consulting work, currently being held qualifies as a Level two instrument and has a book value of $67,500. The Company determined that the instrument was Level two because the market for this instrument was less active, as it was currently being distributed through a private placement memorandum, and was not a freely trading public stock. The value of the stock has been monitored on an ongoing basis and verified to be consistent with the carrying value and, therefore, not requiring an adjustment. Level one instruments were based upon stated balance of financial institution or calculated based upon stock trading in the public market. Level two instruments were calculated based upon the sale of stock through a private placement at arms-length where our shares were an insignificant amount of the total volume of stock sold in the issuer. Level three financial instruments were valued by a professional independent appraiser hired by the Company to determine the valuation. The level three valuation calculation included discounted cash flow models and market based models as appropriately utilized by a professional valuation firm. The inputs they used included the entities past financial performance, projected budgets, prior private stock sale history and comparable company valuations. The following table summarizes the assets we are carrying and the fair value category in which they are currently classified: November 30, 2016 May 31, 2016 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash 646,866 – – 197,231 – – Investments 584,649 67,500 – 2,640,825 67,500 – Total Financial Instruments 1,231,515 67,500 – 2,838,056 67,500 – |
Income Taxes | Income Taxes Deferred tax assets are reduced by a full valuation allowance since it is more likely than not that the amount will not be realized. Deferred tax assets and liabilities are classified as current or noncurrent based on the classification of the underlying asset or liability giving rise to the temporary difference or the expected date of utilization of the carry forwards. |
Other revenue | Other Revenue |
Advertising Costs | Advertising Costs |
Earnings (Loss) Per Share | Earnings (Loss) Per Share |
Stock Based Compensation | Stock Based Compensation On October 2016, the Company declared restricted stock award to its eligible employees and contractors. Total shares declared were 1,035,000, and the fair market price at grant date was $0.37 per share. All these shares were fully vested at grant date, total stock compensation expense totaling $382,950 were recorded during the period. |
2. Critical Accounting Polici17
2. Critical Accounting Policies and Estimates (Tables) | 6 Months Ended |
Nov. 30, 2016 | |
Accounting Policies [Abstract] | |
Accrued liabilities | November 30, 2016 May 31, 2016 China Employees' Salaries and Commissions Accrual $ 40,309 $ 30,598 Accrued Stock Compensation 382,950 Accrued Payroll 65,269 6,799 Accrued Expenses 1,913 1,756 $ 490,441 $ 39,153 |
Fair value of financial instruments | November 30, 2016 May 31, 2016 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash 646,866 – – 197,231 – – Investments 584,649 67,500 – 2,640,825 67,500 – Total Financial Instruments 1,231,515 67,500 – 2,838,056 67,500 – |
4. Property and Equipment (Tabl
4. Property and Equipment (Tables) | 6 Months Ended |
Nov. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | November 30, 2016 May 31, 2016 Furniture & Fixtures $ 88,885 $ 87,413 Leasehold Improvements 23,417 23,417 $ 112,302 $ 110,830 Less: Accumulated Depreciation (100,963 ) (99,062 ) $ 11,339 $ 11,768 |
Schedule of property useful lives | Computer equipment 3 years Furniture & fixtures 3 years Leasehold improvements Term of the lease |
5. Intangible Assets (Tables)
5. Intangible Assets (Tables) | 6 Months Ended |
Nov. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets | November 30, 2016 May 31, 2016 Website development $ 180,795 $ 174,046 Less: Accumulated Depreciation (100,853 ) (95,899 ) $ 79,942 $ 78,147 |
6. Commitments and Concentrat20
6. Commitments and Concentrations (Tables) | 6 Months Ended |
Nov. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Office lease commitment | Office Lease – Shanghai 2017 fiscal year $ 32,400 2018 fiscal year $ 64,800 2019 fiscal year $ 64,800 2020 fiscal year $ 21,600 Office Lease – San Gabriel, California 2017 fiscal year $ 25,450 2018 fiscal year $ 52,173 2019 fiscal year $ 53,783 2020 fiscal year $ 9,000 |
8. Correction of Immaterial E21
8. Correction of Immaterial Error (Tables) | 6 Months Ended |
Nov. 30, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of error correction | Accounts For the For the For the For the Quarter Ended August 31, 2016 As As As As As As As As Total Revenue $ 289,263 $ 219,263 $ 191,952 $ 255,990 $ 903,185 $ 948,385 $ – $ – Operating Loss (671,248 ) (741,717 ) (768,794 ) (704,756 ) (2,922,756 ) (2,877,556 ) Net Loss (684,608 ) (752,827 ) (714,647 ) (650,609 ) (2,026,206 ) (1,981,006 ) Net Loss Attributable to Common Shareholders (684,608 ) (755,452 ) (752,987 ) (689,997 ) (2,223,182 ) (2,180,932 ) (210,410 ) (211,468 ) Investment, Available for Sale 122,646 192,646 126,240 287,840 111,016 282,616 84,384 235,084 Unearned Revenue Paid in Stock 131,944 185,944 111,111 162,273 Accrued Dividend & Interest 66,022 66,491 48,854 50,371 23,954 26,529 71,864 75,497 Preferred Stock Class B 2,535 2,605 2,535 2,605 2,535 2,605 2,535 2,605 Additional Paid in Capital 14,671,770 14,742,075 14,671,770 14,742,075 14,665,583 14,735,888 14,665,583 14,735,888 Unrealized Gain on Investments Available for Sale 364,195 380,195 1,703,406 1,749,806 2,057,770 2,114,170 749,814 785,314 Accumulated Deficit (14,350,783 ) (14,421,627 ) (15,103,771 ) (15,111,625 ) (15,140,555 ) (15,098,305 ) (15,350,965 ) (15,309,773 ) |
1. Liquidity and Capital Reso22
1. Liquidity and Capital Resources (Details Narrative) - USD ($) | 6 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Capital [Abstract] | ||
Net cash used in operating activities | $ (1,695,491) | $ (1,425,396) |
Cash and cash equivalents, end of period | $ 646,866 | $ 487,368 |
2. Critical Accounting Polici23
2. Critical Accounting Policies and Estimates (Details - Accrued liabilities) - USD ($) | Nov. 30, 2016 | May 31, 2016 |
Accounting Policies [Abstract] | ||
China Employees' Salaries and Commissions Accrual | $ 40,309 | $ 30,598 |
Accrued Stock Compensation | 382,950 | 0 |
Accrued payroll | 65,269 | 6,799 |
Accrued Expenses | 1,913 | 1,756 |
Accrued liabilities | $ 490,441 | $ 39,153 |
2. Critical Accounting Polici24
2. Critical Accounting Policies and Estimates (Details - Fair Value) - USD ($) | Nov. 30, 2016 | May 31, 2016 |
Level 1 | ||
Cash | $ 646,866 | $ 197,231 |
Investments | 584,649 | 2,640,825 |
Total Financial Instruments | 1,231,515 | 2,838,056 |
Level 2 | ||
Cash | 0 | 0 |
Investments | 67,500 | 67,500 |
Total Financial Instruments | 67,500 | 67,500 |
Level 3 | ||
Cash | 0 | 0 |
Investments | 0 | 0 |
Total Financial Instruments | $ 0 | $ 0 |
2. Critical Accounting Polici25
2. Critical Accounting Policies and Estimates (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Nov. 30, 2016 | Nov. 30, 2015 | Nov. 30, 2016 | Nov. 30, 2015 | May 31, 2016 | Feb. 29, 2016 | May 31, 2015 | |
Cash and cash equivalents | $ 646,866 | $ 487,368 | $ 646,866 | $ 487,368 | $ 197,231 | $ 498,189 | |
Accounts receivable | 42,282 | 42,282 | 1,899 | ||||
Allowance for doubtful accounts | 0 | 0 | 0 | ||||
Other current assets | 58,029 | 58,029 | 55,780 | ||||
Depreciation and amortization expense | 6,855 | 11,010 | |||||
Impairment of Long-life assets | 0 | 0 | |||||
Accrued dividends | 128,937 | 128,937 | 26,529 | ||||
Unearned revenue paid in stock | 90,144 | 185,944 | 90,144 | 185,944 | 90,278 | $ 162,273 | |
Deferred revenue | 396,889 | 396,889 | 321,416 | ||||
Long-term deferred revenue balance | 65,652 | 65,652 | 37,642 | ||||
Short term debt incentive liability | 83,080 | 83,080 | 39,600 | ||||
Accounts payable - due in stock, value | 67,500 | 67,500 | 67,500 | ||||
Other revenue | 1,783 | 24,940 | |||||
Advertising costs | 180,844 | $ 80,564 | 361,567 | $ 186,942 | |||
Declared stock dividend declared, shares | 1,035,000 | ||||||
Share based compensation expense | 382,950 | ||||||
United States | |||||||
Cash and cash equivalents | 625,701 | 625,701 | 195,571 | ||||
China | |||||||
Cash and cash equivalents | 21,151 | 21,151 | 1,562 | ||||
Various Individuals [Member] | |||||||
Proceeds from short term debt | 410,000 | $ 660,000 | |||||
Short term debt, shares used as collateral | 660,000 | ||||||
Short term debt incentive liability | 43,480 | 43,480 | $ 39,600 | ||||
Medicine Man Technologies [Member] | |||||||
Investment in affiliate, value | $ 48,266 | $ 48,266 | $ 2,425,709 | ||||
Stock held in affiliate, shares | 17,238 | 17,238 | 1,347,616 | ||||
Stock purchased in affiliate, shares | 174,371 | ||||||
Stock sold in affiliate, shares | 1,504,749 | ||||||
Proceeds from sale of stock in affiliate | $ 1,896,939 |
3. Stockholders Equity (Details
3. Stockholders Equity (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Nov. 30, 2016 | Nov. 30, 2015 | May 31, 2016 | May 31, 2015 | |
Proceeds from preferred stock | $ 0 | $ 720,000 | ||
Beneficial conversion feature | $ 0 | $ 51,625 | ||
Series B Preferred Stock [Member] | ||||
Preferred stock issued, shares issued | 720,000 | 1,885,000 | ||
Proceeds from preferred stock | $ 2,605,000 | |||
Beneficial conversion feature | $ 51,625 |
4. Property and Equipment (Deta
4. Property and Equipment (Details - property and equipment) - USD ($) | Nov. 30, 2016 | May 31, 2016 |
Property Plant and Equipment, Gross | $ 112,302 | $ 110,830 |
Less: accumulated depreciation | (100,963) | (99,062) |
Property Plant and Equipment, Net | 11,339 | 11,768 |
Furniture and Fixtures | ||
Property Plant and Equipment, Gross | 88,885 | 87,413 |
Leasehold Improvements | ||
Property Plant and Equipment, Gross | $ 23,417 | $ 23,417 |
4. Property and Equipment (De28
4. Property and Equipment (Details - useful lives) - USD ($) | 6 Months Ended | 12 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | May 31, 2016 | |
Depreciation expense | $ 1,901 | $ 5,732 | |
Computer Equipment | |||
Expected Useful Lives | 3 years | ||
Furniture and Fixtures | |||
Expected Useful Lives | 3 years | ||
Leasehold Improvements | |||
Expected Useful Lives | Term of the lease |
5. Intangible Assets (Details)
5. Intangible Assets (Details) - USD ($) | 6 Months Ended | ||
Nov. 30, 2016 | Nov. 30, 2015 | May 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Website development costs | $ 180,795 | $ 174,046 | |
Less: accumulated amortization | (100,853) | (95,899) | |
Total Intangible Assets | 79,942 | $ 78,147 | |
Amortization expense | $ 4,954 | $ 5,728 |
6. Commitments and Concentrat30
6. Commitments and Concentrations (Details - Office lease) | May 31, 2016USD ($) |
Shanghai | |
Office lease 2017 fiscal year | $ 32,400 |
Office lease 2018 fiscal year | 64,800 |
Office lease 2019 fiscal year | 64,800 |
Office lease 2020 fiscal year | 21,600 |
San Gabriel [Member] | |
Office lease 2017 fiscal year | 25,450 |
Office lease 2018 fiscal year | 52,173 |
Office lease 2019 fiscal year | 53,783 |
Office lease 2020 fiscal year | 9,000 |
New York [Member] | |
Future commitments | 6,501 |
Irwindale [Member] | |
Future commitments | $ 8,000 |
7. Related Party (Details Narra
7. Related Party (Details Narrative) - Lan Jiang [Member] | 6 Months Ended |
Nov. 30, 2016USD ($)shares | |
Stock issued for compensation, shares | shares | 200,000 |
Stock issued for compensation, value | $ | $ 74,000 |
8. Correction of Immaterial E32
8. Correction of Immaterial Error (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Nov. 30, 2016 | Aug. 31, 2016 | Feb. 29, 2016 | Nov. 30, 2015 | Nov. 30, 2016 | Nov. 30, 2015 | May 31, 2016 | |
Total Revenue | $ 510,944 | $ 0 | $ 255,990 | $ 219,263 | $ 852,268 | $ 385,592 | $ 948,385 |
Operating Loss | (1,098,228) | (704,756) | (741,717) | (2,012,173) | (1,443,417) | (2,877,556) | |
Net Loss | (270,057) | (650,609) | (752,827) | (442,538) | (1,452,629) | (1,981,006) | |
Net Loss Attributable to Common Shareholders | (309,033) | (211,468) | (689,997) | (755,452) | (520,501) | (1,504,254) | (2,180,932) |
Investment, Available for Sale | 235,084 | 287,840 | 192,646 | 192,646 | 282,616 | ||
Unearned Revenue Paid in Stock | 90,144 | 162,273 | 185,944 | 90,144 | 185,944 | 90,278 | |
Accrued Dividend & Interest | 128,937 | 75,497 | 50,371 | 66,491 | 128,937 | 66,491 | 26,529 |
Additional Paid in Capital | 14,735,888 | 14,735,888 | 14,742,075 | 14,742,075 | 14,735,888 | 14,742,075 | 14,735,888 |
Unrealized Gain on Investments Available for Sale | (63,263) | 785,314 | 1,749,806 | 380,195 | (63,263) | 380,195 | 2,114,170 |
Accumulated Deficit | (15,618,806) | (15,309,773) | (15,111,625) | (14,421,627) | (15,618,806) | (14,421,627) | (15,098,305) |
Preferred Class B [Member] | |||||||
Preferred Stock Class B | $ 2,605 | 2,605 | 2,605 | 2,605 | $ 2,605 | 2,605 | 2,605 |
Scenario, Previously Reported [Member] | |||||||
Total Revenue | 0 | 191,952 | 289,263 | 903,185 | |||
Operating Loss | (768,794) | (671,248) | (2,922,756) | ||||
Net Loss | (714,647) | (684,608) | (2,026,206) | ||||
Net Loss Attributable to Common Shareholders | (210,410) | (752,987) | (684,608) | (2,223,182) | |||
Investment, Available for Sale | 84,384 | 126,240 | 122,646 | 122,646 | 111,016 | ||
Unearned Revenue Paid in Stock | 111,111 | 131,944 | 131,944 | ||||
Accrued Dividend & Interest | 71,864 | 48,854 | 66,022 | 66,022 | 23,954 | ||
Additional Paid in Capital | 14,665,583 | 14,671,770 | 14,671,770 | 14,671,770 | 14,665,583 | ||
Unrealized Gain on Investments Available for Sale | 749,814 | 1,703,406 | 364,195 | 364,195 | 2,057,770 | ||
Accumulated Deficit | (15,350,965) | (15,103,771) | (14,350,783) | (14,350,783) | (15,140,555) | ||
Scenario, Previously Reported [Member] | Preferred Class B [Member] | |||||||
Preferred Stock Class B | $ 2,535 | $ 2,535 | $ 2,535 | $ 2,535 | $ 2,535 |
8. Correction of Immaterial E33
8. Correction of Immaterial Error (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Nov. 30, 2016 | Aug. 31, 2016 | Feb. 29, 2016 | Nov. 30, 2015 | Nov. 30, 2016 | Nov. 30, 2015 | May 31, 2016 | |
Revenues | $ 510,944 | $ 0 | $ 255,990 | $ 219,263 | $ 852,268 | $ 385,592 | $ 948,385 |
Assets | 1,490,607 | 1,490,607 | 3,053,150 | ||||
Liabilities | 2,426,952 | 2,426,952 | 1,290,862 | ||||
Shareholders' equity | $ (936,345) | $ (936,345) | 1,762,288 | ||||
Scenario, Previously Reported [Member] | |||||||
Revenues | $ 0 | $ 191,952 | $ 289,263 | 903,185 | |||
Restatement Adjustment [Member] | |||||||
Revenues | (45,200) | ||||||
Assets | (171,600) | ||||||
Liabilities | (2,575) | ||||||
Shareholders' equity | $ (169,025) |