Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | Banjo & Matilda, Inc. | |
Entity Central Index Key | 1,481,504 | |
Document Type | 10-K | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Public Float | $ 1,352,932 | |
Entity Common Stock, Shares Outstanding | 58,823,116 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2,017 | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Ex Transition Period | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2017 | Jun. 30, 2016 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 4,491 | $ 11,056 |
Trade receivables, net | 2,869 | |
Inventory, net | 18,443 | 102,427 |
Deposit on purchases | 1,153 | |
TOTAL CURRENT ASSETS | 22,934 | 117,505 |
NON-CURRENT ASSETS | ||
Intangible assets, net | 38,269 | |
Property, plant and equipment, net | 7,529 | 11,976 |
TOTAL NON-CURRENT ASSETS | 7,529 | 50,245 |
TOTAL ASSETS | 30,463 | 167,750 |
CURRENT LIABILITIES | ||
Trade and other payables | 1,178,978 | 1,008,772 |
Deposit payable | 4,621 | 4,621 |
Trade financing | 367,588 | 249,720 |
Accrued interest | 523,257 | 236,398 |
Loans payable (net of related discount) | 630,786 | 274,685 |
Loan from related parties | 170,626 | 183,269 |
Convertible loan from related parties (net of related discount) | 387,328 | 370,008 |
TOTAL CURRENT LIABILITIES | 3,263,184 | 2,327,473 |
NON-CURRENT LIABILITIES | ||
Loans payable (net of related discount) (net of current portion) | 325,137 | |
TOTAL LIABILITIES | 3,263,184 | 2,652,610 |
STOCKHOLDERS' DEFICIT | ||
Preferred stock, $0.00001 par value, 100,000,000 shares authorized and 1,000,000 shares issued and outstanding, respectively | 10 | 10 |
Common stock, $0.00001 par value, 100,000,000 shares authorized and 69,584,149 and 58,823,116 shares issued and outstanding, respectively | 695 | 588 |
Additional paid in capital | 1,951,295 | 1,632,517 |
Other accumulated comprehensive gain | 100,007 | 100,007 |
Accumulated deficit | (5,284,728) | (4,217,982) |
TOTAL STOCKHOLDERS' DEFICIT | (3,232,721) | (2,484,860) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ 30,463 | $ 167,750 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2017 | Jun. 30, 2016 |
STOCKHOLDERS' DEFICIT | ||
Preferred stock par value (in Dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | 1,000,000 | 1,000,000 |
Common stock par value (in Dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 69,584,149 | 58,823,116 |
Common stock, shares outstanding | 69,584,149 | 58,823,116 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Consolidated Statements Of Operations And Comprehensive Loss Income | ||
Revenue | $ 629,969 | $ 2,285,361 |
Cost of sales | 306,231 | 1,531,784 |
Gross profit | 323,738 | 753,577 |
Payroll and employee related expenses | 517,173 | 820,973 |
Operating expense | 70,902 | 148,901 |
Marketing expense | 41,951 | 136,580 |
Samples & design expense | 8,572 | 45,618 |
Occupancy expenses | 49,859 | 78,089 |
Depreciation and amortization expense | 9,246 | 9,239 |
Finance charges | 61,821 | 29,672 |
Corporate and public company expense | 227,042 | 307,800 |
Realized currency loss (gain) | 15,178 | (28,637) |
Total | 1,001,744 | 1,548,235 |
Loss from operations | (678,006) | (794,658) |
Other Income (Expense) | ||
Impairment loss | (31,549) | |
Other income | 3,479 | |
Amortization of debt discount | (67,456) | (69,808) |
Interest expense | (293,214) | (251,511) |
Total Other Expense | (388,740) | (321,319) |
Loss before income tax | (1,066,746) | (1,115,977) |
Provision for income taxes | ||
Net Loss | (1,066,746) | (1,115,977) |
Other comprehensive income | ||
Foreign currency translation | ||
Comprehensive loss | $ (1,066,746) | $ (1,115,977) |
Net loss per share | ||
Basic | $ (0.02) | $ (0.02) |
Diluted | $ (0.02) | $ (0.02) |
Weighted average number of shares outstanding: | ||
Basic | 61,152,628 | 58,772,431 |
Diluted | 61,152,628 | 58,772,431 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Consolidated Statements Of Comprehensive Loss Income | ||
Net loss | $ (1,066,746) | $ (1,115,977) |
Other comprehensive income | ||
Foreign currency translation | ||
Total other comprehensive income | ||
Comprehensive loss | $ (1,066,746) | $ (1,115,977) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) | Common Stock | Preferred Stock | Additional Paid in Capital | Comprehensive Income | Accumulated Deficit | Total |
Beginning Balance, Shares at Jun. 30, 2015 | 58,323,116 | 1,000,000 | ||||
Beginning Balance, Amount at Jun. 30, 2015 | $ 583 | $ 10 | $ 1,759,187 | $ 100,007 | $ (3,102,005) | $ (1,242,218) |
Conversion of debt to equity, Shares | 500,000 | |||||
Conversion of debt to equity, Amount | $ 5 | 27,118 | 27,123 | |||
Change in debt discount on modification of debt | 41,467 | 41,467 | ||||
Change in estimate of debt discount | (195,255) | (195,255) | ||||
Net Loss | (1,115,977) | (1,115,977) | ||||
Ending Balance, Shares at Jun. 30, 2016 | 58,823,116 | 1,000,000 | ||||
Ending Balance, Amount at Jun. 30, 2016 | $ 588 | $ 10 | 1,632,517 | 100,007 | (4,217,982) | (2,484,860) |
Conversion of debt to equity, Shares | 2,227,700 | |||||
Conversion of debt to equity, Amount | $ 22 | 111,363 | 111,385 | |||
Conversion of accrued expenses to equity, Shares | 2,000,000 | |||||
Conversion of accrued expenses to equity, Amount | $ 20 | 39,980 | 40,000 | |||
Share issued, Shares | 833,333 | |||||
Share issued, Amount | $ 8 | 24,992 | 25,000 | |||
Shares Issued in exchange for services, Shares | 5,700,000 | |||||
Shares Issued in exchange for services, Amount | $ 57 | 142,443 | 142,500 | |||
Net Loss | (1,066,746) | (1,066,746) | ||||
Ending Balance, Shares at Jun. 30, 2017 | 69,584,149 | 1,000,000 | ||||
Ending Balance, Amount at Jun. 30, 2017 | $ 695 | $ 10 | $ 1,951,295 | $ 100,007 | $ (5,284,728) | $ (3,232,721) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Consolidated Statements Of Cash Flows | ||
Net loss | $ (1,066,746) | $ (1,115,977) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation | 2,525 | 2,497 |
Amortization | 6,721 | 6,742 |
Impairment loss | 31,549 | |
Stock for services | 142,500 | |
AR allowance | (11,914) | 198,768 |
Debt discount amortization | 67,456 | 69,808 |
Amortization of deferred finance fee | 77,525 | 15,700 |
Changes in operating assets and liabilities: | ||
Trade receivables | 14,784 | (21,349) |
Inventory | 83,984 | 72,365 |
Deposit on Purchases | 1,153 | 356,651 |
Other assets | 5,550 | |
Other receivable | 66,952 | |
Trade payables and other liabilities | 170,240 | 402,502 |
Accrued interest | 286,859 | 166,574 |
Deposit payable | 3,462 | |
Net cash (used in) provided by operating activities | (193,364) | 230,245 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property and equipment | (2,334) | |
Net cash used in investing activities | (2,334) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from issuance of common stock | 25,000 | |
Net proceeds (net payments) on related party loan | (10,757) | (245,190) |
Net proceeds (net payments) on loan payables | 54,688 | 195,600 |
Net trade financing | 117,868 | (529,933) |
Net cash provided by (used in) financing activities | 186,799 | (579,523) |
Net decrease in cash and cash equivalents | (6,565) | (351,612) |
Cash and cash equivalents at the beginning of the period | 11,056 | 362,668 |
Cash and cash equivalents at the end of the period | 4,491 | 11,056 |
SUPPLEMENTAL DISCLOSURES: | ||
Cash paid during the year for : Income tax payments | ||
Cash paid during the year for : Interest payments | 36,082 | 98,447 |
SUPPLEMENTAL DISCLOSURES FOR NON CASH: FINANCING AND INVESTING ACTIVITIES | ||
Accrued expenses converted to equity | 40,000 | |
Debt converted to equity | $ 111,385 | $ 27,123 |
BASIS OF PRESENTATION AND ORGAN
BASIS OF PRESENTATION AND ORGANIZATION | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 1- BASIS OF PRESENTATION AND ORGANIZATION | All currencies represented in the notes to the consolidated financial statements are in United States Dollars (USD) unless specified as AUD (Australian Dollars). Banjo and Matilda, Inc. was incorporated in Nevada on December 18, 2009 under the name Eastern World Group, Inc. On September 24, 2013, its name was changed to Banjo & Matilda, Inc. On November 14, 2013, Banjo & Matilda, Inc., entered into a Share Exchange Agreement (the "Exchange Agreement") with Banjo & Matilda, Pty Ltd., a corporation formed under the laws of Australia (the "Company") and the shareholders of the Company. Pursuant to the Exchange Agreement, at the closing of the transaction contemplated thereunder (the "Transaction"), the Company became a wholly-owned subsidiary of Banjo & Matilda, Inc. Banjo & Matilda Pty Ltd. was incorporated under the laws of Australia on May 27, 2009 and manufactures and sells cashmere fashion. Headquartered at Bondi Beach, the Aussie lifestyle of sun, sand and surf resonates innately with this label and its philosophy of low maintenance, style and comfort. Banjo & Matilda USA, Inc. was incorporated in the State of Delaware on October 14, 2013 and is owned 100% by Banjo & Matilda, Inc. The ultra-soft cashmere staples, pairing simplicity with cool sophistication has rapidly gained loyal customers worldwide positioning the label as the 'go-to' for contemporary cashmere products. Under accounting principles generally accepted in the United States, the share exchange is considered to be a capital transaction in substance, rather than a business combination. That is, the share exchange is equivalent to the issuance of stock by Banjo & Matilda Pty Ltd. for the net monetary assets of the Banjo & Matilda, Inc. accompanied by a recapitalization, and is accounted for as a change in capital structure. Accordingly, the accounting for the share exchange will be identical to that resulting from a reverse acquisition, except no goodwill will be recorded. Under share reverse takeover accounting, the post reverse acquisition comparative historical financial statements of the legal acquirer, Banjo & Matilda, Inc. are those of the legal acquiree, Banjo & Matilda Pty Ltd., which is considered to be the accounting acquirer. Share and per share amounts stated have been retroactively adjusted to reflect the merger. As a result of the exchange agreement, the reorganization was treated as an acquisition by the accounting acquiree that is being accounted for as a recapitalization and as a reverse merger by the legal acquirer for accounting purposes. Pursuant to the recapitalization, all capital stock shares and amounts and per share data have been retroactively restated. Accordingly, the financial statements include the following: (1) The balance sheet consists of the net assets of the accounting acquirer at historical cost and the net assets of the legal acquirer at fair value. (2) The statements of operations include the operations of the accounting acquirer for the period presented and the operations of the legal acquirer from the date of the merger. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Going Concern The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate the continuation of the Company as a going concern. The Company reported accumulated deficit of $5,284,728 as of June 30, 2017. The Company also incurred net losses of $1,066,746 for the fiscal year ended June 30, 2017 and had negative working capital. To date, these losses and deficiencies have been financed principally through the loans from related parties and from third parties. In view of the matters described, there is substantial doubt as to the Company's ability to continue as a going concern without a significant infusion of capital. We anticipate that we will have to raise additional capital to fund operations over the next 12 months. To the extent that we are required to raise additional funds to acquire properties, and to cover costs of operations, we intend to do so through additional offerings of debt or equity securities. There are no commitments or arrangements for other offerings in place, no guaranties that any such financings would be forthcoming, or as to the terms of any such financings. Any future financing will involve substantial dilution to existing investors. Basis of Presentation The accompanying consolidated financial statements were prepared in conformity with generally accepted accounting principles in the United States of America ("US GAAP"). Principles of Consolidation The consolidated financial statements include the accounts of Banjo & Matilda, Inc. ("Banjo" or "the Company") and its wholly owned subsidiaries Banjo & Matilda Pty Ltd. and Banjo & Matilda USA, Inc., collectively referred to as the Company. All material intercompany accounts, transactions and profits were eliminated in consolidation. Exchange Gain (Loss) During the fiscal years ended June 30, 2017 and 2016, the transactions of the Company were denominated in US Dollars. Some transactions were denominated in AUD and British pounds for the sales made outside US and for rent paid for the Australian store. Such transactions were converted to US dollars on the date of transaction and the exchange gains or losses were recorded in the consolidated statement of operations. Foreign Currency Translation and Comprehensive Income (Loss) During the fiscal years ended June 30, 2017 and 2016, the transactions of the Company were denominated in US Dollars. All the transactions which were denominated in other currencies were converted to US dollars on the date of settlement and the exchange gains and losses were recorded in the consolidated statement of operations. No change was recorded in the comprehensive income (loss). Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include collectability of accounts receivable, accounts payable, sales returns and recoverability of long-term assets. Reportable Segment The Company has one reportable segment. The Company's activities are interrelated and each activity is dependent upon and supportive of the other. Accordingly, all significant operating decisions are based on analysis of financial products provided as a single global business. Revenue Recognition Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. Cost of Sales Cost of sales consists primarily of inventory costs, as well as warehousing costs (including the cost of warehouse labor), shipping, importation duties and charges and third party royalties. Operating Overhead Expense Operating overhead expense consists primarily of payroll and benefit related costs, rent, depreciation and amortization, professional services, and meetings and travel. Income Taxes The Company utilizes Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 740, Income Taxes, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that were included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company accounts for uncertain tax positions in accordance with FASB ASC Topic 740. When tax returns are filed, it is likely 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. Interest associated with unrecognized tax benefits is classified as interest expense and penalties are classified in selling, general and administrative expenses in the statements of income. At June 30, 2017 and 2016, the Company had not taken any significant uncertain tax positions on its tax returns for periods ended June 30, 2017 and prior years or in computing its tax provision for 2016. Management has considered its tax positions and believes that all of the positions taken by the Company in its Federal and State tax returns are more likely than not to be sustained upon examination. The Company is subject to examination by U.S. Federal and State tax authorities from the period ended June 30, 2014 to the present, generally for three years after they are filed. The Company has been behind in filing its payroll tax returns and sales tax returns. The Company has recorded $3,455 as penalties and $25,346 as interest for the late payment of taxes in the accompanying financials. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk are cash, accounts receivable and other receivables arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions. The Company has a diversified customer base across many markets, predominantly Australia, United States of America, United Kingdom, Europe and the Middle East. The Company controls credit risk related to accounts receivable through credit approvals, credit limits and monitoring procedures. The Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited. In addition, Receivables that are factored through the Company's Receivable finance facility are guaranteed by the finance company that further mitigates Credit Risk. Risks and Uncertainties The Company is subject to risks from, among other things, competition associated with the industry in general, other risks associated with financing, liquidity requirements, rapidly changing customer requirements, limited operating history, foreign currency exchange rates and the volatility of public markets. Contingencies Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company's management and legal counsel assess such contingent liabilities, and such assessment inherently involves judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company's legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed. Cash and Equivalents Cash and equivalents include cash in hand and cash in demand deposits, certificates of deposit and all highly liquid debt instruments with original maturities of three months or less. At June 30, 2017 and June 30, 2016, the Company had $4,491 and $11,056 in cash in Australia and in the United States. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts. Allowance for Doubtful Accounts The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. The allowances for doubtful accounts as of June 30, 2017 and June 30, 2016 are $135,956 and $147,870 respectively. Inventory Inventories are valued at the lower of cost (determined on a weighted average basis) or market. Management compares the cost of inventories with the market value and allowance is made to write down inventories to market value, if lower. As of June 30, 2017 and June 30, 2016, the Company had outstanding balances of Finished Goods Inventory of $18,443 and $102,427 respectively. As of June 30, 2017 and June 30, 2016, a reserve for Estimated Inventory Charges in the amount of $230 and $17,258 was established. Property, Plant & Equipment Property and equipment is stated at cost and depreciated using the straight-line method over the shorter of the estimated useful life of the asset or the lease term. The estimated useful lives of our property and equipment are generally as follows: computer software developed or acquired for internal use, three to ten years; computer equipment, two to three years; buildings and improvements, five to fifteen years; leasehold improvements, two to ten years; and furniture and equipment, one to five years. As of June 30, 2017 and June 30, 2016, Plant and Equipment consisted of the following: June 30 June 30 2017 2016 Property, plant & equipment $ 29,456 $ 31,378 Accumulated depreciation (21,927 ) (19,402 ) $ 7,529 $ 11,976 Depreciation was $2,525 and $2,497 for the fiscal years ended June 30, 2017 and 2016, respectively. Fair Value of Financial Instruments For certain of the Company's financial instruments, including cash and equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities and short-term debt, the carrying amounts approximate their fair values due to their short maturities. ASC Topic 820, "Fair Value Measurements and Disclosures," requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 825, "Financial Instruments," defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows: 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 analyzes all financial instruments with features of both liabilities and equity under ASC 480, "Distinguishing Liabilities from Equity," and ASC 815. As of June 30, 2017 and June 30, 2016, the Company did not identify any assets and liabilities that are required to be presented on the balance sheet at fair value. Earnings Per Share (EPS) The Company utilize FASB ASC 260, “Earnings per Share.” Basic earnings (loss) per share is computed by dividing earnings (loss) available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include additional common shares available upon exercise of stock options and warrants using the treasury stock method, except for periods of operating loss for which no common share equivalents are included because their effect would be anti-dilutive. The following table sets for the computation of basic and diluted earnings per share the fiscal years ended June 30, 2017 and 2016: June 30, 2017 June 30, 2016 Basic and diluted Net loss $ (1,066,746 ) $ (1,115,977 ) Net loss per share Basic $ (0.02 ) $ (0.02 ) Diluted $ (0.02 ) $ (0.02 ) Weighted average number of shares outstanding: Basic & diluted 61,152,628 58,772,431 Intangible Assets The Company records identifiable intangible assets at fair value on the date of acquisition and evaluates the useful life of each asset. Finite-lived intangible assets primarily consist of software development capitalized. Finite-lived intangible assets are amortized on a straight-line basis and are tested for recoverability if events or changes in circumstances indicate that their carrying amounts may not be recoverable. These intangibles have useful lives ranging from one to ten years. Recently Issued Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers In January 2016, The FASB issued ASU No. 2016-01, Financial Instruments - Recognition and Measurement of Financial Assets and Financial Liabilities (Topic 825) In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This update addresses a diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows under Topic 230, Statement of Cash Flows, and other Topics. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. We adopted this ASU in 2016 and the implementation did not have a material impact on our financial position or consolidated statement of operations. In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features. Down round features are features of certain equity-linked instruments (or embedded features) that result in the strike price being reduced on the basis of the pricing of future equity offerings. Current accounting guidance creates cost and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features that require fair value measurement of the entire instrument or conversion option. For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 with early adoption permitted. The Company has elected for early adoption of this guidance during the fiscal year ended June 30, 2017 on our consolidated financial statements. In August 2017, the FASB issued guidance that eases certain documentation and assessment requirements of hedge effectiveness and modifies the accounting for components excluded from the assessment. Some of the modifications include the ineffectiveness of derivative gain/loss in highly effective cash flow hedge to be recorded in OCI, the change in fair value of derivative to be recorded in the same income statement line as hedged item, and additional disclosures required on the cumulative basis adjustment in fair value hedges and the effect of hedging on financial statement lines for components excluded from the assessment. The amendment also simplifies the application of hedge accounting in certain situations to permit new hedging strategies to be eligible for hedge accounting. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2018, our fiscal 2020. Early adoption is permitted and the modified retrospective transition method should be applied. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements. Reclassification Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations or cash flow. |
TRADE RECEIVABLES
TRADE RECEIVABLES | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 3 - TRADE RECEIVABLES | Trade receivables consist principally of accounts receivable from sales to small to medium sized businesses, principally in Australia, Europe and the United States. Trade receivables are recorded at the invoiced amount and net of allowances for doubtful accounts. The allowance for doubtful accounts represents management's estimate of the amount of probable credit losses in existing accounts receivable, as determined from a review of past due balances and other specific account data. The assessment includes actually incurred historical data as well as current economic conditions. Account balances are written off against the allowance when management determines the receivable is uncollectible. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written off by reducing the carrying amount directly. A provision for impairment of trade receivables is raised when there is objective evidence that the consolidated entity or parent entity will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganization and default or delinquency in payments (more than 60 days overdue) are considered indicators that the trade receivable may be impaired. The amount of the impairment allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. Trade receivables that are past their normal payment terms are overdue and once 60 days past due are considered delinquent. Minimum payment terms vary by product. The maximum payment term for all products is 90 days. All trade receivables that are overdue are individually assessed for impairment. The allowances for doubtful accounts as of June 30, 2017 and June 30, 2016 are $135,956 and $147,870 respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 4 - INTANGIBLE ASSETS | Intangible assets consist of the following as of June 30, 2017 and June 30, 2016: June 30 June 30 2017 2016 Website $ 60,781 $ 60,781 Accumulated amortization (29,233 ) (22,512 ) Impairment loss (31,548 ) - $ - $ 38,269 Amortization expense was $6,721 and $6,742 for the fiscal years ended June 30, 2017 and 2016 respectively. As of June 30, 2017, the intangible asset was impaired for $31,548. |
TRADE AND OTHER PAYABLES
TRADE AND OTHER PAYABLES | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 5 - TRADE AND OTHER PAYABLES | As of June 30, 2017 and June 30, 2016, trade and other payable are comprised of the following: June 30 June 30 2017 2016 Trade payable $ 580,322 $ 593,009 Officer compensation 122,225 83,739 Payroll payable 151,824 29,616 Payroll taxes 195,551 158,518 Employee benefits 95,314 88,097 Other liabilities 33,742 55,793 $ 1,178,978 $ 1,008,772 |
TRADE FINANCING
TRADE FINANCING | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 6 - TRADE FINANCING | The Company entered into a Note Purchase Agreement for $65,000 dated January 4, 2017 with a third party. The amount was due on July 4, 2017 and carries interest at the rate of 18%. As of June 30, 2017, the loan outstanding was $57,958 and accrued interest was $5,301. The loan is currently in default and the interest increased to 22% per annum. The Company has a trade financing agreement with a financial institution in Australia with a maximum limit of AUD $150,000 at an interest rate of 20.95% per annum. Upon default of the loan, the Company reached a settlement with its obligation with the entity in the amount of AUD $165,523. The amount is to be paid through application of its Export Market Development Grant and up to 25% of the Company's store sales in Australia. All of the amounts referenced are in Australian dollars. As of June 30, 2017 and June 30, 2016, the Company had outstanding balances of USD $53,210 and USD $72,936, respectively. On August 14, 2014 the Company entered into a trade finance agreement with an entity in the United States with a total maximum facility of $1,500,000 based on $1,000,000 towards sales invoiced and $500,000 towards purchase order financing. Original term is for 12 months with automatic renewal for each consecutive period thereafter with interest at base rate floor of 3.25 plus 4.5%. In the event of default, an additional 7% interest is added. As of June 30, 2017 and June 30, 2016, the Company had an outstanding balance of $128,468 and $176,783, respectively. As of June 30, 2017 and June 30, 2016, the Company accrued interest balance of $39,062 and $19,531, respectively. On November 2, 2016, the Company entered into a merchant agreement with a capital funding group for a purchase price of $35,000 and purchased amount of $47,250. The Company is amortizing the excess of purchase amount over the purchase price, over the term of the financing of 21 months. Pursuant to the agreement, the Company cannot obtain future financing by selling receivables without consent from the lender. The Merchant holds a security interest in all accounts and proceeds. As of June 30, 2017, the balance owed to the lender amounted to $17,981 and accrued interest of $4,667. On November 3, 2016, the Company entered into a payments rights purchase and sale agreement for $72,500 due in April 2017. The financing has a purchase price of $50,000 with the purchased amount of $72,500. The Company is amortizing the excess of purchased amount over purchase price, over the term of the financing of six months. The Company has to make daily payments of $575.40 to the lender. During the fiscal year ended June 30, 2017, the Company amortized $22,500 of the excess purchased amount, as interest expense, in the accompanying financials. As of June 30, 2017, the loan balance owed to the lender amounted of $2,601 is in default and accrued interest of $22,500 and there are no penalties for the default on this loan. On November 29, 2016, the Company entered into a consignment agreement. It is a platform for funding advance inventory production. This facility allowed the Company to fund manufacturing with a consignment facility which pegs repayment to the sales of inventory. During the period ended June 30, 2017, the Company initially raised $21,928 for a purchase price of $26,313. This amount was paid off as of March 31, 2017. The difference of $4,385 was amortized over the period of financing. The Company again raised $114,888 for a purchase price of $133,342 in December 2016 due by December 2017. The difference of $18,454 is being amortized over the period of financing. As of June 30, 2017, balance outstanding was $107,370 and $15,123 for accrued interest. As of June 30, 2017, the loan was not in default. As of November 2018 the loan balance is in default and there are no penalties for the default on this loan. |
LOANS
LOANS | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 7 - LOANS | In December 2013, the Company entered into a short term loan arrangement in the amount of $100,000 with an individual. Terms of the note require interest payment of $5,000 on the repayment date, 30 days after the note date. If not repaid at that time, interest will accrue at the rate of $166 per day until the note is repaid. The loan has been in default since January 2014 and accruing interest of $166 per day. The outstanding balance as of June 30, 2017 and as of June 30, 2016 was $100,000 and $100,000 respectively. During the fiscal years ended June 30, 2017 and 2016, the Company recorded interest expense of $110,614 and $60,590, respectively, on the note. As of June 30, 2017 and 2016, the accrued interest recorded is $171,204 and $60,590, respectively, on the note. From May 2014 to June 2017, the Company entered into several convertible loan agreements with a lender aggregating in the amount of $162,500. The notes bear interest at 6% per month and are due and payable six months from the date of each note. The loans may be converted into common stock at any time by the election of the lender after a period of six months at a predetermined conversion price. The outstanding balance as of June 30, 2017 and as of June 30, 2016 was $36,500 and $131,500 respectively. On April 15, 2017, the Company issued 2,227,700 at $0.05 per share in exchange for $95,000 in principle and $16,385 in accrued interest. As of June 30, 2017 and 2016, the loan outstanding was $36,500 and $131,500, respectively. The remaining loan balance has been in default. There was no penalty or interest rates increase due to the default. The accrued interest is $2,209 and $11,890 as of June 30, 2017 and 2016, respectively. In June 2015, the Company entered into a secured promissory note in the amount of $500,000 with a Delaware statutory trust. The note bears interest at the rate of 18% per annum and was due or before July 1, 2017. The note has various covenants attached including one in which all credit card receipts are to be swept into an account which will fund payments on the note that are not in excess of the minimum quarterly payments required. As a condition of the note, an affiliate of the lender was granted a warrant to purchase 6,000,000 shares of the common stock of the Company at a price of $.08 in whole or in part. The outstanding balance as of June 30, 2017 and 2016 was $500,000, respectively. On February 5, 2016, The Company signed an amendment to the secured promissory note extending the maturity date by one year to July 17, 2018. The amendment changed the terms of the credit card receipts used to fund payments required by the note. The amendment also cancelled the warrants to purchase 6,000,000 shares at a price of $0.08. New warrants were granted to purchase 6,000,000 shares at $0.05 per share and to purchase 2,000,000 shares at $0.02 per share. The Company determined the fair value of the warrants using the Black – Scholes model and recorded the additional value of $41,467 for the modified warrants. The variables used for the Black –Scholes model are as listed below: · Volatility: 123% · Risk free rate of return: 1.26% · Expected term: 5 years In connection with the issuance of the above notes, the Company recorded a note discount of $115,274. The Company amortized $50,136 and $54,459 of the note discount during the fiscal years ended June 30, 2017 and 2016, respectively. The Company recorded an interest of $90,000 and $5,178 on the note during the fiscal years ended June 30, 2017 and 2016, respectively. As of June 30, 2017 and 2016, accrued interest balance is $59,096 and $5,178, respectively. From August 2016 to February 2017, the Company entered into several convertible loan agreements with a lender aggregating in the amount of $60,125. The notes bear interest at 6% per month and are due and payable six months from the date of each note. A portion of the convertible loan agreements, $23,000, is in default as February 2017. There was no penalty or interest rates increase due to the default. The loans may be converted into common stock at any time by the election of the lender after a period of six months at a predetermined conversion price. The outstanding balance as of June 30, 2017 was $60,125. The accrued interest is $2,096 as of June 30, 2017. Related Party Payable The Company had several outstanding convertible note agreements with a shareholder aggregating to AUD $370,000. The notes had interest rates varying from 6% to 15% per annum. In March 2015, the outstanding balance and accrued interest was refinanced by a $526,272 convertible note. The Convertible Note bears interest at the rate of 18% per annum and is due on or before April 30, 2017. The interest portion of the note shall be paid weekly starting in April 2015. Principle payments of $9,929 AUD weekly were to commence in April 2016. All or any portion of the principal amount of the Convertible Note and all accrued interest is convertible at the option of the holder into common stock of the Company at a conversion price of five cents ($0.05) per share, subject to various standard provisions. The outstanding balance as of June 30, 2017 and June 30, 2016, net of related discount, was USD $387,328 and $387,328, respectively. The interest rate increased from 18% per annum due to 22% per annum due to the loan default as of September 30, 2015. The Company determined the fair value of the convertible note of $80,909 using the intrinsic value method. The Company recorded an amortization of the debt discount of $15,432 and $15,350, during the fiscal years ended June 30, 2017 and 2016, respectively. During the fiscal years ended June 30, 2017 and 2016, the Company recorded an interest of $85,212 and $71,565, respectively, on the note. Accrued interest as of June 30, 2017 and 2016 are $144,745 and $59,533 respectively. The Company has liabilities payable in the amount of $170,626 and $183,269 to shareholders and officers of the Company as of June 30, 2017 and June 30, 2016, respectively. The note bears interest at the rate of 3% per annum and was due on or before June 30, 2014. The outstanding balance, including accrued interest, may be converted into common shares of Banjo & Matilda, Inc. at a pre-determined rate. The Company has granted the Lenders a security interest in the intellectual property of the Borrower. The remaining loan balance has been in default. There was no penalty or interest rates increase due to the default. The accrued interest is $57,260 and $29,653 as of June 30, 2017 and 2016, respectively. Year ending June 30, 2018 Loan 1 Loan 2 Loan 3 Loan 4 Loan 5 Loan 6 Total $ 100,000 $ 36,500 $ 500,000 $ 60,125 $ 387,328 $ 170,626 $ 1,254,579 $ 100,000 $ 36,500 $ 500,000 $ 60,125 $ 387,328 $ 170,626 $ 1,254,579 |
COMMITMENTS
COMMITMENTS | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 8 - COMMITMENTS | The Company leases commercial space in Sydney, Australia that serves as its flagship as well as a retail store. We lease approximately 2,500 square feet of space pursuant to a three year lease agreement which expired in October 2014. After expiration, the lease converted to a month-to-month basis. The annual rent for the premises is AUD $52,000. The Company also leases space on an as needed basis in Santa Monica, California that serves as its corporate headquarters. We utilize approximately 500 square feet of space pursuant to a month-to-month basis. For the fiscal years ended June 30, 2017 and 2016 the aggregate rental expense was $49,859 and $78,089, respectively. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 9 - INCOME TAXES | Based on the available information and other factors, management believes it is more likely than not that the net deferred tax assets at, June 30, 2017 and June 30, 2016 will not be fully realizable. Accordingly, management has recorded a full valuation allowance against its net deferred tax assets at, June 30, 2017 and June 30, 2016. At June 30, 2017 and June 30, 2016, the Company had federal net operating loss carry-forwards of approximately $4,755,000 and $3,664,000, respectively, expiring beginning in 2032. Deferred tax assets consist of the following components: June 30, 2017 June 30, 2016 Net loss carryforward $ 1,425,000 $ 1,095,000 Valuation allowance (1,425,000 ) (1,095,000 ) Total deferred tax assets $ - $ - |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 10 - STOCKHOLDERS' EQUITY | Preferred Stock Pursuant to an Employment Agreement (the "Agreement") with the Chief Executive Officer on November 15, 2013, The Company issued 1,000,000 undesignated shares of Preferred Stock each having a par value of $0.00001. The preferred shares shall be entitled to 100 votes to every one share of common stock. The Preferred Shares shall only valid during the term of this Agreement. At the end of the Agreement, November 15, 2016, the shares shall be cancelled and returned to Treasury and the Executive shall have no preferential voting rights. If this Agreement is renewed the preferred shares remain with the Executives. Common Stock During the fiscal year ended June 30,2016, the Company issued 500,000 shares of the Company’s common stock for settlement of an outstanding vendor balance amounting to USD $27,123. During the fiscal year ended June 30, 2017, the Company issued 833,333 shares of the Company’s common stock for $25,000. During the fiscal year ended June 30, 2017, the Company issued 2,000,000 shares of the Company’s common stock for settlement of an outstanding vendor balance amounting to USD $40,000. During the fiscal year ended June 30, 2017, the Company issued 2,227,700 shares of the Company’s common stock for settlement of an outstanding debt and accrued interest amounting to USD $111,385. During the fiscal year ended June 30, 2017, the Company issued 5,700,000 shares of the Company’s common stock for consulting service amounting to USD $142,500. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 11 - RELATED PARTY TRANSACTIONS | During the fiscal year ended June 30, 2016, the Company paid $20,113 and $1,005 as compensation, respectively, to the sister and mother of the CEO. There were no related party transaction for June 30, 2017 to disclose. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 12 - SUBSEQUENT EVENTS | As of November 1, 2018 both parties have mutually agreed not to proceed with the below described merger between Banjo & Matilda, Inc. and Spectrum King. On September 20, 2017, Banjo & Matilda, Inc. entered into a Binding Memorandum of Understanding (the "MOU") with Spectrum King, LLC. Pursuant to the terms of the MOU, the parties have agreed to cause a merger of Spectrum with Banjo. Additionally, effective April 12, 2018, Banjo & Matilda, Inc. King, LLC entered into an Exchange Agreement dated as of March 19, 2018 pursuant to which Banjo shall acquire 100% of the issued and outstanding membership units of the Company from the Members in exchange for the issuance of Banjo shares of its Series B Preferred Stock constituting 93.67% of the total voting power of Banjo capital stock to be outstanding upon closing, after giving effect to the consummation of concurrent debt settlement and other capital stock issuances but before the issuance of shares of capital stock for investor relations purposes. As a result of the Exchange Agreement, the Company will become a wholly-owned subsidiary of Banjo once the acquisition in finalized. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Jun. 30, 2017 | |
Summary Of Significant Accounting Policies | |
Going Concern | The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate the continuation of the Company as a going concern. The Company reported accumulated deficit of $5,284,728 as of June 30, 2017. The Company also incurred net losses of $1,066,746 for the fiscal year ended June 30, 2017 and had negative working capital. To date, these losses and deficiencies have been financed principally through the loans from related parties and from third parties. In view of the matters described, there is substantial doubt as to the Company's ability to continue as a going concern without a significant infusion of capital. We anticipate that we will have to raise additional capital to fund operations over the next 12 months. To the extent that we are required to raise additional funds to acquire properties, and to cover costs of operations, we intend to do so through additional offerings of debt or equity securities. There are no commitments or arrangements for other offerings in place, no guaranties that any such financings would be forthcoming, or as to the terms of any such financings. Any future financing will involve substantial dilution to existing investors. |
Basis of Presentation | The accompanying consolidated financial statements were prepared in conformity with generally accepted accounting principles in the United States of America ("US GAAP"). |
Principles of Consolidation | The consolidated financial statements include the accounts of Banjo & Matilda, Inc. ("Banjo" or "the Company") and its wholly owned subsidiaries Banjo & Matilda Pty Ltd. and Banjo & Matilda USA, Inc., collectively referred to as the Company. All material intercompany accounts, transactions and profits were eliminated in consolidation. |
Exchange Gain (Loss) | During the fiscal years ended June 30, 2017 and 2016, the transactions of the Company were denominated in US Dollars. Some transactions were denominated in AUD and British pounds for the sales made outside US and for rent paid for the Australian store. Such transactions were converted to US dollars on the date of transaction and the exchange gains or losses were recorded in the consolidated statement of operations. |
Foreign Currency Translation and Comprehensive Income (Loss) | During the fiscal years ended June 30, 2017 and 2016, the transactions of the Company were denominated in US Dollars. All the transactions which were denominated in other currencies were converted to US dollars on the date of settlement and the exchange gains and losses were recorded in the consolidated statement of operations. No change was recorded in the comprehensive income (loss). |
Use of Estimates | The preparation of financial statements in conformity with US GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include collectability of accounts receivable, accounts payable, sales returns and recoverability of long-term assets. |
Reportable Segment | The Company has one reportable segment. The Company's activities are interrelated and each activity is dependent upon and supportive of the other. Accordingly, all significant operating decisions are based on analysis of financial products provided as a single global business. |
Revenue Recognition | Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. |
Cost of Sales | Cost of sales consists primarily of inventory costs, as well as warehousing costs (including the cost of warehouse labor), shipping, importation duties and charges and third party royalties. |
Operating Overhead Expense | Operating overhead expense consists primarily of payroll and benefit related costs, rent, depreciation and amortization, professional services, and meetings and travel. |
Income Taxes | The Company utilizes Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 740, Income Taxes, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that were included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company accounts for uncertain tax positions in accordance with FASB ASC Topic 740. When tax returns are filed, it is likely 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. Interest associated with unrecognized tax benefits is classified as interest expense and penalties are classified in selling, general and administrative expenses in the statements of income. At June 30, 2017 and 2016, the Company had not taken any significant uncertain tax positions on its tax returns for periods ended June 30, 2017 and prior years or in computing its tax provision for 2016. Management has considered its tax positions and believes that all of the positions taken by the Company in its Federal and State tax returns are more likely than not to be sustained upon examination. The Company is subject to examination by U.S. Federal and State tax authorities from the period ended June 30, 2014 to the present, generally for three years after they are filed. The Company has been behind in filing its payroll tax returns and sales tax returns. The Company has recorded $3,455 as penalties and $25,346 as interest for the late payment of taxes in the accompanying financials. |
Concentration of Credit Risk | Financial instruments that potentially subject the Company to concentrations of credit risk are cash, accounts receivable and other receivables arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions. The Company has a diversified customer base across many markets, predominantly Australia, United States of America, United Kingdom, Europe and the Middle East. The Company controls credit risk related to accounts receivable through credit approvals, credit limits and monitoring procedures. The Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited. In addition, Receivables that are factored through the Company's Receivable finance facility are guaranteed by the finance company that further mitigates Credit Risk. |
Risks and Uncertainties | The Company is subject to risks from, among other things, competition associated with the industry in general, other risks associated with financing, liquidity requirements, rapidly changing customer requirements, limited operating history, foreign currency exchange rates and the volatility of public markets. |
Contingencies | Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company's management and legal counsel assess such contingent liabilities, and such assessment inherently involves judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company's legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed. |
Cash and Equivalents | Cash and equivalents include cash in hand and cash in demand deposits, certificates of deposit and all highly liquid debt instruments with original maturities of three months or less. At June 30, 2017 and June 30, 2016, the Company had $4,491 and $11,056 in cash in Australia and in the United States. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts. |
Allowance for Doubtful Accounts | The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. The allowances for doubtful accounts as of June 30, 2017 and June 30, 2016 are $135,956 and $147,870 respectively. |
Inventory | Inventories are valued at the lower of cost (determined on a weighted average basis) or market. Management compares the cost of inventories with the market value and allowance is made to write down inventories to market value, if lower. As of June 30, 2017 and June 30, 2016, the Company had outstanding balances of Finished Goods Inventory of $18,443 and $102,427 respectively. As of June 30, 2017 and June 30, 2016, a reserve for Estimated Inventory Charges in the amount of $230 and $17,258 was established. |
Property, Plant & Equipment | Property and equipment is stated at cost and depreciated using the straight-line method over the shorter of the estimated useful life of the asset or the lease term. The estimated useful lives of our property and equipment are generally as follows: computer software developed or acquired for internal use, three to ten years; computer equipment, two to three years; buildings and improvements, five to fifteen years; leasehold improvements, two to ten years; and furniture and equipment, one to five years. As of June 30, 2017 and June 30, 2016, Plant and Equipment consisted of the following: June 30 June 30 2017 2016 Property, plant & equipment $ 29,456 $ 31,378 Accumulated depreciation (21,927 ) (19,402 ) $ 7,529 $ 11,976 Depreciation was $2,525 and $2,497 for the fiscal years ended June 30, 2017 and 2016, respectively. |
Fair Value of Financial Instruments | For certain of the Company's financial instruments, including cash and equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities and short-term debt, the carrying amounts approximate their fair values due to their short maturities. ASC Topic 820, "Fair Value Measurements and Disclosures," requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 825, "Financial Instruments," defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows: 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 analyzes all financial instruments with features of both liabilities and equity under ASC 480, "Distinguishing Liabilities from Equity," and ASC 815. As of June 30, 2017 and June 30, 2016, the Company did not identify any assets and liabilities that are required to be presented on the balance sheet at fair value. |
Earnings Per Share (EPS) | The Company utilize FASB ASC 260, “Earnings per Share.” Basic earnings (loss) per share is computed by dividing earnings (loss) available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include additional common shares available upon exercise of stock options and warrants using the treasury stock method, except for periods of operating loss for which no common share equivalents are included because their effect would be anti-dilutive. The following table sets for the computation of basic and diluted earnings per share the fiscal years ended June 30, 2017 and 2016: June 30, 2017 June 30, 2016 Basic and diluted Net loss $ (1,066,746 ) $ (1,115,977 ) Net loss per share Basic $ (0.02 ) $ (0.02 ) Diluted $ (0.02 ) $ (0.02 ) Weighted average number of shares outstanding: Basic & diluted 61,152,628 58,772,431 |
Intangible Assets | The Company records identifiable intangible assets at fair value on the date of acquisition and evaluates the useful life of each asset. Finite-lived intangible assets primarily consist of software development capitalized. Finite-lived intangible assets are amortized on a straight-line basis and are tested for recoverability if events or changes in circumstances indicate that their carrying amounts may not be recoverable. These intangibles have useful lives ranging from one to ten years. |
Recently Issued Accounting Pronouncements | In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers In January 2016, The FASB issued ASU No. 2016-01, Financial Instruments - Recognition and Measurement of Financial Assets and Financial Liabilities (Topic 825) In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This update addresses a diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows under Topic 230, Statement of Cash Flows, and other Topics. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. We adopted this ASU in 2016 and the implementation did not have a material impact on our financial position or consolidated statement of operations. In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features. Down round features are features of certain equity-linked instruments (or embedded features) that result in the strike price being reduced on the basis of the pricing of future equity offerings. Current accounting guidance creates cost and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features that require fair value measurement of the entire instrument or conversion option. For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 with early adoption permitted. The Company has elected for early adoption of this guidance during the fiscal year ended June 30, 2017 on our consolidated financial statements. In August 2017, the FASB issued guidance that eases certain documentation and assessment requirements of hedge effectiveness and modifies the accounting for components excluded from the assessment. Some of the modifications include the ineffectiveness of derivative gain/loss in highly effective cash flow hedge to be recorded in OCI, the change in fair value of derivative to be recorded in the same income statement line as hedged item, and additional disclosures required on the cumulative basis adjustment in fair value hedges and the effect of hedging on financial statement lines for components excluded from the assessment. The amendment also simplifies the application of hedge accounting in certain situations to permit new hedging strategies to be eligible for hedge accounting. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2018, our fiscal 2020. Early adoption is permitted and the modified retrospective transition method should be applied. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements. |
Reclassification | Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations or cash flow. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Summary Of Significant Accounting Policies Tables Abstract | |
Summary of Plant and Equipment | June 30 June 30 2017 2016 Property, plant & equipment $ 29,456 $ 31,378 Accumulated depreciation (21,927 ) (19,402 ) $ 7,529 $ 11,976 |
Computation of basic and diluted earnings per share | June 30, 2017 June 30, 2016 Basic and diluted Net loss $ (1,066,746 ) $ (1,115,977 ) Net loss per share Basic $ (0.02 ) $ (0.02 ) Diluted $ (0.02 ) $ (0.02 ) Weighted average number of shares outstanding: Basic & diluted 61,152,628 58,772,431 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Intangible Assets Tables Abstract | |
Summary of intangible assets | June 30 June 30 2017 2016 Website $ 60,781 $ 60,781 Accumulated amortization (29,233 ) (22,512 ) Impairment loss (31,548 ) - $ - $ 38,269 |
TRADE AND OTHER PAYABLES (Table
TRADE AND OTHER PAYABLES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Trade And Other Payables | |
Trade and other payables | June 30 June 30 2017 2016 Trade payable $ 580,322 $ 593,009 Officer compensation 122,225 83,739 Payroll payable 151,824 29,616 Payroll taxes 195,551 158,518 Employee benefits 95,314 88,097 Other liabilities 33,742 55,793 $ 1,178,978 $ 1,008,772 |
LOANS (Tables)
LOANS (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Loans | |
Scheduled principal payments on loans | Year ending June 30, 2018 Loan 1 Loan 2 Loan 3 Loan 4 Loan 5 Loan 6 Total $ 100,000 $ 36,500 $ 500,000 $ 60,125 $ 387,328 $ 170,626 $ 1,254,579 $ 100,000 $ 36,500 $ 500,000 $ 60,125 $ 387,328 $ 170,626 $ 1,254,579 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Income Taxes Tables Abstract | |
Deferred tax assets | June 30, 2017 June 30, 2016 Net loss carryforward $ 1,425,000 $ 1,095,000 Valuation allowance (1,425,000 ) (1,095,000 ) Total deferred tax assets $ - $ - |
BASIS OF PRESENTATION AND ORG_2
BASIS OF PRESENTATION AND ORGANIZATION (Details Narrative) | 12 Months Ended |
Jun. 30, 2017 | |
Banjo and Matilda, Inc. [Member] | |
State Country Name | Nevada |
Date of Incorporation | Dec. 18, 2009 |
Banjo & Matilda Pty Ltd. [Member] | |
State Country Name | Australia |
Date of Incorporation | May 27, 2009 |
Banjo & Matilda USA, Inc.[Member] | |
Ownership Percentage | 100.00% |
State Country Name | State of Delaware |
Date of Incorporation | Oct. 14, 2013 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Jun. 30, 2017 | Jun. 30, 2016 |
Summary Of Significant Accounting Policies Details Abstract | ||
Plant and Equipment | $ 29,456 | $ 31,378 |
Accumulated Depreciation | (21,927) | (19,402) |
Plant and Equipment, net | $ 7,529 | $ 11,976 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Basic and Diluted: | ||
Net loss | $ (1,066,746) | $ (1,115,977) |
Net loss per share | ||
Basic | $ (0.02) | $ (0.02) |
Diluted | $ (0.02) | $ (0.02) |
Weighted average number of shares outstanding: | ||
Basic & diluted | 61,152,628 | 58,772,431 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Penalties for late payment of taxes | $ 3,455 | ||
Interest on late payment of taxes | 25,346 | ||
Cash and cash equivalents | 4,491 | $ 11,056 | $ 362,668 |
Allowances for doubtful accounts | 135,956 | 147,870 | |
Inventory | 18,443 | 102,427 | |
Reserve for estimated inventory charges | 230 | 17,258 | |
Depreciation | 2,525 | 2,497 | |
Accumulated deficit | (5,284,728) | (4,217,982) | |
Net loss | $ (1,066,746) | $ (1,115,977) | |
Minimum [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 1 year | ||
Maximum [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
Computer Software Developed [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Computer Software Developed [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 10 years | ||
Computer Equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 2 years | ||
Computer Equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Building And Improvements [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Building And Improvements [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 15 years | ||
Leasehold Improvements [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 2 years | ||
Leasehold Improvements [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 10 years | ||
Furniture And Equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 1 year | ||
Furniture And Equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 5 years |
TRADE RECEIVABLES (Details Narr
TRADE RECEIVABLES (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Trade Receivables | ||
Trade receivables payment terms | Trade receivables that are past their normal payment terms are overdue and once 60 days past due are considered delinquent. Minimum payment terms vary by product. The maximum payment term for all products is 90 days. | |
Allowances for doubtful accounts | $ 135,956 | $ 147,870 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | Jun. 30, 2017 | Jun. 30, 2016 |
Intangible Assets Details Abstract | ||
Website | $ 60,781 | $ 60,781 |
Accumulated amortization | (29,233) | (22,512) |
Impairment loss | (31,548) | |
Intangible assets | $ 38,269 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Intangible Assets Details Narrative Abstract | ||
Amortization expense | $ 6,721 | $ 6,742 |
Impairment loss | $ (31,548) |
TRADE AND OTHER PAYABLES (Detai
TRADE AND OTHER PAYABLES (Details) - USD ($) | Jun. 30, 2017 | Jun. 30, 2016 |
Trade And Other Payables Details Abstract | ||
Trade payable | $ 580,322 | $ 593,009 |
Officer compensation | 122,225 | 83,739 |
Payroll payable | 151,824 | 29,616 |
Payroll taxes | 195,551 | 158,518 |
Employee benefits | 95,314 | 88,097 |
Other liabilities | 33,742 | 55,793 |
Trade and other payables net | $ 1,178,978 | $ 1,008,772 |
TRADE FINANCING (Details Narrat
TRADE FINANCING (Details Narrative) | Nov. 03, 2016USD ($) | Nov. 02, 2016USD ($) | Aug. 14, 2014USD ($) | Nov. 29, 2016USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2017AUD ($) | Jan. 04, 2017USD ($) | Jun. 30, 2016USD ($) |
Interest rate | 3.00% | 3.00% | ||||||
Accrued interest | $ 523,257 | $ 236,398 | ||||||
Consignment Agreement One [Member] | ||||||||
Balance outstanding | 107,370 | |||||||
Purchase price | $ 26,313 | |||||||
Purchase amount | 21,928 | |||||||
Difference between purchase amount and purchase price | 4,385 | |||||||
Accrued interest | 15,123 | |||||||
Consignment Agreement [Member] | ||||||||
Purchase price | 133,342 | |||||||
Purchase amount | 114,888 | |||||||
Difference between purchase amount and purchase price | $ 18,454 | |||||||
Purchase And Sale Agreement [Member] | ||||||||
Balance outstanding | 2,601 | |||||||
Purchase price | $ 50,000 | |||||||
Purchase amount | 72,500 | |||||||
Difference between purchase amount and purchase price | 22,500 | |||||||
Payment for purchase and sale agreement | 72,500 | |||||||
Payment to lender, daily | $ 575 | |||||||
Accrued interest | 22,500 | |||||||
Merchant Agreement [Member] | ||||||||
Balance outstanding | 17,981 | |||||||
Purchase price | $ 35,000 | |||||||
Purchase amount | $ 47,250 | |||||||
Excess of purchase amount over the purchase price, over the term | 21 months | |||||||
Accrued interest | $ 4,667 | |||||||
Financial agreement [Member] | ||||||||
Interest rate | 20.95% | 20.95% | ||||||
Agreement amount | $ 150,000 | |||||||
Sales | 25.00% | |||||||
Settlement obligation | $ 165,523 | |||||||
Balance outstanding | $ 53,210 | 72,936 | ||||||
Total maximum facility | $ 1,500,000 | |||||||
Sales invoiced | 1,000,000 | |||||||
Purchase order financing | $ 500,000 | |||||||
Trade finance agreement description | <font style="font: 10pt Times New Roman, Times, Serif">Original term is for 12 months with automatic renewal for each consecutive period thereafter with interest at base rate floor of 3.25 plus 4.5%. In the event of default, an additional 7% interest is added.</font></p>" id="sjs-D37"><p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Original term is for 12 months with automatic renewal for each consecutive period thereafter with interest at base rate floor of 3.25 plus 4.5%. In the event of default, an additional 7% interest is added.</font></p> | |||||||
Financial agreement One [Member] | ||||||||
Balance outstanding | 128,468 | 176,783 | ||||||
Accrued interest | 39,062 | $ 19,531 | ||||||
Note Purchase Agreement [Member] | ||||||||
Interest rate | 18.00% | |||||||
Agreement amount | $ 65,000 | |||||||
Balance outstanding | 57,958 | |||||||
Accrued interest | $ 5,301 | |||||||
Note Purchase Agreement [Member] | Maximum [Member] | ||||||||
Interest rate | 22.00% | 22.00% |
LOANS (Details)
LOANS (Details) | Jun. 30, 2017USD ($) |
Loan payable | $ 1,254,579 |
2,018 | |
Loan payable | 1,254,579 |
Loan 1 [Member] | |
Loan payable | 100,000 |
Loan 1 [Member] | 2018 | |
Loan payable | 100,000 |
Loan 2 [Member] | |
Loan payable | 36,500 |
Loan 2 [Member] | 2018 | |
Loan payable | 36,500 |
Loan 3 [Member] | |
Loan payable | 500,000 |
Loan 3 [Member] | 2018 | |
Loan payable | 500,000 |
Loan 4 [Member] | |
Loan payable | 60,125 |
Loan 4 [Member] | 2018 | |
Loan payable | 60,125 |
Loan 5 [Member] | |
Loan payable | 387,328 |
Loan 5 [Member] | 2018 | |
Loan payable | 387,328 |
Loan 6 [Member] | |
Loan payable | 170,626 |
Loan 6 [Member] | 2018 | |
Loan payable | $ 170,626 |
LOANS (Details Narrative)
LOANS (Details Narrative) | 12 Months Ended | |||
Jun. 30, 2017USD ($)$ / sharesshares | Jun. 30, 2016USD ($)shares | Jun. 30, 2017AUD ($)shares | Apr. 15, 2017USD ($)$ / sharesshares | |
Interest expense | $ 90,000 | $ 5,178 | ||
Accrued interest | $ 523,257 | $ 236,398 | ||
Interest rate | 3.00% | 3.00% | ||
Common stock, shares issued | shares | 69,584,149 | 58,823,116 | 69,584,149 | 2,227,700 |
Common stock shares issued in exchange of principle | $ 695 | $ 588 | $ 95,000 | |
Common stock shares issued in exchange of accrued interest | $ 16,385 | |||
Common stock price per share | $ / shares | $ 0.05 | |||
Amortization of debt discount | 50,136 | 54,459 | ||
Loan from related parties | $ 170,626 | 183,269 | ||
Volatility | 123.00% | |||
Risk free rate of return | 1.26% | |||
Expected term | 5 years | |||
Maturity date, description | one year to July 17, 2018 | |||
Related Party Payable [Member] | ||||
Outstanding balance, Short-term loan arrangement | 387,328 | |||
Accrued interest | 59,533 | |||
Loan from related parties | 183,269 | |||
Related Party Payable [Member] | ||||
Outstanding balance, Short-term loan arrangement | $ 387,328 | |||
Interest expense | 85,212 | 71,565 | ||
Accrued interest | 144,745 | |||
Short-term loan arrangement, Amount | $ 526,272 | |||
Interest rate | 18.00% | 18.00% | ||
Related Party Payable description | <font style="font: 10pt Times New Roman, Times, Serif">The interest rate increased from 18% per annum due to 22% per annum due to the loan default as of September 30, 2015.</font></p>" id="sjs-B26"><p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The interest rate increased from 18% per annum due to 22% per annum due to the loan default as of September 30, 2015.</font></p> | |||
Conversion price per share | $ / shares | $ 0.05 | |||
Fair value convertible note | $ 80,909 | |||
Amortization of debt discount | 15,432 | 15,350 | ||
Loan from related parties | $ 170,626 | |||
Related Party Payable [Member] | Minimum [Member] | ||||
Interest rate | 6.00% | 6.00% | ||
Related Party Payable [Member] | Maximum [Member] | ||||
Interest rate | 15.00% | 15.00% | ||
Related Party Payable [Member] | Convertible Note [Member] | ||||
Outstanding balance, Short-term loan arrangement | $ 370,000 | |||
Related Party Payable [Member] | ||||
Accrued interest | $ 57,260 | 29,653 | ||
In April 2016 [Member] | ||||
Intferest principle payment weekly | $ 9,929 | |||
In June 2015 [Member] | ||||
Outstanding balance, Short-term loan arrangement | $ 500,000 | 500,000 | ||
Interest rate | 18.00% | 18.00% | ||
Promissory note payable | $ 500,000 | |||
Common stock warrant purchase | shares | 6,000,000 | 6,000,000 | ||
Common stock price per share | $ / shares | $ 0.08 | |||
On February 5, 2016 [Member] | ||||
Note discount | $ 115,274 | |||
Common stock warrant purchase | shares | 6,000,000 | 6,000,000 | ||
Common stock price per share | $ / shares | $ 0.02 | |||
New warrants granted | shares | 6,000,000 | |||
Price of warrants granted | $ / shares | $ 0.05 | |||
Number of shares purchase | shares | 2,000,000 | 2,000,000 | ||
Additional value of warrants | $ 41,467 | |||
From May 2014 to June 2017 [Member] | ||||
Outstanding balance, Short-term loan arrangement | 36,500 | 131,500 | ||
Accrued interest | $ 2,209 | 11,890 | ||
Interest rate | 6.00% | 6.00% | ||
Lender aggregating amount | $ 162,500 | |||
In December 2013 [Member] | ||||
Outstanding balance, Short-term loan arrangement | 100,000 | 100,000 | ||
Note require interest payment | 5,000 | |||
Interest chargeable amount per day | 166 | |||
Interest expense | 110,614 | 60,590 | ||
Accrued interest | $ 171,204 | $ 60,590 |
COMMITMENTS (Details Narrative)
COMMITMENTS (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Commitments | ||
Annual lease rent | $ 52,000 | |
Rent expense | $ 49,859 | $ 78,089 |
Lease expiration date | Oct. 31, 2014 | |
Term of lease | 3 years |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | Jun. 30, 2017 | Jun. 30, 2016 |
Income Taxes Details Abstract | ||
Net loss carryforward | $ 1,425,000 | $ 1,095,000 |
Valuation allowance | (1,425,000) | (1,095,000) |
Total deferred tax assets |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Income Taxes Details Narrative Abstract | ||
Net operating loss carry-forwards | $ 4,755,000 | $ 3,664,000 |
Expiry year | 2,032 |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Nov. 15, 2013 | Jun. 30, 2017 | Jun. 30, 2016 | |
Amount of outstanding vendor balance | $ 111,385 | $ 27,123 | |
Preferred stock, shares issued | 1,000,000 | 1,000,000 | |
Preferred stock par value | $ 0.00001 | $ 0.00001 | |
Common stock shares issued for services | 5,700,000 | ||
Common stock value issued for services | $ 142,500 | ||
Vendor balance 1 [Member] | |||
Common stock shares issued upon settlement of outstanding vendor balance | 500,000 | ||
Amount of outstanding vendor balance | $ 27,123 | ||
Vendor balance 2 [Member] | |||
Common stock shares issued upon settlement of outstanding vendor balance | 833,333 | ||
Amount of outstanding vendor balance | $ 25,000 | ||
Vendor balance 3 [Member] | |||
Common stock shares issued upon settlement of outstanding vendor balance | 2,000,000 | ||
Amount of outstanding vendor balance | $ 40,000 | ||
Debt and accrued interest [Member] | |||
Common stock shares issued upon settlement of outstanding vendor balance | 2,227,700 | ||
Amount of outstanding vendor balance | $ 111,385 | ||
Chief Executive Officer [Member] | |||
Preferred stock, shares issued | 1,000,000 | ||
Preferred stock par value | $ 0.00001 | ||
Preferred stock voting description | <font style="font: 10pt Times New Roman, Times, Serif">The preferred shares shall be entitled to 100 votes to every one share of common stock</font></p>" id="sjs-B23"><p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The preferred shares shall be entitled to 100 votes to every one share of common stock</font></p> |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - Related party compensation [Member] | 12 Months Ended |
Jun. 30, 2016USD ($) | |
Mother of the CEO | $ 1,005 |
Sister of the CEO | $ 20,113 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member] - Exchange Agreement [Member] - Spectrum King, LLC. [Member] | Apr. 12, 2018 |
Ownership percentage to be acquired under agreement | 100.00% |
Percentage of preferred stock issuable to acquire ownership interest | 93.67% |