Stealth (STTH) 10-Q/A 7 Dec 17 2017 Q3 Quarterly report (amended) Financial data

Document And Entity Information

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2017	Nov. 20, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	Stealth Technologies, Inc.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Amendment Flag	true
Amendment Description	The sole purpose of this Amendment to the Registrant's Quarterly Report on Form 10-Q for the period ended September 30, 2017 is to furnish the Interactive Data File exhibits pursuant to Rule 405 of Regulation S-T. No other changes have been made to this Form 10-Q and this Amendment has not been updated to reflect events occurring subsequent to the filing of this Form 10-Q.
Entity Central Index Key	1,496,818
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Sep. 30, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q3
Entity Common Stock, Shares Outstanding		7,075,107

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	Sep. 30, 2017	Dec. 31, 2016
ASSETS
Cash	$ 226,732	$ 456,967
Accounts receivable, net of allowance for doubtful accounts of $2,500 and $nil, respectively	313,803	853,755
Accounts receivable – related party, net of allowance for doubtful accounts of $207,807 and $nil, respectively	0	59,926
Prepaid expenses	202,725	162,725
Prepaid expenses – related party	413	0
Inventory	395,804	396,518
Total Current Assets	1,139,477	1,929,891
Intangible assets, net	3,963	102,337
Total Assets	1,143,440	2,032,228
Current Liabilities
Accounts payable and accrued liabilities	693,637	1,120,632
Accounts payable – related party	0	9,587
Deferred revenue	146,250	146,370
Derivative liabilities	102,546	1,944
Loan payable	120,000	120,000
Due to related parties	121,597	163,798
Liability for shares issuable – related party	611,186	843,616
Convertible debentures, net of unamortized discount of $76,214 and $nil, respectively	72,399	70,000
Total Current Liabilities	1,867,615	2,475,947
STOCKHOLDERS' DEFICIT
Preferred Stock Authorized: 500,000,000 preferred shares with a par value of $0.001 per share Issued and outstanding: 1,000,000 preferred shares	1,000	1,000
Common Stock Authorized: 750,000,000 common shares with a par value of $0.001 per share Issued and outstanding: 7,075,107 and 6,439,550 common shares, respectively	7,075	6,440
Additional paid-in capital	2,799,068	2,576,869
Accumulated deficit	(3,531,318)	(3,028,028)
Total Stockholders' Deficit	(724,175)	(443,719)
Total Liabilities and Stockholders' Deficit	$ 1,143,440	$ 2,032,228

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 2,500	$ 0
Allowance for doubtful accounts, related party	207,807	0
Net of unamortized discount	$ 76,214	$ 0
Preferred stock, par value	$ .001	$ 0.001
Preferred stock, shares authorized	500,000,000	500,000,000
Preferred stock, shares issued	1,000,000	1,000,000
Preferred stock, shares outstanding	1,000,000	1,000,000
Common stock, par value	$ .001	$ 0.001
Common stock, shares authorized	750,000,000	750,000,000
Common stock, issued	7,075,107	6,439,550
Common stock, outstanding	7,075,107	6,439,550

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Income Statement [Abstract]
Revenue of goods	$ 750,557	$ 1,192,845	$ 2,391,941	$ 2,946,269
Revenue of services – related party	0	117,500	147,881	354,444
Total revenue	750,557	1,310,345	2,539,822	3,300,713
Cost of goods sold	(387,281)	(548,576)	(1,289,225)	(1,347,806)
Gross Margin	363,276	761,769	1,250,597	1,952,907
Operating Expenses
Amortization	25,399	37,092	98,374	110,471
Consulting	0	15,317	68,115	986,159
General and administrative	605,382	425,719	1,220,818	1,271,377
Payroll	77,391	138,025	317,666	394,510
Professional fees	66,429	38,485	201,371	145,022
Research and development	0	41,054	38,002	43,654
Total Operating Expenses	774,601	695,692	1,944,346	2,951,193
Income (Loss) Before Other Income (Expense)	(411,325)	66,077	(693,749)	(998,286)
Other Income (Expense)
Gain (loss) on change in fair value of derivative liabilities	(2,107)	19,413	(4,328)	418,878
Gain on forgiveness of debt	0	19,988	0	19,988
Interest expense	(14,745)	(22,547)	(32,643)	(75,770)
Make whole expense with related party	(176,758)	(281,254)	232,430	(295,280)
Other expense	0	0	(5,000)	0
Total Other Income (Expense)	(193,610)	(264,400)	190,459	67,816
Net Loss	$ (604,935)	$ (198,323)	$ (503,290)	$ (930,470)
Net Loss per Share – Basic	$ (0.09)	$ (0.03)	$ (0.08)	$ (0.17)
Net Loss per Share – Diluted	$ (0.09)	$ (0.03)	$ (0.09)	$ (0.17)
Weighted Average Shares Outstanding – Basic	6,779,214	6,129,552	6,599,633	5,454,847
Weighted Average Shares Outstanding – Diluted	6,779,214	6,129,552	8,140,339	5,454,847

Consolidated Statements of Cash

Consolidated Statements of Cashflows - USD ($)	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
Operating Activities
Net loss for the period	$ (503,290)	$ (930,470)
Adjustments to reconcile net (loss) to net cash used in operating activities:
Accretion of discount on convertible debentures	26,060	0
Amortization of intangible assets	98,374	110,471
Bad debts	210,307	0
Change in fair value of make whole expense with related party	(232,430)	295,280
Gain on forgiveness of debt	0	(19,988)
Imputed interest	0	4,504
Issuance of shares for consulting services	222,834	247,561
Issuance of shares for employee bonuses	0	671,831
Loss (gain) on change in fair value of derivative liabilities	4,328	(418,878)
Changes in operating assets and liabilities:
Accounts receivable	537,452	331,444
Accounts receivable – related party	(147,881)	(311,944)
Prepaid expenses	(40,000)	(159,860)
Prepaid expense – related party	(413)	0
Inventory	714	(45,612)
Prepaid inventory	0	297,305
Accounts payable and accrued liabilities	(426,995)	653,306
Accounts payable – related party	(9,587)	(193,904)
Deferred revenue	(120)	146,250
Due to related parties	(42,201)	83,795
Net cash provided by (used in) operating activities	(302,848)	761,090
Investing Activities
Acquisition of intangible assets	0	(2,247)
Net cash used in investing activities	0	(2,247)
Financing Activities
Repayments of loans payable	0	(19,491)
Proceeds from convertible debentures	120,000	0
Repayments of convertible debentures	(47,387)	(210,000)
Net cash provided by (used in) financing activities	72,613	(229,491)
Change in cash	(230,235)	529,352
Cash, beginning of period	456,967	388,183
Cash, end of period	226,732	917,535
Non-cash Financing Activity
Debt discount resulting from derivative liability	96,274	0
Supplemental Disclosures
Interest paid	2,613	0
Income tax paid	$ 0	$ 0

1. Nature of Operations and Con

1. Nature of Operations and Continuance of Business	9 Months Ended
	Sep. 30, 2017
Nature Of Operations And Continuance Of Business
Nature of Operations and Continuance of Business	Stealth Technologies, Inc. (the "Company") was incorporated in the state of Nevada on May 27, 2010 under the name "Pub Crawl Holdings, Inc". On March 11, 2014, the Company announced its name change from Pub Crawl Holdings to Excelsis Investments, Inc. On May 26, 2016, the Company changed its name from Excelsis Investments Inc. to Stealth Technologies, Inc. The Company is focused on the development and retail of stealth cards, a product meant to block RFID (Radio Frequency Identifier Signal) chipped cards from being read when placed in the correct orientation to help users secure their personal information, and 911 buttons, an emergency two way voice system that connects the user to 911. On March 14, 2016, the Company incorporated a new wholly owned subsidiary, Safety Technologies Inc., a Nevada company. The Company's intention is to sell products other than the stealth cards, through the subsidiary. As at September 30, 2017, there has been no activity within the subsidiary. On November 7, the Company completed a 1:15 reverse stock split of its common shares. All common shares and per common share amounts in these financial statements have been retroactively restated to reflect the reverse stock-split. These interim consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at September 30, 2017, the Company has a working capital deficit of $728,138 and an accumulated deficit of $3,531,318. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company's future operations. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. These interim consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

2. Summary of Significant Accou

2. Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2017
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	a) Basis of Presentation and Principles of Consolidation The interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States ("US GAAP") and are expressed in U.S. dollars. These consolidated financial statements comprise the accounts of the Company and its wholly-owned subsidiary, Safety Technologies Inc., a Nevada company. All intercompany transactions have been eliminated on consolidation. The Company's fiscal year end is December 31. b) Interim Consolidated Financial Statements These interim consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company's consolidated financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. These unaudited interim consolidated financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes filed with the U.S. Securities and Exchange Commission in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2016. c) Accounts Receivable Accounts receivable represents amounts owed from customers for the sale of products and from consulting services. Amounts are presented net of the allowance for doubtful accounts, which represents the Company's best estimate of the amount of probable credit losses in the existing accounts receivable balance. The Company determines allowance for doubtful accounts based upon historical experience and current economic conditions. The Company reviews the adequacy of its allowance for doubtful accounts on a regular basis. As of September 30, 2017, the Company had an allowance for doubtful accounts of $210,307 (December 31, 2016 - $nil). d) Inventory Inventory is comprised of stealth cards purchased for resale, and is recorded at the lower of cost or net realizable value on a first-in first-out basis. The Company establishes inventory reserves for estimated obsolete or unsaleable inventory equal to the difference between the cost of inventory and the estimated realizable value based upon assumptions about future and market conditions. e) Intangible Assets Intangible assets are stated at cost less accumulated amortization and are comprised of customer accounts acquired with a useful life of three years and amortized straight line over three years and patent and trademark development costs, which are currently being developed and have not been placed in use. During the nine months ended September 30, 2017, the Company incurred $98,374 (2016 - $110,471) in amortization expense. f) Basic and Diluted Net Loss per Share The Company computes net loss per share in accordance with ASC 260, Earnings per Share The following represents a reconciliation of the numerators and denominators of the basic and diluted earnings per share computation: Three months ended September 30, 2017 Three months ended September 30, 2016 Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Basic EPS $ (604,935 ) 6,779,214 $ (0.09 ) $ (198,323 ) 6,129,552 $ (0.03 ) Effect of dilutive securities - - - - - - Convertible debentures - - - - - - Diluted EPS $ (604,935 ) 6,779,214 $ (0.09 ) $ (198,323 ) 6,129,552 $ (0.03 ) The following represents a reconciliation of the numerators and denominators of the basic and diluted earnings per share computation: Nine months ended September 30, 2017 Nine months ended September 30, 2016 Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Net (Numerator) Shares (Denominator) Per Share Amount Basic EPS $ (503,290 ) 6,599,633 $ (0.08 ) $ (930,470 ) 5,454,847 $ (0.17 ) Effect of dilutive securities - - - - - - Convertible debentures (195,459 ) 1,540,706 (0.13 ) - - - Diluted EPS $ (698,749 ) 8,140,339 $ (0.09 ) $ (930,470 ) 5,454,847 $ (0.17 ) g) Revenue Recognition The Company recognizes revenue in accordance with ASC 605 as a principal on the sale of goods. Pursuant to ASC 605, Revenue Recognition, The Company considered ASC 605-45, Principal Agent Considerations, and determined that the Company does not act as the principal in its revenue-earnings activities related to certain service revenues where the Company does not bear enough of the risks in the transaction to record them on the gross basis. Revenues for these activities are recorded based on the net amount earned by the Company. h) Cost of Revenue For the Company's product sales, cost of revenue consists of inventory sold in each transaction. For the Company's service sales, cost of revenue consists of engineering services provided by a related party. i) Financial Instruments The following table represents assets and liabilities that are measured and recognized in fair value as of September 30, 2017, on a recurring basis: Level 1 $ Level 2 $ Level 3 $ Total gains and (losses) Liability for shares issuable – related party (611,186 ) – – 232,430 Derivative liabilities – – (102,546 ) (4,328 ) Total (611,186 ) – (102,546 ) 228,102 The following table represents assets and liabilities that are measured and recognized in fair value as of December 31, 2016, on a recurring basis: Level 1 $ Level 2 $ Level 3 $ Total gains and (losses) Liability for shares issuable – related party (843,616 ) – – (12,383 ) Derivative liabilities – – (1,944 ) 489,305 Total (843,616 ) – (1,944 ) 476,922 As of September 30, 2017, the Company had a derivative liability amount of $102,546 (December 31, 2016 – $1,944) which was classified as a Level 3 financial instrument, and a loss on change in fair value of derivative liabilities of $4,328 (December 31, 2016 – gain of $489,305).

3. Convertible Debentures

3. Convertible Debentures	9 Months Ended
	Sep. 30, 2017
Debt Disclosure [Abstract]
Convertible Debentures	a) On June 20, 2014, the Company entered into a consulting agreement for consulting services. Pursuant to the agreement, the Company is to pay the consultant a commencement fee of $250,000. On June 23, 2014, the Company issued a $250,000 convertible note which is unsecured, non-bearing interest and due on June 22, 2015. The note is convertible into shares of common stock 180 days after the date of issuance (December 17, 2014) at a conversion rate of 90% of the lowest closing bid prices of the Company's common stock for the ten trading days ending one trading day prior to the date the conversion notice is sent by the holder to the Company. As at September 30, 2017, accrued interest of $27,461 (December 31, 2016 - $27,461) has been recorded in accounts payable and accrued liabilities. On December 17, 2014, the note became convertible resulting in the Company recording a derivative liability of $94,188 with a corresponding adjustment to loss on change in fair value of derivative liabilities of $1,050 as accretion expense. Pursuant to the agreement, the convertible note matured on June 22, 2015 and 150% of the remaining balance in principal and interest is payable. During the year ended December 31, 2015, the Company included a penalty of $125,000 in interest expense for the additional amount payable due to defaulting on the loan. On February 2, 2016, the Company entered into a settlement agreement whereby the Company would pay $20,000 on or before the third day of each subsequent month until the entire balance is repaid. During the year ended December 31, 2016, the Company recognized a gain in forgiveness of debt for $140,650 for principal and interest forgiven pursuant to the settlement agreement. The Company considered ASC Subtopic 470-50, Debt Modifications and Extinguishments, and determined that the modification was an extinguishment and therefore, recognized a gain on the extinguishment of the original debt. During the period ended September 30, 2017, the Company repaid $47,387 (2016 - $140,000) of the outstanding loan pursuant to a settlement agreement. As at September 30, 2017, the carrying value of the debenture was $22,613 (December 31, 2016 - $70,000) and the fair value of the derivative liability was $2,618 (December 31, 2016 - $1,830). b) On May 23, 2017, the Company issued a $63,000 convertible note which is unsecured, bears interest at 8% per annum, and is due on May 23, 2018. The note is convertible into shares of common stock at a conversion rate of 55% of the lowest closing bid prices of the Company's common stock for the twenty trading days ending one trading day prior to the date the conversion notice is sent by the holder to the Company. As at September 30, 2017, accrued interest of $1,808 (December 31, 2016 - $nil) has been recorded in accounts payable and accrued liabilities. Due to this provision, the embedded conversion option qualifies for derivative accounting under ASC 815-15 "Derivatives and Hedging". The fair value of the derivative liability resulted in a discount to the convertible note of $48,137. The carrying value of the convertible note will be accreted over the term of the convertible note up to the face value of $63,000. During the period ended September 30, 2017, $10,030 (2016 - $nil) of accretion expense had been recorded. The original issue discount on the convertible note of $3,000 was fully amortized to interest expense during the period ended September 30, 2017. As at September 30, 2017, the carrying value of the debenture was $24,893 (December 31, 2016 - $nil) and the fair value of the derivative liability was $49,964 (December 31, 2016 - $nil). c) On May 23, 2017, the Company issued a $63,000 convertible note which is unsecured, bears interest at 8% per annum, and is due on May 23, 2018. The note is convertible into shares of common stock at a conversion rate of 55% of the lowest closing bid prices of the Company's common stock for the twenty trading days ending one trading day prior to the date the conversion notice is sent by the holder to the Company. As at September 30, 2017, accrued interest of $1,808 (December 31, 2016 - $nil) has been recorded in accounts payable and accrued liabilities. Due to this provision, the embedded conversion option qualifies for derivative accounting under ASC 815-15 "Derivatives and Hedging". The fair value of the derivative liability resulted in a discount to the convertible note of $48,137. The carrying value of the convertible note will be accreted over the term of the convertible note up to the face value of $63,000. During the period ended September 30, 2017, $10,030 (2016 - $nil) of accretion expense had been recorded. The original issue discount on the convertible note of $3,000 was fully amortized to interest expense during the period ended September 30, 2017. As at September 30, 2017, the carrying value of the debenture was $24,893 (December 31, 2016 - $nil) and the fair value of the derivative liability was $49,964 (December 31, 2016 - $nil).

4. Derivative Liabilities

4. Derivative Liabilities	9 Months Ended
	Sep. 30, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Liabilities	The Company records the fair value of the of the conversion price of the convertible debentures disclosed in Note 3 in accordance with ASC 815, Derivatives and Hedging. The fair value of the derivative was calculated using a multi-nominal lattice model performed by an independent qualified business valuator. The fair value of the derivative liability is revalued on each balance sheet date with corresponding gains and losses recorded in the consolidated statement of operations. During the period ended September 30, 2017, the Company recorded a loss on the change in fair value of derivative liability of $4,328 (2016 – gain of $418,878). As at September 30, 2017, the Company recorded a derivative liability of $102,546 (December 31, 2016 – $1,944). The following inputs and assumptions were used to value the convertible debentures outstanding during the period ended September 30, 2017: · The stock price for the valuation of the derivative instruments at September 30, 2017 was $0.195 per share of common stock; · The debtholder would redeem (with penalties of 0% to 50% depending on the date and full-partial redemption) based on availability of alternative financing of 95%; · The debtholder would automatically convert note at maturity if the registration was effective and the Company is not in default; · The projected annual volatility for each valuation period based on the historic volatility of the Company 274% - 305%; and · Capital raising events of $100,000 would occur in each quarter at 75% of market generating dilutive reset events at prices below $0.015 (rounded) for the convertible debentures. A summary of the activity of the derivative liability is shown below: $ Balance, December 31, 2016 1,944 Debt discount 96,274 Loss in change in fair value of the derivative 4,328 Balance, September 30, 2017 102,546

5. Related Party Transaction

5. Related Party Transaction	9 Months Ended
	Sep. 30, 2017
Related Party Transactions [Abstract]
Related Party Transaction	a) As at September 30, 2017, the Company was owed $nil (December 31, 2016 - $59,926) in trade accounts receivable, net of allowance for doubtful accounts of $$207,807 (December 31, 2016 - $nil) from a significant shareholder, which is non-interest bearing, unsecured, and due on demand. This amount has been included in accounts receivable – related party. b) As at September 30, 2017, the Company owed $61,523 (December 31, 2016 - $75,964) to the President of the Company, which is non-interest bearing, unsecured, and due on demand. c) As at September 30, 2017, the Company owed $60,074 (December 31, 2016 - $87,834) to the Chief Financial Officer of the Company, which is non-interest bearing, unsecured, and due on demand. d) As at September 30, 2017, the Company recorded a liability for shares issuable of $611,186 (December 31, 2016 - $843,616) relating to 3,134,285 common shares to be issued to a significant shareholder pursuant to the acquisition agreement for the intangible assets. During the period ended September 30, 2017, the Company recorded $232,430 (2016 –$295,280) as a gain in the fair value of the shares issuable to the significant shareholder. e) During the nine months ended September 30, 2017, the Company generated net service revenues of $147,881 (2016 - $354,444) for sales revenue to a significant shareholder. f) During the nine months ended September 30, 2017, the Company incurred payroll expense of $317,666 (2016 - $394,510) to management and officers of the Company. g) During the nine months ended September 30, 2017, the Company incurred bonuses on sales of stealth cards of $nil (2016 - $182,198) to management and officers of the Company which has been included in cost of sales. Bonuses accrue on total gross sales at a rate of 5% each to the Chief Executive Officer and the Chief Financial Officer of the Company. h) During the nine months ended September 30, 2017, the Company issued nil (2016 – 1,544,437) common shares with a fair value of $nil (2016 - $671,830) to management and officers of the Company which has been included in consulting expenses. i) During the nine months ended September 30, 2017, the Company incurred engineering expense of $nil (2016 - $7,025), which was included in cost of goods sold, and research and development costs of $38,002 (2016 - $42,600) to a company owned by the mother of the President of the Company. As at September 30, 2017, the Company was owed $413 (December 31, 2016 - $nil) from the company owned by the mother of the President of the Company, which is non-interest bearing, unsecured, and due on demand. The amount owing has been recorded as prepaid expense – related party. As at September 30, 2017, the Company owed $nil (December 31, 2016 – $9,587) to the company owned by the mother of the President of the Company, which has been recorded as accounts payable – related party.

6. Loans Payable

6. Loans Payable	9 Months Ended
	Sep. 30, 2017
Loans Payable [Abstract]
Loans Payable	At September 30, 2017, the Company owes $120,000 (December 31, 2016 - $120,000) in a note payable to a non-related party. Under the terms of the note, the amount is unsecured, bears interest at 10% per annum, and due on demand.

7. Common Shares

7. Common Shares	9 Months Ended
	Sep. 30, 2017
Stockholders' Equity Note [Abstract]
Common Shares	a) On January 24, 2017, the Company issued 66,667 common shares with a fair value of $25,000 to a non-related party for consulting services. b) On February 1, 2017, the Company issued 13,334 common shares with a fair value of $7,000 to a non-related party for consulting services. c) On August 18, 2017, the Company issued 555,556 common shares with a fair value of $190,834 to a non-related party for advertising services, which has been recorded in general and administrative expenses. The fair value of the common shares was determined on June 20, 2017, which was the effective date of the advertising services.

8. Commitment and Contingencies

8. Commitment and Contingencies	9 Months Ended
	Sep. 30, 2017
Commitments and Contingencies Disclosure [Abstract]
Commitment and Contingencies	a) On February 1, 2016, the Company received notice that a third party was seeking compensation for damages as a result of false advertisements made by the Company in regards to the Company's stealth cards. The plaintiff is a manufacturer and distributor of radio frequency identification (RFID) chip protection cards which are in competition with the Company's stealth cards. The Company has filed an answer to the plaintiff's complaint, with denials and affirmative defenses, and is unable to estimate the likelihood of any outcome as at September 30, 2017. b) On February 22, 2016, the Company received notice that a consultant was seeking compensation for breach of agreement. Pursuant to the agreement, the parties agreed to equally split any net profits generated from the sale of Stealth cards made by the consultant. The Company asserts that historical sales generated from the sale of the Stealth Cards were not as a result of the consultant's services, and therefore the Company should not be liable for any compensation due to the consultant. The Company has filed its Answer and Affirmative Defenses on July 18, 2016 and has asserted counterclaims against the consultant. The Company is currently awaiting the response from the consultant and is unable to estimate the likelihood of any outcome as at September 30, 2017. c) On October 23, 2017, the Company received notice that a consultant was seeking compensation for breach of agreement. Pursuant to the agreement, the Company agreed to compensate the consultant for services performed and for commission earned on the sale of Stealth cards promoted by the consultant. The Company asserts that the agreement was terminated with just cause, and therefore the Company should not be liable for any compensation due to the consultant. The Company intends to defend itself against the consultant and is unable to estimate the likelihood of any outcome as at the date of the report.

9. Subsequent Event

9. Subsequent Event	9 Months Ended
	Sep. 30, 2017
Subsequent Event
Subsequent Event	On November 7, 2017, the Company completed a 1:15 reverse stock split of its common shares. All common shares and per common share amounts in these financial statements have been retroactively restated to reflect the reverse stock-split.

2. Summary of Significant Acc15

2. Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2017
Summary Of Significant Accounting Policies Policies
Basis of Presentation and Principles of Consolidation	The interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States ("US GAAP") and are expressed in U.S. dollars. These consolidated financial statements comprise the accounts of the Company and its wholly-owned subsidiary, Safety Technologies Inc., a Nevada company. All intercompany transactions have been eliminated on consolidation. The Company's fiscal year end is December 31.
Interim Consolidated Financial Statements	These interim consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company's consolidated financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. These unaudited interim consolidated financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes filed with the U.S. Securities and Exchange Commission in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2016.
Accounts Receivable	Accounts receivable represents amounts owed from customers for the sale of products and from consulting services. Amounts are presented net of the allowance for doubtful accounts, which represents the Company's best estimate of the amount of probable credit losses in the existing accounts receivable balance. The Company determines allowance for doubtful accounts based upon historical experience and current economic conditions. The Company reviews the adequacy of its allowance for doubtful accounts on a regular basis. As of September 30, 2017, the Company had an allowance for doubtful accounts of $210,307 (December 31, 2016 - $nil).
Inventory	Inventory is comprised of stealth cards purchased for resale, and is recorded at the lower of cost or net realizable value on a first-in first-out basis. The Company establishes inventory reserves for estimated obsolete or unsaleable inventory equal to the difference between the cost of inventory and the estimated realizable value based upon assumptions about future and market conditions.
Intangible Assets	Intangible assets are stated at cost less accumulated amortization and are comprised of customer accounts acquired with a useful life of three years and amortized straight line over three years and patent and trademark development costs, which are currently being developed and have not been placed in use. During the nine months ended September 30, 2017, the Company incurred $98,374 (2016 - $110,471) in amortization expense.
Basic and Diluted Net Loss per Share	The Company computes net loss per share in accordance with ASC 260, Earnings per Share The following represents a reconciliation of the numerators and denominators of the basic and diluted earnings per share computation: Three months ended September 30, 2017 Three months ended September 30, 2016 Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Basic EPS $ (604,935 ) 6,779,214 $ (0.09 ) $ (198,323 ) 6,129,552 $ (0.03 ) Effect of dilutive securities - - - - - - Convertible debentures - - - - - - Diluted EPS $ (604,935 ) 6,779,214 $ (0.09 ) $ (198,323 ) 6,129,552 $ (0.03 ) The following represents a reconciliation of the numerators and denominators of the basic and diluted earnings per share computation: Nine months ended September 30, 2017 Nine months ended September 30, 2016 Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Net (Numerator) Shares (Denominator) Per Share Amount Basic EPS $ (503,290 ) 6,599,633 $ (0.08 ) $ (930,470 ) 5,454,847 $ (0.17 ) Effect of dilutive securities - - - - - - Convertible debentures (195,459 ) 1,540,706 (0.13 ) - - - Diluted EPS $ (698,749 ) 8,140,339 $ (0.09 ) $ (930,470 ) 5,454,847 $ (0.17 )
Revenue Recognition	The Company recognizes revenue in accordance with ASC 605 as a principal on the sale of goods. Pursuant to ASC 605, Revenue Recognition, The Company considered ASC 605-45, Principal Agent Considerations, and determined that the Company does not act as the principal in its revenue-earnings activities related to certain service revenues where the Company does not bear enough of the risks in the transaction to record them on the gross basis. Revenues for these activities are recorded based on the net amount earned by the Company.
Cost of Revenue	For the Company's product sales, cost of revenue consists of inventory sold in each transaction. For the Company's service sales, cost of revenue consists of engineering services provided by a related party.
Financial Instruments	The following table represents assets and liabilities that are measured and recognized in fair value as of September 30, 2017, on a recurring basis: Level 1 $ Level 2 $ Level 3 $ Total gains and (losses) Liability for shares issuable – related party (611,186 ) – – 232,430 Derivative liabilities – – (102,546 ) (4,328 ) Total (611,186 ) – (102,546 ) 228,102 The following table represents assets and liabilities that are measured and recognized in fair value as of December 31, 2016, on a recurring basis: Level 1 $ Level 2 $ Level 3 $ Total gains and (losses) Liability for shares issuable – related party (843,616 ) – – (12,383 ) Derivative liabilities – – (1,944 ) 489,305 Total (843,616 ) – (1,944 ) 476,922 As of September 30, 2017, the Company had a derivative liability amount of $102,546 (December 31, 2016 – $1,944) which was classified as a Level 3 financial instrument, and a loss on change in fair value of derivative liabilities of $4,328 (December 31, 2016 – gain of $489,305).

2. Summary of Significant Acc16

2. Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2017
Accounting Policies [Abstract]
Reconciliation of earnings per share	Three months ended September 30, 2017 Three months ended September 30, 2016 Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Basic EPS $ (604,935 ) 6,779,214 $ (0.09 ) $ (198,323 ) 6,129,552 $ (0.03 ) Effect of dilutive securities - - - - - - Convertible debentures - - - - - - Diluted EPS $ (604,935 ) 6,779,214 $ (0.09 ) $ (198,323 ) 6,129,552 $ (0.03 ) Nine months ended September 30, 2017 Nine months ended September 30, 2016 Net Income (loss) (Numerator) Shares (Denominator) Per Share Amount Net (Numerator) Shares (Denominator) Per Share Amount Basic EPS $ (503,290 ) 6,599,633 $ (0.08 ) $ (930,470 ) 5,454,847 $ (0.17 ) Effect of dilutive securities - - - - - - Convertible debentures (195,459 ) 1,540,706 (0.13 ) - - - Diluted EPS $ (698,749 ) 8,140,339 $ (0.09 ) $ (930,470 ) 5,454,847 $ (0.17 )
Fair value of assets and liabilities measured on a recurring basis	The following table represents assets and liabilities that are measured and recognized in fair value as of September 30, 2017, on a recurring basis: Level 1 $ Level 2 $ Level 3 $ Total gains and (losses) Liability for shares issuable – related party (611,186 ) – – 232,430 Derivative liabilities – – (102,546 ) (4,328 ) Total (611,186 ) – (102,546 ) 228,102 The following table represents assets and liabilities that are measured and recognized in fair value as of December 31, 2016, on a recurring basis: Level 1 $ Level 2 $ Level 3 $ Total gains and (losses) Liability for shares issuable – related party (843,616 ) – – (12,383 ) Derivative liabilities – – (1,944 ) 489,305 Total (843,616 ) – (1,944 ) 476,922

4. Derivative Liabilities (Tabl

4. Derivative Liabilities (Tables)	9 Months Ended
	Sep. 30, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative liability activity	$ Balance, December 31, 2016 1,944 Debt discount 96,274 Loss in change in fair value of the derivative 4,328 Balance, September 30, 2017 102,546

1. Nature of Operations and C18

1. Nature of Operations and Continuance of Business (Details Narrative) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Nature Of Operations And Continuance Of Business Details Narrative
Working Capital	$ (728,138)
Retained Earnings (Accumulated Deficit)	$ (3,531,318)	$ (3,028,028)

2. Summary of Significant Acc19

2. Summary of Significant Accounting Policies (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Net income (loss), basic	$ (604,935)	$ (198,323)	$ (503,290)	$ (930,470)
Weighted average number of shares outstanding, basic	6,779,214	6,129,552	6,599,633	5,454,847
Earnings (loss) per share, basic	$ (0.09)	$ (0.03)	$ (0.08)	$ (0.17)
Net income (loss), diluted	$ (604,935)	$ (198,323)	$ (698,749)	$ (930,470)
Weighted average number of shares outstanding, diluted	6,779,214	6,129,552	8,140,339	5,454,847
Earnings (loss) per share, diluted	$ (0.09)	$ (0.03)	$ (0.09)	$ (0.17)
Securities
Dilutive effect on net income (loss)	$ 0	$ 0	$ 0	$ 0
Dilutive shares	0	0	0	0
Dilutive effect on earnings (loss) per share	$ 0	$ 0	$ 0	$ 0
Convertible Debentures
Dilutive effect on net income (loss)	$ 0	$ 0	$ (195,459)	$ 0
Dilutive shares	0	0	1,540,706	0
Dilutive effect on earnings (loss) per share	$ 0	$ 0	$ (0.13)	$ 0

2. Summary of Significant Acc20

2. Summary of Significant Accounting Policies (Details 1) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2017	Dec. 31, 2016
Liability for shares issuable - related party	$ (611,186)	$ (843,616)
Derivative liabilities	(102,546)	(1,944)
Total gains and (losses)	228,102	476,922
Liability for shares issuable – related party
Total gains and (losses)	232,430	(12,383)
Derivative liabilities
Total gains and (losses)	(4,328)	489,305
Level 1
Liability for shares issuable - related party	(611,186)	(843,616)
Derivative liabilities	0	0
Total	(611,186)	(843,616)
Level 2
Liability for shares issuable - related party	0	0
Derivative liabilities	0	0
Total	0	0
Level 3
Liability for shares issuable - related party	0	0
Derivative liabilities	(102,546)	(1,944)
Total	$ (102,546)	$ (1,944)

2. Summary of Significant Acc21

2. Summary of Significant Accounting Policies (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Accounting Policies [Abstract]
Allowance for doubtful accounts	$ 210,307		$ 210,307		$ 0
Amortization of Intangible Assets			98,374	$ 110,471
Derivative liabilities	102,546		102,546		$ 1,944
Gain (loss) on change in fair value of derivative liabilities	$ (2,107)	$ 19,413	$ (4,328)	$ 418,878

3. Convertible Debentures (Deta

3. Convertible Debentures (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Repayments of convertible debentures	$ (47,387)	$ (210,000)
Convertible debentures	72,399		$ 70,000
Accretion expense	10,030	$ 0
Convertible Debenture 1
Accrued interest	27,461		27,461
Convertible debentures	22,613		70,000
Fair value of derivative liabilities	2,618		1,830
Convertible Debenture 2
Accrued interest	0		1,808
Convertible debentures	0		24,893
Fair value of derivative liabilities	0		49,964
Convertible Debenture 3
Accrued interest	1,808		0
Convertible debentures	24,893		0
Fair value of derivative liabilities	$ 49,964		$ 0

4. Derivative Liabilities (Deta

4. Derivative Liabilities (Details) - USD ($)	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative liabilities, beginning	$ 1,944
Debt discount	96,274	$ 0
Loss in change in fair value of the derivative	4,328
Derivative liabilities, ending	$ 102,546

4. Derivative Liabilities (De24

4. Derivative Liabilities (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Gain (loss) on change in fair value of derivative liabilities	$ (2,107)	$ 19,413	$ (4,328)	$ 418,878
Derivative liabilities	$ 102,546		$ 102,546		$ 1,944
Stock price	$ .195		$ .195
Projected annual volatility, minimum			274.00%
Projected annual volatility, maximum			305.00%

5. Related Party Transaction (D

5. Related Party Transaction (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Trade accounts receivable	$ 0		$ 0		$ 59,926
Allowance for doubtful accounts, related party	207,807		207,807		0
Due to related parties	121,597		121,597		163,798
Liability for shares issuable – related party	611,186		611,186		843,616
Make whole expense with related party	(176,758)	$ (281,254)	232,430	$ (295,280)
Revenue of services – related party	0	117,500	147,881	354,444
Payroll	77,391	138,025	317,666	394,510
Bonuses	0	182,198	$ 0	$ 182,198
Stock issued for services, shares			0	1,544,437
Stock issued for services, amount			$ 0	$ 671,831
Engineering expense			0	7,025
Research and development costs	0	$ 41,054	38,002	$ 43,654
Due from other related parties	413		413		0
Due to other related parties	0		0		9,587
President
Due to related parties	61,523		61,523		75,964
Chief Financial Officer
Due to related parties	$ 60,074		$ 60,074		$ 87,834

6. Loans Payable (Details Narra

6. Loans Payable (Details Narrative) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Loans Payable [Abstract]
Loans payable	$ 120,000	$ 120,000
Interest rate	10.00%