Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2019 | Jan. 13, 2020 | Mar. 31, 2019 | |
Document And Entity Information | |||
Entity Registrant Name | Graphene & Solar Technologies Ltd | ||
Entity Central Index Key | 0001497649 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Current Reporting Status | Yes | ||
Document Period End Date | Sep. 30, 2019 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 | ||
Entity Ex Transition Period | false | ||
Entity Common Stock Shares Outstanding | 242,983,100 | ||
Entity Public Float | $ 22,000,000 | ||
EntityFileNumber | 333-174194 | ||
EntityAddressAddressLine1 | 433 N. Camden Dr. | ||
EntityAddressAddressLine2 | Suite 600 | ||
EntityAddressPostalZipCode | 90212 | ||
EntityTaxIdentificationNumber | 272888719 | ||
EntityAddressCityOrTown | Beverly Hills, CA | ||
LocalPhoneNumber | 8871477 | ||
CityAreaCode | 310 | ||
EntityAddressStateOrProvince | COLORADO |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2019 | Sep. 30, 2018 |
Current Assets: | ||
Cash | $ 74,241 | $ 6,704 |
Prepaid expenses | 11,684 | |
Other receivable | 5,197 | |
Total Current Assets | 91,122 | 6,704 |
Other Assets: | ||
Furniture and equipment, net of depreciation $51,946 and $38,276 | 27,869 | 47,154 |
Mineral rights | 28,415 | 28,692 |
Total Assets | 147,406 | 82,550 |
Current Liabilities | ||
Accounts payable | 402,599 | 141,128 |
Accrued interest payable | 110,738 | 91,628 |
Due to related party | 455,577 | 447,764 |
Notes payable | 60,000 | 60,000 |
Convertible notes payable, net of discount $0 and $2,503 | 100,747 | 161,244 |
Total Current Liabilities | 1,129,661 | 901,764 |
Total Liabilities | 1,129,661 | 901,764 |
Stockholders' Deficit | ||
Preferred stock: 5,000,000 shares authorized; $0.00001 par value; no shares issued and outstanding | ||
Common stock: 500,000,000 shares authorized; $0.00001 par value; 242,449,767 and 236,046,151 shares issued and outstanding | 2,424 | 2,360 |
Additional paid-in capital | 9,047,139 | 7,972,361 |
Accumulated deficit | (10,132,535) | (8,885,981) |
Accumulated other comprehensive income | 100,717 | 92,046 |
Total Stockholders' Deficit | (982,255) | (819,214) |
Total Liabilities and Stockholders' Deficit | $ 147,406 | $ 82,550 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Sep. 30, 2019 | Sep. 30, 2018 |
Stockholders' Deficit | ||
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares par value | $ 0.00001 | $ 0.00001 |
Common stock, shares issued | 242,449,767 | 236,046,151 |
Common stock, shares outstanding | 242,449,767 | 236,046,151 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Other Assets: | ||
Furniture & Equipment, net of depreciation | $ 51,946 | $ 38,276 |
Current Liabilities: | ||
Convertible notes payable, net of discount $0 and $2,503 | $ 0 | $ 2,053 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||
Revenue | ||
Operating Expenses: | ||
Professional fees | 881,104 | 1,802,058 |
General and administration | 267,109 | 323,221 |
Total operating expenses | 1,148,213 | 2,125,279 |
Operating Loss | (1,148,213) | (2,125,279) |
Other Income (Expense): | ||
Interest expense | (76,135) | (20,853) |
Rental income | 6,334 | |
Promissory note prepayment penalty | (17,860) | |
Foreign currency transaction loss | 1,678 | |
Change in fair value of derivative liability | (2,540) | |
Loss on settlement of convertible note | (9,818) | |
Total Other Expense | (98,341) | (20,853) |
Net Loss Before Income Tax | (1,246,554) | (2,146,132) |
Income tax provision | ||
Net Loss | (1,246,554) | (2,146,132) |
Other comprehensive income (loss) | ||
Foreign currency translation adjustment | 8,671 | 92,046 |
Comprehensive Loss | (1,237,883) | (2,054,086) |
Net Loss available to common shareholders | $ (1,246,554) | $ (2,146,132) |
Basic and diluted loss per common share | $ (0.01) | $ (0.01) |
Weighted average number of common shares outstanding | ||
Basic and diluted | 238,985,282 | 231,311,252 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS DEFICIT - USD ($) | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | AOCI Attributable to Parent |
Balance, shares at Sep. 30, 2017 | 224,426,229 | ||||
Balance, amount at Sep. 30, 2017 | $ (849,394) | $ 2,245 | $ 5,888,210 | $ (6,739,849) | |
Stock-based compensation, shares | 8,200,000 | ||||
Stock-based compensation, amount | 1,206,412 | $ 82 | 1,206,330 | ||
Shares issued for cash, shares | 3,369,922 | ||||
Shares issued for cash, amount | 378,603 | $ 33 | 378,570 | ||
Related party debt forgiveness | 438,521 | 438,521 | |||
Shares issued for debt repayment, Shares | 50,000 | ||||
Shares issued for debt repayment, amount | 60,730 | 60,730 | |||
Foreign currency translation adjustment | 92,046 | ||||
Net Income (Loss) | $ (2,146,132) | $ (2,146,132) | |||
Balance, shares at Sep. 30, 2018 | 236,046,151 | ||||
Balance, amount at Sep. 30, 2018 | $ (819,214) | $ 2,360 | $ 7,972,361 | $ (8,885,981) | $ 92,046 |
Stock-based compensation, shares | 600,000 | ||||
Stock-based compensation, amount | 100,200 | $ 6 | 100,194 | ||
Shares issued for cash, shares | 5,294,525 | ||||
Shares issued for cash, amount | 880,000 | $ 53 | 879,947 | ||
Foreign currency translation adjustment | (1,678) | 8,671 | |||
Net Income (Loss) | (1,246,554) | $ (1,246,554) | |||
Shares issued for conversion of note payable, shares | 509,091 | ||||
Shares issued for conversion of note payable, amount | 36,993 | $ 5 | 36,988 | ||
Terminal balance of derivative liability | $ 57,649 | $ 57,649 | |||
Balance, shares at Sep. 30, 2019 | 242,449,767 | ||||
Balance, amount at Sep. 30, 2019 | $ (982,255) | $ 2,424 | $ 9,047,139 | $ (10,132,535) | $ 100,717 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash Flows From Operating Activities | ||
Net loss | $ (1,246,554) | $ (2,146,132) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Other comprehensive gain - translation adjustment | 92,046 | |
Stock-based compensation | 100,200 | 1,206,412 |
Depreciation expenses | 16,879 | 38,278 |
Amortization of debt discounts | 57,612 | |
Loss on conversion of note payable | 9,818 | |
Change in fair value of derivative liability | 2,540 | |
Foreign currency translation gain (loss) | (1,678) | |
Changes in operating assets and liabilities: | ||
Prepaid expenses | (11,711) | |
Other receivable | (5,419) | |
Accounts payable | 128,052 | (222,880) |
Accrued liability | 704 | 9,944 |
Accrued interest payable | 13,613 | 10,613 |
Due to related party | 335,147 | 555,150 |
Other liabilities | (92) | |
Net Cash Used in Operating Activities | (600,797) | (456,661) |
Cash Flows From Financing Activities: | ||
Proceeds from common stock issuances | 880,000 | 378,603 |
Proceeds from related party | 312,201 | |
Repayment to related party | (489,863) | |
Proceeds from convertible notes payable | 60,497 | |
Proceeds from short - term loans | 5,000 | |
Repayment on convertible notes payable | (31,000) | |
Net Cash Provided by Financing Activities | 671,338 | 444,100 |
Effect of exchange rate in cash | (3,004) | 8,527 |
Net Change in Cash | 67,537 | (4,034) |
Cash at Beginning of Period | 6,704 | 10,738 |
Cash at End of Period | 74,241 | 6,704 |
Cash paid for interest | 4,675 | |
Cash paid for taxes | ||
Supplemental disclosure of non-cash financing activity: | ||
Debt forgiveness from related party | 438,521 | |
Issuance of shares for debt repayment | 60,730 | |
Discount on note payable credited to derivative liability | $ 55,109 | |
Terminal balance of derivative liability credited to additional paid-in capital | 57,649 | |
Note payable converted into common stock | $ 36,993 |
Organization and Basis of Prese
Organization and Basis of Presentation | 12 Months Ended |
Sep. 30, 2019 | |
Organization and Basis of Presentation | |
NOTE 1 - Organization and Basis of Presentation | Organization On June 21, 2010, Graphene & Solar Technologies Limited (“Graphene” or “the Company”), was incorporated in Colorado as Vanguard Energy Corporation (“Vanguard”). On July 5, 2017, Vanguard changed its name to Solar Quartz Technologies Corporation. On September 18, 2018, the name was again changed to Graphene & Solar Technologies Limited (“Graphene”). Business Operations The Company has the right to mine two high-purity silica quartz mineral deposits: White Springs consisting of approximately 1.5 million tons and Quartz Hill consisting of approximately 14 million tons, all through its wholly-owned subsidiary, Solar Quartz Technologies Limited. The ultra-high purity quartz deposits are located in the State of Queensland, Australia. The material is ideal for processing into high purity quartz sand (HPQS) with sufficient reserve to fuel a minimum of 15 to 20 years of processing into solar crucible and high-end electronics grade HPQS. In addition, the Quartz Hill deposit is ideal for processing into solar grade polysilicon metal, as well as for solar cell wafer production. HPQ and HPQS are essential primary feedstock materials required for the manufacturing of mono-crystalline solar grade silicon, through the Czochralski process, for the crucibles in which silicon ingots that solar cells are made from are produced. HPQS is also an essential ingredient required for the production of semiconductors. HPQ is the only suitable material for this process as it shares the same element (silicon) and is almost non-reactive, assuring high quality silicon ingots. Apart from this, HPQ also finds primary applications in advanced lighting, telecom, optic and microelectronics industry. HPQ powders are required for epoxy-molding compound used in manufacture of most electronic semiconductors, and is in a fast growth sector, which includes upgraded auto electronics for electric vehicles. The Company is also primarily focused on the early development of new graphene-enabled photovoltaic solar models, including graphene enabled thin-film solar panels. In this production initiative. The development of graphene enhanced combination photovoltaic silicon materials is currently one of the most intensive areas of research and development, attracting major interests from most world university research divisions and new technology players. The Company’s activities are subject to significant risks and uncertainties, including the need for additional capital, as described below. The Company has not yet commenced any revenue-generating operations, does not have positive cash flows from operations, and is dependent on periodic infusions of equity capital to fund its operating requirements. The Company’s common stock is traded on the Over-the-Counter Market under the symbol “GSTX.” Going Concern The Company’s consolidated financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has not generated any revenues from operations to date and does not expect to do so in the foreseeable future. The Company has a stockholders’ deficit as of September 30, 2019. Furthermore, the Company has experienced recurring operating losses and negative operating cash flows since inception and has financed its working capital requirements during this period primarily through debt financing and the recurring sale of its equity securities. As a result, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the consolidated financial statements are being issued. In addition, the Company’s independent registered public accounting firm, in their report on the Company’s consolidated financial statements for the year ended September 30, 2019, has also expressed substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to raise additional equity capital to fund its activities and to ultimately achieve sustainable operating revenues and profits. The Company’s consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. Because the Company is currently engaged in an early stage of development, it may take a considerable amount of time to develop any product or intellectual property capable of generating sustainable revenues. Accordingly, the Company’s business is unlikely to generate any sustainable operating revenues in the next several years. In addition, to the extent that the Company is able to generate revenues through product sales, there can be no assurance that the Company will be able to achieve positive earnings and operating cash flows. At September 30, 2019, the Company had cash of $74,241 available to fund its operations. The Company needs to raise additional capital during the year ending September 30, 2020 to fund its ongoing business activities. The amount and timing of future cash requirements during the year ended September 30, 2020, will depend on the extent of financing the Company is able to arrange. As market conditions present uncertainty as to the Company’s ability to secure additional funds, there can be no assurances that the Company will be able to secure additional financing on acceptable terms, or at all, as and when necessary to continue to conduct operations. If cash resources are insufficient to satisfy the Company’s ongoing cash requirements, the Company would be required to scale back or discontinue its technology and product development programs, or obtain funds, if available (although there can be no certainty), through the sale of mineral resource assets, through strategic alliances that may require the Company to relinquish rights to certain of its assets, or to discontinue its operations entirely. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies | |
NOTE 2 - Summary of Significant Accounting Policies | Principles of Consolidation The consolidated financial statements include the financial statements of Graphene and its wholly-owned subsidiary, Solar Quartz Technologies Ltd. (“SQTNZ”). All significant inter-company balances and transactions within the Company have been eliminated upon consolidation. Basis of These accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Significant estimates include those related to assumptions used in accruals for potential liabilities, valuing equity instruments issued for services, and the realization of deferred tax assets. Cash and Cash Equivalents Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. As of September 30, 2019 and 2018, the Company had $74,241 and $6,704 in cash, respectively, and no cash equivalents. Financial Instruments and Fair Value Measurements As defined in ASC 820 “Fair Value Measurements,” The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The Company's financial instruments consist of cash, accounts receivable, accounts payable, accrued interest, and due to related parties. The carrying amounts of these financial instruments approximate fair value due to either length of maturity or interest rates that approximate prevailing rates unless otherwise disclosed in these financial statements. Derivative Financial Instruments The Company accounts for freestanding contracts that are settled in a company’s own stock, including common stock warrants, to be designated as an equity instrument or generally as a liability. A contract so designated is carried at fair value on a company’s balance sheet, with any changes in fair value recorded as a gain or loss in a company’s results of operations. The Company records all derivatives on the balance sheet at fair value, adjusted at the end of each reporting period to reflect any material changes in fair value, with any such changes classified as changes in derivatives valuation in the statement of operations. The calculation of the fair value of derivatives utilizes highly subjective and theoretical assumptions that can materially affect fair values from period to period. The recognition of these derivative amounts does not have any impact on cash flows. At the date of the conversion of any convertible debt, the pro rata fair value of the related embedded derivative liability is transferred to additional paid-in capital. The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Binomial pricing model to calculate the fair value as of September 30, 2019. The Binomial model requires six basic data inputs: the exercise or strike price, time to expiration, the risk free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note is estimated using the Binomial valuation model. For the year ended September 30, 2019, the estimated fair values of the liabilities measured on a recurring basis are as follows: Expected term 0.142 years Expected average volatility 739 % Expected dividend yield - Risk-free interest rate 2.44 % The following table summarizes the changes in the derivative liabilities during the year ended September 30, 2019: Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance - September 30, 2018 $ - Addition of new derivatives recognized as debt discounts 55,109 Settled due to conversion of debt (57,649 ) Loss on change in fair value of the derivative 2,540 Balance – September 30, 2019 $ - Debt Issuance Costs Costs incurred in connection with the issuance of debt are amortized over the term of the related debt and netted against the liability. Commitments and Contingencies The Company follows ASC 450-20 to report accounting for contingencies. Certain conditions may exist as of the date the 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 assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that 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 financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time, that these matters will have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. Income Taxes The Company accounts for income taxes under an asset and liability approach for financial accounting and reporting for income taxes pursuant to ASC 740, “Income Taxes.” The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. In the event the Company was to determine that it would be able to realize its deferred tax assets in the future in excess of its recorded amount, an adjustment to the deferred tax assets would be credited to operations in the period such determination was made. Likewise, should the Company determine that it would not be able to realize all or part of its deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to operations in the period such determination was made. The Company is subject to U.S. federal income taxes and income taxes of various state tax jurisdictions. As the Company’s net operating losses have yet to be utilized, all previous tax years remain open to examination by Federal authorities and other jurisdictions in which the Company currently operates or has operated in the past. The Company had no unrecognized tax benefits as of September 30, 2019 and does not anticipate any material amount of unrecognized tax benefits within the next 12 months. The Company accounts for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by GAAP. The tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date. If the tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are recognized. As of September 30, 2019, the Company had not recorded any liability for uncertain tax positions. In subsequent periods, any interest and penalties related to uncertain tax positions will be recognized as a component of income tax expense. On December 22, 2017, the Tax Reform Act was signed into law. The Tax Reform Act is effective for tax years beginning on or after January 1, 2018, except for certain provisions, and resulted in significant changes to existing United States tax law, including various provisions that are expected to impact the Company. Among other provisions, the Tax Reform Act reduced the federal corporate tax rate from 35% to 21% effective January 1, 2018. The Company has completed the accounting for the effects of the Tax Reform Act during the year ended September 30, 2019. Given that current deferred tax assets are offset by a full valuation allowance, these changes will have no impact on the balance sheet. The Company is currently delinquent with respect to certain of its U.S. federal and state income tax filings. Property and Equipment Property and equipment is stated at cost, net of accumulated depreciation. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in the statement of operations when realized. Depreciation and amortization are provided using the straight-line method over a life of five years. Mineral Rights Investment in mineral rights consists of the exclusive mining and development rights for the two high purity quartz silica deposits known as Quartz Hill (represented by mining leases ML 30235, ML 30236 and ML 30237) and White Springs (represented by leases ML 30238 and ML 30239) located in North Queensland, Australia. Based on independent expert reports, together they are estimated to contain deposits in excess of 15 million tons of 99.97% pure HPQ which is feedstock that, when refined, may be used for the production of photovoltaic solar panels, and semiconductors as well as polysilicon for the production of photovoltaic solar cells. HPQS is a core ingredient in the production in crucibles for the manufacture of photovoltaic solar cells, as well as high-end microchips. The investment in mineral rights is carried on the books of the Company at the cost of the lease rights. Mineral rights assets are tested for impairment if facts and circumstances indicate that impairment exists. Long-Lived Assets The Company periodically evaluates the carrying value of long-lived assets to be held and used when events or circumstances warrant such a review. The carrying value of a long-lived asset to be held and used is considered impaired when the anticipated separately identifiable undiscounted cash flows from such an asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily by reference to the anticipated cash flows discounted at a rate commensurate with the risk involved. No impairment charges have been recorded in the periods presented. Stock-Based Compensation ASC 718, “Compensation - Stock Compensation,” The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, “Equity - Based Payments to Non-Employees.” During the year ended September 30, 2019, the Company issued 600,000 shares of the Company’s common stock to members of the Board of Directors, employees and consultants. The fair value of the shares, as determined by reference to the closing price of the Company’s common stock, aggregated $100,200, ($0.17 per share). During the year ended September 30, 2018, the Company issued 8,200,000 shares of the Company’s common stock to members of the Board of Directors, employees and consultants. The fair value of the shares, as determined by reference to the closing price of the Company’s common stock, aggregated $1,206,412, ($0.15 per share). Total stock-based compensation expense was $100,200 and $1,206,412 for the years ended September 30, 2019 and 2018, respectively. Basic and Diluted Net Loss per Common Share The Company computes basic and diluted earnings (loss) per share amounts in accordance with ASC Topic 260, “ Earnings per Share The common share equivalents of these securities have not been included in the calculations of loss per share because such inclusions would have an anti-dilutive effect as the Company has incurred losses during the year ended September 30, 2019 and 2018. For the year ended September 30, 2019 and 2018, respectively, the following common stock equivalents were potentially dilutive. Years ended September 30, 2019 2018 (Shares) (Shares) Convertible notes payable 123,378 114,171 Foreign Currency The accompanying consolidated financial statements are presented in United States dollars (“USD”). The Australian dollar (“AUD”) is the functional currency of Solar Quartz (the operating subsidiary) as it is the currency of Australia, which is the primary economic environment the operating subsidiary operates in and the environment in which the Company primarily utilizes cash. Assets and liabilities are translated into USD utilizing currency exchange rates as published by XE Currency Data API. Income and expense items are translated at average exchange rates prevailing during the period. The resulting translation adjustments are recorded as a component of shareholders’ deficiency. Gains and losses from foreign currency transactions are included in earnings in the period of settlement. September 30, September 30, 2019 2018 Spot AUD: USD exchange rate $ 0.6749 $ 0.7220 Average AUD: USD exchange rate $ 0.7038 $ 0.7605 Related parties Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence. Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02 (Topic 842) "Leases." In June 2016, the FASB issued ASU No. 2016-13 "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” In July 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This update addresses several aspects of the accounting for nonemployee share-based payment transactions and expands the scope of ASC 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The main provisions of the update change the way nonemployee awards are measured in the financial statements. Under the simplified standards, nonemployee options will be valued once at the date of grant, as compared to at each reporting period end under ASC 505-50. At adoption, all awards without established measurement dates will be revalued one final time, and a cumulative effect adjustment to retained earnings will be recorded as the difference between the pre-adoption value and new value. Companies will be permitted to make elections to establish the expected term and either recognize forfeitures as they occur or apply a forfeiture rate. Compensation expense recognition using a graded vesting schedule will no longer be permitted. This pending content is the result of the FASB’s Simplification Initiative, to maintain or improve the usefulness of the information provided to the users of financial statements while reducing cost and complexity in financial reporting. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. Because the Company does not currently have any outstanding awards to non-employees for which a measurement date has not been established the adoption of ASU 2018-07 does not have a material impact to the Company’s financial statements and related disclosures upon adoption. The adoption of this standard will change the way that the Company accounts for non-employee compensation in the future. In August 2018, the FASB issued ASU 2018-13, “Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement” Management does not believe that any other recently issued, including the lease accounting standard; but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Sep. 30, 2019 | |
Property and Equipment | |
NOTE 3 - Property and Equipment | Property and equipment as of September 30, 2019 and 2018 are summarized as follows: September 30, September 30, 2019 2018 Laboratory and factory equipment $ 42,102 $ 45,062 Computers 3,305 3,538 Furniture and fixtures 34,408 36,830 79,815 85,430 Less accumulated depreciation (51,946 ) (38,276 ) Net property and equipment $ 27,869 $ 47,154 Depreciation expense for the years ended September 30, 2019 and 2018 was $16,879 and $38,278, respectively. |
Convertible Notes Payable
Convertible Notes Payable | 12 Months Ended |
Sep. 30, 2019 | |
Convertible Notes Payable | |
NOTE 4 - Convertible Notes Payable | The Company’s material future contractual obligations by fiscal years as of September 30, 2019 and 2018 were as follows: September 30, 2019 September 30, 2018 Notes payable $ 60,000 $ 60,000 Convertible notes payable $ 100,747 $ 161,244 Notes Payable During 2015 and 2016, the Company executed promissory notes payable with six individuals with an aggregate principal balance of $60,000. The notes were due on demand and included interest at 10%. As of September 30, 2019 and 2018, the total promissory notes payable balance was $84,693 and $78,693, including accrued interest of $24,693 and $18,693, respectively. On January 15, 2019, the holder of a note with a principal balance of $10,000 made demand for payment. To date, the note has not been paid. Convertible Notes Payable On August 13, 2018, the Company entered into Securities Purchase Agreement with Power Up Lending Group (“Power Up”). In connection therewith, the Company issued Power Up a convertible note payable in the amount of $63,000. The note was due, including interest at 12%, and matured on May 30, 2019. After 170 days, the note carried a 150% of principal outstanding redemption premium. Also, after 170 days the note was convertible into fully paid and non-assessable shares of common stock, after 170 days (January 30, 2019), at a conversion price which is at 55% discount to the lowest trading price during the previous twenty trading days prior to the date of a conversion notice. As the conversion price of the note, which became effective on January 30, 2019, is variable, the conversion option was treated as a derivative liability and on January 30, 2019 the Company recognized and recorded a derivative liability. On March 15, 2019, Power Up converted $12,000 in principal at $0.0825 per share for 145,455 shares of the Company’s common stock. In connection therewith, the Company recognized a loss on conversion of $9,818. On April 8, 2019, Power Up converted an additional $20,000 of principal at $.055 cents per share for 363,636 shares of the Company’s common stock. On April 24, 2019 the Company elected to pay off the remaining $31,000 balance on the loan, with accrued interest in the amount of $4,675, plus a redemption premium of $17,860. In connection with the payoff, the Company charged operations for the remaining unamortized discount on the note of $2,503 and credited additional paid-in capital for the terminal balance of the derivative liability in the amount of $57,649. As of September 30, 2019 and 2018, the convertible note payable to Power Up totaled $0 and $60,497, net of an unamortized discount of $0 and $2,503; accrued interest on the convertible note payable totaled $3,681 and $994, respectively. Convertible Notes Payable On June 29, 2012, the Company issued convertible secured notes payable totaling $8,254,500 to a group of private investors. The notes matured on June 30, 2015. The notes, with interest at 15%, were convertible at the discretion of the holders, into common shares of the Company at the rate of $3.31 per share. Unable to make a required interest payment on March 31, 2014, the notes became due on demand. Effective June 17, 2014, with the noteholder approval, the assets securing the convertible notes were sold with the net proceeds of approximately $5,200,000 being distributed to the noteholders. Noteholders were to receive payment for the remaining balance due on the notes in the form of an exchange for the common stock of the Company at the rate of $3.31 per share. As of September 30, 2019 and 2018, noteholders representing $70,747 in outstanding principal had not requested the exchange of shares of common stock. As of September 30, 2019 and 2018, the exchange obligation payable was $137,032 and $126,420, including accrued interest of $66,285 and $55,673, respectively. As of September 30, 2019 and 2018, the exchange obligation was for 41,399 shares and 38,194 shares of common stock, respectively. On February 1, 2016, the Company issued convertible secured note payable of $30,000 to an individual. The notes were due on January 31, 2017 and included interest at 10%. The note was convertible at discretion of the holder into common shares of the Company at the rate of $0.50 per shares. The Company has not extended the maturity date and the note is in default. As of September 30, 2019 and 2018, the total convertible note payable balance was $40,989 and $37,989, including accrued interest of $10,989 and $7,989, respectively. As of September 30, 2019 and 2018, the exchange obligation was for 81,078 shares and 75,978 shares of common stock, respectively. |
Stockholders Equity
Stockholders Equity | 12 Months Ended |
Sep. 30, 2019 | |
Stockholders' Deficit | |
NOTE 5 - Stockholders' Equity | Preferred Stock The Company has authorized a total of 5,000,000 shares of preferred stock, par value $0.00001 per share. No preferred shares have been designated by the Company as of September 30, 2019 and 2018. Common Stock The Company is authorized to issue up to 500,000,000 shares of common stock (par value $0.00001). As of September 30, 2019 and 2018, the Company had 242,449,767 shares and 236,046,151 shares of common stock issued and outstanding, respectively. During the year ended September 30, 2019, the Company issued 6,403,616 shares of common stock as follows: · 600,000 shares of the Company’s common to members of the Board of Directors, employees and consultants valued at $100,200 ($0.17 per share). · 5,294,525 shares of the Company’s common at an average price of $0.17 per share for an aggregate purchase price of $880,000. · 509,091 shares of the Company’s common for the conversion of debt totaling $36,993. During the year ended September 30, 2018, the Company issued 11,619,922 shares of common stock as follow: · 8,200,000 shares of the Company’s common to management for stock-based compensation of $1,206,412. · 3,369,922 shares of the Company’s common stock at an average price of $0.11 per share for an aggregate purchase price of $378,603. · 50,000 shares of the Company’s common stock in payment of debt totaling $60,730. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions | |
NOTE 6 - Related Party Transactions | Due to related party PGRNZ Limited, a management company controlled by the Company’s Chief Executive Officer, and a Company Director, provides management services to the Company for which the Company is charged $75,000(AUD) quarterly, approximately $52,787 (US). During the years ended September 30, 2019 and 2018, the Company incurred charges to operations of $211,149 (US) and $224,878, respectively, with respect to this arrangement. During the year ended September 30, 2019, PGRNZ Limited charged to operations $60,000 (AUD), approximately $42,230 as consulting fees and $119,115 (AUD), approximately $83,836 as of administrative expenses. During the year ended September 30, 2019, the Company borrowed $312,201 from PGRNZ Limited and repaid $489,863. The Company’s Chief Executive Officer, and a Company Director, provides office facilities to the Company for which the Company is charged $6,000(AUD) monthly, approximately $4,223 (US). During the years ended September 30, 2019 and 2018, the Company incurred charges to operations of $ 13,232 (US) and $4,791 (US), respectively, with respect to this arrangement. On September 30, 2019, the Company signed consulting agreement with a consultant company which was affiliated with the Company’s CEO and incurred and paid $10,000 (AUD), approximately $7,038 (US). The Company’s commitment was $150,000 (AUD) fee annual and issuance of 10 million common shares within 60 days of the date of agreement. The Company terminated the agreement on November 11, 2019. During the year ended September 30, 2019, the Company appointed Frank Herrera as interim Chief Financial Officer. The Company paid $48,415 to F&E Herrera LLC, a Company controlled by Mr. Herrera, with respect to services. Mr. Herrera resigned on September 2019. During the year ended September 30, 2019, the Company paid a consulting fee of $2,000 to one of the Company’s Director. As of September 30, 2019 and 2018, due to related parties was $455,577 and $447,764, respectively. Stock-Based Compensation During the years ended September 30, 2019 and 2018, stock-based compensation expense relating to directors, officers, affiliates and related parties was $100,200 and $1,206,330, respectively (Note 5). |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2019 | |
Income Taxes | |
NOTE 7 - Income Taxes | Graphene & Solar Technologies Limited was formed in 2010. Prior to the acquisition of SQTNZ in July 2017, the Company only had operations in the United States. In July 2017, the Company became the parent of SQTNZ., a wholly owned New Zealand subsidiary, which files tax returns in New Zealand. The Company provides for income taxes under ASC 740, “Income Taxes.” For the years ended September 30, 2019 and 2018, the local (“United States of America”) and foreign components of loss before income taxes were comprised of the following: For the Years Ended September 30, 2019 2018 Tax jurisdiction from: - Local $ (665,500 ) $ (1,644,242 ) - Foreign (581,054 ) (501,890 ) Loss before income taxes $ (1,246,554 ) $ (2,146,132 ) United States of America Graphene & Solar Technologies Limited is subject to the tax laws of United States of America. The income tax provision for the years ended September 30, 2019 and 2018, consists of the following: For the Years Ended September 30, 2019 2018 Net income (loss) $ (665,500 ) $ (1,644,242 ) Effective tax rate 21 % 21 % Income tax expense (benefit) (139,755 ) (345,291 ) Less: valuation allowance 139,755 345,291 Income tax expense (benefit) $ - $ - Net deferred tax assets consist of the following components as of September 30, 2019 and 2018: September 30, September 30, 2019 2018 Net operating tax carryforwards $ 1,655,439 $ 1,425,213 Valuation allowance (1,655,439 ) (1,425,213 ) Net deferred tax asset $ - $ - On December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (the “Act”) resulting in significant modifications to existing law including lowering the corporate tax rate from 34% to 21%. In addition to applying the new lower corporate tax rate in 2018 and thereafter to any taxable income we may have, the legislation affects the way we can use and carry forward net operating losses previously accumulated and results in a revaluation of deferred tax assets and liabilities recorded on our balance sheet. The Company has completed the accounting for the effects of the Act during the year ended September 30, 2019. Given that current deferred tax assets are offset by a full valuation allowance, these changes will have no impact on the balance sheet. At September 30, 2019 and 2018, the Company had $7,883,042 and $6,786,730 respectively of the U.S. net operating losses (the “U.S. NOLs”), which begin to expire beginning in 2039. NOLs generated in tax years prior to July 31, 2018, can be carryforward for twenty years, whereas NOLs generated after July 31, 2018 can be carryforward indefinitely New Zealand The Company’s subsidiary operating in New Zealand (“NZ”) are subject to the New Zealand Corporate Income Tax at a standard income tax rate range of 28% on the assessable income arising in New Zealand during its tax year. The reconciliation of income tax rate to the effective income tax rate for the years ended September 30, 2019 and 2018 is as follows: For the Years Ended September 30, 2019 2018 Net income (loss) $ (581,054 ) $ (501,890 ) Effective tax rate 28 % 28 % Income tax expense (benefit) (162,695 ) (140,529 ) Less: valuation allowance 162,695 140,529 Income tax expense (benefit) $ - $ - Net deferred tax assets consist of the following components as of September 30, 2018 and September 30, 2018 September 30, September 30, 2019 2018 Net operating tax carryforwards $ 599,053 $ 250,018 Valuation allowance (599,053 ) (250,018 ) Net deferred tax asset $ - $ - As of September 30, 2019, the operations in New Zealand incurred $1,473,975 of cumulative net operating losses which can be carried forward to offset future taxable income. The Company has provided for a full valuation allowance against the deferred tax assets of $412,713 on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future. The following table sets forth the significant components of the aggregate deferred tax assets of the Company as of September 30, 2019 and 2018: September 30, September 30, 2019 2018 Deferred tax assets: Net operating tax carryforwards: United States $ 1,655,439 $ 1,425,213 New Zealand 599,053 250,018 Total 2,254,492 1,675,231 Valuation allowance (2,254,492 ) (1,675,231 ) Net deferred tax asset $ - $ - Management believes that it is more likely than not that the deferred tax assets will not be fully realizable in the future. Accordingly, the Company provided for a full valuation allowance against its deferred tax assets of $2,254,492 as of September 30, 2019. In the period, the valuation allowance increased by $579,261, primarily relating to net operating loss carryforwards from the foreign tax regimes. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Sep. 30, 2019 | |
Subsequent Events | |
NOTE 8 - Subsequent Events | On September 30, 2019, the Company signed consulting agreement with a consultant company which was afflicted with the Company’s CEO and paid $10,000 (AUD), approximately $7,038 (US). The Company’s commitment was $150,000 (AUD) fee annual and issuance of 10 million common shares within 60 days of the date of agreement. The company terminated the agreement on November 11, 2019. Subsequent to September 30, 2019, the Company issued 533,333 shares of common stock. On January 3, 2020, the Company formed Global Advanced Energies Townsville Australia Limited, a company incorporated in New Zealand, retaining an 80% ownership. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies (Policies) | |
Principles of Consolidation | The consolidated financial statements include the financial statements of Graphene and its wholly-owned subsidiary, Solar Quartz Technologies Ltd. (“SQTNZ”). All significant inter-company balances and transactions within the Company have been eliminated upon consolidation. |
Basis of Presentation | These accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Significant estimates include those related to assumptions used in accruals for potential liabilities, valuing equity instruments issued for services, and the realization of deferred tax assets. |
Cash and Cash Equivalents | Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. As of September 30, 2019 and 2018, the Company had $74,241 and $6,704 in cash, respectively, and no cash equivalents. |
Financial Instruments and Fair Value Measurements | As defined in ASC 820 “Fair Value Measurements,” The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The Company's financial instruments consist of cash, accounts receivable, accounts payable, accrued interest, and due to related parties. The carrying amounts of these financial instruments approximate fair value due to either length of maturity or interest rates that approximate prevailing rates unless otherwise disclosed in these financial statements. |
Derivative Financial Instruments | The Company accounts for freestanding contracts that are settled in a company’s own stock, including common stock warrants, to be designated as an equity instrument or generally as a liability. A contract so designated is carried at fair value on a company’s balance sheet, with any changes in fair value recorded as a gain or loss in a company’s results of operations. The Company records all derivatives on the balance sheet at fair value, adjusted at the end of each reporting period to reflect any material changes in fair value, with any such changes classified as changes in derivatives valuation in the statement of operations. The calculation of the fair value of derivatives utilizes highly subjective and theoretical assumptions that can materially affect fair values from period to period. The recognition of these derivative amounts does not have any impact on cash flows. At the date of the conversion of any convertible debt, the pro rata fair value of the related embedded derivative liability is transferred to additional paid-in capital. The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Binomial pricing model to calculate the fair value as of September 30, 2019. The Binomial model requires six basic data inputs: the exercise or strike price, time to expiration, the risk free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note is estimated using the Binomial valuation model. For the year ended September 30, 2019, the estimated fair values of the liabilities measured on a recurring basis are as follows: Expected term 0.142 years Expected average volatility 739 % Expected dividend yield - Risk-free interest rate 2.44 % The following table summarizes the changes in the derivative liabilities during the year ended September 30, 2019: Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance - September 30, 2018 $ - Addition of new derivatives recognized as debt discounts 55,109 Settled due to conversion of debt (57,649 ) Loss on change in fair value of the derivative 2,540 Balance – September 30, 2019 $ - |
Debt Issuance Costs | Costs incurred in connection with the issuance of debt are amortized over the term of the related debt and netted against the liability. |
Commitments and Contingencies | The Company follows ASC 450-20 to report accounting for contingencies. Certain conditions may exist as of the date the 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 assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that 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 financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time, that these matters will have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. |
Income Taxes | The Company accounts for income taxes under an asset and liability approach for financial accounting and reporting for income taxes pursuant to ASC 740, “Income Taxes.” The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. In the event the Company was to determine that it would be able to realize its deferred tax assets in the future in excess of its recorded amount, an adjustment to the deferred tax assets would be credited to operations in the period such determination was made. Likewise, should the Company determine that it would not be able to realize all or part of its deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to operations in the period such determination was made. The Company is subject to U.S. federal income taxes and income taxes of various state tax jurisdictions. As the Company’s net operating losses have yet to be utilized, all previous tax years remain open to examination by Federal authorities and other jurisdictions in which the Company currently operates or has operated in the past. The Company had no unrecognized tax benefits as of September 30, 2019 and does not anticipate any material amount of unrecognized tax benefits within the next 12 months. The Company accounts for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by GAAP. The tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date. If the tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are recognized. As of September 30, 2019, the Company had not recorded any liability for uncertain tax positions. In subsequent periods, any interest and penalties related to uncertain tax positions will be recognized as a component of income tax expense. On December 22, 2017, the Tax Reform Act was signed into law. The Tax Reform Act is effective for tax years beginning on or after January 1, 2018, except for certain provisions, and resulted in significant changes to existing United States tax law, including various provisions that are expected to impact the Company. Among other provisions, the Tax Reform Act reduced the federal corporate tax rate from 35% to 21% effective January 1, 2018. The Company has completed the accounting for the effects of the Tax Reform Act during the year ended September 30, 2019. Given that current deferred tax assets are offset by a full valuation allowance, these changes will have no impact on the balance sheet. The Company is currently delinquent with respect to certain of its U.S. federal and state income tax filings. |
Property and Equipment | Property and equipment is stated at cost, net of accumulated depreciation. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in the statement of operations when realized. Depreciation and amortization are provided using the straight-line method over a life of five years. |
Mineral Rights | Investment in mineral rights consists of the exclusive mining and development rights for the two high purity quartz silica deposits known as Quartz Hill (represented by mining leases ML 30235, ML 30236 and ML 30237) and White Springs (represented by leases ML 30238 and ML 30239) located in North Queensland, Australia. Based on independent expert reports, together they are estimated to contain deposits in excess of 15 million tons of 99.97% pure HPQ which is feedstock that, when refined, may be used for the production of photovoltaic solar panels, and semiconductors as well as polysilicon for the production of photovoltaic solar cells. HPQS is a core ingredient in the production in crucibles for the manufacture of photovoltaic solar cells, as well as high-end microchips. The investment in mineral rights is carried on the books of the Company at the cost of the lease rights. Mineral rights assets are tested for impairment if facts and circumstances indicate that impairment exists. |
Long-Lived Assets | The Company periodically evaluates the carrying value of long-lived assets to be held and used when events or circumstances warrant such a review. The carrying value of a long-lived asset to be held and used is considered impaired when the anticipated separately identifiable undiscounted cash flows from such an asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily by reference to the anticipated cash flows discounted at a rate commensurate with the risk involved. No impairment charges have been recorded in the periods presented. |
Stock-Based Compensation | ASC 718, “Compensation - Stock Compensation,” The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, “Equity - Based Payments to Non-Employees.” During the year ended September 30, 2019, the Company issued 600,000 shares of the Company’s common stock to members of the Board of Directors, employees and consultants. The fair value of the shares, as determined by reference to the closing price of the Company’s common stock, aggregated $100,200, ($0.17 per share). During the year ended September 30, 2018, the Company issued 8,200,000 shares of the Company’s common stock to members of the Board of Directors, employees and consultants. The fair value of the shares, as determined by reference to the closing price of the Company’s common stock, aggregated $1,206,412, ($0.15 per share). Total stock-based compensation expense was $100,200 and $1,206,412 for the years ended September 30, 2019 and 2018, respectively. |
Basic and Diluted Net Loss per Common Share | The Company computes basic and diluted earnings (loss) per share amounts in accordance with ASC Topic 260, “ Earnings per Share The common share equivalents of these securities have not been included in the calculations of loss per share because such inclusions would have an anti-dilutive effect as the Company has incurred losses during the year ended September 30, 2019 and 2018. For the year ended September 30, 2019 and 2018, respectively, the following common stock equivalents were potentially dilutive. Years ended August 31, 2019 2018 (Shares) (Shares) Convertible notes payable 123,378 114,171 |
Foreign Currency | The accompanying consolidated financial statements are presented in United States dollars (“USD”). The Australian dollar (“AUD”) is the functional currency of Solar Quartz (the operating subsidiary) as it is the currency of Australia, which is the primary economic environment the operating subsidiary operates in and the environment in which the Company primarily utilizes cash. Assets and liabilities are translated into USD utilizing currency exchange rates as published by XE Currency Data API. Income and expense items are translated at average exchange rates prevailing during the period. The resulting translation adjustments are recorded as a component of shareholders’ deficiency. Gains and losses from foreign currency transactions are included in earnings in the period of settlement. September 30, September 30, 2019 2018 Spot AUD: USD exchange rate $ 0.6749 $ 0.7220 Average AUD: USD exchange rate $ 0.7038 $ 0.7605 |
Related parties | Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence. |
Recent Accounting Pronouncements | In February 2016, the FASB issued ASU No. 2016-02 (Topic 842) "Leases." In June 2016, the FASB issued ASU No. 2016-13 "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” In July 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This update addresses several aspects of the accounting for nonemployee share-based payment transactions and expands the scope of ASC 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The main provisions of the update change the way nonemployee awards are measured in the financial statements. Under the simplified standards, nonemployee options will be valued once at the date of grant, as compared to at each reporting period end under ASC 505-50. At adoption, all awards without established measurement dates will be revalued one final time, and a cumulative effect adjustment to retained earnings will be recorded as the difference between the pre-adoption value and new value. Companies will be permitted to make elections to establish the expected term and either recognize forfeitures as they occur or apply a forfeiture rate. Compensation expense recognition using a graded vesting schedule will no longer be permitted. This pending content is the result of the FASB’s Simplification Initiative, to maintain or improve the usefulness of the information provided to the users of financial statements while reducing cost and complexity in financial reporting. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. Because the Company does not currently have any outstanding awards to non-employees for which a measurement date has not been established the adoption of ASU 2018-07 does not have a material impact to the Company’s financial statements and related disclosures upon adoption. The adoption of this standard will change the way that the Company accounts for non-employee compensation in the future. In August 2018, the FASB issued ASU 2018-13, “Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement” Management does not believe that any other recently issued, including the lease accounting standard; but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies (Policies) | |
Estimated fair values of liabilities measured on a recurring basis | For the year ended September 30, 2019, the estimated fair values of the liabilities measured on a recurring basis are as follows: Expected term 0.142 years Expected average volatility 739 % Expected dividend yield - Risk-free interest rate 2.44 % |
Summary of changes in derivative liabilities | The following table summarizes the changes in the derivative liabilities during the year ended September 30, 2019: Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance - September 30, 2018 $ - Addition of new derivatives recognized as debt discounts 55,109 Settled due to conversion of debt (57,649 ) Loss on change in fair value of the derivative 2,540 Balance – September 30, 2019 $ - |
Schedule Of Antidilutive Securities Excluded From Computation Of Earnings Per Share | For the year ended September 30, 2019 and 2018, respectively, the following common stock equivalents were potentially dilutive. Years ended August 31, 2019 2018 (Shares) (Shares) Convertible notes payable 123,378 114,171 |
Foreign Currency Transaction | September 30, September 30, 2019 2018 Spot AUD: USD exchange rate $ 0.6749 $ 0.7220 Average AUD: USD exchange rate $ 0.7038 $ 0.7605 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Sep. 30, 2019 | |
Property and Equipment (Tables) | |
Schedule of property and equipment | September 30, September 30, 2019 2018 Laboratory and factory equipment $ 42,102 $ 45,062 Computers 3,305 3,538 Furniture and fixtures 34,408 36,830 79,815 85,430 Less accumulated depreciation (51,946 ) (38,276 ) Net property and equipment $ 27,869 $ 47,154 |
Convertible Notes Payable (Tabl
Convertible Notes Payable (Tables) | 12 Months Ended |
Sep. 30, 2019 | |
Convertible Notes Payable (Tables) | |
Convertible Notes Payable | September 30, 2019 September 30, 2018 Notes payable $ 60,000 $ 60,000 Convertible notes payable $ 100,747 $ 161,244 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2019 | |
Local and foreign components of loss before income taxes | For the Years Ended September 30, 2019 2018 Tax jurisdiction from: - Local $ (665,500 ) $ (1,644,242 ) - Foreign (581,054 ) (501,890 ) Loss before income taxes $ (1,246,554 ) $ (2,146,132 ) |
Aggregate deferred tax assets | September 30, September 30, 2019 2018 Deferred tax assets: Net operating tax carryforwards: United States $ 1,655,439 $ 1,425,213 New Zealand 599,053 250,018 Total 2,254,492 1,675,231 Valuation allowance (2,254,492 ) (1,675,231 ) Net deferred tax asset $ - $ - |
United States of America [Member] | |
Aggregate deferred tax assets | September 30, September 30, 2019 2018 Net operating tax carryforwards $ 1,655,439 $ 1,425,213 Valuation allowance (1,655,439 ) (1,425,213 ) Net deferred tax asset $ - $ - |
Income tax provision | For the Years Ended September 30, 2019 2018 Net income (loss) $ (665,500 ) $ (1,644,242 ) Effective tax rate 21 % 21 % Income tax expense (benefit) (139,755 ) (345,291 ) Less: valuation allowance 139,755 345,291 Income tax expense (benefit) $ - $ - |
New Zealand [Member] | |
Aggregate deferred tax assets | September 30, September 30, 2019 2018 Net operating tax carryforwards $ 599,053 $ 250,018 Valuation allowance (599,053 ) (250,018 ) Net deferred tax asset $ - $ - |
Reconciliation of income tax rate | For the Years Ended September 30, 2019 2018 Net income (loss) $ (581,054 ) $ (501,890 ) Effective tax rate 28 % 28 % Income tax expense (benefit) (162,695 ) (140,529 ) Less: valuation allowance 162,695 140,529 Income tax expense (benefit) $ - $ - |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Details Narrative) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Summary of Significant Accounting Policies (Policies) | ||
Sate of incorporation | Colorado | |
Cash | $ 74,241 | $ 6,704 |
Date of incorporation | Jun. 21, 2010 | |
Ownership description | White Springs consisting of approximately 1.5 million tons and Quartz Hill consisting of approximately 14 million tons, all through its wholly owned subsidiary, Solar Quartz Technologies Limited. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies (Details) | |
Expected term | 17 months 1 day |
Expected average volatility | 739.00% |
Risk-free interest rate | 2.44% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details1) | 12 Months Ended |
Sep. 30, 2019USD ($) | |
Summary of Significant Accounting Policies (Details) | |
Derivative Liability beginning balance | |
Addition of new derivatives recognized as debt discounts | 55,109 |
Settled due to conversion of debt | (57,649) |
Loss on change in fair value of the derivative | 2,540 |
Derivative Liability ending balance |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details2) - USD ($) | Sep. 30, 2019 | Aug. 31, 2019 | Sep. 30, 2018 | Aug. 31, 2018 |
Summary of Significant Accounting Policies (Details) | ||||
Convertible notes payable | $ 100,747 | $ 123,378 | $ 161,244 | $ 114,171 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details 3) - Foreign currency transactions [Member] | Sep. 30, 2019 | Sep. 30, 2018 |
Spot AUD: USD exchange rate | 0.6749 | 0.7220 |
Average AUD: USD exchange rate | 0.7038 | 0.7605 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2017 | |
Cash and cash equivlent | $ 74,241 | $ 6,704 | $ 10,738 |
Stock based compensation | $ 100,200 | 1,206,412 | |
Mineral Rights [Member] | |||
Excess deposits description | Based on independent expert reports, together they are estimated to contain deposits in excess of 15 million tons of 99.97% pure HPQ which is feedstock that, when refined, may be used for the production of photovoltaic solar panels, and semiconductors as well as polysilicon for the production of photovoltaic solar cells. | ||
Board of Directors, Employees and Consultants [Member] | |||
Stock based compensation | $ 100,200 | 1,206,412 | |
Aggregated fair value of shares | $ 100,200 | $ 1,206,412 | |
Stock issued during period new issuance, shares | 600,000 | 8,200,000 | |
Common stock, price per share | $ 0.17 | $ 0.15 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Sep. 30, 2019 | Sep. 30, 2018 |
Property and equipment | $ 79,815 | $ 85,430 |
Less accumulated depreciation | (51,946) | (38,276) |
Net property and equipment | 27,869 | 47,154 |
Laboratory and factory equipment [Member] | ||
Property and equipment | 42,102 | 45,062 |
Computers [Member] | ||
Property and equipment | 3,305 | 3,538 |
Furniture and fixtures [Member] | ||
Property and equipment | $ 34,408 | $ 36,830 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Property and Equipment (Details Narrative) | ||
Depreciation expense | $ 16,879 | $ 38,278 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details) - USD ($) | Sep. 30, 2019 | Aug. 31, 2019 | Sep. 30, 2018 | Aug. 31, 2018 |
Convertible Notes Payable (Tables) | ||||
Notes payable | $ 60,000 | $ 60,000 | ||
Convertible notes payable | $ 100,747 | $ 123,378 | $ 161,244 | $ 114,171 |
Convertible Notes Payable (De_2
Convertible Notes Payable (Details Narrative) - USD ($) | Mar. 15, 2019 | Jan. 15, 2019 | Aug. 13, 2018 | Apr. 24, 2019 | Jun. 17, 2014 | Jun. 29, 2012 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2019 | Aug. 31, 2019 | Apr. 08, 2019 | Sep. 30, 2018 | Aug. 31, 2018 |
Promissory notes payable | $ 60,000 | ||||||||||||
Common stock, shares issued | 242,449,767 | 236,046,151 | |||||||||||
Convertible notes payable | $ 100,747 | $ 123,378 | $ 161,244 | $ 114,171 | |||||||||
Exchange Obligation Under Settlement of Convertible Secured Notes Payable [Member] | |||||||||||||
Common stock, shares issued | 41,399 | 38,194 | |||||||||||
Interest rate | 15.00% | ||||||||||||
Accrued interest | $ 66,285 | $ 55,673 | |||||||||||
Maturity date | Jun. 30, 2015 | ||||||||||||
Convertible notes payable | $ 8,254,500 | ||||||||||||
Common stock per share | $ 3.31 | $ 3.31 | |||||||||||
Principal amount of outstanding on debt | 70,747 | 70,747 | |||||||||||
Exchange obligation payable | 137,032 | 126,420 | |||||||||||
Proceeds from sale of notes receivable | $ 5,200,000 | ||||||||||||
Promissory Notes Payable [Member] | |||||||||||||
Promissory notes payable | $ 84,693 | 78,047 | |||||||||||
Principal balance | $ 10,000 | $ 60,000 | $ 60,000 | ||||||||||
Interest rate | 10.00% | ||||||||||||
Accrued interest | $ 24,693 | 18,693 | |||||||||||
Convertible Note Payable to Power Up Lending Group [Member] | |||||||||||||
Common stock, shares issued | 121,212 | 363,636 | |||||||||||
Interest rate | 12.00% | ||||||||||||
Accrued interest | $ 4,675 | 3,681 | 994 | ||||||||||
Maturity date | May 30, 2019 | ||||||||||||
Convertible notes payable | $ 12,000 | $ 63,000 | $ 0 | $ 20,000 | 60,497 | ||||||||
Common stock per share | $ 0.0825 | $ 0.055 | |||||||||||
Due date | May 30, 2019 | ||||||||||||
Loss on conversion | $ 9,818 | ||||||||||||
Redemption premium | 17,860 | ||||||||||||
Derivative liability | 57,649 | ||||||||||||
Unamortized discount | $ 2,503 | ||||||||||||
Convertible Promissory Notes Payable [Member] | August 13 2018 [Member] | |||||||||||||
Interest rate | 12.00% | ||||||||||||
Accrued interest | |||||||||||||
Maturity date | May 30, 2019 | ||||||||||||
Convertible notes payable | $ 63,000 | ||||||||||||
Description of redemption premium | After 170 days, the note carried a 150% of principal outstanding redemption premium. Also, after 170 days the note was convertible into fully paid and non-assessable shares of common stock, after 170 days (January 30, 2019), at a conversion price which is at 55% discount to the lowest trading price during the previous twenty trading days prior to the date of a conversion notice. As the conversion price of the note, which became effective on January 30, 2019, is variable, the conversion option was treated as a derivative liability | ||||||||||||
Convertible promissory note payable |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Stock issued during period new issuance, shares | 3,369,922 | |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, sithares par value | $ 0.00001 | $ 0.00001 |
Common stock, issued shares | 242,449,767 | 236,046,151 |
Common stock, shares outstanding | 242,449,767 | 236,046,151 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Proceeds from common stock issuances | $ 880,000 | $ 378,603 |
Stock based compensation | $ 100,200 | $ 1,206,412 |
Board of Directors, Employees and Consultants [Member] | ||
Stock issued during period new issuance, shares | 5,294,525 | 3,369,922 |
Total shares issued | $ 6,403,616 | $ 11,619,922 |
Average share price | $ 0.17 | $ 0.11 |
Stock based compensation, shares | 600,000 | 8,200,000 |
Proceeds from common stock issuances | $ 880,000 | $ 378,603 |
Common stock, price per share | $ 0.17 | $ 0.15 |
Stock based compensation | $ 100,200 | $ 1,206,412 |
Common stock issued upon conversion of convertible debt | 509,091 | 50,000 |
Convertible debt | $ 36,993 | $ 60,730 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Due to related party | $ 455,577 | $ 447,764 |
Consulting fees | 2,000 | |
Operating expenses | 1,148,213 | 2,125,279 |
Consulting Agreement [Member] | Consultant afflicted with CEO [Member] | ||
Operating expenses | $ 13,232 | 4,791 |
Common Stock, shares Reserved for Future Issuance | 10,000,000 | |
Office expenses | $ 4,223 | |
Chief Financial Officer [Member] | ||
Operating expenses | 48,415 | |
Chief Executive Officer [Member] | PGRNZ Limited [Member] | ||
Consulting fees | 42,230 | |
Operating expenses | 211,149 | 224,878 |
Administrative expenses | 83,836 | |
Services charges | $ 52,675 | |
Chief Executive Officer [Member] | Consulting Agreement [Member] | ||
Common Stock, shares Reserved for Future Issuance | 10,000,000 | |
Frequency of agreement | 60 days | |
Agreement fees | $ 7,038 | |
Date of termination | Nov. 11, 2019 | |
Directors [Member] | ||
Stock-based compensation expense | $ 100,200 | $ 1,206,330 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Local and foreign components loss before income tax: | ||
Loss before income taxes | $ (1,246,554) | $ (2,146,132) |
Foreign [Member] | ||
Local and foreign components loss before income tax: | ||
Loss before income taxes | $ (581,054) | $ (501,890) |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Net income (loss) | $ (1,246,554) | $ (2,146,132) |
Less: valuation allowance | 579,261 | |
Income tax expense (benefit) | ||
United States of America [Member] | ||
Net income (loss) | $ (665,500) | $ (1,644,242) |
Effective tax rate | 21.00% | 21.00% |
Income tax expense (benefit) | $ (139,755) | $ (345,291) |
Less: valuation allowance | 139,755 | 345,291 |
Income tax expense (benefit) |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | Sep. 30, 2019 | Sep. 30, 2018 |
Deferred tax assets: | ||
Net operating tax carryforwards | $ 2,254,492 | $ 1,675,231 |
Valuation allowance | (2,254,492) | (1,675,231) |
Net deferred tax asset | ||
United States of America [Member] | ||
Deferred tax assets: | ||
Net operating tax carryforwards | 1,655,439 | 1,425,213 |
Valuation allowance | (1,655,439) | (1,425,213) |
Net deferred tax asset |
Income Taxes (Details 3)
Income Taxes (Details 3) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Net loss | $ (1,246,554) | $ (2,146,132) |
Income tax expense (benefit) | ||
New Zealand [Member] | ||
Net loss | $ (581,054) | $ (501,890) |
Effective tax rate | 28.00% | 28.00% |
Income tax expense (benefit) | $ (162,695) | $ (140,529) |
Less: valuation allowance | 412,713 | 140,529 |
Income tax expense (benefit) |
Income Taxes (Details 4)
Income Taxes (Details 4) - USD ($) | Sep. 30, 2019 | Sep. 30, 2018 |
Deferred tax assets: | ||
Net operating tax carryforwards | $ 2,254,492 | $ 1,675,231 |
Valuation allowance | (2,254,492) | (1,675,231) |
Net deferred tax asset | ||
New Zealand [Member] | ||
Deferred tax assets: | ||
Net operating tax carryforwards | 599,053 | 250,018 |
Valuation allowance | (599,053) | (250,018) |
Net deferred tax asset |
Income Taxes (Details 5)
Income Taxes (Details 5) - USD ($) | Sep. 30, 2019 | Sep. 30, 2018 |
Net operating tax carryforwards | $ 2,254,492 | $ 1,675,231 |
Valuation allowance | (2,254,492) | (1,675,231) |
Net deferred tax asset | ||
New Zealand [Member] | ||
Net operating tax carryforwards | 599,053 | 250,018 |
Valuation allowance | (599,053) | (250,018) |
Net deferred tax asset | ||
United States of America [Member] | ||
Net operating tax carryforwards | 1,655,439 | 1,425,213 |
Valuation allowance | (1,655,439) | (1,425,213) |
Net deferred tax asset |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Net operating losses | $ 7,883,042 | $ 6,786,730 |
Valuation allowance | (2,254,492) | (1,675,231) |
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 579,261 | |
New Zealand [Member] | ||
Net operating losses | 1,473,975 | |
Valuation allowance | $ (599,053) | $ (250,018) |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | 12 Months Ended | ||
Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($)shares | Sep. 30, 2019AUD ($)shares | |
Consulting fees | $ | $ 881,104 | $ 1,802,058 | |
Common stock, issued shares | shares | 236,046,151 | 242,449,767 | |
Consulting Agreement [Member] | Consultant afflicted with CEO [Member] | |||
Common stock, issuable to related party | shares | 10,000,000 | ||
Consulting fees | $ | $ 7,038 | ||
Consulting fees payable | $ | $ 150,000 | ||
Shares to be issued under agreement, term | 60 days | ||
Common stock, issued shares | shares | 533,333 |